CI&T Inc (CINT) Q4 2021 Earnings Report, Transcript and Summary

Thanks, Eduardo. Good day, everyone. I hope you're well and safe. It's an honor to be here again with all of you. We are delighted to end 2021 with robust results on performing our growth guidance for the quarter and year. In our first year, and as a public company. Before diving to those results, a word about our industry under the current economic macro-environment, and the opportunity for CI&T. Yes, there are clouds in the sky, the global economy is yet to recover from a devastating pandemic. And we have a new set of geopolitical threads on the table. But one thing has not changed, software continues to eat the world, enabling unprecedented and radical shift in society, values, and consumer behaviors. Companies need to react and uncertainties are the best few for change. Digital is the answer to reconnect companies to a new breed of consumers. The result is a secular demand for digital services in the corporate world, an extraordinary opportunity for a decade of high-growth for CI&T, and that's why we continue to present solid results and a bullish long-term outlook. Our net revenue growth in the fourth quarter of 2021 was 72% year-over-year. And I'm proud to say as our 22nd quarter of consecutive revenue growth. In 2021, our net revenue totaled R$1.44 billion, 51% higher than 2020. This growth was boosted by three main factors. The first was higher demand from existing clients with a net revenue retention of 128%. Second, the addition of 36 new clients, which annual revenue above 1 million Brazilian reais to our portfolio, moving from 58 in 2020 to 94 in 2021. Third, the fast and smooth integration of Dextra as for new growth units. On top of our solid growth, our adjusted EBITDA margin was 22.4%, a benchmark in our industry, and our cash conversion was 66%. It's an outstanding result, and I want to express my gratitude to all CI&T worldwide. I'm very proud of what we've done as a team. Thank you. Stanley will present our financial results in more detail shortly. Another relevant update. January this year, we announced our first BOS IPO acquisition, aligning with our goal to pursue strategically M&A, to foster our organic growth. Somo is an award winning digital projects agents based in the UK with a very similar culture. There are founder-led, innovation driven and have a strong reputation with global brands delivering digital solutions across several verticals, especially automotive and utilities. The company recorded £25 million, net revenue less year, and a 41% growth compared to 2020. Somo adds around 300 digital specialists with deep expertise in digital products, a strong leadership team and offices in the UK, in the U.S., and in Colombia. It will accelerate our growth in Europe, the second largest markets for digital services in the world. Now, let's take a look at recent Paul for stores we are building with our clients. The first is a high end U.S. manufactured, reinventing the home audio experience. The second, is Somo helping the large UK utility company, boost customers experienced at scale. And third is the successful launching of a financial service marketplace to millions of consumers in Brazil in just four months, there we go. [Video Presentation] We are very proud to partner with Somos, one of the world's leading sound experience companies, to support its growth ambitions and deliver stellar customer experiences. Our services play a critical role in several technology solutions that enable Somos to move faster and fulfill business needs that drive innovation. One very important aspect of our joint work is the modernization of Somos co-platform, which has helped to deliver the Somos radio subscription service to customers. And enhance the company's key digital offerings. In the data realm, we are helping Somos structure and evolve its data platform leading to faster and more accurate decision building. CI&T is also working in close partnership with Somos to empower its product organization, and enabled deep internal alignment through digital value streams, and a strong focus on consumer needs. This brings a disciplined and deliberate approach toward progress, accelerating value creation, and increasing efficiency at scale. [Video Presentation] E.ON, a European utility company operating in over 30 countries with over 33 million customers, approached Somo to design and build a self-service customer platform. The goal, to launch a new digital product at rapid pace with the scale to adapt and manage new and existing customers. At the same time, provide a one-stop shop for account management to boost customer experience for E.ON Next, the renewable energy arm of EON. Delivering at pace only 14 weeks from briefing, Somo launched an innovative digital products that transformed the leading energy provider into a digital first business, executing at scale by migrating 5.7 million customer accounts onto the platform served as a key leverage towards a multi-million pound cost reduction. [Video Presentation] The digital product enabled the migration of millions of recently acquired Npower customers on to a single platform. Working with the backdrop of COVID-19, causing global chaos and forcing numerous countries into lockdown, Somo quickly pivoted to develop an effective, agile, and transparent way of working, delivering remote customer testing to enable rapid response and accelerate launch. Using cutting-edge technologies, including the integration of Octopus Energy's Kraken platform and an agile approach to delivery, ensured a more enjoyable and meaningful experience for customers. Empowering E.ON Next and their customers to take a fresh and flexible approach to manage their account requirements in one place. Somo and E.ON Next continue to work together to drive forward digital services that benefit both customers and employees of E.ON and sustain their market-leading status. [Video Presentation] Next Shop is the market place of Next where disco is digital bank. With more than 10 million users, Next created the Next Shop marketplace to enhance its position as a digital platform offering different financial services within the digital financial landscape. The marketplace offers instant cashback, an important competitive advantage. CI&T partnered with Bang Company and VTEX to orchestrate the solution. The project demonstrates CI&T unique approach of articulating and utilizing deep technical skills to build impactful solutions in partnership with different providers and business units. We were responsible for the deployment of the business strategy and all the development of the VTEX platform. Within four months, the Next Shop marketplace was successfully launched and the high-end technology was ready in time for Black Friday, 2021, enabling the next step to reach a new record of downloads. In just two months, 100,000 products were available across over 30 departments and categories. Well, these are just a few examples of how CI&T is generating this impact at pace and scale to some of our clients. Now I invite Bruno to talk about our delivery model and to comment on our people and EACG strategy.

