Q4 2020 Despegar.com Corp Earnings Call
[music].
Good day.
Are you planning session and Pollock.
And thank you. Thank you.
And he comes from reporting financial results in accordance with U I can yes.
We will discuss certain non-GAAP financial measures and metrics, including foreign exchange and can you check and traffic.
Sure.
And Mr should we the definition of these measures and metrics and clinically in our press release carefully to ensure that they end up from that.
Non-GAAP financial measures and nobody can metrics from must be called C that would be an explanation SFC gets far also appears no GAAP financial measure and that's provided as supplemental information only.
Please note that these financial results.
And subject to yet and all of the pent up gentlemen.
The company's audited consolidated financial results for the year ended December 31st 2020. We've included and the company's annual report on form 20-F.
Before we begin our formal remarks allow me to remind you that certain statements made during the course of the recession may constitute forward looking statements, which are based on management's current expectations and beliefs and and subject to a number of freaks and uncertainty there.
And cause actual results to materially differ.
And then and factors that mainly and a younger company from truck.
These include but are not limited to expectations set assumptions relating to day impact of the COVID-19 pandemic and then.
And I should know about for myself and east, Tennessee, we acquire and purely empathy and going.
The description of the three net.
And just trying to do our filings with the Securities and Exchange Commission and our press release.
And speaking on today's call is our CEO and coking coal, we provide and I'll, let you off the fourth quarter and update you on our strategic priorities.
And if I put up a half me our CFO will afterwards discuss it what are the financial assets that we open the call to your question and then young people.
Thank you Natalia and good morning, everyone.
Let me first wish that each of you are in good health and that your families are well.
The COVID-19 pandemic challenge, our industry and waste we have never seen before.
The fourth quarter, and well have a sample of how we pay our toes ready for the quick changes this pandemic throws our way.
We have demonstrated our ability to people quickly and anticipate and respond to customers and adapt to their new behaviors.
Our team has not only manage through the I'll go and demand challenges, but also have made important progress on our strategic you need it.
Including <unk>.
One expanding our reach to new customers, while to increasingly engagement with customers and three focusing on profitability and maintaining it.
Our strong cash position.
This is one of the most challenging and unique times, we have all faced and he socially time that presents opportunities and I look forward to highlighting some of those for you. This morning.
Beginning we expanding our reach to new customers.
And our performance in the quarter and we are executing on the integration of best day, which accounted for 20% of gross bookings in the court.
Our balanced geographic portfolio will generate more sustainable growth going forward.
Moving next to increasing customer engagement 'twenty.
2020 accelerated our strategy by such forward and many of the gasoline gateway initiatives that we have been building toys and increase our flexible inventory from 20% to 60% and will significantly enhance our refund policy.
Our loyalty program continues to gain traction reaching close to 800000 members.
While our co branded card with tens and better is also gaining momentum as the bank has joined that in our marketing efforts.
It's up and telesales.
Collins penetration in the collapsed gross booking increased 60 basis points to 3.4.
And each points.
And I had important initiative is the integration of this big golf fraud, scoring capabilities into calling and Speedman platform.
Next focus on profitability and.
By the significant uncertainty.
Had to go through 2020, we were able to strengthen our balance sheet and improve our cost structure.
Additionally, in the fourth quarter of 2020, we observed a strong take rate of 13.3%, which was driven by your focus on profitability in our commercial strategy together withdrawing supply and negotiations with best day.
Furthermore.
This past quarter, we saw non air segment accounting for 64% of revenue.
But even by growth and higher margin packages.
On the selling and marketing front.
Have continued with our strategy of lowering marketing spend part two and section and we continue to leverage and paid channels.
We are still focused on right sizing our cost structure for the new operating environment, and we saw a 44% year over year reduction and structural cost.
36% decrease in Opex.
Excluding extraordinary charges and the impact of best day and calling.
These decrease would have been six 5%.
I am pleased by the fact that we have been able to maintain the cost savings target we have discussed in previous calls.
We entered 2021 more.
More efficient and leaner company.
Excluding the impact of basically and and calling our consolidated adjusted EBITDA loss decreased.
71% sequentially from minus $33 7 million from.
The third quarter to minus nine 7 million this past quarter.
Last but not least consider this big I'll stand alone, which excludes the contributor of best day and coin.
We had positive adjusted EBITDA in the fourth quarter, if we excluded the extraordinary charges as detailed in our admin and release that the cost of sales call. It transactions, we entail higher cause you to reschedule and and cancellations and the cost to integrate best day and calling.
