Good afternoon, everyone. Thank you for waiting. Welcome to Cosan's Earnings Release Presentation for the Second Quarter of 2023. [Operator Instructions] Please note that this presentation is being recorded and will be made available on the company's IR website at cosan.com.br where you'll find all of the resources related to this earnings release. You can also download our presentation in the chat function, including in English. [Operator Instructions] Please remember that the information included in this presentation as well as in other that may be made during this call regarding Cosan's business outlook projections and operating and financial goals are based on the beliefs and assumptions of our Board as well as on the information that is currently available to us. Any forward-looking statements are not guarantees of performance. They involve risks uncertainty and assumptions because they entail future events and therefore, depend on things that may or may not happen. Investors should understand that general economic conditions, market conditions and other operating factors may affect Cosan's future performance and lead to results that are significantly different from such forward-looking statements. Today, we have Mr. Luis Henrique, Mr. Ricardo Lewin and Ms. Ana Luisa Purina with us. I will now turn it over to Mr. Ricardo Lewin.

Good afternoon, everyone, and welcome to Cosan's earnings conference call for the second quarter of 2023. Before I begin my presentation, I would like to emphasize that we have been continuously working to improve the disclosure and simplification of information in our material, providing higher transparency and better analysis by the market. In this quarter, we have revamped our release to provide a better and more detailed analysis of Cosan Corporate's earnings and cash flow movements. Now regarding the main highlights, once again, we are presenting a robust operational quarterly results, driven by strong performance of our businesses, which we will detail going forward. The pro forma EBITDA progress is an outcome of disciplined execution of our long-term strategy, which provides a sustainable combination between organic and inorganic growth throughout our portfolio. The group's investments have advanced in line with our annual plan, focusing on efficient maintenance of the operations and on the structural projects that we'll in the next expansion cycle of our portfolio. Regarding Cosan's Corporate net income, the growth is explained by the business performance on the top of the market-to-market of the total return swap of Cosan shares and the positive effect of the perpetuates -- due to the FX variation. In this quarter, as part of our liability management process to optimize our debt profile and capital structure, we successfully raised BRL 4.7 billion, ensuring liquidity for the company and guaranteeing the amortization of Cosan's debt until 2025, including the first installment of the color financing in October 2024. Moving on to our ESG agenda. In early June, we released our 2022 sustainability report which introduced the ESG Vision 2030. Moven Raízen also published their reports, and I invite everyone to read these documents, which are available on the company's website. In this quarter, I'm…

Before we start the Q&A session, I would like to hand it over to Mr. Luis Guimaraes.

Good afternoon, everyone. Thank you for being here for our earnings release presentation for the second quarter of 2023. Let me speak for a couple of minutes before the Q&A. In this quarter, we had a number of highlights as Lewin was showing us. We had very robust performance from Moove. We're growing. We have good performance from Compass and the land business and the renewable business with more productivity and the reduction in production costs compared to some of the biggest players in this market, which have already released their presentations. We've had lower costs than them. As low lights, we had our performance for mobility in Brazil and the performance of Vale III stock. I would just likely that as investors and shareholders at Cosan -- as controllers of the of these, we have to take into account performance from different sectors and different parts of the company. We're now going to hold a Q&A session with myself, Marcelo and Lewin. Thank you.

[Operator Instructions] Our first question comes from Isabella Simonato, a sell-side analyst from Bank of America.

First, congratulations on this earnings release and on your transparency. That's really helpful. My first question is related to dividends. I think it came as a surprise to us to see the dividends from move in this quarter. Moving forward, do you have any expectations regarding payouts or regarding this kind of flow from -- Are there any expectations for the total numbers for this year? Also Comgas paid off dividends, but they are still at the early stages of Compass. Looking at the transaction that Compass announced yesterday, what are the expectations to raise Comgas dividends to the levels of Cosan in the third quarter or maybe even in the fourth quarter of 2023? Here's my second question regarding the land segment. You've been able to monetize the operations, but could you please give us a bit more information on your expectation for portfolio turnover? Also, what about a potential restructuring of the land segment? Could this unlock value over time?

