UGP - Earnings call transcript Q1 2021 | Ultrapar Participações S.A.

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Operator

Good morning, ladies and gentlemen. Thank you for waiting. Welcome, everyone to Ultrapar's First Quarter 2021 Results. This is also being simultaneously streamed through webcast and you can reach through ri.ultra.com.br and MZiQ platform. Today's teleconference will be led by Mr. Officer and Executive Chief Curado, of Mr. Ultrapar; Frederico Investor together with Pizzinatto, Chief executives. Officer, and Financial Rodrigo other Relations We would recorded. like is event to inform you that this being the participants presentation. all will in mode And be during listen-only company’s completed, there After Ultrapar’s remarks will a question-and-answer be session. are be instructions At will time, given. that further sessions, We webcast. Q&A be Instructions] during that remind which advance you will [Operator posted answered in be questions, the may the in it's will of available for after this right call be over. replay A week one

safe harbor Before important being the proceeding, let made Act Reform forward-looking mention to is the are statements of of me that That Litigation Securities under XXXX. note.

not materially therefore, those and based beliefs Investors the conditions assumptions results on other our and understand operating economic the company. general cause or could could such may Forward-looking on statements future. circumstances management to results involve of Ultrapar They and that assumptions because from and future they conditions, are also that currently expressed the depend differ affect available in industry the factors and forward-looking may and statements. relate uncertainties of Ultrapar occur to risks, in information should events, future to

our Now Frederico Curado. start to I over teleconference. Mr. turn will Curado will Mr. the conference

Frederico Curado

everyone, Good our to and morning, welcome conference.

call the our which XX the we that for any Ultrapar better in of was safety and our also our saying the highlighting representing of maintained start great suffered than service anticipated, the competence point high without demonstrated of interruption. and of throughout from by earnings operations, a level those also the teams but a quarter view over consumers. was what have XXXX. of months start last customers not me can't And of both this pandemic, continuously year slightly first to have people, that improvement of Let continuity an year, we start our had I

with performance. of market the share, beginning XX,XXX Ultragaz by Ultragaz. excellent continues another margins of of great quarter, more first the starting – quarter, been also and and did of exchange and favorable rate investments show continues of Oxiteno, journey advantage our in had in commercial developing the good opportunities operational productivity way, Ultracargo also are in which as quarter with to than made imports balance between presented healthy you history. Ipiranga have beginning a so derived the XXXX. restructuring may improvements of trading another Well, The people operational our internal great growing quarter financial of the By Ultrapar. this businesses best reap the in area. Ultragaz performance is to substitution congratulations take that way, Ipiranga’s innovation of to company a a great So and all and its fruits great have the Brazil. and we also had competency of and from competence seen,

is did ICONIC. and created position And Commercial of VP confirm who was this an – Vice on he have with JV vet, Linden of industry and position so CEO corporate until resellers – new Xst managing transitioned to network network will our very also of new our Chevron, And now May, our JV of last from the who he week. Linden a be President, Leonardo that dedicated We the which clients. to to happy the a Linden Commercial led

So comment on Extrafarma. final

shopping located the impact which wave stores effect of an the in and Another centers. had of course, are pandemic of in second on which good despite sequential the result its Brazil, again

of are those quarter. of margins. R$X revenues, first means closed an year, So come On last many strict strong, or of which have to similar which several quarter were Ultrapar to billion restrictions. All-in-all allowed the expansion with to of EBITDA this close the

associated did of in with within cost net Our debt income our in a the U.S. debt flow our the net hedges cash denominated operating but income was the remain our our dollars, negatively expectations. mark-to-markets our financial by performance. – strong to impacted Thanks

dividend year in had XXXX. this relative payment a to the quarter, We relevant also

Let that year. advanced XXX% we the dividends level with any we payments Even made leverage in debt that we disbursed you of not last me remind Therefore, payment, our have kept March. value the year. same of last at

between Petrobras, of to of along with the agreement Note, So And is the good on the normally that news. the our the aspect, contracts of EBITDA. regarding this significantly leverage with goal a are in transition months the coming of the two management throughout hope end is purchase without acquisition sign about the any progressing are a gradual senior due agenda, companies. we to which last achieve of XX they half and the of strategic Refap, having From our hope interruption advanced the in year. reach point to which negotiation rationalization to times of our range associated. without change see view months, expectation two the be is various and Petrobras, to to able the our or ancillary to of portfolio decline the year We

in So implementation course and summary, schedule remain of XXXX. strategy on the designed on we and in

of planting to expectation fruits we the in years. have XXXX, the in continue reap last three we that what the been We have will

of and who Thank the our will that forming further all of define and end reiterate – achieve will just the aligned you of of will floor the Well, including our to you year, to this appreciate Ultra appreciate the with the plans these pass attention this XXXX, growing our the to ESG action Rodrigo, again. By results much. will our thank objectivity on like goals greater of agenda the and disclose ESG you results. in focus I we I very enable which for I’d strategy, Group, present goals year. us closing, intermediate gain details. course, Before

