Vibra Energia SA
BOVESPA:VBBR3
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Vibra Energia SA
Earnings Call Analysis
Q3-2023 Analysis
Vibra Energia SA
The company has experienced a striking surge in its adjusted EBITDA, boasting a nearly fivefold increase from the previous quarter, amassing a total of BRL 1 billion. This growth aligns with a rising volume of sales and signifies a notable advancement in the company's financial health. Notably, the EBITDA of Comerc has started to become more significant, contributing BRL 90 million to the third quarter's results, indicating that this segment is starting to play a more considerable role in the company's profitability.
The company is progressing towards a critical phase where its capital expenditure (CapEx) commitments are fulfilled, and projects are finalized without operational hiccups, demonstrating a strategic push towards growth and maturity. Management is buoyed by the performance of EZVolt, which has established itself as a leader in the corporate fleet refueling segment★. The firm also upholds a proactive management philosophy, ensuring adaptability to market fluctuations, which is a fundamental facet of their strategy for enhancing overall value★.
Corporate governance is evidently steering towards judicious capital allocation focused on healthy returns on invested capital (ROIC). The strategic deployment of resources is anticipated to engender service improvements, create additional services that augment value, and organically nurture product growth — all instrumental in steering the company towards a transformative structural leap in the upcoming years.
The company remains steadfast in its commitment to return value to shareholders, pledging the continuation of its policy to distribute 40% of its profits as dividends. They have acknowledged the current quarter as an outlier due to specific conditions and do not foresee a recurrence in subsequent quarters. As part of the future strategy, they anticipate market conditions allowing margins to stabilize at the upper side of the 130 - 140 range, representing a resilient financial posture.
In the wake of increased import volumes, which the company recognizes as uncontrollable, they aspire to maximize outcomes within such market confines. There’s a strategic focus on fostering a robust client base by targeting long-term and recurrent business relations rather than transient, spot client interactions, which is forecasted to spur market share growth over the next year. This reflects a concerted effort to enhance market presence without compromising on service value.
The executives cite operational efficiency as the driving force behind the recent margin improvements, attributing success to the nuanced management of supply and demand and the optimization of the product mix. They have flagged an intention to recapture some of the former market share, though they are cautious to not dilute margins merely for the sake of expansion. The specifics of the initiatives designed to achieve these aims remain undisclosed, but the company hopes to provide greater clarity in the forthcoming quarters.
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Good morning, ladies and gentlemen, and welcome to the Vibra conference call to discuss the results for the third quarter '23. This video conference is being recorded, and the replay can be accessed at www.ir.vibraenergia.com.br. The presentation is available for download. [Operator Instructions]
Please bear in mind that the forward-looking statements are based on the beliefs and assumptions of the company. This information may involve risks and uncertainties as they refer to future events and depend on circumstances that may or may not occur. Investors, analysts and journalists should keep in mind that events related to the macroeconomic environment, the segment and other factors could lead the results to differ materially from the forward-looking statements.
We have here with us Mr. Ernesto Pousada, CEO; and Ms. Augusto Ribeiro, CFO, beside some company executives.
I will now give the floor to Mr. Pousada, who will begin the presentation. You may proceed, sir.
Good morning. Good morning to everybody. It is a pleasure to be with you here for our results for the third quarter '23.
In the first slide, we speak a bit about our results, strongly driven by operational improvements amid a favorable business environment for Vibra. We reached an adjusted EBITDA of BRL 2.333 billion with a significant improvement of 156% vis-a-vis the second quarter '23 and the third quarter '22. This has led to better sales margins and gains because of the appreciation of our inventory.
The result of strong work and the management that we have been focusing on adapting the company to a management model where we can expeditiously respond to the market. Our market tends to be very volatile, and we're constantly adjusting our management model to be agile in terms of our responses. Of course, we had a favorable market movement at this point in sales volume, 9,410,000 cubic meters in this quarter. And for contracted and branded clients as our focus and our adjusted EBITDA margin was BRL 248 million per cubic meter. Now this is the focus that we have since the beginning, a focus on profitability, working on our internal processes, focusing on our cost as well so that we can ever more enhance the company results structurally.
Another relevant point was our operational cash generation of BRL 1.8 billion for the third quarter in the core business, even consuming working capital as we have an increase in the prices of the molecule through the quarter, and the leverage had a significant drop to 1.9x. We had 3 times in the last quarter have now reached 1.9x, and we amortized BRL 1 billion in debt and have already announced the equity dividends during this quarter.
