Cyrela Reports Cash Generation of R$184 Million in 1Q18.

Transcription

1 Cyrela Reports Cash Generation of R$184 Million in. São Paulo, May 10, Cyrela Brazil Realty S.A. Empreendimentos e Participações ( CBR or Company or Cyrela ) (BM&FBOVESPA: CYRE3; OTCQPink: CYRBY), one of the largest residential real estate developers in Brazil, announces its earnings results for the first quarter of 2018 (.) The financial and operating information contained herein, except where otherwise indicated, is presented in Brazilian Reais (R$) and follows the International Financial Reporting Standards (IFRS), which are in line with technical guideline OCPC 04 and technical interpretation ICPC 02, the Brazilian accounting principles, the financial reporting standards applicable to the Brazilian real estate developers and the relevant regulation. The comparisons refer to the same period of 2017 and occasionally to the fourth quarter of GROSS MARGIN In : 27.7%, up 0.7 p.p. from 4Q17 and down 3.2 p.p. from 1Q17 OPERATING CASH GENERATION In : R$184 million vs. R$245 million in 4Q17 and R$118 million in 1Q17 EPS In : - R$0.13, vs. +R$0.13 in 4Q17 and +R$0.01 in 1Q17 SALES NET INCOME ROE In : R$613 million, 18% up on 1Q17 and 51% down on 4Q17 In : Net loss of R$51 million vs. net income of R$49 million in 4Q17 and of R$4 million in 1Q17 Return on Equity (net income for the past 12 months over the period s average shareholders' equity, not including minority interests) -2.6%. CYRE3 (05/10/2018) # of Shares: 399,742,799 Market Cap: R$5,308.6 million US$1,495.0 million Conference Calls on the Results Portuguese (with simultaneous interpretation) May 11, :00 p.m. (Brasilia time) 10:00 a.m. (US EDT) +55 (11) (US) (other countries) IR Contacts: Phone number: (+55 11) ri@cyrela.com.br Visit our IR Website at: 1

2 Súmario MESSAGE FROM MANAGEMENT... 3 MAIN INDICATORS... 4 OPERATING PERFORMANCE... 5 LAUNCHES... 5 SALES... 7 SALES SPEED (SOS)... 9 INVENTORIES LANDBANK DELIVERIES CONSTRUCTION SITES Economic and Financial Performance REVENUE COST OF GOODS SOLD AND/OR SERVICES RENDERED GROSS MARGIN SALES TO BE RECOGNIZED SELLING EXPENSES GENERAL & ADMINISTRATIVE EXPENSES FINANCIAL RESULT NET INCOME AND NET MARGIN Highlights of the Financial Statements ACCOUNTS RECEIVABLE MARKETABLE REAL ESTATE DEBT CASH GENERATION SUBSEQUENT EVENTS ANNEX I BALANCE SHEET ANNEX II INCOME STATMENT ANNEX III REVENUE RECOGNITION ANNEX IV LAUNCHES ANNEX V SALES ANNEX VI LANDBANK ANNEX VII PROJECTS DELIVERED ANNEX VIII MIDDLE + MCMV Glossary

3 MESSAGE FROM MANAGEMENT We observed in early 2018 that some factors, such as a high unemployment rate, still prevent the real estate industry from a stronger recovery despite a stable inflation rate, a low benchmark Selic interest rate and a slight rise in the Brazilian savings account deposits. The upcoming presidential election brings further volatility to the local market. In the international arena, the monetary policy and protectionist measures introduced by the United States have heightened the prevailing uncertainty. Despite the current situation, Brazil seems to be past the peak of the worst economic crisis in decades. We believe the benchmark interest rate kept at its current level will continue to boost the economy, savings account deposits and credit supply in Brazil. As a matter of fact, banks announced lower mortgage rates in April. However, mortgage rates will have to fall even further before the real estate industry can rebound completely. The main highlight in the quarter was our strong cash generation, consistent with our strategy of adjusting the Company's capital structure and boosting shareholder return in the medium term. In this sense, the Board of Directors approved on May 2 the distribution of R$200 million as interim dividends, corresponding to R$0.52 per share. The payment will be made on July 2, It is also worth noting our net sales, which amounted to R$613 million in, up 18.3% year-over-year, mainly due to a drop in cancellations. We remain focused on managing this challenge, which has been facing the entire industry, as efficiently as possible while there is no consensus on rules capable of providing a sense of security for the real estate market as a whole. Once again, we thank all our stakeholders for their support and partnership. It is with you in mind that we work hard to make Cyrela an increasingly solid, profitable and sustainable company. 3

4 MAIN INDICATORS 1Q17 x 1Q17 4Q17 x 4Q17 Launches (1) Number of Launches ,0% 19-68,4% Launched PSV - R$ Million (100%) ,0% ,8% Launched PSV - R$ Million (%CBR) ,8% ,1% Cyrela's Share 59,6% 87,8% -28,2 p.p. 61,9% -2,3 p.p. PSV Swapped - R$ Million (100%) 12 - n.a ,7% Average Price per sq. m. (R$) (ex-lots) ,6% ,2% Usable Area Launched (sq. m.) ,9% ,1% Units Launched ,9% ,8% Sales (2) Pre-Sales Contracts - R$ Million (100%) ,9% ,1% Pre-Sales Contracts - R$ Million (%CBR) ,5% ,9% Cyrela's Share 62,7% 71,4% -8,7 p.p. 69,6% -6,8 p.p. Average Price per sq. m. (R$) (ex-lots) ,6% ,3% Units Sold ,0% ,5% Sales from Launches (2) Pre-Sales Contracts from Launches of the year - R$ Million (100%) ,6% ,7% Pre-Sales Contracts from Launches of the year - R$ Million (%CBR) ,4% ,6% Cyrela's Share 47,0% 65,6% -18,6 p.p. 61,6% -14,6 p.p. Average Price per sq. m. (R$) (ex-lots) ,8% ,2% Units Sold ,1% ,8% Deliveries Delivered PSV (100%) ,7% ,6% Delivered Units ,8% ,0% Landbank PSV with exchange - R$ Million (100%) ,9% ,0% PSV without exchange - R$ Million (100%) ,5% ,1% Landbank (thd sq. m.) ,5% ,0% % Swap over land value 75,4% 75,5% -0,1 p.p. 75,8% -0,4 p.p. % CBR 88% 87% 0,7 p.p. 88% 0,2 p.p. 1Q17 x 1Q17 4Q17 x 4Q17 Financial Indicators Net Revenue (R$ Million) ,4% ,3% Gross Profit (R$ Million) ,8% ,9% Net Income (R$ Million) (51) 4 n.a. 49 n.a. Gross Margin 27,7% 30,9% -3,2 p.p. 27,0% 0,7 p.p. Net Margin -11,4% 0,6% n.a. 6,0% n.a. Earnings per Share (R$) (³) (0,13) 0,01 n.a. 0,13 n.a. Cash Generation / Burn (4) ,8% % Backlog 03/31/ /31/2017 Chg. Revenues to be Recognized (R$ Million) ,1% Gross Profit to be Recognized (R$ Million) ,3% Margin to be Recognized 40,5% 39,0% 1,5 p.p. (1) Including swapped units (2) Net of cancellations and including swaps (2 ) Net of cancellations: sales during the quarter of launches in the year (2 ) Net of cancellations: sales during the year of launches in the year (3) Earnings per share are net of Treasury shares. (4) Cash generation does not include dividends, funds allocated to the share buyback program and acquisitions of equity interests. 4