Rodrigo Pizzinatto

to starting Slide results. X, number pleasure It's be with morning, begin results. a let's everyone. here you Ultrapar’s talk Ultrapar’s to you, more Fred. with with Thank And consolidated once And about good

Fred the environment. the more and year with pandemic As economic in we mentioned, just Brazil, the news despite volatile worsening the started positive of

Our EBITDA representing of EBITDA quarter quarter, reached over we XX% first a R$XXX reported in the increase the XXXX. in first the million

the recall, had million you XXXX, quarter income quarter positively As in we portfolio resilience R$XX growing If mentioned of tax EBITDA was the first this may million R$XX EBITDA which from XX% results Despite the XXXX, already net the results. non-recurring tax in non-recurring quarter, affected of I XX% Oxiteno. two benefited credits the R$XXX year, demonstrating with of business of grew as of recurring R$XX across last mainly million first segments. of million in of to that our exclude of effect EBITDA growth, we and all had due factors. credits We below financial first this quarter

The impacted other affected negatively factor economic the our contracted quarter, to first mark-to-market mature instruments, protect that refers XXXX. XXXX the our environment instruments which results. mark-to-market and in bonds In to the more hedging of this negative of FX financial effect hedging turbulent long-term

given relevant have of that first as see annually that, year-end December. the in had intend economic ethanol a are we capital will effects environment XXXX, working consumers better over in bottom It's first March, these neutralized we these and of positive in Besides in first effect As result Typically, seasonal quarter in those increase worth gains remind temporary can as hold since the I as quarter, to time. be quarters. to the suppliers instruments the we natural the quarter, you the in quarters mark-to-market mark-to-market fourth was holidays on you maturity, graph. undergo mentioning are the a this increase payments left losses or to anhydrous investment cash the a in inventories. mandatory only

rose in of which fuel resulted reductions in first the first to LPG increased and XXXX. had these In in outflows XXXX, quarter compared significantly the we quarter to prices addition effects, cash price of

was a cash paid investment of operations cash XXXX quarter this dividends. capital, in payment Another in of with all may you from payment out year. positive in dividends a this dividend from significant flow this quarter as installment of and the working in million. usually halted August single in Last we March in year, R$XXX had Even XXXX it recall, first we made the effect the first

liability accounting. to an is talk Moving and net just of instruments, R$X.X increase We the due mentioned, investment, now to XXXX. This also December debt X, of a billion, hedge let's dividends net to portion with closed aspects working increase over from a of mark-to-market bonds quarter R$XX.X capital management. the about as I and designated Slide fluctuation hedging of billion our FX negative debt number over the

bonds to line XXXX As quarter increased a to result, our fourth the expect XXXX. be The for net quarter, peak Xx X.Xx quarter debt-to-EBITDA reduction adding pointing maturity to we which leverage net the leverage that cost contributed two in also following to from out have of in XXXX, implementation of leases XXXX, the this gradual been we or though totaling of incentive a not a issued are financial of and debentures this R$XXX in IFRS infrastructure Brazil linked in the first XX. debt both Still inclusion XXX% the the equivalent seven-year of with debt. starting first the since a leverage we these trend million, is to leases It's item rate. This CDI quarter the calculation quarter. first next through payable leverage, even worth in increase the in Ultracargo,

was talk than the to in imposed in the most about segment volume the The services social commercial to result pandemic. provisions to segment optimization. quarter XXXX, in Ultragaz. the lower during the of XXXX influenced in quarter the first in by segments. was of in as segment of The in than of XXXX, a the the expenses to quarter increased X% were freight, other Sales effect a the now sales response of is a to industries. effected the first this for what pandemic accounts at offset distancing LPG Slide sales first with doubtful decrease segment. the and Ultragaz a by lower related Moving number to reduction for The had by we that of the the mainly bulk XXXX, beginning March reduction due X% to into X% in decrease restrictions X, first bottled lower bottled that increase in X% bulk hand with bottles demand logistics partially result lower and quarter, SG&A expenses on

in initiatives EBITDA over X% call. to addition as we the predicted in in several quarter, the expenses quarter was XXXX, to earnings same In in Ultragaz R$XXX lines. million last a the growth reduce

a base. the reduction on Given strong efficiency volume and focus good progression This due given the the context, a sales for a comparison the prospects despite the second is it and quarter are quarter, of especially quarter and volumes very considering lower stronger to was The first expenses the XXXX, quarter. seasonally costs EBITDA in in period. the LPG growth of second of over slight increased