I think the results are expressive for the company, and this result arises from a more favorable market with the diversity of elements of our new management, where we are focused on expeditious agile response to the market. We saw a bit of this in the second quarter with a less favorable market but we're managing our margins. And now in the third quarter, with a more favorable market, we have leveraged our cash generation and results.
We're going to speak in more detail of the adjusted EBITDA margin. As you can observe, our EBITDA margin has had an evolution year-on-year at Vibra since it was privatized. This is interesting data because it shows us accumulated accrued figures when we look at our recurrent margin, when we look at several quarters or the yearly results, this is a benchmark for us. For the first 9 months of the year, we are at BRL 140 per cubic meter accrued in our adjusted EBITDA margin.
We're also managing our volumes. As I mentioned, we had a slight drop vis-a-vis the 9 months of 2022. Despite this, we reached BRL 28 million of cubic meter. Once again, this is a focus of our branded stations and direct clients and expenses. When you look at the figures, there seems to be a slight increase but the lowest volume does have an impact here. In the 9 months of '22, we had some nonrecurring gains that had an impact on expenses due to taxes and other issues and some expenses we had this year to better service our clients and that are linked to volume, especially in aviation, where we did have some additional costs.
When we separate these nonrecurrent expenses, the company has a very good control of its operational expenses, and this is an important baseline. We had been working arduously on this, and we're going to continue to control our operational expenses. Here very briefly, we would like to show you the drop in the price of the molecule. If we focus beginning in January, despite the increase we had in the third quarter for the molecule, it was still not sufficient to offset the negative effect we had in our inventory since last year.
With this graph, we're underscoring that despite the increase we had in the molecule through the third quarter. When we look at the 12 months or even the last 6 months, we do have a relevant loss in our inventory the data, therefore, reflect our operational management.
To speak about our retail network. We continue to grow strongly in Petrobras Grid, Podium and Verana lines, our fuel line. We reached a market sale of 44.5% in additive premium fuels. Vibra is capturing an additional share in the additive field. And this is something we're going to pursue products with higher added value. And we're growing in this journey with a great deal of focus and with a very clear strategy of capturing more value by selling a larger volume of additive fuels.
And in the coming quarters, we want to continue on with this growth in the fuel. They are beginning to represent a significant stake of our gross volume. 1/4 of our gross profit is due to the sale of these fuels in our network of stations. When we look at the EBITDA of the retail business, we see an expressive growth in results increasing twofold vis-a-vis the second quarter of '23 and our volume with a slight growth vis-a-vis the second quarter and a small drop compared to the third quarter of last year.
When we look at the market share of the branded stations, it continues to be stable, and this is where we will focus to value our partners, our branded partners so that we can ever more increase sales, increase our market share in the retail network. We want to invest and be closer to our partners to better service them.
One of the company focuses is to have a value proposition for the consumer to value the Petrobras brand at our gas stations, of course, to capture more value and to grow with this network. This is our focus, and this is how we're going to return to having a growth in market share by selling more in our branded gas stations.
As part of the company, we're focusing on services, on the customer. We have expanded our deliveries to offer better service to our clients to work closer to them which means that we have broadened the offer and the deliveries to our clients with a success story in the company. We have a project here that is called the "client in our DNA," and we want to transform the company into a company that is centered on the client that offers ever more services and where we can extract more value and also increase value for Vibra.
In this next slide, several important points. We speak about Premmia, our loyalty app, and I underscore the growth and the integration with BR Mania. Not only that, this week, it appeared as the third app in iTunes in the business category, the third most important app with a score of 4.8 in terms of customers such as Faxon. And this is a very relevant event. I would like to invite all of you to download the app, to download Premmia and to go to our gas stations. It's an opportunity to learn more about Vibra, to learn more about gas stations, and of course, you also will receive cash back, download Premmia, test it and give us your feedback. This is an app for loyalty and communication with the end user that we're going to continue to grow.
Another significant focus is in the Podium gas. It's our premium gas in the market. We launched a new gas. It's the one with the highest octane in the market. It has less than 20 ppm of this new sulfur technology of this additive called Tecno 3, it truly is a state of the art gas where we are able to neutralize our carbon emission. So it's something that distinguishes itself and is part of the mix that we are focused on.