5 OPERATING PERFORMANCE Note: detailed information on launches can be found at the end of this report in the appendix tables. LAUNCHES Launches amounted to a total Pre-Sales Value (PSV) of R$434 million in, down 29% from R$612 million in 1Q17. Swaps accounted for R$12.5 million of the launches; in turn, there were no swaps in 1Q17. Launches 100% (R$ million) % Q17 %CBR 88% 60% Partners Cyrela We launched six projects two in the city of São Paulo, one in Campinas, two in Rio de Janeiro and one in the Middle West Region in. 1Q17. Cyrela s share (%CBR) in the launches stood at 60%, down from 88% in 5

6 Excluding swaps from launches, the volume launched by Cyrela in fell by 53.1% year-over-year, from R$537 million to R$252 million. Launched PSV Ex-Swap (in R$ million - %CBR) % 252 1Q17 In, it is worth noting the launch of the Medplex project, in Campinas, with a Pre-Sales Value (PSV) of R$114 million. seen below. The breakdown of the 2018 launches by geographical region and segment can be Launches per Region Launches per Product Middle West 11.1% 35.6% São Paulo 26.3% High end Rio de Janeiro 26.9% 26.3% São Paulo - Other Cities MCMV 2 and % Of the PSV launched in the quarter, 62% is recognized through full consolidation and 38% through the equity method. 6

7 SALES Note: detailed information on pre-sales can be found at the end of this report in the appendix tables. Pre-sales amounted to R$613 million in, up 18% from 1Q17 (R$520 million.) Pre-Sales 100% (R$ million) +18.0% 613 Pre-Sales 100% (R$ million) +18.0% High End 241 Middle + MCMV Q17 1Q17 %CBR 71% 63% Launches Under Construction Inventory Finished Inventory The Company s share in sales stood at 63% in against 71% in 1Q17. Of the net sales, 62% will be recognized through full consolidation and 38% through the equity method. Sales of finished inventory units accounted for R$141 million (23%), sales of inventory units under construction for R$346 million (56%) and sales of launches for R$126 million (21%) of sales in the quarter. 7

8 Excluding swaps and considering only the %CBR, sales amounted to R$379 million in, vs. R$371 million in 1Q17. Sales Ex-Swap (in R$ million %CBR) 2.1% Q17 The breakdown of sales by geographical region shows São Paulo accounted for 59% of total sales, followed by Rio de Janeiro at 23.6%. seen below. The breakdown of sales by geographical region and segment in the quarter can be Sales per Region Sales per Product North and Others Northeast South 1.3% 4.5% Rio de Janeiro 3.0% 23.6% MCMV 2 and % High end 33.8% 58.9% São Paulo São Paulo - Other Cities 8.7% 16.6% Middle 8

9 SALES SPEED (SOS) Operating data shows Sales over Supply (SoS) in the trailing 12 months stood at 35.2% in, up from 29.1% in 1Q17 and from 34.0% in 4Q % 30.8% 32.7% 34.0% 35.2% SOS LTM 1Q17 2Q17 3Q17 4Q17 Concerning sales speed by vintage, 29% of the vintage has been sold. Sales Speed 100% through swaps Cyrela * 1Q17 18% 22% 7% 8% 3% 58% 2Q17 31% 16% 9% 3% 59% 3Q17 50% 20% 6% 76% 4Q17 44% 14% 59% 29% In 3 months In 6 months In 9 months In 12 months In 15 months 9

10 INVENTORIES Cyrela s inventory market value amounted to R$5,913 million (100%) and R$4,843 million (%CRB) at the close of. There was a quarter-over-quarter drop of 4.3% in the total inventory at market value in. The share of total inventory (R$5,913 million) to be consolidated into the Company s revenue is R$5,049 million (%CBR: R$4,424 million) whereas R$864 million (%CBR: R$418 million) will be accounted for under Equity Result and Other Appreciations. Inventory at Market Value (R$ MM) Inventory by Delivery Schedule (R$ MM) % CBR 6,646 1,069 5,576 6,441 1,069 5,372 6,212 6,176 1,043 1,144 5,169 5,032 5,913 1,070 4,843 Inventory to be delivered Total Consolidation Equity Method Finished Months Months Months Months Total Q17 2Q17 3Q17 4Q17 Changes in Inventory (R$ MM) Total Inventory Breakdown 6, % ,912.8 North Others South 1.9% 10.3% 5.7% Northeast 2.6% São Paulo 35.2% 24.4% Rio de Janeiro Inventory 4Q17 Sales of inventories Launches Sales of launches Price change Inventory 20.0% São Paulo - Other Cities Inventory under construction Finished inventory 10