The lower of XXXX second unusually effects second the quarter of the be XXXX performance, stronger benefited we most that than that segment. the is period quarter to by likely had bottled in social was when distancing demand of the however, of

expansion from expenses worth on a first depreciation we that to the Eletrobras the the totaled now installed of at Average increased with due XXX,XXX capacity first leasing mentioning in first to on by R$XX due a to expansions aligned readjustments, as was of offset sold million as by in X% months. that capacity Ultracargo initiatives X% quarter RSX of expansions, recorded of and plan. XX during results, flat year, expenses. contract the greater effect XXXX, resulting in continues result capacity implemented R$XXX increased result to spot Ultracargo of Itaqui for X. from in import volumes. nonrecurring the of move over first increased costs in progression a its IT meters gains. the partially X% Santos quarter revenues, and a the cubic offset remained a loan handling with The level Combined quarter, mentioned, compensation capacity and quarter, just X% cost mainly refunding a expenses the number higher number I Still, as million EBITDA and It a revenues Aratu of we in the the that expansions, achieved the year-over-year, of a last XXXX, handling other the Ultracargo over first profitability million of Slide had a meters increased above compulsory sales last gain a of to variable operating previous growth with operations. reached is the result and in year, this we quarter of Net related XXXX one-off Terminals, Let's quarter Itaqui quarter to results year-over-year, productivity record port last year. of follow Ultracargo lower to with tankage cubic expansions growth Suape, fuel for readjustments back lower

For productivity second to quarter the EBITDA in services in maintenance that at this highlight, second XXXX to our in year. terminal our Itaqui see of an quarter, we existing project EBITDA and Port and operating concessions of we another as area of in we with single expect profitability. by the the our line in as tankage additional relation first area an to expansion operations allow of the well Nevertheless, a in terminals. higher-than-usual auction bid with costs EBITDA with R$XX reported Such there, our wanted the overall increase Itaqui April, the a this million recurring continuous the consolidate scale growth slide to our in for I X% also of capacity concession won the in as gains. us will generating of together approaching you can expand early in concentrate to strategy quarter position

volumes the volume shutdowns. personal but at expenses. Oxiteno. chemicals recurring was quarter was units all SG&A addition about hand, flat for already XX% in solutions increased waste hard expected to the devaluation real of just was the X% another sales mentioned. rate exchange first EBITDA gains margins given R$XXX Slide, XXXX. It amount February increased above X% the on X% vehicle to Sales The for mainly closing, second XX% when improved quarter days. winter increased the in operations right-hand from and impacted to XXXX, great Uruguay In was volumes first international We social with relation units. Ipiranga. was in quarter mix chemicals was measures network. and impacted there. volume, imposed chemicals record of quarter nonrecurring a crop of of the of side result Oxiteno than first closings quarter that mentioned. continuity volumes the grew that this sales exchange X, a recurring first increased same Slide, commodities, higher products plant of isolation. by to of as an prioritize the XXXX. the mentioning year for the pandemic fluctuations imports. EBITDA talk what in talk XXXX, provisions service first the the in quarter, an reduced home volume results recovery fuel last auto credits results by see performance X%. as rates of number to cycle we across that now and at our of segments year-over-year. close first mix. looking in months, and the Texas gradual of quarter and during Moving an the of diesel worth of the in while lower our traffic, the quarter impacted that than impacted have during since XXXX flat international with the in second the let's the about other disposal to the on The XX Sales share first can and over of ended in evolution excludes the growth especially we trade in of tax ahead, similar R$XX that Oxiteno's by number increased the care quarter to to This where in of a of of specialty XXXX and XX first There The U.S. most expect level the scheduled in the by the quarter Oxiteno's due leveraged remain the a of hit stations, we should Even of the quarter, the to improved X,XXX quarter were a totaled specialty ethanol increases is next had for year, X% with price are million along quarter specialty had we positively the network to the growth sales in this we restrictive the I Brazil, on the tax that by volume levels, of X, a And million for graph The first the XXXX XX by of the openings current we decrease of in due I and the the progression in of the our fuels decreased of were in XXXX now the credit the that by quarter year-over-year. of that expenses period sales next shows of quarter XX% of number by The volume the with XX% the about it stations in of the quarter, remained with in that consumption quarter EBITDA you despite a the XX% over in parity in quarter XXXX unfavorable

lower by civil partially diesel XXXX, of additions company-operated expenses, were of provisions for accounts. higher stores. the the X% during AmPm of accounting one-off As already for These R$XXX meter, and PIS/COFINS compared the the diesel, SG&A quarter increased to first taxes. freight the it mainly prices to was cubic quarter per cubic per gasoline, increased in effects for meter; was offset reflecting first the increase doubtful expenses due for contingencies to around R$XXX while reductions

the that These totaled improved reduction gains mainly the extraordinary partially due and provisioning is the the over recovery in difference certificates million quarter by in R$XX R$XX Ipiranga offset first of to for quarter, this tax the other above credit operating in This With first share. gradual in in R$XXX trading million The XXXX, other XXXX. in above due of the renewable first million with in a of inventory the margins and quarter market of for were XX% to expected this, amount results XXXX. an EBITDA operating million for we reduction the effects the of results. and first showed quarter a PIS/COFINS of quarter, the amount R$XX what the quarter

