Pet Retail Market and Valuation Outlook

Appendix 25 104 | 25. Price War - Discount Simulation Average Discount 0% Average Discount 10% Average Discount 0% Average Discount 10% Average Discount 0% Average Discount 10% Petz Petz Cobasi Cobasi Petlove Petlove Sales Mix Products Sales Mix 92.6% Products Private Label 7.4% Private Label 92.6% 7.4% Sales Mix Products 100% Sales Mix Products 100% Sales Mix Products 100.0% Sales Mix Products 100.0% Total Units Sold X Total Units Sold X Total Units Sold X Total Units Sold X Total Units Sold X Total Units Sold X Average Sales Price BRL 100 Average Sales Price BRL 90 Average Sales Price BRL 100 Average Sales Price BRL 90 Average Sales Price (Products) BRL 100 Average Sales Price (Products) BR 100 Average Sales Price BRL 87 (Private Label) Average Sales Price (Private Label) BRL 87 Products Revenue 100.0x Products Revenue 90.0x Products Revenue 100.0x Products Revenue 90.0x Total Revenue 100.0x Total Revenue 90.0x Total Revenue 100.0x Total Revenue 90.0x Products Revenue 92.8x Products Revenue 83.5x Private Label Revenue 6.3x Private Label Revenue 6.3x % COGS 59.9% % COGS 66.6% % COGS 71.0% % COGS 78.9% Total Revenue 99.1x Total Revenue 89.8x COGS 59.9x COGS 59.9x COGS 71.0x COGS 71.0x % COGS (Products) 53.3% % COGS (Products) 59.2% Total COGS 59.9x Total COGS 59.9x Total COGS 71.0x Total COGS 71.0x % COGS (Private Label) 43.3% % COGS (Private Label) 43.3% Gross Profit 40x Gross Profit 30x Gross Profit 29x Gross Profit 19x COGS (Products) 49.5x COGS (Products) 49.5x Gross Margin 40.1% Gross Margin 33.4% Gross Margin 29.0% Gross Margin 21.1% COGS (Private Label) 2.7x COGS (Private Label) 2.7x Total COGS 52x Total COGS 52x Change in Gross Margin -6.7% Gross Profit (Products) 43x Gross Profit (Products) 34x Gross Margin 46.7% Gross Margin 40.8% Private Label Sensitivy Gross Profit (Private Label) 3.6x Gross Profit (Private Label) 3.6x Gross Margin 56.7% Gross Margin 56.7% Gross Profit Gross Margin 47x 47.3% Gross Profit 38x Gross Margin 41.9% Change in Gross Margin -5.4% Gross Margin A 10% 8% 6% 4% 2% 0% 3% 6% 8% 11% 13% 16% 18% 21% 23% Private Label Penetration Change in Gross Margin -7.9% In this way, the team was able to see the actual value of an increased private-label penetration, which is the main factor that guarantees a lower variation in gross margin for the company. We replicated the following model numerous times, creating a sensitivity analysis that shows the variation in gross margin according to the increase in Petz's private label penetration. -5% Discount 10% Discount 15% Discount Source: Company's Data; Diário Oficial; Team 7

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