Which now sits at this periodically.
Our 2020 results demonstrate the effectiveness of our strategic actions and the progress we have made to date. Despite these unpredictable buyer and then.
Moving next to a discussion of the global travel industry on page four.
As you're all aware.
The effect of the global pandemic are ongoing but we believe we are most likely through the worst of it and.
Nevertheless, the impact on the travel industry remains and is reflected and global airline seat capacity, which is still negative on a year over year basis, but in currently at a lower level.
According to Ical and line capacity Latin America declined 47% versus last year during the fourth quarter.
That compares with a decline of 90% at the start of the pandemic.
During the fourth quarter, Europe, and Africa was the only region that has a sharper decline than Latin America.
And the bottom right chart, we have extrapolated the monthly capacity published by a cow.
Adjusted to take into account, our international and domestic exposure.
As you can see the monthly year over year decrease had been moderate into the fourth quarter before turning up again in January.
Keep in mind.
That is travel declines it impacts our revenues far before it is reflected in capacity reductions.
So the softness we experienced in December is reflecting January capacity reductions.
Mitch.
Most of the travel restrictions and had been in place through 2020 were lifted and November However, still was late December.
Trial, and Mexico was particularly impacted due to the increase.
Health alerts in many regions of the country.
The European market was impacted by another wave of the virus and the fourth quarter and.
And so he can travel restrictions were enacted.
And I will observe that the trends in Latin America for North.
North America, and Europe with a lag.
And similarly, one quarter.
Consequently, we saw a similar negative trend in Latam in the first quarter, although the level of contagion and Latam.
Yeah.
They're all two industry recovery is expected to be choppy and is highly correlated with the number of Covid cases government actions taken to mitigate it and the vaccine world, which will be key for our consumers to regain confidence and travel.
Moving next to a discussion about trends and transactions and gross bookings on page five.
Since our last earnings call. The overall business environment did not materially change.
Our operations continue to be impacted by the pandemic, albeit to a lesser and extend that in the prior quarters.
It is important to highlight that our results for the fourth quarter include a three month contribution from best day acquisition.
In turn.
Total from the sectors, one point and 26 million were down 56% year over ear.
And improving trend from the prior two quarters.
Excluding best day transactions were approximately 1 million, which was a seven 4% sequential increase.
We also saw a similar trend with gross bookings, which declined 69% year over year 401 million, including the contribution from best day.
Excluding this day gross bookings would have been three candy and $23 million, resulting and the 75% year on year decline in gross bookings.
The rate of decline in gross bookings was sharper than that of transactions.
And it's a reflection of our mix shifts to lower ticket domestic travel products as well as currency depreciation when compare with the fourth quarter of 2018.
After a good start in October and November most transactions and gross bookings slowed in December.
This reflects the resurgence of the virus and many countries and the resulting slowdown and travel.
Exactly Scott.
Specifically, we said this in Mexico.
Illustrations increase across the country and the government also put in place restrictions on restaurant and commercial centers.
These slowing trend and transactions and gross bookings continued into January of this year.
But the second half of February we were once again seeing.
And improvement.
With this trajectory continuing into early March.
You can see the monthly trends in the bar chart shown on the right side of page five moving.
Moving next to slide six.
2020 was quite the year in just about every respect.
And that's begot, it wassa and opportunity to demonstrate our value proposition to our customers over the past year, we have proven our ability to pivot quickly and dissipate customer needs and adapt to their new their new behaviors.
Our customers wake and serving them in new ways.
Let me now talk our day few of these actions.
First working with our suppliers, we were able to increase the flexibility of our current offering to 60% from 20% pre pandemic.
And the same time, 90% of non refundable bookings that were impacted by the flu Covid Lockdowns and now flexible.
Order to make it easier for customers to risk getting their trees.
We also focused our communications and promotions on domestic travel and we made significant changes to our refund policy. For example, we're also you shun refund coupons and U S dollars to mitigate the impact from currency volatility.
Next loyalty.
Whereas it is as.
Important to welcome new consumers to our sites as well as having consumers that repeatedly choose this regatta.
Regatta they'll travel experiences.
And our loyalty program plays a key role in this debate, we have 760 cell phone and loyalty members with the majority in Brazil.
Without much marketing activity as we would for battle troubled conditions and wish to expand the program to other countries and have already signed up a significant number of customers in Argentina.
Furthermore, our plan is to launch a loyalty program in Mexico at some point this year.
As announced previously we have launched a co branded credit card with Santander in Brazil.