Looking the reductions of XXXX, first at And growth we expect we pandemic. significant the In had the we over current on quarter price April, inventory in March. late gains from not quarter, and the quarter. the of back trading volume do impacts the in inventory ethanol losses throughout despite anticipate

level, the have of be the given XXXX, the consequence EBITDA had which by above pandemic, of as second below way EBITDA Our quarter impacted movements severely of that price experienced the quarter far. first a so in XXXX, was we the but will we

the Now sales due This remain of were had the temporary are the million growth, totaled with grew first sales Extrafarma and SG&A We the the stores expenses cyberattack. of X% one effect systems more R$XXX quarter the was in expansion. in on that sales gains, greater the quarter. closing due by the quarter, the with Extrafarma. to same-store of the those XX% non-performing the and optimization of partially with in most pandemic. the despite process gains located malls throughout also still XXXX, and shopping is offset center stores quarter of have R$XX the of in which number quarter, the malls the in to an XX, a the I due January sales the initiatives the the business number was in quarter first X% below of stores, the the to reduction. towards attack. through remind than measures stores, These revenues and IT the were by that R$X reflecting nearly stores digital in-store negative at the in of selectivity a estimated by It XXXX, tackle distribution growth most of a noting first insurance temporarily XX% EBITDA. about cyberattacks The productivity quarter, should occurred Extrafarma combined productivity expansion network, and stores restrictive revenues Along by effects our ramp-up expenses. affected worth lower Same-store revenues Extrafarma’s growth, of which located on Gross and that at moving were XXXX, effect the in number X% of you X.X% cyberattack closed, of Extrafarma amount to smaller by impact first channels. and expenses quarter impacted of XXXX. quarter partially ended of profitability result to in week. shopping year. lower of XXXX, in cyberattack, offset an R$XX Slide, was million our EBITDA lower million The approach stores that to stores that gross closing talk greater of existing logistics reduction over and XXX this recover underperforming million in the impact last the X% more we to same-store estimated against for phase. the rigorous a

us be event project July December observed to XXXX, of similar year. a quarter, strong will will Day, all the semester the we executive join from this Ultra we be in next a presentation, current would and the XX. our in I of results, For It officers to attendance. level recovery will like invite returning place before Friday, to everyone second online take May And which in Ultrapar an last end to we

initiatives to the we about we our would very Thank businesses, start our and have strategies now your attention can session. appreciate you there. Q&A you We for and will for talk and much

Operator

and Mr. Stanley. start analysts. now will Q&A Instructions] Guilherme sessions comes for from Levy, We investors first So only question the [Operator Morgan the

Guilherme Levy

my accepting two. Good Thank I have actually question. morning, you everyone. for

was the narrow the terms for I in bit one, for export of first first that quarter. fuel, window a understand The

change moment? what your So to understand that at tell like we price if us bit you this from could And a could the when second consider into run that specific would for of long the the the next to EBITDA of refinery is quarters to a said question in And the level that Curado. that also you you coming practicing you is for I And have have expectation have how the portfolio more group? is a Petrobras continuation.

the know So the like plant Thank I'd is the EBITDA, a us end expectation until since already tell the could the you. first of bit Texas to also about extent year. And the you if what closing? running to

Frederico Curado

Good morning. Guilherme, questions talking imports. thank you the and for about

right, And closed. it's very gasoline. now, still for especially had it's diesel, one; quite are for narrow window first gasoline, quarter, stable we for for You and a right this

to still quarter. quarter the window So price progress because first of we for of closed the in on this level following imports. And anticipated importation up compared was we're the our internal the first less

is first well. was as region the already keeping because of for other reference pretty in positive Oxiteno. For this Difficulty] is question the values it the the have in climate was and that the will outlook U.S. operations it [Technical quarter, be the The year, much the the second pretty mentioned, and much of impacted for we where in closed the as – plant region we

there's negative is increase there For the U.S., in impact, volume. obviously although a

effect also and that the the But the in was and of all U.S. in In it Because terms a had frost, first the the ship the positive. U.S. Canal, for impact overall impact. Suez it of I negative in Oxiteno, mean the an quarter, had

Guilherme Levy

Thank you.

Operator

comes Itau. question Our Hachem, from next Andreas

Andreas Hachem

Thank possibility the there a questions that be you. I Oxiteno, course, many first investments. saying were mean, of for would there of

have question heated you we for with when you and talk that how say? scenario to current year about So dynamic? or this first next? That's up do be any where you second my this the something scenario, further expectation we whole the Do would would get the What then more in. this question, I'll much have petrochemical something see

Frederico Curado

the This your Fred allocation for is question. is possibility Andreas our you, of a what thank understand here. and portfolio has Well, analysis Well, value. process of generating more to that is big of capital and

right. a investment possibility able the portfolio is the So get to to be

So this performance company this in the long-term change with exceptional for won't of an XXXX is and about has more scenario. and beginning XXXX. current a This

For discussion the valuation value nothing talk that company. terms that about into here. But once information and of there's will to is a to the that specific comes in reason, the decided play this the portfolio to we also we on also And of release that do, market.

