Hello. Good morning, everyone.

Thank you for participating in our earnings call for the first quarter of 2026. I'm going to present Belmiro Gomes, our CEO; Rafael Sachete, our CFO; Sandra Vicari, VP for People and Sustainability; Wlamir dos Anjos, with him passing on the role of VP for Commercial and Logistics; and Anderson Castilho, the Executive Director for Operations.

I'll pass on the floor to Belmiro for his presentation.

Thank you, Gabi. Good morning, everyone, and those of you that are participating and the team present.

The idea today is to share information from the first quarter. This is a quarter that combines a series of effects, adverse effects that have been impacting consumption, especially food.

On the negative side, we have one market aspect that we've seen, the current context of the market being extremely complex. If we were to separate this into a few points: the first point that we've seen as an offending factor is the level of debt among families month-over-month have reached all-time highs, and that has impacted the lower-income population with their purchase power and consumption.

One of the movements that would not be expected for this period in the first quarter of 2026, such as the trade-down and some challenges to take in volumes in some categories, have really been consistent. The level of debt creates this bad combination, right, with high debt and high level of interest.

I think this level of debt, Brazil reached an all-time high, reaching 80% now in March, has also been levered by different market data and an increase in sports bets activities as well, where these bets, especially among the lower-income population, when we look at the North and Northeast of Brazil or some other regions, this pace continues to be really strong. In the first quarter, the pace of sports bets reached almost 230%, almost three times the same period last year.

Brazil currently has like 1 billion accesses monthly. It's a country where the level of accesses to sports bets websites is higher even than WhatsApp or YouTube, according to the data we've been monitoring in the market.

That has really contributed to debt because the population has more debt, and that reduces their purchase power, and that pressures our customers, the small businesses that supply themselves by it. In the fourth quarter, we brought in the difference of performance in the food sector which services low-income and high-income.

The difference is, as we had already mentioned, something we had never seen from one year to the other. In the sectors that are servicing high-income, when we look at low-income, this number has been capped at a drop of 9%.

This cash that is being spent on interest has been really impacting consumption. We've also seen a combination in the first quarter of a commodity deflation, and in all of the big commodities like rice, sugar, flour, and oil, which in this quarter led to a average deflation of about 12%.

This is an average view of the quarter. This—these are commodities that are important to the sector as a whole, not only Assaí.

The cash-and-carry sector responds for about 50% of the Brazilian food market. When we look at commodities from an Assaí perspective, we respond for 65%.

That has expanded very strong when it comes to flour, meat, milk. That leads to an impact on the revenue.

Within this scenario, what we observe is that our policy in the first quarter to preserve the margins. When you have this market scenario, you see, commodities are commodities.

We spoke about this, and it's temporary. The inflationary effect or deflationary effect in the commodity, either through production or demand, that will be extend—that will be tending to have an adjustment.

Then we'll highlight the initiatives that when this deflation finishes, and it will finish, and so that the company will be ready to capture this. We see this shift in this deflation scenario, which would be persistent throughout the first quarter.

We have a new effect, which are the conflicts in the Middle East. When you have a conflict that pressures the oil prices, you have a component that could become inflationary.

The most obvious would be oil derivatives, sub-products, and freight of low-added-value products, but even some items that are maybe not imagined, like water, for example. That would be freight and packaging, basically, right?

Even the cost of water is very low. There's probably going to be an inflationary impact.

At the end of the first quarter, we held the volume of supply, and we expanded the stock levels a bit, considering our planning, to also not be surprised by an increase in prices by industries. Despite all this, even in a scenario that was challenging with a series of components I mentioned previously, we were able to keep profitability and our margin—gross margin stable.

That demonstrates that the business model is extremely resilient from a pre-IFRS perspective when it comes to cash generation. The margins were completely stable, and they're at the same level of last year, even with the top line when you have a heavy deflation, considering the weight of these categories in our sales mix, and there's no way that the same-store sales will reach this, right?

Our assessment is if we were to try to do this, we would have a—we'd spend margins at a moment where the market's not a buying market. We've protected this a little bit, and the sales performance in the quarter demonstrates this, right?

Deflation, it's very strong in commodities. On the other side, despite all this, we're able to have important advances in the gross margin, three percentage points, and a series of initiatives to control and hold our expense levels, and that helped us keep expenses, of course, despite being above the levels, because our work to sell a pack of rice at 28 reais or 12 reais is pretty much the same.

We were able to have a series of strategic initiatives from an automation perspective and also from a new process perspective. We also readjusted our employee base, especially in the administrative functions of the company, that allowed expenses to be at a level that was lower than inflation increase.

It's still higher than sales. If not, we would have an increase in—despite the economic scenario, stability of our EBITDA is an important indicator, considering the level of sales in the first quarter.

Then this quarter, we had already highlighted the first quarter—in the in the fourth quarter, sorry, that there's a new PIS/COFINS credit, which are the items from Article 14, that we already highlighted before in the fiscal rules. Within our results, earnings, it adds up to R$397 million.

For more—for comparison, the EBITDA we're showing here, 5.5%, does not have any influence. It's an adjusted EBITDA.

It did not have to reflect any volume of this credit, and it could just reflect the operational metrics. What we're looking at, 5.5% is stable, and that's a base that is completely comparable to last year.

Of course, within the net income of the debt indicator, this volume of credit is being accounted for. If we were to split this in the following: part of it is non-recurring, which are prior exercises or periods, and that were monetized now in the first quarter, and that adds up to a total of R$272 million.

Then another volume of R$124 million in the first quarter, which is recurring now in the first quarter, which is launched and will still be in the monetization queue, right, when with the calculation of PIS/COFINS. That makes the recurring profit, when we look at the new base, it's when it's non-recurring, you have the post-IFRS vision, right?

Then we have cash management and leverage. We already had the opportunity to speak about this, and the company has a big focus of on deleveraging.

We had a Selic rate that hasn't really contributed to the volume of our debt, right? In this quarter, you have an increase in the interest rate of almost 14% compared to the first quarter last year.

Last year, we had an average Selic rate that was lower, and you have this feeling of high grounds, which has been persistent over the whole year. With all the efforts the company made were a strong cash generator, and so the EBITDA we generated, and Rafael will talk about the financial slides a bit, really supported the investments of the company and also the payment of the cost of debt.