And of course, we must speak about Lubrax's strength that is celebrating its 50th year, Top of the Mind award for the sixth consecutive year, 25% growth vis-a-vis the third quarter of '22 in synthetic and agro-products. The launch of a specific lubricant for the agro market which has become part of our focus ever more. We're growing the franchises in the automotive sector. So we have the opportunity of expanding our stores with Lubrax plus, and we will have 50 additional stores until the end of the year.
So we're putting all of this in practice. These are structural strides to offer better products to work better with our clients. And structurally, they will offer Vibra better margins with the additive gas, Premmia, the Podium gas and the Lubrax lubricant, which is a significant avenue for growth. To speak about B2B, we had an adjusted EBITDA with a significant leap as you can see from one quarter to the other, almost a fivefold lead closing with BRL 1 billion in EBITDA and B2B suffered a great deal with diesel -- that had a strong entry into the country and our strategy whenever it is below the cap by complying with everything the company as part of its policy.
We'll acquire it at the best price. We will even buy Russian diesel if this is the case. This is part of the company policy to buy the Russian diesel. So we had a significant growth in EBITDA. The volume also grew vis-a-vis the second quarter with a slight decrease vis-a-vis last year. Now the main products in B2B, obviously, are diesel with the growth that is similar to that of the second quarter, and the drop vis-a-vis the third quarter '22 because of some losses that we have in aviation, the resumption that we have which tends to be seasonal when we compare quarter-on-quarter, but still with an opportunity for growth compared to the pre-pandemic period.
And in lubricants, we continue on, and our goal in the coming quarters is to attain growth once again. If we compare lubricants with the third quarter '22, we have been growing. And this will be our goal going forward. Lubricants are undervalued as part of the Vibra portfolio, and we're working with it in the retail market as well as in B2B. The market share, as I mentioned, has a focus, especially for the contracted clients that are not spot clients. And we observe a small growth. And in the case of B2B, we also expect to have a growth in market share based on the sale to direct clients.
Now let's change a bit and speak about renewables and speak about Comerc energia, the energization of the Hélio Valgas plant. We will officially inaugurate this plant on November 9, on Thursday. We're still ramping up, but we have reached a record of 119 gigawatts per hour in September. To give you an idea, this is sufficient to supply energy to a city like Curitiba, with 1.8 million inhabitants. This, of course, stands out. You can now see the EBITDA of Comerc that begins to appear in a more relevant way, BRL 90 million for the third quarter '23. That is our stake in Comerc, a relevant growth, and we're delivering our products on time, on budget.
And ever more, we're going to begin to see a more relevant recurring EBITDA and Comerc has 70% to 75% of its generation capacity between centralized and distributed generation. All of this is under operation. And of course, this will generate an interesting recurring cash and EBITDA.
Now this is our route for growth in renewable energy. It has significant EBITDA. We have an important positioning in renewable energy that generates cash and EBITDA. This, of course, is our stand, and we're going to discuss Comerc in our coming quarters. Now we still have some plants that will come into operation. Basically, we have 2 per centralized generation. For distributed generation, we have minor plants. There is still a great deal that will come into operation in centralized generation until the third quarter of 2024, we will have delivered all of our projects in centralized generation, and we should reach a point of maturity where we will see the fulfillment of the CapEx or the entry of projects without operational problems and on time.
This is Comerc doing what we had foreseen when we carried out the acquisition of the company. And this will generate an interesting recurrent EBITDA for the company. There is no downside here. It's a positioning as if it were a hedge, but with cash generation, we're well positioned in renewable energies with an interesting cash generation coming from Comerc.
When it comes to ZEG Biogás, this is a platform for the production and marketing of biomethane. We have an operation that is already under operation and we're concluding the part of the vinasse. This is an interesting avenue for growth. We're working strongly on having more raw material coming from vinasse and this will become a focus for Vibra in the coming quarters, seeking growth and that entry into the biogas market and Evolua that is becoming ever more consolidated as an important player and a trader of ethanol. I reminded that in the first year of the operation, it had an impact anticipating the carryover that it carries out.
It was carrying stock between harvests because of the price of ethanol that had dropped in the market. So this is a mark-to-market process, but this is an accounting impact that will be recovered between harvest as soon as Evolua is able to sell its carryover of ethanol, and we have EZVolt which is a leader in the corporate fleet refueling segment.
Of course, the focus is to continue to grow Vibra presence in the platform for renewable energy. Vibra servicing the clients with whichever energy they won with the presence throughout Brazil with fossil fuels and renewable fuels. To speak about our sustainability journey here, you will see some acknowledgment we had to shrink this slide. We had a very long list. We decided to focus on the main ones and innovation award, 100 open start-ups, B3, IDIVERSA B3, the Biggest & Best for the historical series of Exame in the last 50 years. Vibra ended up 5 of the most awarded companies in the last 50 years.