We saw an acceleration of the signed up and the fourth quarter of 2020, and the first quarter of 'twenty 'twenty, one and something they're drawing our efforts by market and the card through up and tell us Hey, Sterling.
Great and combined with our own Air Force, we have 24000 co branded cards in circulation.
The last initiative I want to discuss is going and you have been focusing on increasing <unk> penetration and the colada, our rescue and operation through wellness special campaigns and promotions.
And the fourth quarter penetration increased 60 basis points to three 4%.
Gross bookings and I'll turn it back.
And could be at ecolab.
The TEG growth achieved through a sale of this product are going was seven 5% and it is measured as a percentage of total purchase volume.
Additionally, we're working on integrating our highly rated from its core platform into coins.
And so many ways, we are building deeper relationships with our consumers we remain confident.
You know where our ability to provide the one rate of solutions as we blend our agile platform with our leading position in the Latam online travel industry.
Moving next four and discussion of our focus on improving profitability on slide seven.
While it was another challenging quarter, we continue to see a number of benefits from initiatives, we have undertaken throughout the year, enabling us to successfully manage the business with it.
Pandemic and should we focused on improving profitability and managing their body of those that are under our control.
We have been working on three key areas, mainly negotiating with our travel partners.
Leveraging organic traffic and maintaining a lean cost structure.
Yeah.
Since the onset of the pandemic, we have been working with our travel partners.
And have put in place a new commercial strategy adjusted growth.
Current environment.
We have been successful in this endeavor.
Roll off distributors have become an even more important channel for the travel suppliers.
The result of these was a strong take rate excluding cancellations of 14, 5% in the Corp.
Additionally, with the completion of the best day acquisition, we have been able to integrate both sourcing teams quickly.
And drive further improvement thanks to a larger scale.
In turn and we saw an increase and transactions of a higher margin packages with non air revenue accounting for 65% of total revenue.
As a result of these initiatives you can see that in the first chart on the bottom left that this quarter revenues declined less than gross bookings.
Next.
And as the leading online travel agency and Latin America, we have leverage unpaid marketing channels and drive visitors to our sites.
Strong participation and local industry, then and social and important traffic driver.
And then the fourth quarter, we participated and the.
One thing campaign in Mexico, and Black Friday and Brazil.
Mobile is also and more cost efficient traffic driver accounting for 50% of all transactions in the quarter.
All these actions enable us to reduce selling and marketing expenses by 73% in the quarter, while gross bookings OLED client and 69%.
And the impact of best day, and coin and extraordinary charges the reduction in selling and marketing expenses would have been 89%.
Lastly, maintaining a lean cost structure.
Prior to the onset of the pandemic, we were already working towards becoming a leaner organization.
But we have become even more so over the past year.
Late 2018, we took some decisive action and their expenses and cost control was also a key feature in our operation in 2020 as we aim to cash and the impacts from bundling.
We are very proud to have achieved 44% year over year reduction in structural costs during the fourth quarter and thinking through the structural cost levels of the prior quarter.
The chart on the bottom right of page seven the peaks the evolution of our structural cost.
Please note that these structural costs consider the operation of this they got on the Standalone basis regarding this day with bonds and the integration and expect to fully capture synergies by 2020 two.
We achieved a significant number of milestones in 2020, operationally financially and strategically which positions us well when the travel industry recovers and beyond.
Our accomplishments through 2020 as we continue to navigate and unprecedented environment have been a testament to the strength and resilience of our team and.
I will now turn the call to Alberto what it is.
Passion of our financial results and thoughts about the near term industry outlook.
Thank you Amanda and thank you all for joining us today.
Turning to slide eight.
A levered another quarter of sequential top line growth.
And with revenues of three and a half.
Times higher when compared to the third quarter, although still largely affected by the COVID-19.
Prices on a year on year basis.
Okay and I noted.
As reported revenues performed better than gross bookings and the quarter.
Driven mainly by a commercial strategy adapt it to the newspaper from Sanchez.
Additionally, we observed a larger share of higher margins from the loan packages.
Year on year as reported revenues were down 63% versus 69% declining gross bookings, resulting in an exceptionally high take rate.
And point to the percentage and the fourth quarter.
And that's where cancellations due to the pandemic declined in absolute terms by nearly half of this quarter to 5 million.
Represented only 9% of revenues.
Excluding these extraordinary customer cancellations.
Our take rate would have been 14, 5% on revenues would have increased 107, 7% sequentially.
Several factors contributed to these improved performance.