The the debt also has a reduction of R$1.2 billion in regards to last year. Then we can see a leverage of 2.52 of the credits and a reduction of 0.63.

Then, of course, there's a financial discipline and the fact that the company is a strong cash generator, the preservation of the EBITDA margin, which is the basis to be able to pay for the debt service and continue to deleverage, and with that, with time, you have the positive effects of these new credits, right? If we exclude these, we would reach a leverage of 2.75.

Then we can see that the the leverage, the deleveraging trajectory is in full in line with what has been continued to happen. I want to highlight a bit of this with the base that would be fully comparable where you eliminate any of the costs.

Then you have the gross margin that we had already maintained in this process of expansion, either because we have a smaller amount of new stores, and then as you reduce the store openings, the margin starts reflecting the actual margin that appeared where 20% of the stores were recently opened. Then you have an important advance in our price management, especially at this moment where, differently than other formats where you look at supermarket data, for example, most of the chains service a single social level—middle class, high class.

In our case, we're exposed to all social levels, either in direct consumer services or in the B2B public, right, which includes restaurants with high income, all the way to supermarkets or grocery stores that are replenishing low-income homes. That makes different impacts in the economy, also justify a different kind of pricing, and especially when you look at this with a series of modifications in the product mix.

Expenses, as I mentioned, the company's always searching for ways to have automation. There's a series of projects for automation, self-checkout advances, and that allowed the expenses to evolve, keeping the EBITDA in mind with this from a nominal and percentage levels.

Now I'll move on to the next slide for it's our first session here with Rafael Sachete will explain the numbers here. He joined our team recently.

Rafael, the floor is yours.

Thank you, Belmiro. Good morning, everyone.

I want to start thanking the company for welcoming me so well—the board, Belmiro, has really helped me a lot, my peers as well here on my side, really providing incredible support, and the team that's been collaborative so we can really build long-term work in the company's finances. A special thanks to Aymar that has been contributing so much, and he took on this role as CFO for a while, and he had very careful and diligent work.

Thank you so much, Aymar, for supporting me in this transition process. Now about our financial results, we reached R$565 million of financial results in this period, a growth of 10.2% that was mainly impacted by the growth of the average CDI in the period from the first quarter to the second quarter last year.

CDI grew 14%, pressuring our financial expenses, and that was positively impacted by lower card anticipations. The company generated a lot of cash, and it was not necessary to perform such a relevant anticipation, right?

We'll see this in the next slide when we consider the reduction of the company's gross debt. When we talk about the net income, we reached R$367 million in net income from an accounting perspective, representing 1.97% of our net revenue.

This was impacted by the PIS/COFINS credits recognized during the period and also non-recurring expenses of the organizational restructuring, and so that generates a negative impact. When we talk about the recurring net income, we were growing 7.3% in regards to the same period last year.

When we consider this on the next slide, talking about our debt and our cash generation in the period, we reached a leverage of 2.52 times and a growth of 0.63 in regards to the same period of the previous year. Now the main focus is the resilience of this business model, where despite a period with more challenging sales due to the different reasons Belmiro mentioned, the company was able to keep discipline in gross margin and expenses was very strong and strong cash generation in the period as well.

We had R$2.9 billion of operational cash generation, and then after that's added on to this delta for the normalization of anticipate of cards, and in regards to CAPEX for investments, we had R$700 million in investments. This is an important alignment in regards to the company's strategy for deleveraging, and so a lower amount of stores and a level of investments, and that generated a cash generation that was null, but when we adjust this to the effect of the non-anticipation of cards in comparable basis, we generate R$1.2 billion of net cash, and that is converted automatically to debt payment.

When we talk about our net debt, we go from R$13.4 billion to R$12.2 billion, the net debt dropping in that period, a drop of R$1.2 billion. In regards to the leverage on the right side, we have this trend of the drop in the debt.

An important mention also on the right side of the chart here of the covenants: the company has covenants that were hired for 3x EBITDA, and these consider the post-IFRS EBITDA, in the conversion of this covenant to the pre-IFRS EBITDA, it is equivalent to 1.28. That would be a current status of less than half of the risk of covenants, reinforcing a level of security and financial comfort that the company has in regards to these debts.

Finally, on our cash on the next slide, we finished the period with R$4.4 billion, and that's our available cash. Along with this, we also have the non-discounted cards, which would add up to total possible position of R$7.5 billion at the end of the first quarter.

The company is really confident about the cash generation. Due to this, we also launched a buyback program for debentures, which is the amount of R$200 million in a period of 180 days.

This program intends to reduce our gross debt in the company and take advantage of possible opportunities for arbitrage of these fees and rates, considering possible secondary market for the debenture market. These will be financial highlights of the first quarter of 2026.

Now pass the floor on back to Belmiro to talk about our initiatives to evolve the business. Belmiro, you're on mute.

Sorry about that, guys. Within what was mentioned initially, of course, regardless of the external market, we've been going through these different cycles.

We know about the commodity cycles, the high interest rates, the low interest rates, that the company has been searching for ways to be positioned. We have other opportunities even to talk about this and take advantage of an asset that is most important, which are the 40 million monthly customers, so that we can all we have these new initiatives focused on low CAPEX, taking advantage of the current flow and store structure to add on new sales.

We already have 100 stores with the products we consider in and out, and our objective is to have products that have quick turnovers, competitive prices, and that can last for a certain period of time, right? We're seeing like refrigerators that were placed in the stores and other products that we're going to work with, and we're not going to sell like a big line of refrigerators.

It's just an opportunity item. Looking at our flow of customers and that's where we reinforce this perception of low price and increase the share of volume.

Another important highlight is a shift in the legal framework that will allow us to deploy full drugstore in our stores. We were able to do this before in our galleries, but the first the layout of our cash-and-carry to start working on the factory on the drugstores outside.

We saw some changes in habits, the GLP-1 analog drugs, and so we've been searching for greater healthy lifestyles. We had other opportunities also for carbs, protein, and supplements, and in our view, the drugstore, looking at the public, the existing public in our structure, is will allow us to also be competitive and to enter in this new sector.