11 During, the Company sold 5.4% of its inventory of finished units early in the quarter. Considering deliveries, the Company s inventory of finished units R$2,588 million in 4Q17 vs. R$2,595 million in remained virtually stable. Although still high, the inventory of finished units in Rio de Janeiro and the Northeast Regions put together fell in value in relation to 4Q17, from R$852 million to R$789 million (down from 33% to 30% of the total inventory). Finished Inventory Breakdown in 1.8% South 5.9% 14.4% Northeast 5.9% Rio de Janeiro Others North 24.5% 18.9% São Paulo 28.6% São Paulo - Other Cities Changes in Finished Inventory Units (R$ MM) +0.3% 2, ,595.0 Finished Units 4Q17 Sales of finished units PSV Delivered Price change Finished Units The share of the inventory of finished units to be consolidated into the Company s revenue is R$2,261 million (%CBR: R$1,968 million) whereas R$334 million (%CBR: R$169 million) will be accounted for under Equity Result and Other Appreciations. 11

12 LANDBANK Note: detailed information on landbank can be found at the end of this report in the appendix tables. At the close of, the Company s landbank amounted to 12.6 million sq. m. of marketable area with total potential sales of R$45 billion. Cyrela s share in the landbank is 88%, equivalent to R$40 billion. In, Cyrela acquired five plots of land, three in the city of São Paulo State and two in the city of Rio de Janeiro, with potential PSV of R$0.8 billion. Swaps accounted for 60% of the total value of those acquisitions. In addition, the Company canceled or sold 6 plots of land, with a net negative impact of R$28 million on the income statement. Landbank on 03/31/2018* Breakdown by Segment (PSV in R$ billion) Method of Acquisition (in %) MCMV 2 and 3 Middle 1.1 Cash % 36.1 High end 75% Swaps Breakdown by Region (PSV in R$ billion) 8.8 São Paulo *The landbank PSV is based on the latest feasibility assessment of the land plot, adjusted by the INCC yearto-date. Rio de Janeiro São Paulo - Other Cities South North Northeast Middle West Minas Gerais 12

13 DELIVERIES Note: detailed information on delivered units can be found in the appendix tables at the end of this report. Cyrela delivered 13 projects, with 3,200 units totaling a PSV of R$1,005 million on the dates of their respective launches. Of all the projects delivered during the quarter, none belongs to the MCMV 1 segment. Deliveries -5% 1,055 1, Others* Northeast South North Rio de Janeiro São Paulo** Q17 Note: *Espírito Santo State, Central-West Region and Minas Gerais State. **São Paulo and São Paulo Interior. 13

14 CONSTRUCTION SITES At the close of, there were 88 projects in progress broken down as follows by segment, execution and geographical location according to the active construction site criterion. Faixa 1 MCMV accounts for eight of all the projects in progress. Projects in Progress High end Partners % North Midwest(2) South RJ Middle + MCMV 69 Cyrela and JV s 85 97% SP 59 In line with its strategic direction, the Company manages a large share of the construction sites to monitor the execution of the works. At the close of, 97% of the construction sites were managed by the Company's own teams or joint ventures. This clearly shows Cyrela s commitment to managing costs and ensuring product quality. Of all the launches, only one project will be constructed by third parties. Construction Projects Partners % % % 4 5% 3 3% Cyrela and JV s 98 94% 95 94% 96% 95% % 1Q17 2Q17 3Q17 4Q17 14

15 Economic and Financial Performance Because MAC has been accounted for in a different manner since 2Q17, we will be presenting only proforma numbers for 1Q17 and 2017, considering MAC through the equity method, so that comparisons between those periods and 4Q17 and/or 2017 can be made. In compliance with accounting practices, Cyrela adopted the CPC 48 (IFRS 9) - Financial Instruments, recording a provision for credit risk. The adequacy of this provision had a negative effect on the Shareholders' Equity for the period ended in December 2017 in the amount of R$196 million. In there was a consumption of part of the provision, with a positive impact of R$41 million on the result for the quarter. REVENUE The Company s total gross revenue amounted to R$464 million in, down 29.3% from R$657 million in 1Q17 and 44.2% from R$832 million in 4Q17. This quarter-overquarter decrease reflects mainly lower net consolidated sales. Gross Revenue by Activity (R$ million) % -44.2% Q17 4Q17 Services rendered Real Estate Development 15

16 COST OF GOODS SOLD AND/OR SERVICES RENDERED 4Q17. Total cost came to R$326 million, falling by 26.1% against 1Q17 and 44.8% against Costs by Activity (R$ million) % -44.8% Q17 4Q17 Services rendered Real Estate Development The cost of development activities (99.3% of total costs) came to R$323 million in, down 44.9% from 4Q17 and 25.4% from 1Q17. 16

17 GROSS MARGIN The Company s total gross margin stood at 27.7% in, 0.7 p.p. up on 4Q17, when gross margin came to 27.0%, and 3.2 p.p. down on 1Q17, when gross margin came to 30.9%. Adjusted gross margin stood at 33.4% in, up 0.9 p.p. from 4Q17 and down 4.6 p.p. from 1Q17. 4Q17 1Q17 Adjusted Gross Margin R$ MM R$ MM x 4Q17 R$ MM x 1Q17 Net Revenue ,3% ,4% Gross Profit ,9% ,8% Gross Margin 27,7% 27,0% 0,8 p.p. 30,9% -3,1 p.p. Capitalized Interest from COGS ,9% 45-42,9% Adjusted Gross Margin 33,4% 32,5% 0,9 p.p. 38,0% -4,6 p.p. Gross Margin 30.9% +0.7 p.p 27.0% 27.7% Gross Profit: R$125 million Gross Margin: 27.7% 1Q17 4Q17 17

18 SALES TO BE RECOGNIZED At the close of, net revenue from sales to be recognized totaled R$1,586 million. Gross margin from revenue to be recognized stood at 40.5% in, up 1.5 p.p. quarter-over-quarter and 2.9 p.p. year-over-year. It is worth noting gross backlog margin does not consider the PVA effect and SFH-related financing costs. These effects usually have an impact between five and seven p.p. Backlog Margin +1.5p.p. 37.6% 39.0% 40.5% Margin to be recognized: 40.5% 1Q17 4Q17 Sales to be Recognized (R$ MM) 4Q17 x 4Q17 1Q17 x 1Q17 Sales to be Recognized ,0% ,1% Taxes to be Recognized (35) (35) 0,8% (42) -16,4% Net Revenues to be Recognized ,1% ,1% Costs of Units Sold to be Recognized (944) (1.009) -6,5% (1.208) -21,9% Gross Profit to be Recognized ,3% ,8% Gross Margin to be Recognized 40,5% 39,0% 1,5 p.p. 37,6% 2,9 p.p. 18