And we also have a case that is very interesting and that refers to diversity. To believe in women's energy, we have carried out a call and we're focusing on the start-ups that are led by women. We chose 216 start-ups. We offered 10 hours of training offered by very qualified women. We're not only calling them to invest, but we're bolstering that movement of inclusion of women through start-ups and those who are helping us to lead this process in-house are Vanessa and Clarissa. The two women in our team with whom we work directly. There are references in-house and sponsors to make sure that this project advances. So this is our sustainability journey with Vibra making significant strides on its platform.
As a summary, the company focus continues, as we had mentioned previously, significant management so that regardless of the market situation, we can maximize our results, a management that is focused ever more on the day to day looking at market fluctuation and adapting very quickly to the market conditions. We have a focus on the company, ROIC, the return on capital. We're allocating company capital in health and the amounts are quite high.
And we're structuring everything so that we can better service our clients, add services that will add value, and this will enable us to obtain more value, growing our products with Premmia and margins and additional services so that in the coming years, we can attain that structural change and take Vibra to a completely new level. So we manage day-to-day to ensure that we will have the best results regardless of the market condition. And alongside with this, we have created a very important plan of focus on clients, offering more value to the clients, our branded gas stations, extract value, selling more additive fuel, premium products so that we can increase our value.
With this, I would like to conclude the presentation, and we can now open the floor for questions and answers.
[Operator Instructions] Our first question comes from Mr. Luiz Carvalho from UPS.
Can you hear me? Are you well, Ernesto, thank you for the call and congratulations for the quarter results. I have two questions to obtain more details. First of all, Ernesto, regarding the capital allocation/time, you entered the company a short while ago, and we already perceived some changes when it comes to processes. However, I would like to gain an understanding of how you look upon this business of renewables. At the end of the presentation, you mentioned the business line. Would it make sense to include everything as part of a single vehicle to list and to raise capital and to enhance your ability to invest? And as part of this capital allocation, your leverage below 2x allows you to think about the payout of dividends.
The second question or speaking about the competitive scenario for margins. In the last quarters, we observed enormous volatility of margins due to the dynamic of the Russian diesel, the outlook for the growth of volume and of course, we have seen record margins in this quarter. Even if we eliminate the extraordinary effect, you are a benchmark company when it comes to the disclosure of these impacts. I would like to hear from you your outlook on the competitive scenario if we have reached a new level in terms of margin and how you for the competition in the white line and with your main competitors going forward?
Luiz, thank you for your several questions. I will begin and Augusto can, of course, speak as well. You spoke about the payout of dividends and the renewables business. What we see in our renewable business is that it is a very interesting platform that the company has invested in. We're still analyzing several aspects of this portfolio. Now at no time, are we going to make any investment that will not have a return for the shareholders. I can ensure you're not only in my mindset and in the mindset of the Board and the entire team that we're going to attain growth.
And ESG, for example, we're going to find avenues for growth in renewables, only if they allow growth for the company. When we speak about growth and the question is where are we going to? We're going to maximize the return for our shareholders through these different avenues that could become relevant in the future. We cannot state which are the routes we will follow to achieve this. What we do know is that the [ biofuel ] will continue to be a relevant program in coming years, and we're going to extract the maximum value. We're going to look carefully at our renewables business to find models and avenues that will generate more value for shareholders.
If this goes through a consolidation, if it is plausible, we will do it. Not that we are surveying this at this point in time, but if it does become a viable and plausible solution, generating value for shareholders, we will opt for that. Now this is how my mind works to believe in the business of renewable business and our challenge, our avenues to grow in renewable energy with significant returns to our shareholders. This is a different business. It will have to be measured differently, but it has to generate value for us.
When it comes to the payout of dividends, your question was somewhat different. We're going to continue paying out 40% of our profit in terms of dividend. Now it's important the leverage has been reduced significantly.
And I will now go into your second question. Our business continues to be volatile. We have been in the company for a very short time, and we're learning very quickly that this business is volatile. We have reduced the leverage, but it can increase, go back, it can become incremental. We can't have variations here and there, and we don't know where we will end up in terms of leverage. For the time being, our payment of dividend continues to be the same 40% of our profit. And I underscore this to answer your question.