Thank you, Cesar. Good morning, everyone. It's nice to be here with you again. We are very proud of our organizational design, which will be perfecting over many years. It is a model design for growth and as entrepreneurship at its core. We approach the market through autonomous units called growth units, which are in charge of bringing together multi-functional teams that work on multiyear journey along of our clients. Into fast innovation and corporate learning across growth units, we created a powerhouses. Powerhouses are virtual cross grow of unit communities, focused on the spin up in learning on marketing verticals, new technologies, security practices, or any specific subject relevant in a digital world. With our powerhouses, we can assemble teams that are fluid in industry verticals, have deep expertise in the lifecycle of digital products and its practices, master of wide range of technologies, and are also role models for our new organizational culture, more agile and more collaborative. Now, let's take a look at a practical example of one of our successful powerhouses. [Video Presentation] The open finance powerhouse brings together a global team of strategists, designers, and technologists who have been immersed in the financial services industry for years or decades. It includes teams that have been implementing open banking in some of the largest global banks, and market expertise from countries at different stages of open finance adoption. It goes beyond the regulatory demands of open banking where those exist and explores the business benefits of embracing a broader open finance strategy. One key example of how the powerhouse works to leverage this global network is the participation in the global open finance challenge, which resulted in us winning this global competition proposed by for global banks, and now having an opportunity to develop in partnership with them. [Video Presentation] A platform that enables global mobility from a financial perspective and solves an age-old problem that millions of immigrants continue to face every year. Overall, the open finance powerhouse allows CI&T to serve its clients in their local markets with the perspective of multi-markets experience, the more intelligent approach for a world that is increasingly connected. Now on to our most important asset, our people. In 2021, we serve fast incredible mark of 5,000 CI&Ters around the globe in end year with more than 5,500 people. It represents a net addition of 2,300 CI&Ters, a 73% growth year-over-year. Our attrition rate at the end of 2021 was 15.6%, an increase compared CINT's historical level due to our many activity in the current competitive environment for tech talent. Our leadership attrition though was only 3.6%, allowing us to continue projecting consistent growth in high net revenue retention. We continuously strive to enhance CI&Ters ' experiences and opportunities internally. Speaking up in their careers. Our strategy is to attract people at entry and mid-level position, develop them, and promote from within. As they grow with us, they stay longer with us. So due to that strategy, we are very proud of having an average standard of 15 years at exact level. At the beginning of 2022, we onboarded 400 new hires into our trainee program called Next Gen, which has been going on for more than two decades. We have long-term partnerships with the best universities in Brazil to foster our program and promote our employer brand. Our hiring and training machines have been operating at full speed globally to attract and retain the best talent in the industry in order to support our accelerated growth. We are proud of being nominated as one of the Top 5 Great Place to Work in Brazil in 2021. A recognition that demonstrates our continuous effort and commitment to provide an innovative and collaborative environment for our employees. Moreover, CI&T’s top ranked as a Great Place to Work in most countries that operates. And now we add Colombia to that list, a recognition received by Somo in 2021. Over the last two decades, we have been perfecting our robust and distributed delivery model that allows us to provide superior performance to our clients, and therefore keep our net revenue retention at a very high level. Our operating model is based on a combination of onsite teams close to our clients with near short tech talent from cost-effective and time-zone compatible locations. Due to our origins, Brazil is still our main source of tech talent. And although Brazil is ideally located to serve the massive U.S. market and the largest pool in America is just behind U.S.A, we are yet working to diversify our talent pool. In those lines, we're very happy to see the recent addition of Colombia to our footprint, an operation we are integrating from the Somo acquisition. We are committed to building and promoting a diverse inclusive, and equitable company focused on creating a better tomorrow around us. It's a long journey that requires an inspiring vision, sorted actions and a lot of pragmatism, we don't just want to do the right thing, and we want to be a lighthouse for changing society. Our ambition is to be a role model for more responsible leadership in the corporate world with a broader vision of what success looks like. Beyond simply the company's success to a more significant impact on the lives of our people and the communities around us. Last year, we signed a global comeback from the United Nations, and we chose six sustainable development goals that connect to our cause and served as a starting point for the final goals and actions. In the second quarter of 2022, we will release our ESU report, detailing our remain initiatives, results and ambitions for the future. Now, I'll hand it over to Stanley to comment on our financial results. Stanley please.