19 SELLING EXPENSES Selling expenses totaled R$73 million in, down R$7 million from 4Q17 and R$12 million from 1Q17. Commercial expenses 4Q17 1Q17 x 4Q17 R$ MM R$ MM R$ MM x 1Q17 Show-rooms ,4% 24-25,7% Media ,1% 14-28,6% Third-party Services ,7% 22-25,4% Finished Inventory Maintenance* ,3% 16 13,9% Others ,1% 9 18,9% Total ,4% 85-14,0% * maintenance costs of the inventory of finished units such as carrying fees and property tax. This quarter-over-quarter change is mainly explained by a R$12 million drop in media spending due to the lower number of launches. 19

20 GENERAL & ADMINISTRATIVE EXPENSES General and administrative expenses totaled R$99 million in, flattening out quarter-over-quarter and rising by R$5 million year-over-year. 4Q17 1Q17 General & Administrative Expenses R$ MM R$ MM x 4Q17 R$ MM x 1Q17 Salaries and Social Charges ,8% 26 0,0% Board Members/Management Remuneration 1 1-0,3% 2-13,5% Employees' 2 2 3,5% 4-54,6% Stock Options ,6% 2-24,3% Third-Party Services ,1% 21 0,4% Rent, travelling and representation ,6% 7-10,5% Indemnities ,1% 21 35,0% Others ,2% 11 7,9% Total ,3% 94 5,1% This quarter-over-quarter change was basically due to a decrease in indemnities to customers, offset by a rise in third-party services. 20

21 FINANCIAL RESULT 4Q17. The Company recorded net financial income of R$3 million in vs. R$8 million in R$ million 4Q17 Financial Expenses SFH Interest (29) (34) Interest on Corporate Loans (18) (22) Capitalized Interest Sub Total (24) (24) Monetary Adjustment on Loans (0) (0) Bank Expenses (3) (3) Other financial expenses (2) (2) Total Financial Expenses (29) (29) Financial Revenues Income on Investments Income on Receivables - - Monetary Adjustment 2 5 Other financial income 10 6 Total Financial Revenues Financial Result

22 NET INCOME AND NET MARGIN In addition to the accounts discussed above, it is worth noting the following items: (i) (ii) (iii) (iv) (v) A positive impact of R$12 million from Cyrela s share in Cury s net income, recognized under Equity Result and Other Appreciations in Equity ; A negative impact of R$14 million from contingencies on the income statement; A negative impact of R$19 million from reparatory expanses in the Northeast region; A negative impact of R$21 million from the cancellation of a lond plot in Brasília; A positive impact of R$41 million from the consumption of the provision that dah been recorded in the Shareholders Equity in 4Q17 due to the initial adoption of the IFRS 9. As a result of the performance described above, the Company recorded a net loss of R$51 million in, against net income of R$4 million in 1Q17 and of R$49 in 4Q17. 22

23 In, the Company s earnings per share fell to a negative R$0.13, vs. positive R$0.13 in 4Q17 and R$0.01 in 1Q17. EPS Q17 4Q *Total shares at the close of the quarter, not including Treasury shares on the same date **Number of shares without Treasury shares in millions. EPS Shares ex-treasury Net Profit (R$ million) 49 4 Net Margin -51 1Q17 4Q17 0.6% -11.4% 6.0% This led to a last 12-month ROE of -2.6%. 23

24 Highlights of the Financial Statements ACCOUNTS RECEIVABLE 12 Months Cost to be incurred (ref, sold units R$ million) Considering all pre-sales contracts executed, Accounts Receivable totaled R$3.9 billion on March 31, 2018, a 7.6% decrease from December 31, In the Company s Balance Sheet, this amount is R$2.3 billion, recognized based on construction progress in each project. 24 Months 36 Months After 36 Months Cost to be incurred (ref, inventory units R$ million) Delivered units account for 35.5% and units under construction or in the delivery process for 64.5% of that amount. The average Accounts Receivable turnover is about 1.6 years (19 months.) 12 Months Months Months 34.2 After 36 Months 0.5 4Q17 Accounts Receivable Chg % R$ MM R$ MM Units under construction ,7% Finished Units ,5% Total Accounts Receivable ,6% Construction Cost to be Realized from sold units (944) (1.009) -6,5% Construction Cost to be Realized from inventory units Construction Cost to be Realized from inventory units - Launched Phases Construction Cost to be Realized from inventory units - Unlaunched Phases (555) (638) -13,0% (332) (397) -16,4% (224) (241) -7,4% 12 Months 24 Months 36 Months After 36 Months Receivables Schedule ¹ (in R$ million) , , ,385.4 Net Accounts Receivable ,7% Economic Basis Cash Basis (1) Economic concept: considers full and immediate payment on the Habite-se date Cash Concept: Considers the Company's projection for the actual cash receipt. 24

25 MARKETABLE REAL ESTATE The main item under Inventory is land earmarked for future development, which comprised 37% of the total inventory on March 31, Estate. In Cyrela s Balance Sheet, the landbank totals R$1,702 million, under Marketable Real Marketable Real Estate 4Q17 R$ MM R$ MM Chg % Units under construction ,7% Finished units ,3% Landbank ,5% Suppliers ,0% Interest capitalized in inventories ,8% Total ,8% In addition to actual advances from customers, the Advances from Customers account comprises liabilities connected with physical swaps in land purchased (contra entries to land swaps), appraised at cost value. Under this account, land for future development amounts to R$232 million and developed projects to R$120 million, totaling R$352 million, corresponding to the cost value of swapped units. The Company will be repaying those obligations by following the same procedure as sales revenue recognition, with no actual cash outflows. Advances from Customers 4Q17 R$ MM R$ MM Chg % Receiving of real estate sales ,0% Land for future incorporation ,5% Incorpotared real estate units ,4% Total ,7% 25

