Again, NPLs and the liquids in general is performing better than last year, and much better than the market is performing. Still I mean given the profile of the business and how contracts are renewed Isaac can use all of this information to reprise the contracts for the next cycle, okay? The numbers I’m giving is the average of the portfolio, but of course, in some specific situations, you have different performances for specific schools, and they can use the moment to €“ the renewal moment to reprise those contracts and bring genetic rate back to where it should be, okay? So at this point, again, we’re not seeing any negative implication to the business.
Mauricio Cepeda: Do you see any kind of risk of the potential client seeing now a little bit more adversely selected, like the worst schools or let’s say the worst paying parents could end up with Isaac?
Roberto Otero: I think it’s difficult to put to generalize a bad school. I think at the end the adverse selection for this business is actually benefits from the fact that you have a very polarized base of families paying you one single client, right? So the client is the school, but at the end, you have a base of 200, 300 families there. So this mitigates the adverse selection risk in general, okay? I think at the end, Isaac leverages a lot on their proprietary historical data of payment performance for schools, for families. So they have a lot of data intelligence backing their pricing strategy, okay? So if this is the case either they will decide not to bring that school or they will price that school at a completely different level relative to the portfolio, okay?
So the risk appetite is low because it’s not necessary and they rely a lot on their proprietary data to price the contracts completely individually, okay? So the pricing is done individually for its school based on historical figures that those schools supply to Isaac combined with information that Isaac through its technology can collect to also combine and bring the ideal pricing for those schools, okay?
Mauricio Cepeda: Okay. Great. Thank you.
Operator: Thank you. The next question comes with Yan Cesquim with BTG Pactual. Please go ahead.
Yan Cesquim: Good evening, everyone. Two questions here on our side. The first is regarding our working capital dynamics. We see that Q4 is usually hit by wars working capital dynamics, especially because of the concentration of revenue recognition in the quarter. And this time, we also saw a similar scenario and especially because we had these higher revenue concentration. But I just wonder if this is the reason and we should see the normalization of these working capital dynamics soon, or if there is any other reason for the print in working capital that we saw, right? That’s the first one. And the second one is regarding the very nice breakdown that you gave us on the ACV splitting, what was the churn and price increases in new clients?
And I just wonder if you could share with us what was the historical churn levels? I imagine that if we compare to the last couple years, the churn probably improved a lot. And I just wonder if we are seeing here a normalized churn level if you see space for improving this ahead or if it should continue at this run rate €“ healthy run rate, okay? That’s it. Thank you, guys.
Roberto Otero: Hey Yan, Otero here. Thanks for the questions. So on the first one, the key reason there is as you said a higher revenue recognition in the quarter, but more than that, okay, it’s a higher revenue recognition for Supplemental solutions in the quarter, okay? So Supplemental has a different DSO profile when compared to Core, okay? So I mean when we compare brand by brand relative to last year, we’re not seeing an increase in DSO, okay? But we did see a higher revenue recognition or a higher revenue concentration for Supplemental solutions in Q4, okay? And they have a different profile. So we should see as collection kicks off, and it has already started. We should see a normalization there, okay? So delinquency in general is performing quite well, okay?
