CVC Brasil Operadora e Agência de Viagens S A : 4Q22 Press Release

RESULTS 4Q22

Santo André, March 14, 2023: CVC Brasil Operadora e Agência de Viagens S.A. (B3: CVCB3) informs its shareholders and other market participants of the results for the fourth quarter of 2022 (4Q22) and the year of 2022 (2022). Unless otherwise indicated, the financial and operating information below are presented in nominal million of reais (R$), prepared pursuant to the Brazilian accounting standards, especially Law No. 6.404/76 and the standards issued by the Accounting Standards Committee ("CPC") and approved by the Securities and Exchange Commission of Brazil ("CVM"), and must be read together with the financial statements and the explanatory notes for the period ended December 31, 2022.

2022: Net Revenue reaches R$ 1.2 billion (up 48% vs 2021), while EBITDA totals R$ 167 million (compared to -R$ 235 million in 2021); R$ 1.4 billion in Confirmed Bookings recorded in January 2023 (up 90% vs January 2022)

• Bookings and Consumed Bookings grew 56% and 64% respectively (YoY), due to the resumption of sales at all Units
• Operating leverage: Net Revenue grew 48% in 2022, as a result of the strong recovery in business travel, pleasure travel, and event travel. General and Administrative Expenses increased 13% in 2022; in 4Q22 they were like those reported in 4Q21;
• Highest quarterly EBITDA since 3Q19: R$ 83.0 million;
• Digital Transformation
• • Complete roll-out of the new platform that consolidates relationships with B2C customers (apps, e- commerce and stores) with CRM
  • Availability of the Financing Center, a credit marketplace that expands payment methods that are attractive to consumers
  • Launch of Programa de Fidelidade - Clube CVC (Loyalty program)
  • A new and unified backoffice for B2B operations.
• Subsequent event - Renegotiation of debentures: On March 10, the Company entered into an agreement for the total renegotiation of its debt, in agreement with debenture holders representing more than 75% of the outstanding debentures of the 4th issue of each series and 100% of the outstanding debentures of the 5th issue. The implementation of the reprofiling is subject to the consent of the debenture holders, as well as approval at the respective Debenture Holders General Meeting. More details on pg. 10.

R$ million

Bookings

Consumed Bookings

Net Revenue

Take Rate

EBITDA

Adjusted EBITDA

Net Loss

4Q22	4Q21	∆
3,455.4	3,044.2	13.5%
3,693.6	3,444.6	7.2%
321.4	314.0	2.4%
8.7%	9.1%	-40 bps
83.0	(35.4)	n.m.
4.2	8.9	-52.4%
(96.8)	(145.8)	-33.6%

	2022	2021	∆
	13,942.4	8,967.1	55.5%
	14,428.7	8,816.4	63.7%
	1,221.6	825,9	47.9%
	8.5%	9.4%	-90 bps

166.5 (235.1) n.m.

72.6 (218.8) n.m.

(433.4)

(486.6)

-10.9%

Capital Markets (Dec. 31)		Results Conference Call		Investor Relations
CVCB3: R$ 4.49 per share		March 15, 2023		https://ri.cvc.com.br/
Total shares: 277,247,309
	2:00 p.m. (BRT) / 1:00 p.m.		[e-mail]
Market cap: R$ 1.2 billion
	(EST)
Daily avg fin vol. 4Q22: R$ 99
	Ph. [phone] /
million
	[phone]

Link for webcast

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RESULTS 4Q22

Message from Management

The year 2022 was a milestone in the trajectory of CVC Corp in terms of Digital Transformation and the development of "omnichannelity", with relevant deliveries such as a new storefront system as well as interaction with customers in B2C, Customer Loyalty Program (called "Clube CVC"), Financing Center (or Credit Marketplace), and dynamic product pricing system. These deliveries have allowed us to seek new levels of efficiency and will make it possible for us to enjoy greater operating efficiency and, consequently, operating leverage. Also noteworthy was the evolution of our CRM, which already exceeds 34 million contactable customers, thus creating support for a relationship journey through targeted campaigns that will contribute toward higher conversion and greater customer loyalty, our CRM is already integrated with the new B2C platform and with all sales channels (website, store and app).

An amount of more than R$ 400 million has been invested in technology since 2020, of which more than R$ 240 million was in 2022 alone, an absolute record for the company that ends a more accelerated cycle of tool development. Due to everything that was done throughout 2022, CVC won, for the 12th consecutive year, the Top-of-Mind award in the "Tourism Agency" category and made its debut in the new "Tourism Application" category.