26 The short- and long-term Accounts Payable for Real Estate Acquisition account shows a credit balance R$275 million, R$105 million of which corresponds to developed projects. Accounts Payable - Real estate acquisition 4Q17 R$ MM R$ MM Chg % Incorporated ,8% Others ,0% Total ,0% 26

27 DEBT On March 31, 2018, gross debt including accrued interest amounted to R$2,145 million, down 16.7% from R$2,574 million on December 31, The balance of financing denominated in local currency, entirely connected with construction financing through the Housing Finance System (SFH), accounted for 55% of total debt (without interest payable) and decreased by 23.6% in the quarter. Gross debt ex-sfh (R$ million) 1, Q17 Short term -6.8% Long term Debt (R$ million) 4Q17 x 4Q17 SFH financing ,6% Loans - local currency ,9% Sub total ,8% Interest - local currency ,8% Total ,7% (R$MM) 1, Months 24 Months 36 Months 48 Months > 48 Months SFH Other debts 27

28 As a result, the balance of loans denominated in Brazilian currency, comprising 45% of total debt (not considering accrued interest), corresponds to: R$ million Issued In Matures In Cost Balance Corporate Debt 1st Issue of CRERs 2011 Jun % of CDI 43,2 5th Issue of CRERs 2016 Dec-18 98% of CDI 150,0 6th Issue of CRERs 2016 Dec-18 98% of CDI 100,0 7th Issue of CRERs 2016 Dec % of CDI 30,0 Preferred Shares 2013 Dec-18 CDI % p.y. 35,0 Long-term credit lines TR % / 71.86% % of CDI 442,5 Long-term credit lines % of CDI 1,3 Long-term credit lines 2013 Jan-27 TJLP + 3,78% p.y. 94,6 Long-term credit lines 2017 Jan-23 CDI + 1,2% p.y. 63,6 Subtotal ~102,0% CDI 960,2 The Company s net debt amounted to R$1,012 million, down 15.4% from 4Q17. In R$ million 4Q17 x 4Q17 Long-Term Debt ,1% Short-Term Debt ,1% Total Debt ,8% Cash and Cash Equivalents ,6% Long-Term Financial Investments ,8% Total Cash and Equivalents ,1% Net Debt ,4% 28

29 The Company s leverage ratio, as measured through the Net Debt/Equity ratio, fell quarter-over-quarter to 16.8% in, which shows Cyrela s commitment to keeping it low, as well as its sound financial health. In R$ million 4Q17 % Chg Net Debt ,4% Shareholders Equity ,9% SFH ,6% Net Debt / Shareholders Equity 16,8% 19,4% -2,7 p.p. Net Debt (ex SFH) / Shareholders Equity -2,6% -5,4% 2,8 p.p. Debt (R$ Billion) Corp. 2.1 SFH Gross Debt 1Q % Corp. 1.5 SFH Gross Debt 4Q Corp. 1.2 SFH Gross Debt 19.4% 16.8% Short 0.9 Long Term 1.1 Cash and Cash Equivalents 1.0 Net Debt Indicators Net Debt/ Equity Average Cost Without SFH* = R$ -155 MM Total Debt 16.8% Debt Ex-SFH W/o SFH: 102.0% CDI SFH: TR + 9.0% p.y. Duration 1.4 y 1.0 y Short Term 59% 72% Long Term 41% 28% Net Debt / Equity 29

30 CASH GENERATION The Company recorded cash generation of R$184 million in, vs. R$245 million in 4Q17 and R$118 million in 1Q17. Operating cash inflow in the quarter was lower than in 4Q17, offset by a decrease in disbursements related to constructions and with interest on debt. (R$ million) Q17 1Q17 Stake Acquisition Cash Burn/Generation (R$ MM) 4Q17 Chg % 1Q17 Chg % R$ MM R$ MM x 4Q17 R$ MM x 1Q17 Total Debt (Gross Debt without Interest payable) ,8% ,0% Total Cash ,1% ,8% Net Debt ,4% ,3% Accountant Debt Change ,0% ,6% (+) Buyback Program 0 0 0,0% - 0,0% (+) Dividends - - 0,0% - 0,0% Operational Cash Generation/Burn ,0% ,6% (+) Acquisition of Equity Interest -1,6-66,0-97,6% - 0,0% Operational Cash Generation/Burn ,9% ,2% 30

31 SUBSEQUENT EVENTS At a meeting held on May 02, 2018, the Board of Directors declared the payment of intermediary dividends by the Company, in the total amount of R$ 200million, equivalent to R$ 0.52 per common share. The dividends shall be paid in July 02, 2018, for people registered as shareholders of the Company on the basis date of May 07,

32 ANNEX I BALANCE SHEET Consolidated Balance Sheet R$ million March 31, 2018 January 01, 2018 ASSETS Current Assets Cash and Cash Equivalents Marketable Securities Accounts Receivable Marketable Real Estate Recoverable Taxes and Contributions Deferred Taxes and Contributions 3 2 Selling Expenses to Be Recognized Anticipated Expenses Other Receivables Non-Current Assets Long Term Accounts Receivable Marketable Securities Checking Accounts with Partners in Projects Related Parties Recoverable Taxes and Contributions Marketable Real Estate Other Receivables Permanent Investment in Controlled Companies Fixed Assets Intangible Total Assets LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Loans and Financing Debentures 0 45 Real Estate Certificates Suppliers and provision for guarantees Taxes and Contributions Payable Deferred Taxes and Contributions Payroll, social charges and profit sharing Real Estate Acquisition Payable Dividends Payable - - Related Parties Checking Accounts with Partners in Projects Advances from Customers Other Payables Non-Current Liabilities Long Term Loans and Financing Debentures 4 4 Real Estate Certificates Suppliers and provision for guarantees Real Estate Acquisition Payable Labor Laws, Civil and Tax Proceeding Deferred Income Tax and Social Contribution Advances from Customers Minority Interest SHAREHOLDERS' EQUITY Capital Stoc k Capital Reserve (44) (43) Legal Reserve Surplus Reserve Treasury Shares (212) (215) Profit / Losses (51) - Other Comprehensive Income (56) (56) Total Liabilities and Shareholders Equity