Liwin and Marcelo, could you please answer this one?

Isabella, thank you for your questions. Let me answer the one regarding payout expectations for both Moove and Compass. Actually Moove didn't come as a surprise to us. Moove has been getting better and better since its acquisition. Please remember that this asset had an EBITDA of BRL 30 million when we bought it. We made progress with this company. In the last quarter, we had big earnings for Moove. So the last 12 months of EBITDA are over BRL 1 billion. So for us, these earnings in this payout are not a surprise. Regarding payouts in the future, of course, we don't have any specific guidance for that, neither for Moove nor for Compass. Of course, for Compass, we have a big, big distributor of dividends, and we expect the same to happen in the future, but we don't have any guidance for its payout. Regarding the land segment, we hold stake in 3 big companies, Radar and the funds, TELUS and Genus. Overall, as the sum of it all, we hold 30% of the sum of these 3 businesses. We look at land as a big portfolio for the most mature lens, yes, we think about selling as we did in previous quarters. We sold a piece of lent called butanol. And you may remember that we talked about BRL 500 million. We also expect to sell and buy new land. It all depends on the level of maturity. Now when it comes to any restructuring to unlock value, I don't even think that's needed. I think value is really clear right now. This land in this portfolio is worth over BRL 14 billion, and our share is worth over BRL 4 billion. So its value is really clear. Also, when it comes to monetization in this quarter, we sold land in the state of as we mentioned in our earnings release presentation.

Next, we have a question from Thiago Duarte, a sell-side analyst from BTG Pactual.

Here's my first question. It's striking to see your funding during this quarter and the cash position you've built. So it is only natural for us to wonder about what this company is going to do. You have a number of options. You have a number of triggers in a relatively short term. You have a due date calendar for your options and for your direct stake at Vale. There's also the cost of preferential stock in Raízen. Meanwhile, last night, you also talked about a new share buyback program. So I think there was, and there still is this expectation that this company will go into the next quarter in a deleveraging cycle, either because their investments are mature in subsidiaries or because of reducing interest rates or because of options that you're building to allocate your very robust cash position. So of course, I have a very broad question, but also a very relevant question. What can we believe you're going to prioritize in the future for your cash and location? So this is my question. And I have another one very quickly. You had an EBITDA for the cash -- for actually the land operations. How is this EBITDA connected to the appreciation of this portfolio for this specific quarter.

Lewin, you're going to lead this call today.

Yes, Marcelo and I are here. So let me talk about liability management and Marcelo will be talking about capital allocation. Thiago, this funding is very specific. You know the Cosan Group. We've always, always cherished liquidity, especially before a volatile market. I believe we took the best advantage of our domestic market and a small window of the international market with BRL 2 billion in debentures or bonds. And more from the international market. We also had the 100% swap operations of our bonds at a lower cost than usually. Our swap was around 116% of the CDI rate, which we believe is a good cost for the holding. Some of this money was used for liability management for bonds for 2027. So we're talking about $100 million to $150 million. As you can see in our presentation, we were able to postpone our towers for 2027. So we were able to postpone our debt. And we're able to face our next values that are -- We have our backlog debentures. And in 2024, we have our biggest towers. With this money in our hands, we have options. Of course, we can pay for these 2024 and do liability management for our debt, and we can unravel the core or we can get to 2024 and actually postpone this structure. So we have these options now. Finally, please remember that some of this funding was used recently. After we saw our earnings for a small settlement of our core, as stated in our release. So we settled 20% of the first installment of our core due in October of 2024. So we have the option, we can make the most out of different momentums in this market to get the best return possible, and we can undo the structure that we put together to buy Vale. Let me now hand it over to Marcelo to talk about capital allocation.