In line with the digitalization strategy, several weeks ago we launched ConecTaaS, a new platform for integrating APIs, which increases connectivity and facilitates access for CVC agencies to sell products. The platform is plug-and-play, and functions like a product showcase.

With the aim of expanding the means of payment and convenience for our customers, we recently started to allow the use of Livelo (rewards program) points, which can be used to cover the total or partial amount of the purchase of travel products. This new offering is now available throughout the CVC network, and all Livelo customers can enjoy this new benefit at all CVC brick-and-mortar locations. We have a long-standing partnership with Livelo (since 2016), when we became suppliers of products related to the tourism sector, through the official website of the company's rewards program.

With regard to results, our bookings and earnings progressed throughout 2022, demonstrating the recovery of the market and the Company's performance capacity. Confirmed and consumed bookings increased both in Brazil and Argentina, and, consequently, the net revenue between periods grew as well. Our deliveries - whether in terms of results or the enhancement of our operation - are aligned with our values, especially "We Honor our Commitments".

Throughout 2022, we endeavored to support our customers in the use of travel credits resulting from the restrictions imposed by the pandemic. This amount fell 62% compared to the final balance of 2021 (from R$ 761 million to R$ 293 million). We also made progress on the operating efficiency front, which resulted in better control of expenses. In early 4Q22, we began the process of reassessing structures and streamlining suppliers, in addition to a major overhaul of internal processes. This process will extend throughout 2023 and will be supported by an external consulting firm, focusing primarily on revising operational activities.

In view of the strong recovery in sales in 2022 and the growth forecasts for the coming years, we have been constantly assessing our capital structure. Last June, the Offer of Shares of R$ 403 million was ratified, and we are currently in the final stages of negotiations for the reprofiling of our debt. We hired an advisor to assist us, and this month we released to the market a proposal for reprofiling our entire debt; the broad acceptance of this proposal indicates that we are on the right path, building a more solid and profitable company, with the support of shareholders and debenture holders. When completed, CVC Corp will have its lowest level of gross debt since 2017.

We started out 2023 with the best January in sales since the onset of the pandemic, with all areas of the company focused on bringing the best offers in products, services, and payment terms to our target audience. This is all being done in a way that is supported by a refurbished and robust IT structure, with a better customer experience, capable of supporting the increase in demand. We believe that these bases will allow us to take advantage of opportunities on the market throughout the year, and thus report sales growth and evolution in our profitability.

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RESULTS 4Q22

CVC Corp Result

Bookings and Consumed Bookings

R$ million

Bookings

Brazil

B2C

B2B

Argentina

Consumed Bookings Brazil

B2C

B2B

Argentina

4Q22	4Q21	∆
3,455.4	3,044.2	13.5%
2,502.9	2,229.5	12.3%
1,164.6	1,051.0	10.8%
1,338.2	1,178.5	13.6%
952.5	814.7	16.9%
3,693.6	3,444.6	7.2%
2,741.0	2,630.0	4.2%
1,322.3	1,393.6	-5.1%
1,418.7	1,236.4	14.7%
952.5	814.7	16.9%

2022 2021 ∆

13,942.4 8,967.1 55.5%

10,274.6 7,455.4 37.8%

4,557.2 3,781.9 20.5%

5,717.4 3,673.6 55.6%

3,667.8 1,511.6 142.6%

14,428.7 8,816.4 63.7%

10,760.9 7,304.8 47.3%

4,995.5 3,563.9 40.2%

5,765.3 3,740.9 54.1%

3,667.8 1,511.6 142.6%

Bookings increased by 13.5% in 4Q22 over 4Q21, with demand for international destinations (42% increase in Brazil and 71% in Argentina compared to 4Q21) benefiting from greater availability of the airline network and frequency of flights. Furthermore, 4Q22 bookings in Brazil were positively influenced by Black Friday, which grew in relation to the 2021, but adversely affected by the World Cup, especially in B2B, and by the change of B2C platform, which despite successful in not causing inconvenience to customers, it momentarily impacted store operations in the period. It is worth mentioning that the new B2C platform allows for greater integration of the physical and digital channels, as well as a customized approach for customers in offers, purchases and service.

We also highlight our performance regarding the 2022/2023 cruise season, with an increase of more than 200% compared to 4Q21, given the expansion of offer of what is expected to be the busiest Brazilian cruise season in the last 10 years1. In January 2023, cruise product sales accounted for 20% of the B2C Business Unit's bookings; more than 25% of all passengers who boarded cruise ships within Brazil that month were customers of CVC Corp. Consolidated confirmed bookings in January 2023 totaled roughly R$ 1.4 billion.