Including.
The positive contribution from best day for the whole quarter.
COVID-19 commercial strategy, reflecting adjustments, we implemented from negotiations with our travel partners.
Leveraging our purchasing power through joint negotiations with testes sourcing team.
Our strong focus on demand for non air which accounted for 65 percentage of revenues and <unk>.
I won't and destinations with a higher take rate.
Yeah.
And my job and Plaza Academy, and Mexico has without growth.
And Buffy you and Brazil.
Turning to profitability on slide nine.
Adjusted EBITDA levels have been improving sequentially since second quarter 2020.
And this past fourth quarter.
Reported and adjusted EBITDA loss from slightly over $21 4 million.
36% less sequentially of the adjusted EBITDA loss reported in the prior quarter.
They stay on and on a standalone basis contributed with an adjusted EBITDA loss of $9 7 million.
While that day and coin contributed with an adjusted loss of $11 7 million.
Note. This does not reflect the synergies that we expect to cover from these recent acquisitions once the integration is completed.
Excluding the extraordinary charges detailed in our earnings release published this morning, which include extraordinary cancellations, resulting from COVID-19.
Restructuring charges associated with cost reduction efforts.
And one time fees from our M&A and capital raising efforts.
Comparable adjusted EBITDA.
Would have been a loss of $7 $6 million.
For this play out on a standalone basis. This would have been a loss of only $1 million.
Now please turn to slide 10.
We're taking advantage of the current crisis to build the foundation for a more profitable company and the future.
That's why we think it's important to share with you dislike me schools.
Because it will give you a glimpse of how we think it's going out and going forward.
And our last earnings call, we mentioned that consider and display on a stand alone basis, we thought we could be EBITDA breakeven.
We get.
Close to gross bookings per quarter, and the 400 million area.
This figure represents approximately 35% of this bring US 2019 gross bookings now.
And importantly, we also mentioned that this EBITDA breakeven level would exclude the following items.
First relate.
Related to restructuring cost.
Associated with our cost reduction program, plus M&A and capital raising and expenses, which resulted in comparable adjusted EBITDA loss of 1 million for this payoff on a standalone basis.
Our assumptions.
Also excluded the cost associated with integrating best day and coin.
Currently see that this thing up.
And the impact of canceled tickets rescheduling and.
And there are services due to COVID-19.
Based on these assumptions display or on a standalone basis.
Posted positive EBITDA of three and a heartbeat and into fourth quarter.
With only 302 billion and reported gross bookings.
Yeah.
This is an extraordinary achievement and.
Flex well on the future business profitability.
Moving to liquidity on slide 11.
We ended the year with a solid cash and equivalents position of $351 million declined.
Declining sequentially by $35 million.
Total net operational short term obligations increased sequentially by 69 million to 193 with the majority of the increase explained by the consolidation on that day.
And this complex environment operating activities drove a use of cash of $35 million comp.
Compared to cash generation from operating activities of $15 3 million and the vehicle quarter.
The use of cash resulted mainly from.
Our net loss of $26 4 million, partially offset by eight and a half million in non cash adjustments.
All $34 9 million investment and working capital.
Partially offset by 18 million increase in other working capital accounts.
<unk> the assumption of best day's initial cash balance.
Investment in working capital reflects an increase of 28 million and accounts receivables and a decrease in travel and payable of $6 8 million.
Wrapping up the key highlights of the Corp.
They're not seen and linear recovery.
Cross bookings and transactions showed a positive trend in October and November and.
In December demand slowed.
Due to a spike in Covid cases in the region on the restrictions put and take some covenants, particularly from Mexico.
In this environment of lower demand.
They all have become more relevant to suppliers.
Leveraging our purchasing power best day, we have put in place a commercial strategy adjusted to the new circumstances.
As a result.
We have been able to achieve this because highest take rate since its IPO in 2017.
We have been increasing engagement with our current customers, who organic initiatives, such as improving our offering by adding flexibility to our products and probe.
Total customer retention and solid loyalty program.
We have maintained our focus on profitability.
Online marketing channels continue to deliver and good results.
With 50% of our transactions were done through more and services and structural costs remain in line with third quarter results.
Achieved EBITDA breakeven when considering just pick up on a standalone basis.
And excluding the cost to integrate the new acquisitions and extraordinary charges from COVID-19, and so what.
And that's one time M&A financing options.
And last and not least with.
And with close to a year with a strong cash position or to kind of a 50 billion, including unrestricted cash.
Now please turn to slide 14 for our final remarks.