Thiago, Lewin talked about many of these points that are related to liquidity, but let me stress something. First, by undoing the color, we did something that was important because this was interesting, as you can imagine. We had this option, and it made sense for us to undo a part of it. We're not necessarily going to keep on doing it. But in case this happens, it is very unlikely that right now, up until the due date in 2024, it's unlikely that we're going to undo more than the first share, which is around 15% of the full color. We don't want to do more than that. And we're not necessarily even going to get to this number. Of course, when the cost is in the money, it's appealing to undo it. But since we've always strived to create options up until the point where we have more clarity on what we want to do regarding our stakes, this is going to happen gradually. So we shouldn't expect the undoing of very relevant number in these operations. So I would say that the maximum would be the first installment due in 2024. Now having said that, something really relevant, which draws questions is our funding in companies from public equity because right now, we have a window of opportunity to take advantage of. We've clearly stated to the market based on our last meetings that we are not interested and follow on right now, the IPOs for Compass or Moove. We don't want to follow on both of these IPOs for 2023. Of course, in 2024, anything could happen, we could prioritize something else. But we have a capital structure in these companies that simply makes sense. We don't need more liquidity. They are generating cash. They are surprising us positively when it comes to revenue. And one of our highlights is Moove. Moove is going above and beyond our expectations. They have record highs month after month. So we believe this path is very positive. We don't need an IPO this year. I want to make this clear because I don't -- I know there's a lot of speculation in our market regarding this topic. Now regarding that, as Lewin was saying, we're making the most out of our windows so that we can address our needs. And so that by 2025, we can have addressed everything else. So we don't need to raise any more up until then.

Thiago, this is Anna. Let me answer your question regarding the land EBITDA. As of last quarter, we opened our P&L for a length in our release presentation. And you can see a line for expenditure, which was BRL 82 million in this quarter. Most of it is related to our portfolio appreciation based on an EBITDA of EUR 190 million total. So can I assume that the other in other revenues is majorly coming from land appreciation. Yes, you can.

our next question is from Gabriel Barra, a sell-side analyst from Citi.

Let me follow up on the last question. Marcelo was mentioning the IPO of Compass. We've seen a number of questions regarding this and the possibility of seeing that this year. I remember that your hypothesis at Cosan had to do with making our structure simpler. And making it simpler also had to do with listing these companies under the holding company. I understand what Marcelo was saying regarding 2023. However, what could trigger this operation? In our last Investor Day, we saw some food for thought regarding how to do portfolio management for the holding and the little boxes that Cosan is participating in different businesses. We can also think about companies that might go private this year, and this could be a trigger for that. For example, we can think about Compagas. So what could trigger the IPOs? I know it's a tricky topic, but if you could talk about it, that would be great. My second question related to Compass, is this one. please talk about the progress with TRSP with the São Paulo regasification terminal. We've seen information about the mountain area and we'd love an update on that. And finally, if you will allow me, something you also mentioned in the Investor Day was partnerships. Could you please give us an update on that? And if we think about the long term for the company, these are really important. So I'd love to hear an update.

Thank you, Gabriel. This is Luis speaking. And please, Marcelo, feel free to jump in. Let me start with the second point. When it comes to the São Paulo regasification terminal, we're doing really well, we're going to be operational by the end of this year. We're working on final details for these works, especially to work on the last piece of piping to Citygate. Everything that is land related has been completed. The vessel is on route to Brazil. Everything is going well. And of course, this is one of the biggest points for any changes at the company for a potential IPO or other potential operations. We want to make sure that the promises that we made a while ago when we didn't have the IPO, but we had the private placement are delivered. We have the TRSP, the TSRU. We have the Commit, which is happening with the ones that are under us. We have the sales memorandum for the Northeast, which has been executed. And of course, we still rely on the preemptive rights by Mitsui. We expect to complete that by the end of this year or tops by the first quarter of next year, but we're pushing strongly to do it this year. And of course, we have the progress of guys which are going really well as Lewin was saying at the beginning. So the maturation of our network and our partnership operations Mitsui in the States is really important. So that we see an overall -- overview of our evolution and so that everything falls into place in their portfolio. Yesterday, we talked about the JV for biomethane and this is really important for us in our product offering. We signed a big contract with Petrobras recently for Comgás supply in the…