Bookings at CVC Corp for international destinations continued to rise and accounted for 53% of confirmed bookings in the period (39% in 4Q21). Below, we detail the breakdown by destination in Brazil and Argentina:

1 Source: https://abremar.com.br/guia-clia-brasil/

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RESULTS 4Q22

	4Q22	4Q21
	39%	31%
Brazil
	61%	69%
	10%
Argentina		39%
90%	61%
		National	International

In B2C, Consumed Bookings were down compared to 4Q21, when there was a strong resumption of local tourism, reflecting the pent-up demand following the reopening for travel as well as advanced vaccination, and also due to the higher number of long weekends. In B2B, Consumed Bookings grew 14.7% vis-à-vis 4Q21, because of the resumption of corporate events and business travel witnessed over the last three quarters. In Argentina, Consumed Bookings continued to grow, mainly to international destinations, with Almundo being the most highly representative of these bookings, driven by the FIFA World Cup.

Since the beginning of the reopening of various destinations, the Company has endeavored to assist its customers in the use of travel credits stemming from rescheduling because of the restrictions imposed by the COVID-19 pandemic. These amounts were significantly reduced throughout 2022, for a total a balance of R$ 292.7 million at the end of 2022, a reduction of R$ 468.5 million (or 62%) compared to the closing of 4Q21, thus reaching - at the end of 2022 - more normal levels considering the company's usual operation. It is also worth recalling that the Law 14390/222, published on July 04, 2022, extended deadlines for rescheduling and using credits available in hotels and other ground services to December 31, 2023.

3 Full text available at http://www.planalto.gov.br/ccivil_03/_ato2019-2022/2022/lei/L14390.htm

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RESULTS 4Q22

Net Revenue

R$ million

Net Revenue

Brazil

B2C

B2B

Argentina

Take Rate

Brazil

B2C

B2B

Argentina

4Q22	4Q21	∆
321.4	314.0	2.4%
255.7	262.1	-2.5%
167.1	183.9	-9.1%
88.6	78.3	13.2%
65.7	51.9	26.6%
8.7%	9.1%	-40 bps
9.3%	10.0%	-70 bps
12.6%	13.2%	-60 bps
6.2%	6.3%	-10 bps
6.9%	6.4%	50 bps

2022	2021	∆
1,221.6	825.9	47.9%
960.3	706.7	35.9%
637.7	451.4	41.3%
322.6	255.3	26.4%
261.3	119.1	119.3%
8.5%	9.4%	-90 bps
8.9%	9.7%	-80 bps
12.8%	12.7%	10 bps
5.6%	6.8%	-120 bps
7.1%	7.9%	-80 bps

Net Revenue in 2022 grew 47.9% over 2021, reflecting the performance in Consumed Bookings, contributing toward the improvement of operating income (loss). In 4Q22, Net Revenue was similar to the same period last year, with the growth in Bookings partially offset by a downturn in the take rate, due to the mix of businesses and products, such as increased sales of cruise products and lower occupancy on exclusive products at certain locations.

Consumed Bookings - Product B2C (%)

									11%
	17%
46%						56%
37%						33%
	4Q22					4Q21
			Air		Non - Air			Cruise

one reported in 4Q21.

The Take Rate reached 8.7% in 4Q22, reflecting the strong growth of cruise products, which - despite having a lower nominal take rate compared to other products - does not require working capital. It is worth noting that 4Q21 was sustained by the increase in travel (mainly domestic), due to the greater availability of flights and pent-up demand, momentarily favoring the take rate. As a result, the take rate in 4Q22 was 0.4% lower than the

The 2022/2023 cruise season runs from October 2022 to May 2023 and - according to data from the Brazilian Cruise Lines Association (Abremar) - is expected to be the busiest in recent years, as mentioned above.

Argentina's Take Rate reached 6.9% in 4Q22, 0.5% higher than in 4Q21, driven by Ola. It is also worth mentioning that there was an increase in taxes on international travel, which were added to the value of consumed bookings (albeit with no impact on Net Revenue), thereby diluting the take rate.

On February 28, Brazil's Federal Senate approved (unaltered) the conversion of Provisional Measure 1138/2022 into Law 14537/2023, which established the reduction of the nominal rate from 25% to 6% of Withholding Income Tax (IRRF) levied on remittances abroad related to personal expenses on travel for tourism, business, services, training, or official missions from January 2023 to December 2024; thereafter, increasing by 1% per annum until 2027 (capping at 9%). This reduction aims to stimulate tourism, seeking to make tourism agencies and operators more competitive, which was one of the sectors most affected by the COVID-19 pandemic, with CVC Corp benefiting from this measure.

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