Good evening, everyone. Thank you for standing by. Welcome to Stone Coast's third quarter of 2020, and you should have access to our earnings release. The company also posted a presentation to go along with its call. All material can be found on the website. Before we begin the call, I advise you to review the disclaimer included in the press release and presentation, which outlines important and general measures. In addition, many of the risks regarding the business are disclosed in the company's Form 20-F file with www.sdc.gov. I would like to highlight that the company is receiving joining calls today. It's Stone's CEO, Mateus Scherer, the CFO and IRO, Diego Salgado, and the head of our conference over to Mateus Scherer. Please proceed.

Thank you for joining us. Take a step back and share where our focus has been and how we are progressing. As we remember, late last year we began to see higher return in our client base as we extended our range of products and services. Our offers and our operations became harder for our clients to manage to remove the complexity. We are making our offers simpler and our pricing more transparent. We are moving in the right direction on products, but the changes are starting to show the numbers. DPV growth accelerated against this trajectory. The Brazilian Card Industry Association reported that CardTBV grew, six-card president transactions grew 3.5%, and cards lost president maturity. Our overall market share is stable as of this quarter, and we gain more of this share within our segment, as clients use more of our ecosystem. This is also why we are investing in our position as a bank for entrepreneurs. Rent takes time, and we expect the benefits to be looked for gradually. Inc. Credit Square. We lightened our stands on the dedicated desk, where larger tickets call for more caution and bathrooms. These lights carry a guarantee, and that lets us keep serving our clients in a tougher environment where we're seeing the results. At the same time, the environment for small business remains challenging in the future. That keeps us cautious on the cost of risk and selective on where we grow. While we were discussing that our care was under pressure, two themes drove that. Higher provisions as a credit portfolio. Cost control is one of our main priorities, and it will remain a central focus in 2020 in cities like Florida. But these dynamics come together in our nine-month results. The first nine-year REI is an adjusted gross profit, and 6.9 REI is an adjusted basic GPS, with five-year action. These results are below what we envisioned at the start of the year. Part of that is the number of our investors. The credit environment remained difficult, and smaller merchants felt that pressure lost. Empire initiatives prioritized offers that maximized the lifetime value of each client. We need a column which justifies it, but that would strike a pressure on our top line, in exchange for a more sustainable roof over time. There is science out there, in the people, in our cash share, in empowering us to carry the costs of building for the long term. Three things guiding how we think about what comes next. Our focus on the development of a commitment to return capital to shareholders. During these last five years, we are updating our 2026 factors. We now expect adjusted gross profit to be between 6.1 and 6.2 billion reais, 7 billion reais per day. Just a basic GPS. The range is now between 9.1 to 10.8 to 11.4 BISP frequency. Our extractives test rates are substantial. All time can say about it. We are wishy-washy from the targets we communicated earlier this year. The interest rates remain ahead of us, and the economic costs for next year fall at a high level. We're not comfortable providing guidance to updated 2017 guidance when we report full year results. Our strategy and execution priorities will not change. Thank you, Mateus, and good evening, everyone. This story ends live. Our revenue growth continues to be led by our credited product, as our portfolio continues to increase year-over-year and sequentially, as the growth in revenues was more than offset by provisions for loan losses These lower gross profit combined with investments in selling led to a decrease in basic EPS decline much less. As the continued share buyback toward the last year, meaningfully reductive decline in EPS reached 5.1 million versions, led by the performance of Tom, our micro-merchant brand. as we evolve in our position as the bank for entrepreneurs. This growth makes us size clients as they engage with our solutions over time. Turning to slide 8, TPV is slowly accelerating. although the sequential acceleration is a sign that our initiatives are gaining traction and compounding time. In the last six years of COVID, which grows well ahead of our lives, car TPP remains under pressure and still declines fast, with credit cards getting flat-pitched. But the trend is improving. Its second annual decline has been easing. On the earliest time, Our retention efforts are gradually reaching hard volumes as well, in banking and deposits growth, as we further engage clients with our account offerings. On slide 9, we presented 4.1 billion reais, 78% larger than one year ago, and 90% more profitable. We've been focusing our growth backed by government-secured programs. These loans have nearly doubled. We are currently disbursing three different programs and setting new ones to support our clients. It's also capital advancing, reaching over 500 million reais. Our strategy will be roughly studied throughout the year, even as government-backed programs begin weighting the portfolio on a risk-adjusted basis. That takes us to slide 10, where our concept with cost of risk declines sequentially. On NPLs, we're benefiting from the normalization of first plans. Additionally, we've been investing in new collection and renegotiation tools, which benefit both cabins. We're at 197 million reais a quarter, mainly given by the scaling of the portfolio. That led to a cost from 21.5% in the second quarter, in line with our previous expectations. Finally, compared with over 200% in the previous quarter, which reflects the same shift in the afore required lower provision. Although we continue to see gradual improvements in our credit portfolio, we are mindful with the impact of higher wealth of our clients' businesses. As such, we are currently reviewing our traffic models to try to focus on the cost of risk for longer than we initially expected. We still believe costs of risks will go down, and that will remain the pressure in the coming waters. Slide 11 explains the moves in our NPL ratio. It is consistent with the season of the book. The main driver was the role forerunner of early stage delinquencies in our dedicated NPIL class quarter. On the short end, the NPIL was 15 to 90 days on the automated task, as I previously mentioned, in line with what we've been observing during the last months. At this end, renegotiations that we recently launched are showing early signs of success. On slide 12, we present our capital position and return on equity. We are comfortably above our 17% internal hurdle. We continue to return capital to shareholders. We purchase lower repurchase space in the third quarter. Our commitment to distribute the distributed reais in excess capital over the course of 2026 remains unchambered. Finally, our adjusted return on equity extended almost 200 years. On slide 13, we present the evolution of our cost and expense, what is higher mainly due to investments in software, with AI as a key and fastest-growing component, alongside higher transitions. On that front, We are currently facing higher risk costs with new products presenting an efficiency opportunity as these products mature and we evolve in managing product risks. The net financial expenses associated with the destruction of the legal entities as I've mentioned before were partially offset by a lower average CDI and many more. Funding costs in the quarter was 86% of the city on reduced personal expenses and a more disciplined approach to G&A. Selling expenses were up on the higher and higher marketing expenses, including our repositioning campaign as the bank for entrepreneurs, to lower share-based compensation as we update our estimates of share-based compensation to contingencies and higher provision for POS losses. Finally, our effective tax rate was 14% implied in our guidance. As final remarks on slide 14, our operation continues to improve for the Brazilian economy. When I look at the nine months of 2026, GDP is accelerating, and the engagement of clients with our account keeps increasing. However, our expectation that interest rates will remain high and volatile Our goal is to be the bank that entrepreneurs rely on to run and grow their business. This is how we get there. We are confident we are building that, one quarter at a time. With that,