Regarding the scenario for margins, obviously, we had a complicated quarter in terms of the market. But once again, it was benign because we had a more active management, a daily, weekly, monthly management literally analyzing all of the value drivers that we have. And since the beginning, I have said that we're working on the cost of goods. This is an important part that we're focusing on and working with the margin very closely with our clients. We're servicing our clients, where we're looking at our branded gas stations with whom we have a partnership. And this quarter, we had a very favorable scenario and it's difficult to repeat this scenario. In coming quarters, of course, the -- it was a mixture of factors that led to this. But structurally, we can see that we have been able to gain some points in our margins during the last few months.
Our next question comes from Bruno Montanari from Morgan Stanley.
I would like to volume and margin, perhaps focusing more on margin in volume, which is your mindset in terms of cleaning out the base TRR, the white line has been concluded. What can we expect for the fourth quarter, if the trend of growth of volumes will be similar to what we had in past months or if there will be an alleviation? And what do you think in terms of volume for 2024. In margin, we have lost the reference somewhat. It was BRL 50 per cubic meter to BRL 250 per cubic meters. Ernesto just said that this quarter will never be repeated. But is it fair to say that the margin can be somewhat higher than the levels we were accustomed to 130, 140, will you pursue an upside? Or is it too early to refer to these figures? These are our 2 questions.
Bruno, thank you for the questions. Regarding volume. We have been working on this and what you can expect from the company is maximizing our results. We're not going to have a sole focus on market share as a benchmark. We're seeking to maximize our results as a whole. Our goal is to once again grow in volume to do this gradually. This could not happen in the fourth quarter, perhaps it may happen in 2024. We're pursuing this growth mainly for our partners, the branded partners with the Petrobras brand. This is where we want to grow more and end customers in B2B.
Of course, we're going to serve the entire market that is why we're here. But obviously, for those who have a long-standing relationship with us, well, they will become our focus, and we're going to deploy great efforts to that. It has not been reflected in the figures, but in the coming 12 months, we're going to show you this growth of our branded gas station and our end users.
Now to speak about volume, I would like to underscore a point. This is for a long-term agenda. We're going to put ever more focus in the coming years, beginning in 2024, as Vibra and this management, we're going to have a significant focus on the irregularities that come up in the sector. The counter feeding of products, the aviation products, we want competitors to play in a fair-playing field like ours. And we're going to search for this tirelessly. Vibra has had significant growth, and I think this can be reflected in the figures of the company in coming years.
This is a struggle that will require time. There is no limit but we will be able to revert or change the situation that the market is in at present to gradually take Vibra and the entire industry and to another level in terms of these irregularities. And this, of course, will bring additional volumes.
Regarding your question on margin, this is a quarter that is an outlier because of some conditions. I've already mentioned the fourth quarter. We don't expect the quarters in the coming year to follow this movement. You spoke about margins of 130, 140. Look at our accrued margin and we will be at the higher level of the range at about 140. So structurally, at Vibra, we're making strides in terms of the volume. It's too early to say where we will end up but it will all depend on how we structure everything here. We have gained some additional margin points vis-a-vis the past. Well, simply to end this, if we think about your transformation agenda, therefore, you're going to see these additional points in the upper range, above 140, yes for coming years.
Simply to clarify this, we're speaking of 130, 140, perhaps it will be in the upper 130, which is already again given our volume. When we speak about this, the gains will be very relevant. And based on that, we will continue to evolve in this midterm journey where we will sell more additive fuel, work with lubricants, have a different value proposition for our gas stations, their clients. That is the agenda that we are focused on and bring a margin that structurally will be less volatile.
Our next question comes from Gabriel Barra from Citi.
Congratulations for the results. It truly was a very strong quarter for the company. If we consider the dynamic of the sector, if we look at the company's strategies and their behavior in the market, since the beginning of the year up to present, we have had the Russian diesel hampering what is happening. So my first question refers to this dynamic of imports. The first semester was somewhat of a blender and we see a quarter with greater comfort with imports. We now have the data for October about Russian volume coming into Brazil.
So what do you expect in this scenario vis-a-vis competition and imports and if this volume will once again hamper you when it comes to your margin dynamic. Two quick follow-ups. Speaking about capital allocation and the company's strategy. What draws attention is the decrease of market share and volume that you had. Perhaps it was on purpose focusing on return. It seems to be the right strategy that you are pursuing. My doubt when we look at the company and the company's supply capacity, you still have a great deal of idle capacity, which is the next step.