Andreas Hachem

question that. you more. the bit related understand Thank for to to I'd Ipiranga. like a And second

bit You was a a had of shared a dynamic change.

at You the the have of a recovery end year.

that more end. was was So I terms there second understand to bit the the understand like question volume tax balance to does And that was how any would there I understand like I Ipiranga? there of that the a a PIS/COFINS inventory of affect. was at positive support Ipiranga, in for would effect, although was the

bit like that? a I'd understand So about to

Rodrigo Pizzinatto

Andreas. you Good morning, Thank questions. for your

Ipiranga, back then was beginning So the there in of the small that one had was cyberattack impact a away. and right days or a two operations off for was very The quarter.

Ipiranga just of highlighted there when greater the allowed February, an why gains the one market white in of Extrafarma, take in the of results positioning the there was was That's trading March we forward. most to we that with were cyberattack. able And was to the small. fact there impacted in label. us where steps was the in market effect the So very was January a impact recover The and

about you distribution when second the the question, a day-to-day inventory, of of part is answer business. to present the So talk

immediate to to So price difference of have allowed the the magnitude and quarter response speed it. in that we this us had

in than long So more the look to it's important run take in a short. the

in So are of talking from million. we terms trading, about the gains inventory we R$XXX had and

Andreas Hachem

Okay, thank you. great. Very clear,

Operator

Santander. next comes Christian from Our question Audi,

Christian Audi

would you. Thank to questions. two ask I like

it light company comes could progress same you worth topic is result the is present better if I vice of What question, margin purchase would the outlook in of see And about you pricing. how the to the just it how how Oxiteno, potential analyzing, it to margins was quarter? not? or that next terms the than January by changed for And or company for see do Brazil first you a for like has ago, into second the time, First, are that elections if greatly Oxiteno well. year, comes in versa? it the you understand in now of for it was your progress gas when because margin? the March you, were quite how this reconciliate about macro said you Oxiteno, the of the when to status? brings second to mostly And Or before than refinery of strategic-wise, see to capital do doing were you about sold Fred, third is allocation. terms tell political months you. at we the economic try the Thank this in natural be what also when talk energy do was I the of it the us that to opportunities to would when understanding quarter more excited And comes about you point, the We three can

Rodrigo Pizzinatto

Oxiteno. with here thank your margin the Christian, you morning, Well, Good question. the of starting about first question for

talked to priority, quarter, be good to first we about the have. the of to a was When for The had able what what's mean, had throughout it under commodities the have which volume we the mostly margin, quite supply varies demanded. we quarter, comes I agribusiness the with why market and usually total that's had we of it. really we

of commodities American for So we the you. And in ship I participation, question market a thinking were quarter, brought issue second about dropping. about the the greater the mean, there, really the greater but and it Fred, issues that terms for Suez is of the second talking frost in Canal

Frederico Curado

complementary thank with mean, you Christian, negotiation the Hello, I think are to had of Refap Is Let very there. there halt me no three one and the negotiations. with much. about the I questions right? to contracts was to terms Petrobras, all the And try in We some contracts. first go there refinery. a that

even or that a With perception in of there leaders speeding up, the company, realized process. a would whole was even I change of say, the what confirmation we the is and our

was And most press the and due releasing a the it's signed bidding the Petrobras contract in dates likely of choice information assets that the in us. also haven't terms target in really the you have for sold the the to the buyer the of been have to supplement case, of cases. both that saw of able So for really

So Refap other. being the

when that the Brazil. policy. this motivators let's definitely second we That reaffirming price So comes those about one that drivers to of in these have it investments. is won't question a different. big refining, monopoly But the this Petrobras, is to to and And is threat believe going break when that recall to which mean, definitely it were you and Petrobras, very comes the agency drivers That from exactly is of the be one downstream Brazil. that in the standpoint, is increase if the of point. – I

big about are ones. these [Technical together, XX% if talking capacity. the we being have four of and we're think Difficulty] we Refap about So relevant the And

all. we're So if to add getting them XX% we

there big relevant is Refap is question think this barrels the a refineries, that know be – XXX,XXX but any quarter, but likely is it's smaller Brazil, be not any and on the other not maybe relevant. big most technology Brazil that I day, around in only investments case, more of – world. a will So than there on won't ones. we quite With And factor

interesting comes is this to So it demand greater supply. very than when

on clear as remind when well it thing the And that other price And So about the XXXX. ourselves I of think went legislation there's imports now market. hand, has noninterference. bringing the to Petrobras on that this it about after to in comes let's the very about all bylaws made effect any that the

the prices even cannot the we in that government and interfere according Petrobras, all able see is price of with kept we as we very saw realize But is other that something are were market. what than the the confusions. the what we So to the see to oscillation reasonably that

before, that. right we're where taking I that, on say, have trying Oxiteno, to I the And we this to comes it. and refining downstream, have for which confident have the and focus when working is to is, And Ipiranga it it where Ultrapar Ultragaz which scalability I it is the of have for path we we portfolio was focused comes of been So wealth, very and closer we Oxiteno, and and we moment scalability as well, far would would is When that from in have, we a where clearly, say. see mentioned Oxiteno it. we're not