The objective is to sell to generate new sales, but also recover a piece of what we call HPC, which is hygiene and personal care products, that besides being an important sales lever was also applicable to the products I already mentioned, like supplements and other food complements that were already advancing with. Our drugstore project, with this shift in the legal framework, that was a demand from the sector for almost 30 years in Brazil, our expectation is in the second half of the year, we'll already have 25 stores with this drugstore implemented.

Already included some new products as well that are geared to supplements, vitamins, proteins, etc., to adjust to consumer habits. Of course, supplements and vitamins and everything where I understand they're big potential to sell more in Brazil, we expect the drugstore product to advance even more with.

On the next slide, we can advance. Private label, we've already started the first products.

They're going to be we're going to use the Assaí brand. It's going to be geared to the end customer, especially the Chef brand that's geared to our food service public.

It's a brand Assaí already worked with before and is already geared to some products that should probably be expanded a bit and in common with the first level price. We've already advanced on the first 25 SKUs.

The other 175 should be available by the second half or until the end of the year. The objective is to expand margins.

That's our clear objective, considering that we saw industry and it took on a low cost and put this in. We want to get part of this from industry, and the objective is the expansion of the margin, loyalty of our customers, and creating a strong point of our commercial purchase power and expanding the mix of private label.

Digital, this year, also went through important We expanded the amount of stores present on iFood. We have over 100 stores.

If you want to get into the app, and we're already looking at the different tests as well for fulfillment, especially invoices and logistics and everything so we can work on this new channel. We're also waiting on the approval of the split of the FIC, which is one of the important value levers in our company.

We already got the waiver for the pilot project for the POS credit card terminals, but the other initiatives still rely on approvals from the Central Bank. We have over 1.3 million active cards, and we think it's an important opportunity for complementary financial services and also exploring a private label either for consumers or also for businesses that maybe find challenges to obtain credit.

These new initiatives that we're assessing, such as fuel stations, Assaí has, so, 40 million customers, almost 20 million drives. We also have the fuel stations and the electric car stations.

Our cost of being in the free power market is maybe half than like a residential cost. In big stores with high parking areas, as you advance, how we can also reinforce this, we would be able to sell power to customers even for cheaper than what they would have at their houses.

It's really reinforcing price, margins, etc. That these are initiatives where if you keep the leverage levels and low-level CAPEX, if you consider, we can really consider the value creation possibilities.

I wanted to go over this. Wlamir is also keeping up with our earnings call, and we've already announced that Wlamir will be dedicated to more personal projects, and we'll have Anderson Castilho taking on commercial and logistics, just as Sérgio is working on this period as well.

I want to thank Wlamir for all of his effort, dedication, and contributions. We had other opportunities to talk about this as well.

Without your contributions, we'd never get to where we're at, and I want to wish you success for your new personal projects. Then we'll pass this on to Sandra and open up for Q&A.

Good morning, everyone. Thank you, Belmiro, first of all.

I don't want to get in the way here of the call, but I want to thank you for these 15 years of partnership at Assaí, and thank our shareholders, and the board, and management as a whole, my peers, and the financial market as well. I think I wanted to have two special thanks: one, to our suppliers, which while I was leading the commercial area, we got a lot of support from our suppliers, and I hope they continue to support.

They're still in the company. To the over 90,000 employees that during this period that I was leading the commercial areas and logistics really contributed to the growth of Assaí.

I went from a company back in 2011 that had a revenue of R$3 billion and making this a company of R$80 billion really makes me honored to have participated in this and contributed to the growth of and development of Assaí and our people. I end my cycle in this company really proud of everything that we were able to achieve by over 90,000 employees.

I wish you all success, and especially to Anderson and Sérgio as they take on these new roles. I hope they can conduct this in the best way possible.

Thank you all, everyone.

Thank you, Wlamir. Thank you once again.

Now we can move on to Sandra.

Thank you, everyone. Now as we talk about ESG, we're committed to ensuring that our growth continues to generate consistent value for society and for the environment.

We have been actively working in three pillars, which are efficient operations, people and community, and ethical and transparent management. In this quarter, we've been able to keep our presence on ISE by B3 for the fourth consecutive year.

We had significant evolution in the ranking, and we're the only company in the food retail sector that is present on the index. In efficient operations, we were able to advance with the increase of 48% of the stores having composting operations, a growth of over 10% of compostable waste.

We also expanded our correct disposal program to 277 stores and over 12% growth in donation of food. Then for people and community, we continue to evolve in diversity and inclusion.

We have over 26% women and over 44% Black people in leadership positions. We've also advanced with including professionals that are over 50.

Through the Assaí Institute, we also expanded our social impact with a growth of over 200% in training micro and small entrepreneurs around Brazil and over 1.1 million meals donated in this period. That reinforces our commitment to fighting food insecurity.

We will continue to evolve consistently in ESG and focus on sustainable value creation over time. These are our main advances in this quarter.

Now I'll pass the floor on to Gabi so that we can conduct the Q&A session.

Now we have a slide here from Belmiro on the closing. Yeah.

Before moving on to Q&A, the next steps, I think we kind of already tied together. The company is really geared to deleveraging and financial discipline.

We intend to continue to deleveraging. There's a lot of uncertainty about the interest rates.

Everyone imagined that the interest rates would drop a bit, but we've been also highlighting the effect of how high interest rates have really hindered low-income customers, and there's some other factors, of course. We cannot disregard that this has been simply impacting this because although you have maybe kept higher for a long period of time.

When you look at consumer data, with the exception of some points related to new consumer habits, we've been trying to keep control of our investments, keeping on the trajectory of our leverage, and continue to expand productivity and our margin expansion as well. We have 140 stores that are new and a lot of stores that came from the hypermarket project with different initiatives I highlighted that are geared to this and ongoing evolution of this model.

As I mentioned, cash-and-carry is 50% of the food market in Brazil because it wasn't restricted to the original model. Of course, we cannot think that a single model will meet all of the demands and needs of all of the social levels.

We're going to continue to explore structure of stores and existing flow so that we can search for ways to generate sales, dilute expenses, and continue to keep our margins as we have, or even increase our margin as you go past the deflation, have another scenario of consumption. Now I'll pass on to Q&A.

Now we will begin our questions and answers session. Remembering that to ask questions, you should click on the Q&A icon on the bottom of your screen, write your name, company, and language to enter into the queue.