If you allow the market to be less supply, I'm not finding the right words. If you don't have the supply that we have in the market, and if you improve your margin which would be the next step to become more aggressive to reduce the installed capacity, invest on the base which is your next step in the strategy of enhancing return.
And if you could explain more about this recurrent margin, that draws attention. What is the effect that has brought this about? Is it due to the tax reform? Is it because competitors have begun acting more rationally? Is the market tighter? What explains your higher margin this quarter? This would help us to understand the dynamic going forward when it comes to the sector margins.
Gabriel, and thank you for your questions. Regarding the imports, the first question, we did have a more favorable environment when it comes to imports. That is something we do not control. It's important to mention this we have a significant process to plan demand, to plan the operational demand of the company. We have focused on this in-house process in the company. And we're going to continue to import to fulfill our needs and to service our clients in the best way possible, always having availability of products. We're working with our regular inventories as we always have.
What we are observing is that we will probably have a different environment, especially in the second fortnight of November and December, where we will have the arrival of higher volumes of imports in the market. This is a reality and once again, this is something we cannot control.
Vibra does not have a tighter market. We service our clients. We import but have no control in terms of what others will do in terms of import. What we are going to do is to carry out the best management maximizing the company results, given the present day market conditions that we do not control. The imports will be somewhat higher at the end of the year. And we are importing the necessary volumes to fulfill our sales needs until the end of the year.
Regarding your second question on market share, there are some medium-term movements and longer-term movements as well. We are not going, and I'm going to repeat this, we're not going to run out to recover our market share. This is not the path that we're going to follow, but we're not going to allow our market share to drop indefinitely. There has to be a point of balance where volume and prices can operate adequately to generate the best result. And I will repeat what I have said since the beginning, we are maintaining our market share in the branded network and with our direct clients.
And I want to underscore this, we want clients that value our services that will remain with us in the long term. We don't want spot clients, we want recurrent purchases. This is a type of client we want to work with, and we're going to offer them our value proposition. In the coming 12 months, we're going to have a growth in that market. This is the market we are pursuing, and this is what will enable us to grow our market share once again.
And the most significant movement that we're doing along with the entire industry of legal fuel for the growth of share and volume is representative. We are working strongly on the institutions, along with the government to reduce the volumes of tax evasion of counterfeiting fuel, to ensure that we will all have a fair playing field. It's the only way we know how to play. We will be very strong and direct in these activities so that we can have an evolution.
Regarding your third question about the margins for the third quarter. Yes. What explains this?
Well, there is no silver bullet, of course. Since the beginning of the year, in the first half of the year, we have effects from the last year, nonrecurring expenses. We reduced our exposure. We worked with the volumes of imported volumes. And of course, this has a direct impact on expenses. And Ernesto mentioned this at the beginning, that daily management that is so important.
Now decisions will cost millions to Vibra, a delay in responding to a client anticipation in a transfer from one base and the other can represent millions for the company. When you look at everything we did containing expenses, reducing costs in the short term, this had an impact on the recovery of the margin. Now it is this operational efficiency that gives us the security that we're going to raise the bar of this volatility and will raise the bar in terms of our average margins.
And I repeat once again. Its market conditions that led to this and to complement what Augusto said, we are selling additive fuel or a mix of products that is better. We're deploying great efforts in analyzing our product mix to see where we can leverage our results. It's impossible to find a silver bullet. It's not a single thing that improve the results. It's due to the company effort, the management of supply and demand that we carry out daily, when we look at COGS, well, some things may not be that transparent, the mix of products. It is this combination plus the market conditions that allowed us to attain a better margin.
Our next question comes from Monique Greco from Itaú BBA.
Congratulations to the team for the strong results. My first question refers to capturing synergy and the renewable portfolio for B2B. You have already remarked on this in other events and other calls. And with the Clarissa, you wanted to leverage that, capture synergies in the B2B segment. If you could refer to how this process doing, if you have obtained tangible results in this?
The second question is more specific. It refers to the PIS/COFINS credit. If you can refer to the status, if they will become part of your results this year?
Monique, thank you for the question. In terms of capturing synergy in B2B for Comerc there has been an evolution. We have 240 businesses. We still don't have tangible results. In the coming months, we will be able to speak more about this. We have had an evolution. We still have significant synergy, but we have not been able to define the figure for the synergies that we have been able to capture. It's part of the analysis that Clarissa is leading along with Bernardo for B2B to enhance the synergies and all the optionalities and the avenues that we have along with Comerc.