Thank you, Bruno. And good morning, everyone. I hope you're all doing well. I am excited to present the details of 2021, another great year of CI&T. In Q4 '21 our net revenue was R$456.8 million, an increase of 72% compared to Q4 '20 and above our guidance of at least R$440 million. Net revenue organic growth was 40%, while our net revenue in constant currency grew 69% in the comparable period. During the quarter, we expanded our engagement with our existing clients and we added to our portfolio 19 new clients with net revenue above R$1 million in the last 12 months, going from 75 clients in Q3 '21 to 94 in Q4 '21. Our adjusted EBITDA was R$101.8 million, an increase of 78% compared to Q4 '20 with an adjusted EBITDA margin of 22.3% in Q4 '21. Adjusted net profit reached R$47.7 million, an increase of 62% compared to Q4 '20. In 2021, CI&T’s net revenue was R$1.44 billion, an increase of R$488 million or 51% year-over-year. Net revenue growth in constant currency was 47%. Our performance was driven by our net revenue retention rate of 128%, demonstrating the recurrence and the resilience of our business. Adjusted EBITDA was R$324 million, 36.2% higher than in 2020. Adjusted EBITDA margin was 22.4% in 2021 below the level of 24.9% reported in 2020 when the results benefited from lower costs and expenses during the first year of the pandemic. The adjusted net profit was R$157 million, an increase of 22.6% compared to 2020. The adjusted net profit margin was 10.9% in 2021, a reduction of the level observed in 2020, mainly explained by the increase in the cost of services provided and higher expenses with depreciation and amortization and financial expenses. CI&T continues to deliver solid cash flow. In 2021 CI&T generated R$214.4 million in cash from operating activities, 37% higher compared to the amount of R$156.9 million recorded in 2020. Deducting payments for income tax and interest on loans, borrowings, and leasing, net cash from operating activities was R$132.4 million, an increase of R$31.4 million in relation to 2020. CI&T ended December 31, 2021, with a financial net cash position of 145.8 million composed are the gross debt position of R$788.7 million and R$934.5 million in cash, cash equivalents, and financial investment including the net proceeds of our IPO. Moving on to our pro forma numbers, our pro forma net revenue for 2021 totaled R$1.62 billion, 39.4% higher than in 2020. And above our guidance of at least R$1.6 billion in 2021. In terms of geography, the West operation continues to be the fastest-growing market, recording a 50% organic growth in Q4 '21 compared to Q4 '20. All industry verticals presented significant growth. It's worth mentioning that technology, media in Telecon, and retail and manufacturing were the verticals that grew faster in terms of revenue in Q4 '21 year-over-year. In 2021, we improved significantly our revenue breakdown by client. We reduced our top one client concentration from 21% in Q4, '20, to 16% 16% in Q4, 21, and reduced our top 10 client concentration from 72% to 54% in the same period. And as of the first quarter of '22, Somo will contribute to increase our revenue exposure in Europe, earning hard currency, add exposure to two new verticals, automotive and utilities, and diversify our client concentration with its portfolio of solid and well-known brands. Now, talking about our land and expanded strategy, the average net revenue retention rate in the past five-years reached 120%, and in 2021, our net revenue retention was 128%. Most of our growth in the upcoming years happens by expanding within current clients, which provides greater visibility of the trends in our business. In addition, we pursue the entry of new logos every quarter to foster future growth. In 2021, we successfully increased the number of clients with annual revenue above $1 million from 58 in 2020 to 94 in 2021. The number of clients above 5 $ million and $10 million also consistently grew over the same period, building a solid cohort for the upcoming years.