Once you are announced, a request to unmute will appear, and you should activate your microphone to ask questions. We'd like to ask kindly that the questions are made once at a time.

Let's go to our first question from Danni Eiger, Sell-Side Investments. Danni, you can ask your questions.

Good morning, Belmiro. Good morning, Sachser, Gabi, and everyone who is present.

Thank you for the question. I have two on my end.

The first is in relation to the recognition of credit. I'm not sure if you have seen this, but there was news a few weeks ago which brought some uncertainty if it would be possible to take advantage of this credit.

You brought the recognition of that result. It would be interesting to hear your side.

When you informed us last time on the results, there was a judicial basis as well as an audit basis to recognize that knowledge. It would be interesting if you could give us more information on the issue of the revenue.

There are some markets where there are undue use of this credit. Then my second question is in relation to the restructuring, if you could give us more information on the quarter in which it was conducted and how we should think about this for the future.

I am not sure if there is any guidance or clear link. On the discussion of 6x1, this is a discussion that has evolved a lot.

I imagine that the self-checkout could be a move in that direction, but if you could contextualize what would be these strategies that you have been doing in relation to this short-term challenge.

Thank you, Danniela. Actually, there are three questions.

I'll start with the last one. The restructuring affected areas related to participation in '22 Assaí when we converted Extras.

We had 14,000 people in civil construction working. If you reduce investment, you also have to readapt the structure.

Besides that, the company has a series of efficiency projects that are internal in various areas to have a new system for employees, not only for payroll, but also for admissions and hiring, a series of processes that were manual will be automated. This is going to begin in June.

We have a system of purchases that will allow the stores to have a catalog that is more automated. The tower of projects that we have that are done internally, well, '22, we converted the Extras with a huge effort.

The projects that we have today that are involved in the area of IT and many others of the company are also changing a lot of things at the same time, and we see a series of opportunities to improve the expenses situation and also cost reductions. For our company, leaving 2010 with 38 stores to 2013 and 40 million clients, there are a series of optimizations happening.

These are strategic actions of the company in various areas that are happening at this moment. It's not restricted only exclusively to the issue of personnel and staff.

We are trying to preserve the service in the stores and the shopping experience. If part of the volume is not coming or the minimal value of a drop of 2% in the value of commodities, I'm not going to remove a cashier.

We are working hard not to affect the customer experience. In relation to credits, of course, the tax issue is always difficult to explain.

We saw from the movement launched by the revenue a notification to 3,000 companies that do not have any connection to this credit at the moment. Maybe they will have in the future, but it's in respect to any credit that the companies can take advantage of in a contradictory way.

Every company has their own method. In our case, this affects a series of opinions, but the company may have conditions to have a discussion on this.

The right to this is reserved to each contributor. In this sense, we saw an operation where there are a series of practical issues in the market, which is a movement that the Federal Revenue can do at any moment.

On the 6x1 labor journey, this is a movement we have observed, and we will be observing. Of course, the company will have to adjust.

It's an issue that's very important. Today, cash-and-carry is a channel for lower prices for the population, and it's lower in relation to other channels.

The other channels should probably be more impacted than us. The company has been observing the movements and the discussions that are happening at this moment with the authorities, and we would adjust when it happens.

If the change is the same for all, I think a good example would be from the previous year where there was a 2% quota on the taxes, and the margins were not affected because this happened in the end. We are cash-and-carrys where you buy and you add the cost and you pass on the price.

Within this sense, it will be reflected in the price. This could open opportunities in terms of the shifts and schedules of our working hours.

We will be looking towards the period of transition and how we will adjust to that. The impact will be affecting everyone.

Those who have lower costs will have less relative costs, and those who have more costs will have more costs to pay when you look at it relatively. Depending on the way it's applied, it will probably even increase our competitiveness.

Excellent. Thank you so much for those answers.

The next question is from Luiz Felipe Guanais. Luiz, open your audio so that you can ask your question.

Please go ahead.

Good morning, Gabi, Belmiro, Sachser. I think two questions we have on our end.

The first one, Belmiro, you commented on the behavior of inflation over the quarter. If you could comment more towards the end of the first quarter and in the beginning of the second quarter, how did you see the elasticity of the volume to price, if there was anything that you were able to notice, especially now in April, where the first readings already show an acceleration of inflation in the food sector?

A second question on the working capital and negotiations with suppliers, if you could comment on the dynamic of negotiations over the first quarter and how this affected the gross margins, if you were able to capture any gains in gross margin with these negotiations. Thank you.

Thank you for that question. In the first quarter, I think there's no capture in margin.

What we did in the second quarter, we see the market with deflation, our intention was to close the first quarter with a lower level of stock, but as the market showed signs of prolonging this and a lot of uncertainty in the chains of production, we decided to increase our stocks, also in the end of the first semester. There is a movement.

We are seeing the first movements of inflation, obviously, since it has a tail. The effects should affect us in the second quarter.

Until this moment, we have not observed any changes in terms of price elasticity because even though the store owners, especially when you look at the purchasing power of the population, there's no space in order to increase volume. We observe more care in the B2B market.

There is a project from the government that may insert more money into the market, because the level of indebtedness with the interest rate is very high, and inflation will pressure low-income populations even more. I believe we still need to advance more.

It will be higher inflation, but we will be waiting for May and June to see how this movement will be behaving. We are operating with a higher level of stock to avoid worse discussions with the industry on terms of price, but there are some categories that will be more affected than others, especially those that are derivative from petroleum.

Packaging has been affected in industry. The industry of packaging, in some cases, there have been adjustments of two digits in prices, especially when we look at the packaging industry.

There's also the issue of fuel and the transportation and freight. The government has been taking care of this so there is less impact, but this is something that will live on because it is a risk for fuel.

This is something that's happening not only in Brazil, but in other countries since the consumption is being affected. Like mineral water, the price is affected more by fuel than the actual water.

I hope I was able to answer your question.

Thank you.

The next question is from Joseph Giordano from JPMorgan. Joseph, please open your mic so that you can ask your question.

Please go ahead.

Hello, good morning to all. Good morning, Belmiro, Sachser, and the team.

I would like to explore the scenario of the more adverse demand and how we should think about the upgrades of the evolution of the model. There are various movements, including electrical home appliances.