Thank you. Now we will begin the Q&A session with Mateus Scherer, CEO, Diego Salgado, CFO, and Roberta Noronha, Head of Investor Relations. If you would like to ask a question, please press the Q&A button at the right-hand corner. You will then receive a request to activate your microphone. One moment, please, for the first question. Our first question comes from .

Hey, guys. Thank you for your time. So two questions on my side. So the first one, you mentioned that you had some restructuring of smart detail here. The second one would be on your crowd initiative. You mentioned that the macro market has been more challenging than expected and you can of course see this and it provides a little bit of color here. So when you look at the commercial portfolio Where is this iteration coming from? And how are your model revisions doing? Thank you very much. Thank you very much for the question. We moved the relevant amount of the capital that we had from our holding company from Cayman, Luxembourg, and Switzerland. So that caused us to withdraw capital from Brazil for certain periods of time, capitalize those entities, and then move them back. We are now centralizing this main entity in Switzerland, so that causes a lot of moves and cash balances among the entities. Is that clear? Yes, it is. But what is the need for this? What is behind this organization to do this? There are two business reasons behind it. So the first one is we want to make sure that we've been reducing our Well-perceived by the Brazilian tax authorities, we are looking to reduce our exporter-trained tax institutes in the future, but as a healthy capital hub to support the growth of the business, not only in Brazil, as we evolve, but also two other regions. Ventura, what we've been seeing is that CPV retention from clients on the credit products are not necessarily performing of the year. So we do not necessarily see that in the NPL formation just yet. But as you know, we follow the daily TPV from our clients and the expected daily amortizations in the contracts. Diego, the other place where we see clearly the impact of the macroenvironment is in traditional recovery pipelines, the Brazil's equivalent of something that's all over the news. If you were to look We took a look at the previous workers that hit our dedicated desk and that led us to make a series of changes in policies and rules to the government and the backline. So those are the two factors on the dedicated desk. It's mostly about judicial recovery fines and then we also see our clients to bring on the TV side. Take it for a time.