When we look at our renewables business besides the synergy, we see that the company has a portfolio investees along with its core business with the fossil fuel business. We're creating a platform. Well, I've been in the company for 10 months and our capacity to transform the company into one of the best and largest in the country. When I look at the company portfolio that we have on one hand, our positioning in fossil fuel, our goal is to create one of the best and largest companies for energy in the company. And with Comerc, we will have synergies, but Comerc is not only a player for synergy, it is part of our relevant stance in our transition, our energy transition.
Regarding the C-92, what I can say to you is that, we have one in the court of second instance, the government had a recourse. We're responding to the government, this will not impact our results this year. If you consider the terms of this process that is underway, certainly, it will not impact the results this year and will be left pending for the coming year.
Our next question comes from Bruno Amorim from Goldman Sachs.
The first refers to your opportunities for margin gains that are under the company control. Some of this was due to a favorable market, the rest was due to the company activities. What can you do going forward? Which are the main opportunities? If you can price in terms of BRL per cubic meter?
The second question is a follow-up in the dynamic to recover share going forward. You lost your share because you decided to focus in niches. And the question is, as you intend to recover part of that share going forward, does this mean that you will accept a margin dilution to recover the share and will you continue to be attractive below the present day margin or will you run with higher margins going forward? And does it make sense for Vibra to recover part of their share once again.
Well, thank you for the two questions. Regarding the gain of share and the main projects we have, we mentioned this previously, when we look at our outlook for recurring margin, we think about longer terms where we can remove several effects. We had referred to 130, 140, within that range the company has been able to have an upside considering reasonable market conditions.
Of course, this is a volatile market. But on the average, we're working with this on management, managing supply demand, enhancing our product mix with higher margins. This is what we are doing. And this allows us to say that we have had an evolution in our margin and that we're closer to the upper side of the range of 130, 140. We're growing in lubricants. We're growing with convenient stores in the coming years. We have a strong growth plan for convenience stores. We're assessing all of this. And the results, we will look at quarter-on-quarter. We will see these results materializing.
We don't have a figure for each of these initiatives. We will see the materialization of this in coming quarters, where we can give you more color.
Regarding the market share, it's not the company intention once again to fight for market share. Within the limit that we are in presently, we ended the month of September for Vibra as a whole with 26% market share. When we -- this is important when we look at the market share. We lost them in July, we have been recovering it. In September there was a slight recovery. And it's important to speak about share. We have recovered part of the share once again in the month of September. Now the information has been publicly disclosed. We want to grow our share with value. We're going to maintain our gas stations, the branded ones in a competitive position so that they can grow. If they're competitive, they will grow. They would capture more margin. They will bring us higher volumes, and this will enable us to obtain more value.
Now part of the essence of the company is that they are our partners, and we want our partners to grow. We want to grow alongside them. And this is an important message. We're going to grow jointly with our partners. This represents more volume. It doesn't only represent more gas stations, we're making efforts to grow the volume with our gas stations. We're going to give them greater competitiveness so that they can grow in a healthy way, offer them a value proposition so that we can structurally grow the margin in the future.
Incremental margins. The analysis is not only profitability when we sell to clients that are not our branded clients. The main goal is how to grow if we have the opportunity, if we had added value sales, of course, we're going to sell everything. The fact of diluting the margin or not is a challenge we have in-house to offer the best option that will be profitable. Perhaps the margin will be lower than the average, but will still make sense for the company.
Our next question come from Leonardo Marcondes from Bank of America.
We have some questions at our end. In the release you mentioned, you still have some enhancements to do, for example, the management of sales challenge, reducing operational inefficiencies and supply. Could you give us more color on how you're going to act upon those areas? And if you could give us some examples so that this will become more tangible for us?
My second question refers to the decision of tax evasion, something that has been impacting the sector for some time. Ernesto has already remarked on this, which are the activities the company is taking up to eliminate this problem?
And the last question, if you allow me, I would like to understand your mindset in terms of the branding strategy. The number of branded gas stations has not grown significantly, and we see a competitor that is ending the cleaning out of gas stations this quarter. So what are you thinking about new branded gas stations?
I'll begin from the back to the front. The strategy for branding, for example, Leonardo, and thank you for the question. Our branding strategy, well, we have grown are branding significantly in the last few years. And we're not at a moment of optimization, but granular growth. We have stable figures, but we do have some movements happening. Some gas stations are withdrawing, new gas stations are joining us. This is a natural process. We're going to continue seeking new opportunities for growth in terms of branding. And given that we have grown significantly. As we have grown significantly in the last few years, we can now have a more selective growth, focus more on micro regions.