Do you have any guidance, especially for the next year? The second point would be to understand how we should think about the dynamic of opening and closing of stores over the year, if there are any closings or any openings of store that are carried on from the previous year, how the phasing will be over the year, and if by any chance we should contemplate somehow sale of points or closings, how this should be modeled over the year.

Thank you.

Thank you, Joseph. Thank you for the question.

Yes, obviously in the fourth quarter, we have been evaluating existing markets, but we still have not been able to visualize anything yet. We are always looking at our portfolio of stores and seeking to reduce the debt as quickly as possible, especially because this expectation in regards to the income tax and inflation has not been realized.

To tell you the truth, there will be more detailed numbers in the second quarter, but the impact is not a relevant impact yet with what we signaled. There may be changes which we are still studying in the mix of stores that we open for '26.

Once we had a quantity of stores in which some of them had the forecast of being done through the build-to-suit model, but as the interest rates are high, we may delay them or they may be adjusted. The projects that were for 2027 will be for 2026, or '26 projects may happen in '27.

There is still the issue of legal licensing, there are important construction works that we are working on. In Capão Redondo, for example, it will be the first cash-and-carry in a region of almost 400,000 inhabitants.

Sachser, one of the things that he did when he arrived was look at the space, which we looked at in the map, the regions of the city, and see the spaces where we could look at the North Zone. There were only three stores.

In the Eastern side, there were a lot of inhabitants where there were no cash-and-carrys. There are projects that will be executed, the second store in the city of Mauá, where there are 400,000 inhabitants within the larger metropolitan region of São Paulo.

We will bring a more balanced vision over the second semester once we are closing a lot of licensing, and this affects expansion. What happened in April came from last year, but there are a lot of projects that are outside of the company's control.

I hope I answered your question, Joseph.

Perfect. Thank you.

The next question is from Lucas Esteves from Santander. Lucas, open your microphone so you can ask your question, please.

Please go ahead.

Good morning to all. Thank you for the opportunity to ask questions.

I'd like to congratulate you for the resilience in such a difficult moment and wish Sachser a lot of success in Assaí. There are two points that I would like to approach Belmiro and Sachser: first of all, in relation to the dynamic of revenue, if you believe that these initiatives over the year, especially the partnership with Meli and the rollout of the stores, if you believe that this should impact in a relevant way the top line in the second semester, offsetting some of the pressure which we see in the sector of food.

Then on the credits of PIS and COFINS, if you saw any expectation of timing for the monetization of these credits, I believe they were not monetized. They were only recognized in the first quarter.

With all of the credits that are historical and also recurrent, considering this, if you see as plausible to consider the possibility of finishing the year lower 2x of the expected EBITDA, what your deleverage is expected until the end of the year. Thank you for the answers.

Thank you, Lucas. Let's go.

The new initiatives, some of them, for example, within [unclear], where the stores have a capacity of generating revenue, but I don't believe that in the second quarter this will be relevant since we're talking about R$270 million in terms of commodities what we lose. If we get [unclear] and derivatives, it would be 3.4 points.

If you get rice that goes down from 28 to 12, there is a reduction in the magnitude of 20% or 30% in the categories that are our specialization. There are initiatives that will be long term.

It's that same story for those who have been in the food market for a long time: commodities have always behaved in this way. They go up and they go down.

What we will have now maybe is a cycle of many commodities diving down, but it will pass and it will be adjusted because the farmers, in terms of the rice, for example, it reached R$57, and now it's R$75 to be produced. It's just an issue of time.

Obviously, the new projects are advancing and they will help us. I do not believe they will change.

What will change, perhaps, in the top line is a inflationary change because the main offender today, if we look at our situation, is that the stores should be aligned with inflation. Deflation is the first offender, there are categories in this magnitude plus a population that is maintained because the base last year was already restricted in terms of consumption, and contrary to the expectations, when you look at the income and unemployment and a series of funds that are being injected into the market, the consumption has not changed because indebtedness has been increasing over time.

On issues related to credit, yes, your reading is correct. The recurrent was only launched now in the operation.

The expectation is that this should happen within the deadline not higher than 12 months. Otherwise, it would also have to be part of a contingency.

This is why it's within the results as a recurrent result. Looking at indebtedness, our idea is no different than focusing on the deleverage.

We will reach the lowest level we can this year. With the Selic going down, and Mercado Libre came up, but we will be preserving margin, these new initiatives in the company are not going to change even if we add gas stations and CAPEX, it's not pressuring our cash with the initiatives that may generate more percentage.

We'd be lower than the number you quoted, but I cannot give you any guarantees at this moment. Thank you, Lucas.

Belmiro, if I could just ask a follow-up question on the issue of recurrence of the recognition of these credits, I understand that the phase-out of PIS and COFINS happened in the last year. If you could recognize these credits, we could deal them as recurrent within '26, in the first quarter of '27, these credits will no longer be existing, just to confirm if my understanding was correct.

They are recurrent until the moment in which the legislation is changed. I need to confirm if it will be '27 or '28 when PIS and COFINS will change, but then it will be launched, but for the highlight of EBITDA, it's connected because PIS and COFINS will change in '27.

Exactly, it's in '27, Belmiro. Thank you, everyone.

That was clear.

The next question from Irma Sgarz from Goldman Sachs. Irma, please open your microphone so you can ask your question.

Please go ahead.

Hello, good morning. I would like to ask a question on the digital partnerships, perhaps the partnership with Mercado Libre.

I know that it's still early in the cycle, but if you could perhaps share some of the first lessons that you had in this partnership, what products are making sense, maybe about the economics, where they make sense and do not make sense, and also the lessons learned on how the management of stock is being within full and the logistics, and perhaps also trace the difference with the other partnership that you had, which you have been increasing with iFood. Thank you.

Thank you, Irma. I think those are two very different projects.

The partnership with iFood, we are the ones that do the separation in the stores, more than 770,000 requests, with their presence in four stores in our vision, it's complementary sale where they buy from the platform and they don't go to the store, but it's all organized by Assaí. The platform iFood has a huge reach.

This has allowed us in our vision to create additional sales. There are a series of improvements still for us to apply in this process, especially in relation to multi-picking because some stores are very large, separating one order at a time may take a long time, and then it's our deadline.