Thanks, Stanley. Let's talk about the future. It's worth looking back to understand how we will move forward. Founded in 1995, CI&T has 27 years of consecutive growth and profitability. From 2006, the emblematic a year we launched CI&T the USA to 2016, we had an organic 10-year CAGR of 30% in revenue. From 2016 on, we introduced three new growth forces. A domain driven digital strategy as a core component of our offering our growth unit, business architecture, fostering a scalable entrepreneur organizational model, and a programmatic approach for M&A as an enduring new capability focused on the floor of selective and strategic acquisitions. As a result of those moves, we are accelerating our annual growth base, 41% in 2020, 51% in 2021 in guiding at least 56% in 2022. To operate at these new base, we are constantly increasing our investments in hiring, training, and leadership development while keeping solid margins and cash conversion rates. That said, we can indicate a solid business outlook for Q1 '22 and full-year 2022. Based on current market conditions, we expect our net revenue in the first quarter of 2022 to be at least R$485 million, a 64% growth compared to our net revenue of R$209.6 million in the first quarter of 2021. For the full year of 2022, we expect our net revenue to be at least R$2.25 billion, a 56% growth compared to our net revenue of R$1.44 billion in 2021. In addition, we estimate our adjust EBITDA to be at least 20% for the full year of 2022. This guidance for 2022 assumes an average exchange rate of R$5.2 to the US dollar for the full year. That's what we had for today. We are fully committed to generating value for our clients in this, investors, society, and our people. And we are confident we are on the right track. Thank you all for your trust in CI&T and for attending our call today. So we conclude our presentation here, and we may now begin the Q&A session. Eduardo Galvão: We'll now begin the question-and-answer session. I will announce our name. Once you're hearing, please unmute your line and ask your question. Then when you're done, please unmute your line. The first question comes from Ashwin, from CITI. Ashwin, please.

Good morning, everyone. And thank you for the presentation. If I can start with a question on the growth and margin cadence that you expect through the year. If you can comment on that, and the drivers particularly because of the comp associated with Dextra and so on.