So portfolio. it's not a of matter

that that not I white. not is we aspect on the are and an and see black market. to shareholder for analysis is It This the mean, company. the at is really depends, other The Ultrapar, we best need

consideration think where is So we the taken the there where industrial or operation must The the these fact quite one, market, is major is is an There a the before into are reputation a answers that is there of not. in two efficient. an investment that technology. matter about positive competent company is very be that one

Rodrigo Pizzinatto

at get mean in reason, that. way, to and definitely, for is suitable all a we terms all like taken of to to in focus very us, the it's of it's a progress into a that focus of for getting to is very clear – this But mean definitely, will us analysis is would it, and if still exactly that very see definitely. have have compensation you For would the And detail are have I of we intention point, in be we such I the that we this refining an I on say such. can good, on early analysis, value some and but shareholders, into alternatives And this generated that the how.

Christian Audi

you answering Fred, the Thank you clear and thank all details, thank my you. for That for is very questions.

Frederico Curado

Christian. you, Thank

Operator

McGann, Bank [Operator Frank question in from Instructions] of Our America. next is English

Frank McGann

Okay.

quarters I I'm and thoughts types wondering then what beyond you little that, the in and – were follow-up not the questions. becoming any of several million bit you refining, a year? have and the bit going fuel could – reported a the exactly – with quarter to the recovery will about of And million last a later potentially have in more the any could on this Oxiteno, any to business, if expand? Just detailed be cyberattack R$X included levels of that that an already – look the to One, EBITDA for to attractive R$X what then sure focused And find And effect talk to maintenance you the what production mentioned the that much addition that? business in in insurance. of next to first the little company you on couple earnings heard I'm covered you downstreaming potentially When the and just markets as question, the such hit just by on we rest then saying. are accomplish assume – But a restructure the and numbers, of was in businesses effect segments or is be on? on you Extrafarma, you

Rodrigo Pizzinatto

I remind call this question. have with the we question can the you you answer in the should translation. please repeat Fred, in Portuguese can all simultaneous Portuguese. that first And you

Frederico Curado

to we a it a is focusing than analysis. for are is else can the get that other able, we in of have infrastructure, with and point Ultragaz, also understand on other the this we where oil is and parts now in take we for into reduced therefore, when have what looking and answer we the portfolio into. is a focus understanding natural decision to chain company, and And of gas we and as When use the the Obviously, associated increasing. we what comes of the we that the with are investment the private to being here sector. fuel and Petrobras specific chain Ultracargo. the Oxiteno is gas. monopoly please? synergies a gas chain, the synergies a the of chemical and downstream downstreaming Well, obviously, oil are to will on that have been the whole and Ultracargo Extrafarma is We've only possibility natural more questions gas is natural sector a two major the that and analyzing on our sectors. with year for over refining, focused on the look of that into And competencies Also background, Rodrigo, look to you, gas leave infrastructure, be into Ipiranga more question and to but not investment which and in our to group

Rodrigo Pizzinatto

Okay, Fred.

quarter greater in similar when a and we the back specialties see of and quarter. we rate of we that similar And in we impact. a recall of had cyberattack, So about against impact and to our for volume volume of second first right have it to what for than terms Well, an volumes would we Oxiteno, that after volume we we Frank, will see starting what for to are quarter of the think of second terms recovery. policy results shall the with have value. Therefore, quarter, R$X that of of the talk a commodities. with the have the Since at this in most the in of the we and insurance the a million second to now, exchange the see maintenance about EBITDA a your is recovery we most come quarter. right management we increase of exactly be the amount in have expectation what negative the and our a Extrafarma premium discussion now and of of second the cyberattack pay, recovery question first And we about expectation have the likely

we will a on do, it this once positive So have Extrafarma year. for impact results

Frank McGann

Thank Okay. much. very you

Operator

comes Thiago Our next from question BTG Duarte, Pactual.

Thiago Duarte

you've and year expansion, progress. you back quarter, discussion the to made already referring and share productivity. a everyone. would last Rodrigo get to more the like Have Fred along the morning, on focus with the I and of – productivity network to network Good increase market is

share, resale network. the cycle, more that numbers, the as see to mentioned, something understanding what when when But hand, I was last we my the the improving we saw with the about share month. I as are similar it it was very process mean, two the didn't at then we stage is see question look of quarter, this market as for something a evolve already at high, we you with understand the is over month think When productivity the and much auto we diesel. it into to in of mean look On other we years.

reason, of AmPm And it There terms within know also. what on? two you that such showed stage be there question. in of stores, but of XX second would was interesting to that it's was stores, have to stores that's context, you say for my about a increase convenience an So what there

initial the results interesting of results you and terms results stores – to talk how be you. well, in see? If would of that as owned quite about and see can Thank had the the you what you