As we navigate through this pandemic, we have not provided formal guidance.
However, we feel it is important to be as transparent as possible.
As to what we are currently experiencing and our expectation for the travel industry.
Because of the unique environment, we're facing let me take you through some of our key assumptions.
To begin.
They're still facing similar COVID-19 related challenges as we have over the past year and Covid still has the potential to be a headwind is it difficult to fully colchicine.
For example, we experienced some softness in December.
Resurgence of the virus resulted and restrictions being reinstated.
This softness continued into January and early February.
On the positive side, we saw improvement and second half of February and continuing into March.
Importantly, however.
Business performance.
And the country specific.
This Q1 dynamic.
Look similar to the try and experience in fourth quarter, 'twenty and the northern hemisphere.
As such.
As Covid cases decline and travel restrictions are lifted we expect travel to rebound.
However.
We expect that this rebound will be.
Likely be choppy.
Moving now to the macro factors.
And we'll continue to live and work in and largely pre vaccine environment. During the first part of 2021.
But expect to see momentum return and later in the year of the availability of multiple vaccines is encouraging.
However, it.
It is hard for us to predict the rollout of the vaccine as it varies widely across countries.
But one of them for example in order to contextualize the impact of vaccination and trouble I would like to share with you. The example.
Chip.
And this country is leading when it comes to vaccination road.
And by March Pete.
<unk> 24 per cent of the population was.
It was touching weighted and we could observe a subsequent improvement in gross bookings of 34%.
Our sustained resumption and travel though is highly dependent on inoculated passengers.
So to conclude.
1021 brings more uncertainty and then you know my ear, but we're focused on their part of US we can't control.
With that and we're working on the strategic and he said we have undertaken over the past several years dropped commodity position ourself for growth decent.
This includes advancing on the best day of Carnitas questions.
Next.
We believe our current liquidity our efforts to reduce cash burn and focus on profitability and our balance sheet strength.
Will enable us to navigate the challenges of 2021.
Although this year will be a challenge and one we.
We remain nimble and continue to execute on our cost reduction plan and commercial initiatives.
This concludes our prepared remarks, we are ready to answer your questions. Operator, Please open the line for questions.
We will now begin the question and answer session to ask a question you May Press Star then one on your telephone keypad if.
If you were using a speaker phone please.
Please pick up your handset before pressing the keys.
If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.
We ask that you. Please ask one question and a follow up and if you have more questions you can return to the queue.
At this time, we will pause momentarily to assemble our roster.
Okay.
The first question comes from Ed <unk> of Keybanc capital markets. Please go ahead.
Hey, good morning, and hope all are well two quick ones from me I guess first and some constructive commentary on Chile, I guess when you saw that improvement in gross bookings of 34% and February what type of travel and are they engaging and is it more local are are you seeing some package activity and then just as a.
Housekeeping question I noticed that trade payables increased I think almost 100 million quarter on quarter, what would that do the best day or if you could kind of walk us through why that number went up and how we should be modeling that going forward that'd be great. Thank you.
Okay.
Hi, Yeah, good morning, and Alberta here.
So let me, let me address and both questions and.
And in Chile and it.
Clearly and as you know today Latin America is more a region.
And our domestic travel and short trips et cetera, but clearly.
And recognition actually and the rollout has actually moved in a positive manner.
Sorry can see actually makes it more international travel and starting to pick up okay, and more bundled product as well. So the trend is as expected either like in Asp's and going up.
FX, maybe leaving aside effect asp's going up with the let's say the complexity of the travel plans and increasing.
<unk> and <unk>.
And I think that and I think that.
And with that address it.
The first part of the question.
Okay regarding the net payable at close to 60% of that increase EBITDA day, Okay and.
And we discuss it caused a bad day come and will be from legacy debt.
And then the remainder of the explanation and comes with the seasonality, Okay, clearly the net payable position and Hugh.
And as you might recall, particularly in what you see each day.
And the receivables goes up okay.
Particularly the payable position us.
And also goes up so it's a combination of both.
Over 60%.
Approximately 60% EBIT day.
That does a one timer given though were consolidated and the company and at the same time, what also happened is that.
And remember seasonality from Mexico, and Vietnam from seasonality for this figure out what you used to see but you used to see it was that.
And the fourth quarter and.
And in Brazil, and South America, and the fourth quarter was actually and <unk>.
You actually saw.
And set a lot and then you start paying down those payable in the first quarter of the following year, However, Mexico and because the and the high season in the middle of the year.