The next question comes from Shackle Bigspud with Goldman Sachs.

Hi, good evening everyone. Thank you for taking my question. It's really just a follow-up on the guidance decision on why to suspend the 2027 expectations for now. Can you help us understand what are you thinking about these resetting conditions? Do you need to see over the next three months to decide about launching new Thanks for the question. I think the main reason why we decided to round, the volatility is still very high and the visibility is still very limited on that front and probably would have been the same for the past, so post-election I think we've seen Thank you very much. It's still hard to say where rates and credit conditions would be 12 months from now, so that's why it's hard to put out a range that would be The one thing that we also have been highlighting here is that even though we're taking the decision to do the action of the business, nothing is actually changing. So, we managed to stop for the long term the priorities for 2020, focusing on the retention of the work, focusing on the long term, I think the decision around the 2027 guidance has mostly to do with the macro-environment and we're going to reassess whether we disclose the 42 numbers. Thank you. Thank you.

Our next question comes from Caio Prato with UBS.

Good evening, thanks for the opportunity. I have a follow-up on credits, please. If you can just, Diego, remember us, what's your new view estimate for cost of risk, I think you briefly mentioned. During the conference call, to be honest, for a moment, how would you describe your current appetite for growth going forward? And if you can split by the secured loans and also the unsecured ones, just to understand if there is room to continue growing at this pace, or if you could see like a major deterioration at some point in 2027.

Thank you.

Thank you for the question. Let me start with the cost of where that cost of risk would peak and then would trend down to the mid to high teens. And we were hoping that it would happen by 2027. What we've been seeing or what we've been working on is that this trend towards lower levels will probably take a little bit longer. We are in the process of reassessing our credit models for a material that offers additional provision expenses than we initially expected considering the forward-looking component of those models. Hence, what I've mentioned during the presentation that should go to those levels. As to the appetite to grow the business or the credit portfolio, We're also preparing for higher inflation, lower consumption, lower GDP generally for the Brazilian economy. And that should, to a certain extent, hit on the models or hit significantly on the We're not anticipating any material changes in the growth of the portfolio, but we're certainly going to be extremely careful about that. Credit is a key component of our strategy in the long term. and an important need for our clients. And we will be careful. We're going to monitor that very carefully, very closely on a day-by-day basis, on a month-by-month basis. Matheus, do you have anything to think about the growth of the credit portfolio? We also need to keep in mind that our share of wallets within our client base is penetration. So, like general institutions, on one hand, we are very mindful of the environment. Our next question comes from Jamie Friedman with SIG. Hi guys, thank you for the opportunity. Mateus, you addressed this to some degree with your prior answer, but I'm just curious if you were to frame how the company has performed relative to what it did at the end of the state in 2025. I realize there's a lot of macro changes between then and now. But if you could summarize, you know, where you are relative to there that are leading to suspend the guidance now. Thank you. Jamie, thanks for the question. So when you look back at the original guidance that we provided back in 2023, in the yesterday, I think if we're banking, The reality is that when we see the numbers, we are pretty much in line with what we had forecasted in the past. So if you remember, if you look at the trends of growth in the credit portfolio, and where we stand nowadays, it's pretty much, if not a little bit better. And on banking, I think we've been guided for 14 billion reais in business results nowadays. It's pretty much in line. Where I think we've seen... The first one is on the TPP growth side. I think if you remember the message that we share expects high market share gains in the future. But we should run in line with markets. And then two things happened. The performance was likely to be low on the market, so we lost some market share. But then the market grew a lot less than what we had anticipated back then. And the second one is around interest rates and the overall macro-economic environment. So back then, the original plan was around 117% by 2027. If you look at where the rates are nowadays and what is implied on the curve, that alone is a huge gap in companies' performance. Again, I think we are in the right track, like Diego mentioned, especially when we think about the company keep evolving on Reddit, increasing engagement. What has been a lot tougher than what we had anticipated is around the TPG growth and the macro side. I don't know if you want to add, Diego. Yeah, that's great. Thank you. Thank you, Matheus. I'll jump back

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