Thank you, Ashwin. Great to see you again. Well, as we mentioned, we are guiding an annual growth of 56% for 2022. And part of this is organic, 41 +% of this growth is organic. And then we have the contribution of Somo for this growth. And in this guidance, we are not considered any additional M&A move. Even though we have a very strong pipeline, I'm confident we are going to do -- I feel Next moves in this space. So this is basically falling our -- really did amazing opportunity in the market. I think digital is more than ever being broaden and be strategic for every single company. And I think we are really showing our ability to manage the supply side of this equation, combining a very aggressive organic hiring, training, and leadership strategy with our M&A I think were programmatic M&A strategy.

In terms of just the cadence of what you're expect or roughly speaking, 1Q, 2Q, 3Q, 4Q, how do you expect that to vary over time both for margins in both.

In terms of revenue growth, we probably will have a very similar pace quarter-over-quarter along the year, in terms of margins, there is some seasonality, especially because of salary inflations, normally, we have a lot of costs in Brazil, salary costs, and we have normally adjustment of salaries in the beginning of the year, January, and our price adjustments are designed to occur along the year. So normally, first half is more challenging in terms of March than the second half, but everything is as we said, we are confident, we are guiding 20% plus EBITDA along the full-year.

If I can ask just one quick question because we get this a lot because of the geopolitical situation you mentioned with Ukraine and Russia as well. I know you have no direct exposure there. But are you seeing maybe more opportunity as clients who may have done some work in those areas, maybe turn to you for more work or do you see maybe on the margin side because of those companies hiring in other regions? Are you seeing any pressure on radio stations [Indiscernible]?

As you mentioned, CI&T does not have office people or any meaningful client exposure in the region. Certainly there is -- this is an event that creates imbalance globally, and we are closely monitoring the development in that region. Really, in order to prepare to adapt ourselves and more important is support our clients as needed. But at this time it’s difficult to make any further projections or expectations. We do hope this conflict will be over soon and we are prepared to support our clients as needed.

Thank you for that. Eduardo Galvão: Thank you, Ashwin. Our next question comes from Diego Aragao, from Goldman Sachs. Diego, please.

Yes. Good morning, everyone. Thank you for taking my question. Maybe just a quick follow-up on Ashwins question. If I would try to bridge your revenue growth expected in 2022 considering your MRR new clients and maybe M&A, how should we be thinking about it? And simple margin, maybe just trying to understand what will be your margins without Somo because if I'm not mistaken, Somo comes with lower margins that CI&T. So this is the first question.

Sure. Thank you. I think first, our growth profile is basically 41 plus organic, and then a little more than 10% coming from Somo acquisition, and again, we are not considered further M&A in this growth. It's concentrating in the main markets, we are well established, U.S., Brazil, and now UK, and we foresee a lot of growth coming from Europe, compounding our historical growth in the U.S. and Brazil. The second in terms of margins, you are right. Somo -- and our M&A targets are operating in lower levels of margins than CI&T, and so basically, it's a small impact if you consider that Somo is a company with very good margins, by the way, in the high teens, EBITDA high teens, but less than 10% of our business and we see also a very good opportunity to gradually improve their margins because of the current exposure to near shore, it's only 20%, we are using Colombia for that, And we believe that gladly as they grow, we can increase adding CI&T global near shore capability to increase their margin. So we foresee that basically our strategy and that we can expect as they -- our M&A strategy move on, we expect some volatility in bottom line because of this is part of the game. We are adding CI&T ability to increase margins to the companies we are acquiring.

That's great. Thank you, Cesar. And I guess looking through your Net Revenue retention of 128%, if I'm not mistaken this implies a great increase relative to 2020. So can you just maybe give some color on what is driving such improvement? Maybe new applications, new solutions, new services. Just want to understand where the incremental demand is coming?