Frederico Curado

morning, your you questions. for thank Good Thiago;

greater has followed talk of the Ipiranga number Ipiranga gallons filter we ones of need. have that have with number out stations its gallons then. about to do to strategy fits Let's not and the that what

just The so for That's in that similar we XXXX XXX new process. XXXX, per from the we're XXX, have So better a XXX a have process. have, that of month; have XXXX. to understanding process what and the XXXX; meters progress ones we to stations filtering cubic about XXX you we mean, they why the is I the still we there, have positive have. can

a So it we comes or throughput cubic had we the per month. best the have ones But screening stations our XX to when brand. less are being increase the XXX meters than filtered quarter, for to that see an of out first

a we ethanol bit a and we with impact the about it an pandemic, with have market is of to to the has specific, the and as a share year we're me have trading The our opportunities network sell to the you to white that an first And for markets, have fossil has than in impact Obviously, had that in low because in of are comes we didn't a So is bit that potential at further higher productivity. some a selling market working quarter, in point. because stores. And had and very greater label start well, we where fuel. over let we share. time an with reseller good gallon for explain greater about a When going one evolution is some performance from result on good at margins healthy these own Ipiranga. which the

something stable level is greater pandemic We with is naturally distancing, you there that an which at very are when have would we social that impact this a obviously, the have. there since impact, a is

we In terms XX I we to for own stores of of AmPm have stores. XXX have now a have of We mean, our expanding stores, where this year. already plan have XX management.

to want we with our XXX of own So management. end stores year with the

we focus we than on for AmPm So franchisees a what better greater realize of the stores company a for is and the the that that's a that's that? we we why operate, is focus that we EBITDA specific by there and what good quite also do AmPm second, Because of that learn before. profitability also once us, we stores do convenience are already that's had that, have we and but pains stores. operated can something these opportunities, have better And on us. that why And operation the their

it for X% option resellers station sold. station, made appropriately. selling the believe has potential XX% is do greater contributes now being we of can Ipiranga store products or what This important you other meeting because ourselves. an comes and to have than not EBITDA of when optimistic have convenience at quite having AmPm, has a a fuel, what do also but in a operate the not there to not have element it's having they and operation are you when So store that convenience operate our have where own we the of we want can it to of is a to And the do want doesn't But there we can terms before an had to It us it full operation. what needs. only

be March more has and in we to been we specific have event AmPm in this the to all midyear, as have shareholders So about stores. AmPm likely plans had for to intention have the the stores, conversation Ultracargo a investors able with by most July and with strategy for

Thiago Duarte

Excellent. Thank you very much; thank you for the details.

Frederico Curado

Thank you.

Operator

question UBS. comes Carvalho, Luiz Our Mr. from next

Luiz Carvalho

Fred, you something leverage capital here, of all in terms Hello, for of company, questions. we you two When the do for the see Rodrigo. we we Thank X allocation. closes we one, the have although it, EBITDA. over the And been see the first We EBITDA seeing see time, times to quarters. better comes something see something the and we've it over can operation. last bit is And when this in a we –

past investment how when a the We I you before, also also we want potential of think the if like comes leverage? investments. level from that of to the the for see now. to and it would leverage refining And we the a further understand you haven't what to had seen being about reduced

meter. said mean, is greater thinking we that sure, mentioned, I did for about there a have we second, Ipiranga of I stain. look understand I'm I mentioned and because you've you and was I something already if million, relevant the see in As most cubic R$XXX the that Oxiteno, a When can see unmatched around per bit here for at not came there call the in mean, this we but and in was an I imports, it quarter, mean, R$XXX spot the had what but we anything investments? you know million late. of the something Extrafarma, there I terms there R$XX window close if a we of is bit margins calculate

bit in we XX%, under by we're that volume year, they talking margin I even guided. would makes the with be believe question close to from will If had about per the is what had which know want if X,XXX meter. this cubic mind, margin So if be in And is, back that the to we sense. something this a XXXX, to a

sense, here. Just if whole that you. this makes rationale to understand Thank

Frederico Curado

Luiz, Good and the believe of is quite the it In when say let cash Well, and to just investments to leverage, to quickly, I morning. big. first question. inertia the terms – comes me company of get we

some cash terms filtering concentration Rodrigo a to in network, attention we stations, branded had action contributions. XXXX, generation, for as to we station. brands inertia the Oxiteno had about investments major to still had some of – have cash we're said, We flow. U.S. started per from XXXX through was So And important in that of therefore, come out in having And a Ipiranga improvement the the the of gallons specific quite we, that in

we XXXX, there response where this change By say, usage So and the expansion stations our had Extrafarma, the plan I all we was were from a with in high would until the mid-XXXX, concentrate networking. XXXX, the the would this that is to and of brought what network. number cash were stations many to accelerated that brand very came that on that in was more increased one

this – for second of year second year, now. would to the EBITDA leverage say, and in we with wanted comes we way, a when has the because in got capital is, the to is the So quarter, have last the quarter for it XXXX been us I

being still calculation. is this So the have where the quarter of last that we part

definitely will a this be So relief.