For example, we have a very careful analysis of where it would make sense to grow, where to implement a new flag or a new gas station, but we'll do this in a more selective fashion. We're going to enhance partnership, competitiveness of our gas stations because we want to sell higher volumes through the branded stations. We will offer them a better product mix. We'll offer them more competitiveness, ensure that, that partner will grow and will sell higher volume and jointly we will be more successful.
The partners will increase their margins, increase their revenues and the company will have higher volumes. This is the strategy still growth, but a selective growth and a focus on growth through gas stations that are branded and that are partners.
The second question about tax evasion. We're working with the institute for legal fuel. We're also negotiating with the Ministry of Mines and Energy to ensure that we will have a greater control of tax evasion, counterfeit fuel, adding biodiesel to fuel. We know that there are deviations in the country that are not legal.
So as Vibra what we're going to do, we have an action that was -- will be strengthened beginning in the year 2024, alongside with the Institute for Legal Fuel and others like the ABD, which is an association that we have, all united for the same cause, which is to eliminate counterfeit fuel, eliminate all of these irregular practices that are so wide spread in the industry.
I have worked in other industries where I observed that there was a high level of illegality of nonconventional practices that were reduced. I believe in this. This is not a short-term process. It is a long-term process where we will advance gradually step by step. And this represents an expressive volume growth.
Now in terms of our actions to grow margins, I will give the floor to Augusto, so that he can refer to this.
How can we continue on with our growth margin. A very broad question, and I'm going to mention some examples. Some of them relate more to engagement without projecting volumes and margins. For example, the increase of the average volume of our branded gas stations, Premmia, for example, Ernesto already mentioned this, we carried out a campaign showing the potential trying to attract consumers more to our gas stations. The download of app on YouTube. This was very important for us. And this has an enormous potential when you think about the expansion in the capacity of lubricants.
This is a key process for our growth in a product where we stand out. This is very relevant. The review that we have carried out in terms of supply and demand, Ernesto, began this, I have had a more active participation in the last 3 months, how we analyze the supply projection and the service, the entire part of service. How to maximize imports and ship, how to put the right product in the right place, how to supply basis that has not been scheduled that had significant fluctuations in sales. This is something that has not been concluded, but we're making strides. And our capacity to execute, we execute, we test. We rethink. It's a [ BCBA ] that is reiterative. We have to be faster to correct our advance in these projects.
Training. We're training our sales force, the sales discourse, following up on their monthly goals, basic things that sales executives that consider and more advanced tools to sell our products. It's difficult to give you an example of the project that will allow us to grow our margins, but most of these projects are part of an initiative that we created at the transformation office. We follow up on this with a certain periodicity. We have goals and most of our future success will come from our capacity to execute what we have implemented.
Well, you mentioned a very relevant point. Presently, we have 200 executives of our sales force that are being trained so that we can offer a better value proposition and offer more competitiveness to our clients and fully understand all of this issue and the scope is to better service our clients.
Vibra is a very strong company in terms of logistic distribution. Our assets for logistic infrastructure are incomparable, and we're transforming the company to have a focus on the outside to serve our clients and to be able to offer them ever more competitiveness and capture value through that, simply to complement what Augusto mentioned.
The question-and-answer session ends here. I would like to return the floor to Mr. Ernesto Pousada for the company's closing remarks. You may proceed.
Well, thank you very much. I think the message I would like to convey is the capacity that we have to build a sustainable model to deliver results so that every quarter regardless of the market conditions, we can deliver the best results possible, maximizing results. We're searching for that balance between volume and price. We're moving forward in our agenda to transform the company. It's a cultural transformation, a company with the ability to quickly adjust to market movements to deliver the best results. We're going to be tireless in enhancing and eliminating the illegal practices that exist in the market, the counterfeiting, tax evasion and much more so that everybody can play on the same field.
And as I mentioned before, our focus is on return on capital, our ability to generate value on the capital invested by the company and our mission to be part of the best and largest energy companies in Brazil through our fossil fuel platform and our robust platform of renewables. This composition will give us a unique positioning to further leverage our results for the short and long term. This will be the continuous effort of the management so that quarter-on-quarter, we can show you this evolution.
With this, I would like to thank all of you for your attendance and wish you a good day. Thank you all.
The Vibra video conference ends here, we would like to thank all of you for your attendance and have an excellent day.