Via S A : Q2'23 Earnings Release Presentation Video Transcript

VIA - Earnings Results Q2'23

Renato Franklin - CEO

Hello! Welcome to Via's Q2'23 earnings conference call. Please note that this video is made available together with the earnings materials so that we can focus on the Q&A session during the live conference call to be held tomorrow.

Before going into our results for the second quarter and our transformation plan, I would like to highlight the pillars of our strategy that guide our work.

• First, it is worth noting that our entire strategy is customer-centric. We are leaders and protagonists in our core categories, and we are fully committed to always delivering the best experience to our customers. All our employees are sales consultants and experts in the categories in which we operate. Our scale, our number of stores, and the relevance of our online channel open up opportunities to sell more and better to customers who are already in our ecosystem. This is the foundation of our best marketing. Well-served customers come back to buy more products and recommend more customers.
• As a second pillar, happy people who are passionate about what they do deliver more and spread this passion to our customers as well. Here, I would like to mention Via's stellar team. It is thanks to them that we can have ambitious goals ahead of us. In the last few months since I joined the Company, I was able to see the spirit and passion of each employee for our really valuable brands. We will invest in further equipping this team to maintain and leverage this competitive advantage so that we can stand out even more, both in stores and in online sales via WhatsApp (Me Chama no ZAP).
• The third pillar is Focus and Austerity. We are reinforcing the commitment to efficiency and profitability as a pillar of our culture. They will be the base for our business sustainability. We will choose what we will do and where we will allocate capital, and we will do what we do well, in a simple and austere way, with no waste. Retail is a scale business that creates value but does not tolerate disrespect or waste. Later on, we will talk about our transformation plan, which has 18 levers broken down into over 100 initiatives to boost operational efficiency and

generate cash and profitability. With new and more granular profitability metrics that incorporate the cost of capital, we have more control over what to do and how to do it.

• The fourth pillar is crucial to capture Via's entire potential. There are great opportunities for value creation, and we need to prepare ourselves to seize them. In this sense, we are modernizing our sources of financing with several initiatives, including a receivables investment fund, FIDC, to finance our installment plan. This can release substantial amounts from bank balance sheets, unlocking the reach of this type of consumer financing, which creates substantial value for Via and our customers. We also have the opportunity to tap into new liquidity pockets and asset monetization levers, which will make the Company lighter and more liquid and prepare the balance sheet to enable our progress.

I will now talk about our sales performance in the quarter. The GMV of bricks-and-mortar stores came in slightly above R$6 billion, rising 1.2% year on year, despite a strong comparison base resulting from the 18% growth recorded in the same quarter last year.

Our online 1P GMV declined 5% year on year but improved sequentially, compared to the 15% downturn recorded in the previous quarter. We continued to record market share gains without investments in pricing, which enabled us to reach an all-time high in the channel.

3P grew 9%, totaling a GMV of approximately R$1.5 billion, while our take rate reached 12.4% in the second quarter. Year to date, the take rate went from 11.5% to 12.2%, mainly driven by the monetization of services, installment plans, and logistics.

Complementing sales performance figures, we once again recorded material market share gains both in the online and in the offline channels.

In the period, we beat Via's historical record, reaching a 15.3% market share. According to Confi Neotrust, we had a 2 p.p. increase compared to last year, despite the decline in the online market. Our bricks-and-mortar retail operations grew 1 p.p. of share year on year, maintaining our leadership in the channel, according to GFK. This market share gain reinforces our brands' unique position in the Brazilian retail, especially in our core categories.

As we said when we presented the pillars of our strategy, customer satisfaction is at the center of everything. In this pillar, we have been maintaining our investments and delivering numerous improvements - with many more to come soon.

For example, our Reclame Aqui (consumer report leader in Brazil) score increased year on year across all channels.

It is worth noting the high scores obtained by our bricks- and-mortar stores, which enable us to build customer loyalty in our most profitable channel.

As a recognition for our efforts, Via received two additional awards confirming our right course: the Latam Cliente SA Executive of the Year Award for Ted, our director is in charge of customer care; and an award for the insourcing of our Consumer Protection Agency Services.

Our Logistics infrastructure, including our more than one thousand stores and 29 DCs, is another major competitive advantage. The infrastructure is ready, and we have capacity to develop our businesses without the need for additional capex. In this sense, we continue to expand our operations to serve customers outside of Via's ecosystem, bringing in revenue, cost dilution, and profitability to an existing network.

Our multimarketplace fulfillment operation recorded an increase of 70% in the number of customers and 18% in the number of orders.

In our operation as a logistics player for third parties, the number of customers increased 21-fold, while the number of orders jumped 186%. I also highlight a

revenue increase of over 400% in this operation. And this is just the beginning.

Thanks to technology enhancements and operational levers, we are able to have more agility, more routes, greater reach, lower costs, and better delivery times, strengthening the customer experience.

It is worth noting that this is an across-the-board progress, both year on year and quarter on quarter.

In marketplace deliveries not managed by Via, delivery times improved 20%, as we worked more actively and closer to sellers.

The deliveries managed by Via, whose delivery times were already shorter than those of the marketplace, also improved 20%.

In addition, our 1P deliveries and fulfillment, which have the best delivery times because of our greater control over the entire journey, improved 22% and 10%, respectively.

This is another structural competitive advantage of Via. In our iconic installment plan, with a portfolio of R$5.3 billion, delinquency was within the Company's historical levels. Our actual losses, comprising over 180-day delinquency, represented 4.9% of the total portfolio.

Over 90-day delinquency corresponded to 9.1% of the portfolio, virtually in line with the previous quarter. The stability of short-term cohorts allowed us to maintain the ADA (Allowance for Doubtful Accounts) coverage ratio.

Our credit portfolio, which boasts excellent quality and a great track record, allows us to capture value from new financing models that might even promote the expansion of this product, as we will further see.

The Company' ESG agenda is growing stronger, with important advances that make us want to accomplish more.

In the environmental aspect, the Reviva Program sent 800 metric tons of waste for recycling, and we collected around 1.5 metric tons of electronics through drop-off points at our stores.

On the social front, the Casas Bahia Foundation renewed projects focused on productive inclusion for entrepreneurs and education for young people. We also encourage all our employees to do volunteer work at the Foundation's projects.

Also on the social front, Via was recognized as a benchmark in good Diversity and Inclusion practices by Ethos Institute in partnership with Época Negócios magazine. In addition, we launched campaigns focused on maternity and preventing gender discrimination and discrimination against the LGBTQIAP+ community, and they were extremely well accepted by our employees and customers.

On the governance side, we published three reports that clearly and thoroughly present the Company's initiatives. They include:

• Via's Annual Report following GRI (Global
  Reporting Initiative) guidelines
• Our Tax Transparency Report, an innovative initiative in the retail sector that gives visibility to the Company's tax initiatives
• Casas Bahia Foundation Activity Report, which presents detailed information on the

Foundation's private social investment activities Finally, I remind you that the Board of Directors has approved the election of Elcio Ito as our new CFO as of July 10. I will take this opportunity to welcome Elcio and invite him to talk about our financial highlights.