Let me add something to what Luis said. Regarding the funding of potential acquisitions, we don't need to have specific funding for this. Please remember that the leveraging for Complex is closer to this. So we could make these acquisitions with our own funds. We're moving forward with our plans, but any potential acquisitions will be funded with our own resources. Regarding the IPO, both for Compass and Moove, it's important to say that these companies have shareholders which are not Cosan. And of course, they are interested in leaving at some point. So yes, we want to hold an IPO for these businesses, but there's no urgency. And we don't need to do it without optimizing our valuation when we go to market. As for Compass, as Luis said really well, we have the São Paulo regasification Terminal. In 2022, when we didn't hold an IPO, we talked about this point. And this is the only one which hasn't been completed yet, and we want to complete everything before we have a IPO. This is very significant for us. Regarding Moove, around a year ago, we acquired PetroChoice. We also believe it is important to deliver things and to show how much we can grow outside of Brazil before we hold an IPO. They are doing really well. These deliveries look promising. And after that, we can think about an IPO, so that we can give an option for our shareholders to leave. There is no urgency. We're not worried about the window of opportunity right now, but we're Keeping an eye on the maximum valuation possible, we want to deliver on everything we promised and we want to have good performance.

And Marcelo, we've been educating the market on these 2 businesses with more and more disclosure for you. So we're going to tackle these companies as if they were listed so that you can see their results better and better with more complete information because they are becoming more relevant in our portfolios.

Up next, we have a question from Mr. Luiz Carvalho, a sell-side analyst from UBS.

I'm happy to see a few changes in your Board too, regarding the last elections. Luis, let me piggyback on the question regarding Vale. You're a member of their Board. And recently, we saw news regarding a potential change in the CEO position. Could you please give us an update, not regarding mining necessarily, but regarding the company and any changes that we may expect. It's been a while since Cosan joined. So what do you think about the business? What do you think about the opportunities you have there? In around 6 to 8 months ago, I asked you a question regarding your time allocation and your priorities, given the complexity and the number of projects you have going on right now in your pipeline. So could you please talk about that? Piggy backing on what Lewin said, how do you look into move in this sense? Because Moove has an EBITDA above BRL 1 billion. So what could we follow up on from a close? What kind of opportunity could we expect?

Thank you for your questions, Luiz. Regarding Vale, of course, I need to be brief. And as a Board member, I must ask you that any questions regarding that company's performance should be asked to that company. I face restrictions as a Board member. Now what I can say is that we have a Board that is working really well together. We had good elections. We didn't have multiple votes. We saw many national and international shareholders on the same page. And this is working really well through the nominating and Governance Committee with Benito, who is still on the board and who did excellent work with the previous Board to choose the current Board. So what I can tell you is that I'm a witness to how well this is working. Another highlight is how important it is to segregate base metals. We're doing something structured and focused with specific goals. We have specific talent, values and cultures that are compatible with the challenges that we have ahead of us. And this frees up time for the team to focus on iron ore should they be experts on that. And for the team who is an expert on other things to also focus on other metals. We have an Executive Chairman, Marco with a lot of experience that's good for base metals. And we have 2 very important shareholders, at 10%, which is a very strategic partner, given the importance of the Middle East as a potential hub to build solutions for low-carbon mining and as well. This is a shareholder who is a leader in the energy transition in ESG. Many operations with the Canadian government and the American government, lots of operations in North America. They have important experience, which really goes to validate our efforts as…

Let me follow up on what you said about Moove. You're thinking about expanding regionally. Does it make sense to go public abroad and not in Brazil to be listed abroad and not in Brazil? Does it make sense in tax terms?