Sure. Sure. Historically, our net revenue retention was around 120%. We are seeing an acceleration of this rate. It's basically more demand coming from our portfolio clients. I think, especially our global companies are really vastly increasing their investment digital, there is plenty of opportunity regarding of cloud and data really improve customer experience using more aggressively technology to support their customers, and that drivers more demand. And I think we have a very strong positioning and reputation within, and basically that help us to really not only increase the occurring engagements, but navigate to new business units and geographies with our portfolio. And that's drives this new level off-net recommendation. That is very important to guarantee just new base of growth. So we -- our strategy continues to be land to expand, whether they're short-term or this year and next year growth will depend a lot on our ability to increase our positioning in revenues in our current portfolio, while having the discipline of adding new logos, new clients, every single quarter, that will guarantee future long-term growth. That's what we have been doing and to go for this new pace of 40% plus of organic growth, we'd definitely need a higher natural rotation, and we are having -- we are being able to do that.

Perfect. Thank you. Eduardo Galvão: Thank you, Diego. Our next question comes from Puneet from JP Morgan. Puneet please.

Hey, thanks for taking my question. Real is appreciating versus the U.S. dollar. Are you seeing any impact on pricing for either Pacific-based are U.S. based clients? And what margin implication on this currency move?

Sure. Bruno, can you take this one?

Sure. Of course there's no implication for the part of the business that are in Brazil as long as it's the same currency implications for serving the us market from Brazil. Of course, there's some short-term implications in margins, but in our experience being operating for more than 20 years it evens out in mid to long term. The FX ended up incorporating more than enough, the inflation of the local market. And in the end that evens out on mid-term but we can expect some volatility in the short-term, yes.

And then how much visibility you have on 2022 revenue guidance, 40% organic growth, and, excuse me if you already mentioned this, how much is Somo contribution going to be this year?

From this number really 41 plus percentage organic. And then we have the last [Indiscernible] 56 is Somo's contribution. In terms of visibility, for the expand part, that is basically the majority of this growth. We have full visibility by now. And I think there is -- I think the part that's we have less certainty is the land part, but the market is -- the demand is really high. We have been able to really on-board new clients every single quarter. And a good number and different industry and geography so by now the visibility, I would say is full. I think that as always, in this industry and for CI&T I think the complexity is the way -- is the supply side. And I think we are doing an amazing good job in the hiring front, training our people, develop our leadership to be able to cope with the demand.

Quick clarification just to make sure, organic growth calculation that does not include incremental contribution from Dextra?

Yes. Dextra was -- we end the integration of Dextra last November. So now is -- we integrate Dextra as four new growth units, now they are operating in our platform. So it's now about organic growth, by now we have 26 growth units and we are fostering growth in each of one of them. So it's basically, we are counting for 2022, it's CI&T as a platform growing 41 plus percent plus Somo as a new growth unit growing in a very good base that will contribute for 56% year-over-year revenue growth.

Understood. Thank you. Eduardo Galvão: Thank you, Puneet. We have a question here via email from Arturo Lang from Itau. Could you please provide color into the pace and climate for hirings? How are you seeing wage inflation and are you being able to pass on this to your clients?