There are great gains in productivity and in sales once our sale price is very competitive. With Meli and Mercado Libre, we are still in tests, especially in the systemic area, because they will issue a fiscal document for us in the category of products that will be established.

The goal is to put products that have added value, higher-added-value products that are not perishable. Of course, we are very competitive in those goods and leverage and create additional sales.

There are some cases where there are many industries also that are within this platform, but we need to have a structure of management and tax and fees, and we may enter into a second level. We should probably have more data that are robust in the second quarter because the tests are focused on the systemic integrations at the moment.

We started the partnership at the end of March, we will expand it to the end of April. There are two large companies that are looking at this very carefully to see if the systemic part works and then the logistical part of the products.

It should reach 250 items. In second semester, we should have better data to be able to talk about this partnership.

Thank you.

The next question is from João Soares from Citi. Please open your audio so that you can ask your question.

Please, go ahead.

Thank you. Two very quick questions here.

Good morning, everyone. The first is that I would like to understand Belmiro on the converted stores, what the performance was, how much the sale per store is, what are the margins that we should expect, and then also thinking about the competitive dynamics when we look and compare with the Atacadão and the industry.

How do you see the performance of the mature stores, the non-converted stores, and if they're well, looking towards the rest of the year, how do you see the possibility of increasing competitiveness in terms of more robust market share without counting on the converted stores? I'm not sure if my point was clear.

The second point that I would like to explore is on the benefit of PIS and COFINS, if we can imagine a number higher than 1 billion and a half. For me, it wasn't clear if there is an upside that could be clearer.

I know it's not easy to clarify this, but if you could help us understand this better.

Let's go. It is really hard to make predictions.

That's why the idea is to go quarter by quarter. We have an original forecast, but the numbers were higher in terms of compensation in the end.

Then it also really depends on our measurements. There have been changes in the legislation.

The inspections and legislation will change, we cannot estimate too much. Even if the rhythm is continued, this should probably increase a lot in terms of what was recurrent.

As we mentioned, when we look at competitiveness, if we gain 0.3 in share, the evaluation that the company has made is that we have a market scenario with indebtedness of the consumers and deflation of commodities, we will probably be able to sustain the margin, but worse maybe it could have altered and made difference in sales. That's the scenario we were working with right now.

The company is being very cautious, but this will not affect the deleveraging. Despite the deleveraging, we will have a scenario of very tight money in the hands of consumers of low income, and those who are at the other end do not notice this.

Brazil has many Brazils at the same time, and the reality today, if we look at the numbers, with the movement of the government of [unclear] and other things is because we are still highly pressured. With the new factors that appear, I think that it's something that will not affect the higher income, we already have higher prices and consumers investing more in margins to seek more sales in levels of competitiveness.

The main share has been maintained in the first quarter. In April, we see there is still a higher advance in share despite the fact that the market as a whole has been suffering.

Since there are few companies of public companies, but as I said, this is a temporary cycle. The cycles in commodity have always happened—high interest rates, low interest rates—and we are implementing new initiatives to support us until the cycle passes.

In the converted stores, there's not a lot of difference. In this year, we will stop providing the numbers, but if you look at the first quarter where they were above the forecast, but what's interesting about the stores, especially from Extra, that many of the new projects, even with the layout and the pharmacies and the gas stations, the more adherent stores are the central stores that we have that are not necessarily coming only from Extra, even with organic expansion stores, which we put closer to the central regions to capture the higher-income population.

I hope I answered your question.

You did answer. Just to draw attention to one more point to clarify: looking at the Note 14 about the commercial points, was there anything in this quarter that was abnormal, this R$170 million that was reduced?

Is that sustainable? Are you going to continue doing this?

Just more color on working capital if you can.

Yes, it's sustainable. It should continue to be done.

Part of the commercial funds we receive are recurrent, given the negotiations. There may be some variations over the quarter, but nothing that is outside of normal, with the exception of the fourth quarter, where there is higher seasonality.

Thank you.

The next question is from Rodrigo Gastim from BBI. Rodrigo, please open your microphone and ask your question.

You may begin.

Good morning, everyone. I have two questions on my end.

The first one, Belmiro, is a curiosity on how you internally buffer the budget, how much this cycle of commodities that are more under pressure will last, understanding the 12% that you mentioned for the first quarter. How do you see this in your accounts, and in case this lasts for a longer period of time where there is a deflation of more commodities, what could be done in terms of profitability?

Is there any space to tighten all the operations, how much efficiency can you still gain? The second question is about the pricing project and the impact on the gross margins.

This is something that you have been talking about for several quarters, if this was already captured and how much is still to come in terms of gross margin because of this project. Those are the two questions.

Thank you.

I think both of these questions are related to each other because there have been changes in our model of pricing. We would price in store clusters, and given the geography of stores that we have, there have been advances at the rate in which the projects are maturing.

At this moment, there are many components in the margin. There is a margin that has suffered impact at the rate in which there was deflation, when the stock is higher and you need to sell things at a new price, where there's a drop in margin.

Despite that, what we expect is to continue to deliver the evolution in margin, be it through the system or because the commodity in itself, and its participation will affect the mix. It's not so marginal, but in this quarter, it's very marginal.

In the predictability, it is very complex because commodities are very difficult to estimate in terms of prices. At this moment, what we have been looking at with more caution, we have some strategic stocks being done in April with some projects where we had convictions of purpose, but we are not playing with stock of having more stock than we need, more than is necessary in terms of capital, working capital, because there are uncertainties in terms of the consumers.

While this uncertainty exists for the low-income population, we should continue to be reflecting on this and working slowly. The market has been suffering with this and the international consumption as well, estimating it is very difficult.

We basically will adapt to it. The company has always been resilient in this sense, so much that I invite anyone who would like to look at our presentation for international investment.

Our gross profit has increased in the last 15 years, even in inflationary cycles or deflationary cycles, we have been able to preserve margins. In a more objective way, the consequences for the price of sales, we are working to have low prices and good commercial negotiations and continue to be competitive and maintain the margins that the company needs.

I hope I answered your question.

Very clear, Belmiro. Just a quick question that some people asked, and maybe it would be interesting to leave this very clear, when asked about the inflation of food starting in the second quarter, especially in April, just to make it clear, Belmiro, that you already noticed or did not notice in your operations, have you seen any changes or recovery of pricing?