We're doing research, Luiz, to see our options. And of course, we're going to go public wherever we can attract the right investors. Moove is very specific. You know I have a background in lubricants. I worked a long time in lubricrants for Shell. And right now, I don't know about any company in the world that has built what Moove has built. So we're going to look at it dearly to choose the right place and the right circumstances for its IPO because we want to attract specific investors for it. We have incredible cash generation, low need for recurring CapEx and a very high-performance team with high-quality brands, either proprietary brands or through our operations with ExxonMobil. We're getting to growth market, mixed market and very good profitability as well. So we can put together an expansion in our market share, quality and our profit share. We're expanding our total value in our cash conversion very efficiently. When we look at Moove's earnings, to the end of the year, we only have to work on liability management for the recent acquisitions, basically. The rest of the company is balanced with a very robust cash position and we're deleveraging after last year's acquisition basically. Would you like to add anything?

No. Thank you.

Up next, we have a question from Lucas Ferreira, a sell-side analyst from JPMorgan.

I have a follow-up question regarding Compass. Do you have a minimum stake with which you'd be comfortable with for a future IPO? You have 30% for Rumo. Do you have anything similar to that? Also at Compass, you have a very important shareholder Mitsui. Would you be comfortable with liquidity through Cosan or through future purchasing at Compass? Would you be able to increase your stake at the distributors? Regarding capital allocation. You just talked about the share buyback program. How comfortable are you with capital allocation? Should we have capital allocation in the group's assets? Are you comfortable with the buybacks? What do you think about this thing? And regarding capital allocation, finally, regarding Vale, Luis was talking about the company. And in the past, they decided not to add the 1.6% to the results that may have been strategic, but do you have any economic opportunities right now where Vale is at? Are you happy with your stake at the Board? Why not at the 1.6%, which was a possibility at the beginning?

Let me start, and then I will hand it over to Marcelo. First, let me make something clear. Mitsui is not a shareholder at Compass. It is a shareholder at Commit. Regarding a micro stake at companies like Compass and Moove, we will always have controlling rates. So over 50%. We'd love to have a larger share of Rumo right now. You know their history. We only have 30%. We'd love to have more for Rumo because it's a company that performs really well with a very robust horizon. Regarding Mitsui, we don't have anything at the table right now or on the table. So we can't speculate on that. Regarding our stake per Vale, we're comfortable with 4.9%. It gives us a very comfortable position when it comes exposure in derivatives. So we repeat the same thing we've said in previous earnings release presentations, we won't be increasing our stake right now. We think this is the responsible thing when it comes to exposure, our total debt and our capital allocation. Marcelo, would you like to talk about the buyback program and capital allocation?

Yes, of course. Lucas, regarding the buyback program, as we were saying before, yes, we intend on doing the buyback program. The right timing for it depends on a few things, but it could happen quickly. This is something we're going to determine soon. But yes, we intend on doing it. Regarding Vale, we look at this operation according to 3 layers. We have 1.5 available to us right now. And after undoing some of the color, we went to 1.6. We have 3.3 from the color and then 1.6. So it doesn't make sense for us to use the option to buy the 1.6 before solving the 3.3. So this is at the end of our line of our queue. We're going to get to it after working on the 3.3 in addition to 1.6. So this is not in our list of priorities. And we could maybe not complete it and just undo it, but it is an option after we tackle the 3.3.

Our next question comes from Regis Cardoso, a sell-side analyst from Credit Suisse.

Let me echo my colleagues, and thank you for your disclosure in the earnings release presentation on how much recovery of these holdings would be worth. This is really useful information, so I'd like to echo their things. Let me touch upon a few things. Number one, when interest rates went up, especially the CDI rate, we saw changes in the group. We saw a behavior that was more related to cash preservation and maybe deaccelerating some investment plans because, of course, the debt burden became bigger. So on this note, since we're seeing changes in interest rates, I would like to pick your brain on that. Does it have any impact on how this company is going to have a different pacing on capital allocation? Now more specifically, I have a question regarding Compass, more specifically, Commit. You've been exposed to different regulating models on natural gas in different states. So here's my question. Do you have good examples of different options or different regulatory models that draw your attention? Do you have a best practice role model that could be replicated? Is there a state where you feel more comfortable allocating more cash? Finally, if you will allow me, this is a question maybe for Luis, maybe for Marcelo, it's up to you. I remember that you invested in Vale. And at that time had a hypothesis on how to unlock value. One of the hypothesis was basic metals, which hasn't come true. So overall, I'd like to ask you about your investment hypothesis at the time and how it has changed up to now?