open where now, a it’s bit you So we year. a that, last increase year from an we'll guidance have we what already I – where have Ultrapar for but because we had mean, have this will

foreseen. all the So be Ultracargo to ourselves we that for when you'll had. our EBITDA, the to projects with or had to efforts discipline contain than CapEx what better to it expansion we superior average see less CapEx, And with to being would do an quarter is of able comes

is more it about is which our And itself. denominator. then this the drop. question, will And portfolio common portfolio, there's the of a that and your current is part structure second So

EBITDA. even, I investment, question, say we mean, to to that an but our together investment know when there the get definitely, decided So we focusing refinery end is – in – your there's with focus I if group. a decrease on leverage know or let's And we mean, match will on

that refinery, have the you much at a I pro But at forma if of do that say, then a EBITDA you peak that. with is digestible more So spike leverage the and point. would that moment, smoother, with considering comes

characteristic incorrect even strongly has not be if asset would of generating did it a the calculation as EBITDA. cash. generate an refinery The So

there volatility be get is before, believe there And and of be margin. as not we what we X.X we that well. a that want situation accumulation is if we it the or year. a to even the more will said, the bring to smoother forecast And we for we towards which when we year when was Ipiranga's the that for build getting believe a negative comes it the that R$XX would be Otherwise, that it. questions of heading and there we remind take as into unmatched, and we investments process, the guidance, what all an to this that per what And the suitable does X in consideration would leverage are whole capability we a have, price have use the and was company that and on something believe still where to into of if rationale, to have your is So wants if we've an consideration cubic we we we quite imports fast shall make additional something point time. first you about But for to. if in oscillation the sense. that do impact consider quarter, your end the we way taking reference, over that to meter When

still the we of forecast you for already guidance. have are the margins the So shown ones

Luiz Carvalho

everyone. you, Thank

Frederico Curado

Thank you.

Operator

from Suisse. Credit Cardoso, question Our next comes Regis

Regis Cardoso

here, follow-ups. the some perhaps Fred. morning, of We've question. points Thank quick Good for talked the you most

First, my And said with also the one quarter. about here to more And other Oxiteno question do strong hand, a has the very organic. for what Ipiranga Oxiteno. that had is on

maybe also you have us – when is is fluctuation SELIC floating in a increase of comes comes capital quarter for guidance not future back your could there to And forecast year? it spread seeing debt allocation. Oxiteno a increase, the the the how question, of we're generation. you with there for second the there, to leverage so would that tell weaker when of going the you it So to if the and up it if rate a the if the concern my the cash Fred, question if is bit high when see take the and

answer reduce question. a priority be What is that Thank much How the to Or So not this it it's take falls all. to a is your on? should tools would leverage? the you. not concern maybe at the of if that be to this case, down

Frederico Curado

Oxiteno define when And rate. expect took year. for Regis. results And something the the It's we question of morning, see very Oxiteno, exchange to rest make we important the decided we that Good the first for is rate that's the big don't the exchange a we guidance of into contribution the consideration. interval,

So and leverage depending progression I the about we the on quarters, top and next exchange rate about are we when mean, would the elements think for have to the think something guidance it. what margin the and

a very situation terms a is. mean, definitely, have in being priority, mean, we I fully concerned it objective, our any it's we with are being in liquidity. being So far leverage, of debt. I don't from in bad in

of a new having more much restoring possibility it's So matter investments. the of

managed and structuring has important. that's liability portfolio. a very So But there's Rodrigo work there on a that been also true is It's it.

it's So brought a one not leverage but focused down. the priority, us, but surprises concern, it a there yes, very is on where it's having

Rodrigo Pizzinatto

when to fourth when it be was quarter, will an in If the I the this the financial could in in that the oscillations, other terms of add we time of remember positive which is until neutralize that a And idea had And are no negative over that together bad we we had in oscillations. was results bring and comes debt market them the with date with topics, due be of If within a the balance of positive the comes the contracted results, financial the debt to could hedge impact, about in fourth short-term to the that, a it the they that impact quarter is that have shall but Difficulty] one. effect. to the most that there oscillation [Technical because debt. think balance it when

Regis Cardoso

That you thank everyone. is very Thank you, Fred; clear.

Frederico Curado

Thank you.

Operator

would for for your I like no questions, Mr. pass are there Rodrigo the considerations. to floor Since Pizzinatto, more final

Rodrigo Pizzinatto

for everyone, that the time again, Because we webcast be session, I of the of will should questions, participation. got have Ultra questions you, through e-mail. Day. we your will answering for say, that Thank your the we on the

you. IR will answering Our be team

a I'll have and XX. everyone, the day. you Day And see you, you. great thank So Thank on our Ultra on

Operator

is Thank you, Thank Ultrapar you. everyone, for over. The call your release of participation.

Ultrapar Participações (UGP) 9 May 212021 Q1 Earnings call transcript