It would be important to make this message very clear because that generated some questions. Thank you.

No, in fact, this has altered prices in some categories of products that has been visible. There are products that are more affected because of the conflict that is unrolling.

We should see stronger impacts now in May and June since most of the operators in the sector, and even us, had stock. At the rate in which now there is stock that has suffered inflationary impact, we will be correcting the price of sale.

Obviously, we need to be careful to not give you a number. Of course, if there's a pressure of price, we will need to pass on the prices that we had.

Perfect. It's a dynamic that's still similar to what the first quarter was in April, but there's some optimism in relation to that for May and June.

That's the reading you have today. There's a nominal correction in the same way that we see a deflation of 12% in the commodities.

There is a limit of what we can offset, as well as an inverse movement, which obviously is not in our hands. This is in the market context because of everything that we mentioned, in terms of the increase of consumption.

All of this, inflation may help correct the top line.

Excellent, Belmiro. Thank you for the answers.

That was very clear.

The next question is from Vinícius Strano from UBS. Vinícius, we will open your audio so that you can ask your question.

Please, go ahead.

Good morning, Belmiro, Sachser, and Gabi. Two questions on my end.

The first is about the volume of PJs, if you could comment on what you see in terms of your PJ clients, what your perception is on the financial health of these clients in the scenario of high interest rates, and if you think that in a scenario of recovery of inflation, if we can think about a re-pick in some movements of anticipation or formation of stock in the profile of clients here at the end of the line. My second question is about the effects of the removal of products from the tax regime in São Paulo, if you think that this can generate the possibility of monetization that is additional for taxes.

Looking at the ICMS angle, if you have 1.6 billion to recover in ICMS alone, maybe this can generate some opportunities. Thinking about new phases of tax exemptions, what can we think about in terms of impacts in ICMV net revenue and margins towards the future?

Thank you.

Thank you, Vinícius. As you well mentioned, São Paulo has been removing a series of items in the tax burden, which will be happening over the year, and new batches will follow.

We put the variation of gross margins because this will affect the ceiling that São Paulo has and the correction of ICMV. Once you leave the regime where you only had the restitution of the tax as a reductor of ICMV for credit and debit, this will be affecting the net sales.

In relation to the competitiveness, we do not expect any change because our numbers were already elevated if you think about the substitution or the imaginary sales with the effectively sell products. That way, we would need to recover credit, which is extremely complex.

It would have to be one for every SKU per weighted average. In our point of view, this will alleviate us in the point of processes because you go into the credit and debit regime, which we operate with low price.

The lower the price, the lower the margin, no matter how that was already composed before, but the lower price, the less taxes you pay. That has a neutral effect from the point of view of competitiveness, in my opinion, since seriously, what will change is the form of negotiation with pricing and negotiating with suppliers, but the products will be going to the normal level.

The volume of PJs, what have we observed? These clients, as I mentioned, for the 4%, even those who accompanied the Nielsen report has a vision that it's a bit distorted.

There is a bias in the samples because those who deliver data are the large industries. For low income is only done afterwards.

The PJ clients are the people that are in the 9%, and these clients, we have observed them as highly cautious from the point of view of credit. It seems that their financial health has not been dropped in this sense because these clients are very resistant.

They never had access to credit, they are maintained, but they're being very cautious. It's the origin of the low income that comes and has been impacting cash-and-carrys.

Deflation is at the origin of the consumer. When they feel if there's any explosion in any category of product that is not perishable, where they see more opportunities of gain, the clients will be more careful before they invest in stock.

That's what we have observed. This movement has been happening in the last two or three years with the PJs being very careful at the moment of absorbing more.

Part of this explains the margin movement which we have been doing. We do not see clients with elasticity to say that, 'Oh, now I'm going to drop prices and have huge volumes.'

No, this has not happened. I hope I answered your question.

Perfect. Thank you, Belmiro.

The next question is from Tales Granello from Safra. Tales, open your audio so you can ask your question.

Go ahead. Tales, your audio is open.

Please go ahead and ask your question. We will continue to the next question.

Bob Ford from Bank of America. Bob, please open your audio so that you can ask your question.

Go ahead.

Thank you so much. Belmiro, I know it's difficult, but what do you think about same-store sales and operational leverage for the year as a whole?

You have deflation, but there are also compensations. Your launch in the Mercado Libre seems a bit delay.

How should we think about the timeline to reach 450 SKUs on a national level? Belmiro, it also seems that you are very confident in the value proposals.

Could you comment on the price differentiations that you are observing, and to confirm the initial proposal would be B2C, B2B, or both? Thank you.

Bob, I didn't understand the value proposal in relation to what. You talked about B2B or B2C, both?

What is the value proposal in comparison to the electronic competition in the platforms? Oh, okay, understood.

I think there are two factors. What we are confident on in the value proposal with a partnership with iFood is because of our capillarity in stores and assortment which we can offer and the price level that we are able to provide, so much that today, we are probably the main operators within this platform.

It's an observation of ours that there is still a lot of space to be able to advance for Mercado Libre. Since we closed the deal in the end of March, we even had announced that the tests would begin in April because there's also timeline of projects for both companies the objective is to accelerate more, but with responsibility, especially on the part of integration.

I believe that given our size and our scale to add a series of products, we could, as we showed in the initial numbers, be a very strong competitor within the platform on items that we understand would be adherent. This is a discussion that is done with four hands with us and Mercado Libre, and this should probably stronger in the second semester.

In regards to the stores, we see a scenario which for consumption it should still continue restricted, obviously. In a deflationary scenario, it could be that there's a turnover and that will affect the sales, but with deflation, we cannot do anything about it.

In the same way, the inflation, which coincidentally be over the main products, which are the ones that have more components of credit and also have more weight in the final price of the product and the composition of the packaging, looking at the same stores, we have observed the clients doing trade-downs. Every time we look at the level of indebtedness of the population, they are holding their supermarket consumption.

There are other sectors of retail that are not being affected, but then we have to understand the social classes in Brazil, a movement for higher incomes do not suffer impact even in our stores for higher income. Those that are directed to lower income, they are in a market scenario that is very difficult.

We hope the scenario improves, and we are working on this at the moment to prepare with new incentives, new proposals of value, new channels, and new products to be able to best be prepared.

That was clear. Thank you very much.