And with another hemisphere of course.
You actually that dynamic played differently. So you got to have the negative EBITDA, the working capital and more in the fourth quarter.
And so just to be clear on the best day associated payables did that that's just record that a use of cash as you pay those down as theyre in our company and kind of offset or just thank you.
Yes.
And the future stock and those payable stuff's coming down okay that will be on its own and use of cash. However, net one recall that we are going we are operating at levels that are very low from a gross booking perspective, so the positive working capital dynamic that if they got hub.
And he is in top okay. So as we grow gross bookings okay. The expectation is the expectation is that the working capital dynamic will start generating cash for the company okay.
Thank you.
The next question comes from Eric Sheridan of UBS. Please go ahead.
And so much and hope everyone is well on the team maybe I'll ask a two parter around the broader competitive dynamic you know as you see the potential for demand to become less volatile and to pick up as we move through 2020. One can you give us a better 17th country by country or thinking through lens of who you see it.
Some of the most competitive forces you're trying to sort of play a mixture of offense against in the region for when demand improves and how that's manifesting itself and the investments, you're making and you're marketing channels on the product side and on the inventory side. Thanks guys.
Okay.
Hi, Eric.
Is that me and.
And in general as parents, we ceased and as Alberto mentioned significant volatility even from week to week are in that.
Maybe heavily depended on how the vaccination and how they.
And the restrictions on movement apply for the come from from one week to another Chile shoot up and then Mexico became a more restricted and sales went down and so so we don't tend to look at this.
Betty bumpy changes, but what we rely on and whether we are seen and and underlying trend of bookings and recovery.
Fair.
And the competitive environment and how are we making our investments two things here and we haven't seen any significant change and competitive dynamics.
I think all any competitor and merging with leasing and strategy are spending significantly more or less and.
In this context, we know that everybody almost everybody and Americans cost constrained. These investments what we are doing and these contract and so we're just taking advantage of our strong brand our organic traffic and are optimizing and reviewing our and traffic spent going forward that being cost me and you.
Using visa minus into challenging our already very sophisticated algo lithium standard tuition model to make sure that as soon as the market Dream gauge, we even collared and much more.
Precise approach to how we acquire traffic and we with the objective obviously of relying much more on was what was already a heavy proportion of no break traffic so and in that channel. We as I said was splendid and robotics, we're retaining them.
And if he can lean more on our organic traffic and going forward and respect that not to remain at current levels, but not to reach our prior levels of investment.
Yeah.
Thank you.
Okay.
Again, if you have a question. Please press Star then one.
The next question comes from Kevin Kopelman, with Cowen and company.
<unk> go ahead.
Yeah.
Hi, Good morning, and this is Emily laugh and on for Kevin. Thank you very much for taking my question and.
Wanted to ask about you had and process take rate expansion and Q4.
And you noted it was impacted by mix shifts to higher margin products.
And but you also noted.
And Gary negotiations with suppliers could you give us some more color on that new strategy and do you expect the increase and take rate to continue going forward. Thank you.
Yes, and Emily Hi, this is Amin.
I would say and this is a combination of three things as you say, we leverage our are growing and bargaining power with suppliers and that's it linger.
Driver for take rate.
And secondly, the product mix.
And obviously, we are trying to push a day known there and but it is a component as we've been doing.
Four seven time already a best day, Heavenly and help us to.
Strengthen that and we will continue doing that and the future and selectively we our revenue management capabilities have also been part and what we've been investing over over the last few months and we've been able to increase some of our margins without losing market share.
And and I combination of those things go into your point of where that will continue in the future.
And you always reply, we adapt our pricing strategy.
Dynamically to market conditions, and we believe and and I think the results are proof that this strategy is the best possible strategy and this context, and we will tell it and that our pricing strategy going forward as per hour and negotiations with our suppliers and our pool.
Star Wars, I imagine and packaged products that has been in place for some time now and what you're seeing he sees and basically the results of both our organic efforts on them and how.
And they say help us and part of and achieve that.
Was there a follow up Mr Kopelman.
No. Thank you very much and that was helpful.
Thank you.
This concludes our question and answer session.
I'd like to turn the conference back over to dummy on scoping.
Keith Executive officer for any closing remarks.
Yeah.
Wanted to thank you all for joining us today.
We look forward to speaking with you again next quarter in the meantime, please keep.
Keep in mind and will remain available to answer any questions. You may have and please stay safe.
Goodbye and have a nice day to all of you.
Yeah.
Yeah.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
And.
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