I can pick this one. Thank you for your question, Arturo. Regarding your first question about hiring. In 2021, we hired more than 2.3,000 people, so 73% growth year-over-year. Upon half of that was incorporation of Dextra and the other half was just our ability to go-to-market and hire. As we accelerate in organic growth, we are also investing more in the support, our hiring, training, and leadership development teams. As you know, the market for talent continues to be very competitive. But we believe we have a very strong value proposition to offer to this environment and to this -- the professionals in this industry, which is always focused on offering them a place where they can develop their careers the fastest, by and this has always been very compelling for this market. And it's important to highlight that our hiring strategy is focused on attracting talent on the early stages of their careers, so not in the last minute market for senior people. And so just for example, we are just on board of last month, 400 trainees and so we will develop And prepare up to support future growth, so overall our strategy is designed for the long term. And so for us 2022 initiated years ago when we started developing the new leaders and the new key positions that will take on the new client engagements and the growth that we're expecting in 2022. So this consistencies is what actually guarantees the quality of the services that by consequence guarantees the high recurrence on the business of our clients. I think this will finalize that point. We're very comfortable that we are also operating in very big talent pools in U.S. of course which is the biggest one, In Brazil, which is the second biggest in Latin America time zone. So now we are diversifying, getting into Colombia, which is an important Latin American market that we just got into through the Somo position. Second part of the question is about inflation recovery a little bit, but maybe just add that we're seeing happening this across-the-board. So the Asian wage inflation. But that's happening more on the developed countries where the shortage of tech talent is higher than in emerging countries. And by the end of the day we'll create price elasticity that will help us do the price adjustments with our clients along the way, and we've been very successful in doing this year-over-year based on our close relationship and the value we create to our clients. Eduardo Galvão: Thank you, Bruno. Our next question comes from Rodrigo Gastim from Clave Capital. Considering the Somo acquisition, how should we expect the growth breakdown among the different regions? Should we expect a growth based in Europe similar than in the U.S., and regarding the 2022 guidance, how much of the revenue and maybe that comes from Somo?

I think we've already talked about the contribution Somo. In terms of regions, I think the acquisition of Somo was a very important move to really put Europe, especially UK, as a main source of growth for CI&T. Europe is the second largest market in the world for digital, and we have now an amazing platform reputation, skills, strategy skills, design skills, and of course, full-stack technology skills to operate there. So you are right, we are really foreseeing a very aggressive growth in UK as we have been doing in the U.S. Eduardo Galvão: Thank you, Cesar. So that concludes the questions we have from emails, like to extend here to see if some of the analysts, Ashwin, Diego, Puneet would like to do a follow-up question. Well, with that, thank you, all.

Sorry, Eduardo. Eduardo Galvão: Go ahead, Diego.

Apologies, I was trying to unmute my phone. So just a quick question, can you just comment on the attrition rate for 2021, and how this compared to 2020. I know that 2020 was a year -- a very different year because of COVID, but just want to understand what are the trends in there. Thank you.

I can take that one.

Bruno is on mute, but Stanley, can you take this one?

Well, we have 15.6% of attrition, and mainly we see two effects that, of course, we have the market conditions, current market conditions. We -- if you compare 2021 to 2020, 2020 we had this the first year of the pandemics and we had a -- the higher rate of retention at that time in terms of uncertainties of the market, etc., and then later down the road, we had the opposite effect. We played very well in the field as we continue to be a reference in the markets even in competitor peers. And of course, we have this -- the acquisition of Dextra that came in with the higher attrition, but already we incorporated as Cesar mentioned, and we are driving their attrition to our lower levels, let's say. So if you compare this higher attrition, comparing to 2020, most -- two biggest factors are those two that I mentioned.

Thank you.

Diego, just adding. I think there's another KPI very important that we are monitoring carefully. Our leadership attrition in 2021 was only 3.6% that allowed us, really to continue to project with consistent growth in that revenue retention -- hiring at revenue retention rate. I think it's important not to look only the overall attrition, but the leadership attrition. At the end of the day, leadership is the main bottleneck for growth in this space.

It's amazing. Thank you. Eduardo Galvão: Well, that concludes our Q&A session. I'll now pass to Cesar to proceed with his closing remarks.

Sure. Thank you, Eduardo, Stanley, Bruno for joining us -- for joining me today. Again, thank you all, the analysts and all the questions. I want to really take this moment to thank all CI&T - ERS, clients, investors and partners for their continued support. We continue to be very confident. We will have another great year ahead. And at the end of the day, I think I expect you always stay safe and well. And looking forward to see you in a couple of months. Thank you. Eduardo Galvão: Thank you, all.

Thank you.

Thank you.