The next question is from Andrew Ruben from Morgan Stanley. Andrew, we'll open your audio so you may ask your question.

Please go ahead.

Hi, thanks very much for the question. I'm interested to understand more about the plans for private label.

You mentioned the 200 SKUs for the year. Do you have any sense of where you could see that figure reaching over time, and even over the medium term, your vision for what private label penetration could be within your store sales?

Thanks very much.

He can hear the translation. He also asked about the 200 SKUs and how we are doing in that sense.

I think I was able to activate it now. We still have the first 25 products.

As there are a series of negotiations with the industry, we will finish the quarter. Until the end of the year, we should continue with an evolutionary scale and every quarter bring you the new information.

The interest from the industry is very high. Our own label has always been a challenge in Brazil, but as we had highlighted before, in the metropolitan region of São Paulo, we have 60% of penetration in homes, there is still opportunities for our own brand.

This is being discussed in the board, but it's a very favorable moment to come in with an aggressive project for private label. We are also looking for products with lower prices.

Obviously, there's a lot of caution, and we need a lot more information because of competition issues in the market. At the rate in which we can, in every quarter, we'll be shedding more light on the subject.

Thank you.

The next question is from Guilherme Domingues from HSBC. Guilherme, we will activate your audio so you can ask your question.

Please, go ahead.

Hello, everyone. Good morning.

Thank you for this space. My question is in line with the previous one on the private label.

When we look at the more mature markets in the United States, for example, like Costco, the giant Costco, they have their own private label that is very strong in terms of vitamins and supplements, just like the Equate brand. Just to know how the company that brought this release of whey and creatine, if that is going to be offered connected to higher amounts of protein consumption because of the change of the consumer.

You also expect it to grow in this category with your own brand? Thank you.

Thank you, Guilherme. I think in terms of vitamins, when you look at the other protein supplements, no, there's no restriction from the point of view of doing this with our own private label.

There are medications in private labels, and we can work with the brands that are well known. The rest would be to work with projects that could be extended.

They are in a previous phase because we are creating more space in stores. In my vision, the pharmacy will also be attractive for this.

The coincidence with Costco is that they have a pharmacy as a important point of attraction, and they are able to follow on even in these markets with the volume of sales, and medications within the food sector is huge. We are still working on this, but the first pharmacies will come out in the second semester, but it will be much faster since it doesn't depend on a license.

For us to be able to advance once the behavioral changes, especially with the higher classes and the search for more protein products has been quite notorious, we've seen these changes in the market. Assaí is the largest seller of protein in Latin America, especially with some projects which we've had in the last few years for the inclusion of services that are still under maturity.

This was made in order to position us more strongly in the category of protein, this is strongly in our radar.

Thank you, Belmiro.

The next question is from Tales Granello from Safra. Tales, please open your microphone so that you can ask your question.

Go ahead.

Good morning, everyone. Good morning, Belmiro, Gabi, Sachser.

I would like to ask three quick questions. If you could open on gross margins, how much the annual gains come from store maturity and how much comes from pricing projects?

Anticipation of credit cards, the level dropped a lot in terms of receivables ever in the year-over-year. In relation to the last quarter, I would like to know if this is a recurrent volume that we should expect in the future.

Then the last point is in relation to taxes over revenue. There was an increase in this quarter.

I would like to understand exactly what the motive of this increase was and if we should consider a higher volume from now into the future. Thank you.

Tales, I'm going to talk about the margins of the taxes, and then Sachser can talk about the anticipation of credit. The taxes was a change when you talked about the item leaves the tax substitution when it is in the ST.

The tax of ICMS is within the ICMB. When it comes into the normal thematic, the tax is deducted, and that's why it comes in as net revenue.

The weight and the increase of taxes over sale is connected to the change of the system of the substitution of taxes, especially in the state of São Paulo. There are other states that also made this change, but it has not been so relevant.

In terms of gross margin, we should not probably open. We've showed positive margins, but there are also negative sides.

We will probably reach a number which in our opinion opens a strategy for the company and opens a lot of strategies to gain share in the company. Then the margin should also become interesting to the competition because it wasn't expected.

The natural path of pressure is that you lose in top line and then you lose margin, but that's not what happened. Our resilience is very strong in this sense within the food sector.

We cannot open the components of the margins on the taxes. The more products leave the substitution of tax, more will the effect become visible.

If there are any questions on that, please speak with our International Relations team because they will be more than available to give you more information on that. Sachser will talk about the anticipation of credit cards.

Thank you. Tales, for the question on the anticipation of credit cards, historically, we've always had this as an alternative to recompose short-term cash, to accelerate some kind of cash flow to cover the needs of the company.

Historically, these are avenues of cash reductions that are a bit more expensive than a structured sale as a debenture or other paths. Given the tax situations, we had a substantial drop or decrease within the period compared over the last 12 months, and even in the quarter as a whole, as a strategy.

What we see for the company is no activation in this front, but we should prioritize the lower-cost debts. There will have a balance of the cards increasing.

Thank you so much, Belmiro and Sachser.

Just a complement: in terms of the debt, we have a program of rebuying the debt, and this has been improving some taxes or some fees. The Board approved it, and so we can anticipate credit cards after the purchase of the secondary.

It's not necessary to have a volume of cash, and this has been well demonstrated.

The session of questions and answers is finalized. Now we will pass the floor to the final considerations of the company.

I would like to thank everyone for the participation in building this material, the board for the support we had to bring these scenarios. We would like to be talking more about the consumer market in a better scenario, but Assaí is highly resilient if you look at the delivery of margin independent of the scenarios that we have been going through.

The company, once again, is positioning itself, planting seeds, which when it's connected to indebtedness and the higher possibility of consumption for the low-income population, which are highly pressured at this moment, that the company will be well positioned with new initiatives to capture these gains. I would like to thank everyone and thank you for the participation.

I am sorry if I spoke too long in the beginning. I wasted more time on that, but we just like to make things very clear when we talk about Assaí, independent of the moment we are in.

In our vision, we could say, but all things could be better, but given the scenario of consumption, I think the entire team in general is highly congratulated. Thank you so much to all.

The video conference on the call of results for the first quarter of Assaí has been finalized. The Department of Relations for Investors is available to answer any further questions.

Thank you so much to the participants and have a great day.