33 ANNEX II INCOME STATMENT Consolidated Income Statement R$ million 4Q17 % Change Gross Revenue of Sales and/or Services Real Estate Development and Resales ,3% Lots for Development ,0% Services Rendered ,4% Deductions from Gross Revenue (14) (23) -41,4% Total Net Revenue ,3% Real Estate Sales and Resales (317) (581) -45,5% Lots for Development (6) (6) 11,5% Services Rendered and Others (2) (3) -22,3% Cost of Goods and/or Services Sold (326) (590) -44,8% Gross Profit (Loss) ,9% Operating (Expenses) Revenues Selling Expenses (73) (80) -8,4% General and Administrative Expenses (97) (98) -0,3% Management's Fees (1) (1) -0,2% Equity Result and Other Appreciations ,2% Other Results in Investments ,1% Financial Expenses (29) (29) 0,1% Financial Revenues ,9% Other Operating Expenses/Revenues ,5% (148) (122) 20,9% Earnings Before Income Taxes on Profit and Shareholders (23) 96 N/A Deferred ,5% Current (14) (21) -33,7% Tax and Social Contribution (12) (21) -44,3% Income (Loss) Before Minority Interest (35) 75 N/A Minority Interest (17) (27) -37,5% Net Income (51) 49 N/A 33

34 ANNEX III REVENUE RECOGNITION PROJECT SEGMENT LAUNCH DATE % ACCRUED FINANCIAL EVOLUTION ACCRUED REVENUE (R$ MM) *Considers only revenues from Residential Real Estate Development activities 1Q17 1Q1T18 1Q1T17 One Sixty High-end 04/16 3,4% 1,3% 23 (8) Medplex Eixo Norte High-end 12/16 9,4% 4,8% Riserva Golf High-end 07/14 1,9% 3,1% K By Cyrela High-end 02/14 0,0% 0,5% 15 7 Carioca Residencial Middle 03/14 0,0% 1,1% 15 (16) Inspire Mauá MCMV 2 and 3 11/16 10,0% 10,1% 14 4 Lead Americas High-end 03/14-0,1% 2,3% 13 7 In Side Península Home Design High-end 01/15 0,0% 8,6% Living Family Middle 12/16 11,8% 0,9% 12 4 Living Magic 2 Middle 04/16 7,0% 4,0% 11 9 Condomínio Castelo Do Batel High-end 06/16 7,0% 1,5% 11 2 Verdant Valley Residence Middle 11/14 0,2% 1,7% 10 (3) 360 On The Park High-end 04/12 0,0% 0,0% Vista Park Middle 10/12 0,2% -0,1% 9 (10) Living Magic Middle 01/15 5,0% 12,1% 9 21 Essenza Moema High-end 10/13 0,0% 0,6% 8 17 Praça Piratininga Middle 07/16 7,5% 7,8% 8 10 Atmosfera Bosque Da Saúde High-end 09/15 8,6% 7,6% 8 9 Living Moovie Middle 06/15 4,7% 12,5% 7 13 Cyrela Heredità Middle 12/16 7,7% 3,6% 7 5 Cyrela Landscape Seminário High-end 12/16 6,5% 2,4% 7 7 Inspired High-end 06/15 13,9% 8,0% 7 2 Living Wish Middle 09/16 5,5% 4,3% 7 9 Living Resort Middle 12/16 3,7% 1,1% 6 3 Living Baroneza Middle 05/16 9,8% 4,3% 5 1 Other Projects Sub-Total Projects begun after March, 2017 Plano & Estação Itaquera MCMV 2 and 3 02/18 22,4% 0,0% 11 - Living Wish Lapa Middle 07/17 1,2% 0,0% 5 - Plano & Panamby MCMV 2 and 3 05/17 11,9% 0,0% 5 - Plano & Vila Sonia MCMV 2 and 3 02/18 10,1% 0,0% 5 - Plano & Ermelino I MCMV 2 and 3 05/17 15,3% 0,0% 5 - Living Near Pacaembu Middle 12/17-0,7% 0,0% 4 - Ny 205 High-end 09/17 1,7% 0,0% 4 - Boulevard Lapa High-end 12/17 0,0% 0,0% 3 - Praça Mooca Middle 12/17 2,7% 0,0% 3 - Living Special Middle 12/17 2,7% 0,0% 2 - Living Connect Middle 09/17 0,1% 0,0% 2 - Exato Residencial MCMV 2 and 3 06/17 3,1% 0,0% 2 - Movva Middle 12/17 2,7% 0,0% 2 - Nomad High-end 05/17 7,9% 0,0% 1 - Praça Mooca Middle 12/17 10,5% 0,0% 1 - Other Projects begun after March, Sub-Total 57 - Total

