Ultrapar Participações S.A. (NYSE:UGP) Q2 2023 Earnings Call Transcript

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Unidentified Analyst: Hi, good morning. Thank you for taking my questions. Follow-up on Duarte’s question. Could you please tell us more about the pillars, the four pillars of the turnaround of Ipiranga, which one is the most developed? Which one is lagging behind? What are the difficulties you come across? And how long will it take for you to close all the doors so to speak? I can see that — in stations and it’s very successful. I don’t know if it’s an ongoing process or whether we are going to come to a halt eventually? And secondly, concerning the CapEx against the guidance, it seems that it’s somewhat lagging behind, do you expect any spillover or will you reach the guidance of the year in all different terms? Does Ultracargo seems to be the ones which is taking longer to use its CapEx? So, please — these are my questions. Thanks.

Rodrigo de Almeida Pizzinatto: Good morning Georgina. Concerning disinvestment and the sales of our stations, we expect to finish this movement now in September, in this quarter; the bulk of it at least. Four pillars,[Indiscernible], this pillar is very important to us but in our — this is something ongoing in our operation. This is something that we have structured quite well, the pillar has been completed and now we are going to keep on finetuning our policies to have stable competitive position and policies which are in sync with the market. The pillar of trading has evolved significantly as well. When we launched this pillar at first, we had no structure of trading at that time. Today, we have a very robust trading structure with a capacity to originate products wherever we are always adding value and it has contributed to reducing the issues we faced in the second quarter.

And similarly competitiveness now we’re going to just keep on focusing that as a critical issue for us. The next pillar was the engagement has also experienced significant progression in the past 18 months. It has improved our relationship with the network at large. Our processes and policies are much more consistent and this is very important for the network. We are closer to our resellers, which is something expected at Ipiranga. We’ve expanded the network. We have gained more space in our branded stations. It’s a pillar to be maintained. The pillar with which we are still working on is logistics and operations because it requires deeper changes of processes and this is not the first time I mentioned it. I know I’m just being consistent with what was said in the past, but it’s clear that by the end of the year, it would have — we will have covered most of what we had intended to be our plan.

There are very significant progresses, but the rollout for all over Brazil, for all our distribution bases, it takes time because we are deeply reviewing processes. So, as I told you the part of selling the stations and disinvestments will be completed by September. Let’s say we’ll talk about CapEx. Well, concerning CapEx and similarly to previous years, we just forecast and there is some seasonality of the investments in expansions and branded operations concentrating more on the second half of the year and this year is not going to be different because it’s not a linear plan.

Unidentified Analyst: That’s great. Thank you.

Operator: Thank you. If there are no further questions, I would like to hand it back to Mr. Rodrigo Pizzinatto for his closing remarks.

Rodrigo de Almeida Pizzinatto: Well, let me thank you all for your questions and for your interest. Let me remind you that the questions that were submitted through the webcast will be answered by our Investor Relations team. And on September 5th, we’re going to have our Ultra Day and I hope to have you all there with us. Thank you all very much.

Operator: Thank you. The earnings release call of Ultrapar is completed now. Please hang up now. Thank you very much. Have a nice day.

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