Netshoes (Cayman) Limited announced that it has decided to discontinue its business-to-business (B2B) operation dedicated to sales of nutrition supplements and vitamins after the remaining stock of products is depleted. Despite investments over two years, the venture with Midway Labs generated lower than expected results and a high level of inventory of nutrition supplements. In order to minimize further negative results, Netshoes adjusted the margins of nutrition supplements products, accelerating sales through its B2C channel. This will result in a write-off of about BRL 60 million in existing nutrition supplement inventory. In addition,
Netshoes terminated its commercial agreement with Midway Labs and has filed a lawsuit against them. Netshoes expects to record a provision of about BRL 20 million for Midway receivables that may not be collected.

The company announced that Mr. Andrew Béla Jánszky joined Netshoes as a Class III member of its board of directors and has also been appointed to serve as a member of its Audit, Nominating and Corporate Governance, and Compensation committees. Mr. Jánszky has decades of experience as a corporate finance, capital markets and mergers and acquisitions lawyer. Until November 2016, he was the partner responsible for the Latin America practice of Milbank, Tweed, Hadley & McCloy LLP and managing partner of the firm's São Paulo office. He currently splits his time between Brazil and New York as a corporate finance, governance and anti-corruption consultant. Mr. Jánszky is on the board of directors of Gol Linhas Aéreas Inteligentes S.A. and also serves as a member of the independent investigative committees of CCR S.A., Hypera S.A. and M. Dias Branco S.A. Indústria e Comércio de Alimentos, all companies listed on the Brazilian stock exchange (B3). Mr. André Petenussi has assumed the position of Chief Technology Officer. Mr. Petenussi has been with Netshoes for over two and a half years, leading efforts to continue developing innovative technology that improves the shopping experience of customers.