35 ANNEX IV LAUNCHES Project Quarter Month Region PSV (R$ MM) Usable Area (sq. m.) Units Segment % CBR 1 Vida Sol Jan-18 CO 48, MCMV 2 and 3 50% 2 Plano & Parque São Vicente Jan-18 SP 95, MCMV 2 and 3 50% 3 Plano & Largo do Cambuci Jan-18 SP 58, MCMV 2 and 3 50% 4 Medplex Campinas Mar-18 SP - Other 114, High end 100% 5 Dez Portal Mar-18 RJ 55, MCMV 2 and 3 50% 6 Bela Vista São Gonçalo Mar-18 RJ 61, MCMV 2 and 3 25% Total 6 434, Q17 Launched PSV CBR Launched % CBR Units Averege Price PSV - Swaps % Sold with Region 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. São Paulo ,1% ,2% 50,0% 94,2% -44,2 p.p ,6% ,9% 0 0 0,0% 29,6% 10,9% 18,7 p.p São Paulo - Other Cities ,0% ,0% 100,0% 0,0% 100,0 p.p ,0% ,0% 1 0 0,0% 12,7% 0,0% 12,7 p.p Rio de Janeiro ,1% ,5% 36,8% 25,0% 11,8 p.p ,8% ,0% 5 0 0,0% 47,7% 81,3% -33,6 p.p Minas Gerais 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Espírito Santo 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p North 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Midwest ,0% ,0% 50,0% 0,0% 50,0 p.p ,0% ,0% 6 0 0,0% 26,9% 0,0% 26,9 p.p South 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Northeast 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Total ,0% ,8% 59,6% 87,8% -28,2 p.p ,9% ,6% ,0% 33,7% 48,5% -14,8 p.p Launched PSV CBR Launched Averege Price PSV - Swaps % Sold % CBR Units (R$ MM) PSV (R$ MM) (per sq. m.) (R$ MM) with Swaps Segment 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. High end ,7% ,7% 100,0% 100,0% 0,0 p.p ,3% ,0% 1 0 0,0% 12,7% 12,9% -0,2 p.p Middle 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p MCMV 2 and ,6% ,7% 45,2% 38,3% 6,8 p.p ,3% ,6% ,0% 35,9% 50,1% -14,2 p.p Total ,0% ,8% 59,6% 87,8% -28,2 p.p ,9% ,6% ,0% 33,7% 48,5% -14,8 p.p ANNEX V SALES 1Q17 Pre-Sales Contracts (R$ MM) Units Usable Area Sold (sq. m.) Avg. Price (R$/sq. m.) % CBR Region 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. São Paulo ,2% ,7% ,0% ,1% 62,6% 78,1% -15,5 p.p São Paulo - Other Cities ,4% ,0% ,7% ,9% 79,7% 66,9% 12,9 p.p Rio de Janeiro ,2% ,0% ,9% ,6% 59,7% 49,4% 10,3 p.p Minas Gerais ,2% 9 0 0,0% ,7% 0 0 0,0% 0,0% 0,0% 0,0 p.p Espírito Santo ,3% ,9% ,2% ,8% 74,6% 71,4% 3,2 p.p North ,7% ,7% ,8% ,6% 68,2% 86,9% -18,6 p.p Midwest ,2% ,0% ,1% ,6% 50,0% -3,6% 53,6 p.p South ,3% ,7% ,9% ,9% 35,9% 108,9% -73,0 p.p Northeast ,9% ,5% ,9% ,1% 55,2% 82,0% -26,8 p.p Total ,9% ,0% ,7% ,6% 62,7% 71,4% -8,7 p.p Pre-SalesContracts (R$ MM) Units Usable Area Sold(sq. m.) Avg. Price(R$/sq. m.) % CBR Segment 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. High end ,7% ,8% ,9% ,1% 71,2% 79,3% -8,1 p.p Middle ,5% ,6% ,5% ,8% 94,0% 85,6% 8,4 p.p MCMV 2 and ,0% ,7% ,9% ,2% 46,5% 49,1% -2,6 p.p Total ,9% ,0% ,7% ,6% 62,7% 71,4% -8,7 p.p 35

36 ANNEX VI LANDBANK Landbank Region PSV - with swaps (R$ MM) PSV - without swaps (R$ MM) Land Units Swap % CBR São Paulo ,8% 86,5% São Paulo - Other Cities ,2% 91,2% Rio de Janeiro ,5% 91,8% Minas Gerais ,0% 90,0% North ,4% 77,8% Midwest ,5% 70,7% South ,3% 73,3% Northeast ,0% 87,4% Total ,4% 87,9% Product PSV - with swaps (R$ MM) PSV - without swaps (R$ MM) Land Units Swap % CBR High end ,2% 87,5% Middle ,1% 88,9% MCMV 2 and ,5% 92,9% Total ,4% 87,9% Land Acquisition Region PSV - with swaps (R$MM) PSV - without swaps (R$ MM) Land Units Swap % CBR São Paulo ,5% 91,3% São Paulo - Other Cities ,0% 0,0% Rio de Janeiro ,9% 91,4% Minas Gerais ,0% 0,0% Espírito Santo ,0% 0,0% North ,0% 0,0% Midwest ,0% 0,0% South ,0% 0,0% Northeast ,0% 0,0% Total ,8% 91,3%, Product PSV - with swaps (R$MM) PSV - without swaps (R$ MM) Land Units Swap % CBR High end ,0% 93,6% Middle ,7% 75,0% MCMV 2 and ,3% 100,0% Total ,8% 91,3% 36

37 ANNEX VII PROJECTS DELIVERED Delivered Projects Location Launch Date Delivery Date Usable Area (sq mts) PSV Launched (R$ MM) Units Delivered Cyrela 2014 The Year Edition SP Nov-14 Jan ,0 120 High end 100% Cosmopolitan Santa Cecília SP Apr-15 Jan ,4 230 High end 50% Dez Nova Iguaçu RJ Nov-14 Jan ,7 285 MCMV 2 and 3 50% Next Office - Castanheira North Jan-15 Jan ,7 160 Middle 100% Encontro Imigrantes SP May-14 Feb ,2 522 Middle 100% Classic Lapa SP Mar-15 Feb ,0 102 High end 100% Living Magic SP Nov-14 Feb ,7 449 Middle 80% Inspired SP May-15 Feb ,9 132 High end 100% Dez Praia Grande SP - Other Cities Dec-14 Feb ,9 251 MCMV 2 and 3 50% Super Cittá - Horizonte SP - Other Cities Jun-15 Feb ,1 240 MCMV 2 and 3 60% Super Cittá - Jardins SP - Other Cities Jul-15 Feb ,1 180 MCMV 2 and 3 60% Fatto Evidence SP - Other Cities Sep-14 Feb ,6 180 MCMV 2 and 3 100% Vidamérica Clube Residencial RJ Dec-14 Mar ,0 356 Middle 100% Total 13 Projects , Product % CBR ANNEX VIII MIDDLE + MCMV Summary 1Q17 x 1Q17 4Q17 x 4Q17 Launches (1) Number of Launches ,0% 15-66,7% Launched PSV - R$ MM (100%) ,6% ,6% Launched PSV - R$ MM (%CBR) ,7% ,4% Cyrela's Share 45,2% 38,3% 6,8 p.p. 62,8% -17,7 p.p. PSV Swaped - R$ MM (100%) 11-0,0% 22-48,5% Average Price per sq. m. (R$) ,6% ,2% Usable Area Launched (sq. m.) ,3% ,1% Units Launched ,3% ,2% Sales (2) Pre-Sales Contracts - R$ MM (100%) ,4% ,9% Pre-Sales Contracts - R$ MM (%CBR) ,8% ,5% Cyrela's Share 58,4% 62,3% -3,9 p.p. 67,2% -8,8 p.p. Average Price per sq. m. (R$) ,7% ,6% Units Sold ,4% ,9% (1) Including swapped units (2) net of cancellations and including swaps 37