Thank you, Regis. Let me answer the first question. Marcelo will answer the second one. We have shareholders being represented by them, and I represent the Board. When it comes the interest rate cycle, we are actually focused on actually executing our projects right now. So for Rumo, we want to complete the investment in Lucas do Rio Verde. We want to raise funds for each step. We want to work on better loads. We want to optimize things. And of course, we want to increase profitability and the competitiveness of Rumo going into Mato Grosso. Meanwhile, as Beto has been saying, we, of course, want to look at bottleneck opportunities in Santos because we have higher volumes getting to Santos, and we need to process it properly. We have the terminal, we have other improvements and we have other opportunities we're looking into. So we don't have any other opportunities. The same thing for our Commit and Compass. We can think about the acceleration of the expansion of operating models for these new companies. Now regarding your second question, Regis. We're comfortable with different regulations, different regulatory bodies in different granting authorities in different states. Of course, these legislations, these all have their pros and cons, and they may have different levels of maturity in different states. Sometimes we have low levels of maturity. We see that we need more base structure investments. In other states, we need to accelerate expansions. Of course, in São Paulo, we have a high level of maturity. For our next step to understand how biomethane is going to be added to the trading scenario. You also have negotiations with different producers in Brazil, other players in this industry and the regulators. So we need to work on our first 3 clients. We have…

Regis, regarding Vale, we believe this investment of the PIF in base metals was really positive. We believe the valuation was interesting. We were happy with these results. We expect this to be a good business, but it was even better than what we had anticipated. This is a valuation that should reinforce our significant numbers for Vale. And there is no reason for us to be where we're at right now. So we expect some impact here. Our hypothesis is still being confirmed, but we haven't reached a decision. Our first results with base metals is really, really satisfactory. Not only having investors for that, but also a separate governance. When you have someone from this industry with a strong background, this also leverages a lot of value for the company looking forward. But we haven't reached a decision on our stake regarding Vale. And a quick reminder of the color mechanism. Every time we think we have enough gains to undo the color. And when we think it makes sense to convert this stake in a share stake or actual stake at the company and not a color stake, we can do it. But that doesn't mean that we're going to keep this stake over time. It's important to make this clear. A color is a combination of derivatives and options. When you undo it, you have a stake at the company, which you could keep at the price that you have booked. You can undo it by immediately selling it or you can sell it in the future. So we decided to undo the color because it's really appealing. We are going to have significant gains. And that's it. But I don't want to give you any indication either way for Vale at the moment. I just reinforced that we're happy with what we're seeing right now, especially operationally and strategically speaking. We're monitoring other factors before we make any further decisions regarding our stake in the future.

And Marcelo, we're also keeping our 4.9% stake with the option for the future.

Yes, exactly.

This is the end of our Q&A. Now let me hand it back over to Mr. Luis Henrique for his closing remarks.

I would like to thank everyone for the high-quality questions and discussion. I believe it is important to stress that we're focused on the execution of the specific plans for each one of these companies. and we've delved into them in detail. We're trying to optimize our capital structure. We're looking at opportunities to generate value and to work on deleveraging our company. We're focusing a lot on reversing our results for mobility in Brazil. Of course, we also expect Vale to keep on going up with shares that show better performance. At the end of the day, we're focusing on execution, focusing on the areas we believe are promising and focusing on maintaining capital discipline. As Regis was saying, we want to make the most out of these low interest, but without increasing our exposure to new investments, except for the investments that are already well structured, so that we can generate the results that we expect and that investors expect. Thank you, and we'll see you at our Investors Day in September. We're looking forward to continuing this conversation with you and with other shareholders and partners at Cosan to talk about our opportunities and our challenges and to get your input. Thank you very much, and have a wonderful afternoon.

This is the end of our earnings release presentation for the second quarter of 2023 at Cosan. Our Investor Relations area is available to you should you have any further questions. Thank you very much, and enjoy your evening.