38 Middle + MCMV Launches 1Q17 Launched PSV (R$ MM) CBR Launched PSV (R$ MM) % CBR Units Averege Price (per sq. m.) PSV - Swaps (R$ MM) % Sold with Swaps Region 1Q17 Chg% 1Q17 Chg% 1Q17 Chg p.p. 1Q17 Chg% 1Q17 Chg% 1Q17 Chg% 1Q17 Chg p.p. São Paulo ,9% ,9% 50,0% 50,0% 0,0 p.p ,7% ,6% 0 0 0,0% 29,6% 10,7% 18,9 p.p São Paulo - Other Cities 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Rio de Janeiro ,1% ,5% 36,8% 25,0% 11,8 p.p ,8% ,0% 5 0 0,0% 47,7% 81,3% -33,6 p.p Minas Gerais 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Espírito Santo 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p North 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Midwest ,0% ,0% 50,0% 0,0% 50,0 p.p ,0% ,0% 6 0 0,0% 26,9% 0,0% 26,9 p.p South 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Northeast 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Total ,6% ,7% 45,2% 38,3% 6,8 p.p ,3% ,6% ,0% 35,9% 50,1% -14,2 p.p Launched PSV CBR Launched Averege Price PSV - Swaps % Sold % CBR Units Segment (R$ MM) PSV (R$ MM) (per sq. m.) (R$ MM) with Swaps 1Q17 Chg% 1Q17 Chg% 1Q17 Chg p.p. 1Q17 Chg% 1Q17 Chg% 1Q17 Chg% 1Q17 Chg p.p. Middle 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p MCMV 2 and ,6% ,7% 45,2% 38,3% 6,8 p.p ,3% ,6% ,0% 35,9% 50,1% -14,2 p.p Total ,6% ,7% 45,2% 38,3% 6,8 p.p ,3% ,6% ,0% 35,9% 50,1% -14,2 p.p Middle + MCMV Sales 1Q17 Pre-Sales Contracts (R$ MM) Units Usable Area Sold (sq. m.) Avg. Price (R$/sq. m.) % CBR Region 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. São Paulo ,0% ,8% ,4% ,8% 57,3% 70,2% -12,9 p.p São Paulo - Other Cities ,6% ,3% ,0% ,7% 80,6% 75,5% 5,0 p.p Rio de Janeiro ,0% ,7% ,5% ,0% 52,2% 18,7% 33,5 p.p Minas Gerais 0 0 0,0% 0 0 0,0% 0 0 0,0% 0 0 0,0% 0,0% 0,0% 0,0 p.p Espírito Santo ,3% ,2% ,0% ,4% 81,4% 71,7% 9,7 p.p North ,7% ,9% ,5% ,0% 100,0% 100,0% 0,0 p.p Northeast ,2% ,6% ,9% ,5% 50,0% 50,0% 0,0 p.p South ,3% ,9% ,4% ,1% 96,7% 98,6% -1,9 p.p Midwest ,0% ,7% ,1% ,4% 100,0% 100,6% -0,6 p.p Total ,4% ,4% ,3% ,1% 58,4% 62,3% -3,9 p.p Segment Pre-Sales Contracts (R$ MM) Units Usable Area Sold (sq. m.) Avg. Price (R$/sq. m.) % CBR 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg % 1Q17 Chg p.p. Middle ,5% ,6% ,5% ,3% 94,0% 85,6% 8,4 p.p MCMV 2 and ,0% ,7% ,9% ,8% 46,5% 49,1% -2,6 p.p Total ,4% ,4% ,3% ,1% 58,4% 62,3% -3,9 p.p 38

39 Middle + MCMV Landbank Region PSV - with swaps (R$ MM) PSV - without swaps (R$ MM) Land Acquisition Middle + MCMV Land Units Swap % CBR São Paulo ,8% 88,0% São Paulo - Other Cities ,2% 95,1% Rio de Janeiro ,0% 87,1% Minas Gerais ,0% 60,0% North ,9% 100,0% Midwest ,1% 58,3% South ,4% 99,1% Northeast ,0% 80,0% Total ,2% 89,3%, Region PSV - with swaps (R$MM) PSV - without swaps (R$ MM) Land Units Swap % CBR São Paulo ,6% 86,7% São Paulo - Other Cities ,0% 0,0% Rio de Janeiro ,0% 0,0% Minas Gerais ,0% 0,0% Espírito Santo ,0% 0,0% North ,0% 0,0% Northeast ,0% 0,0% South ,0% 0,0% Midwest ,0% 0,0% Total ,6% 86,7%, 39

40 Glossary PSV: Pre-Sales Value, or the amount in R$ obtainable by selling each real estate unit. %CBR: the Company s share, or the sum of its direct and indirect share in each project. Pre-sales: the sum of values of all units sold the contracts for which have been signed. Percentage of Completion ("PoC"): construction costs incurred divided by total construction costs. Revenue is recognized up to the incurred cost/total cost ratio. Result to be recognized: due to the "PoC" accounting method, results from units sold are recognized according to the percentage of completion of construction costs. Therefore, it is the result to be recognized as costs incurred increase. Cash generation (burn): change in net debt between two periods. Net debt: total debt plus debenture and MBS issuance costs, net of accrued interest, less cash position (cash and cash equivalents + short- and long-term marketable securities). MBS: Mortgage-backed securities. Earnings per share: net income for the period divided by total shares (on the last day of the quarter), net of Treasury shares. Landbank: all the land available for future launches. Swap: land purchase arrangement whereby the Company pays for land with units (in the case of unit swaps) or with cash flows from sales of units (in the case of financial swaps). SFH: Sistema Financeiro da Habitação, or Financial Housing System 40