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1
Institutional Presentation
November 2011
Disclaimer
This presentation does not constitute an offer, or invitation, or solicitation of an offer to subscribe for or purchase
any securities neither does this presentation nor anything contained herein form the basis to any contract or
commitment whatsoever.
The material that follows contains general business information about LPS Brasil – Consultoria de Imóveis S.A
(“LPS”) as of September 30th, 2011. It is not intended to be relied upon as advice to potential investors. The
information does not purport to be complete and is in summary form. No reliance should be placed on the
accuracy, fairness, or completeness of the information presented herein and no representation or warranty,
express or implied, is made concerning the accuracy, fairness, or completeness of the information presented
herein.
This presentation contains statements that are forward-looking and are only predictions, not guarantees of
future performance. Investors are warned that these forward-looking statements are and will be subject to
many risks, uncertainties, and factors related to the operations and business environments of LPS and its
subsidiaries such as competitive pressures, the performance of the Brazilian economy and the industry, changes
on market conditions, among other factors disclosed in LPS filed disclosure documents. Such risks may cause the
actual results of the companies to be materially different from any future results expressed or implied in such
forward-looking statements.
LPS believes that based on information currently available to LPS management, the expectations and
assumptions reflected in the forward-looking statements are reasonable. Lastly, LPS expressly refuses any duty to
update any of the forward-looking statements contained herein.
2
Investment Highlights
3
Highlights 2011
Awards
Considered the main award of the real estate industry in Brazil; Lopes won The Top Imobiliário
aditions, since 1993.
Top Imobiliário Award
Ranking Valor 1000
Listed by Valor Econômico as one of the 1000 largest business groups in Brazil;
Greater emphasis on the 20 th largest net margin between all groups; 8th place in value generation between service companies.
Agressive strategies of M&A, expanding business into other regions of the country;
Lopes was considered the largest company in real estate marketing and consulting in Brazil, in the last five
years.
IG/ Insper Award
Achievements
Mr. Francisco Lopes
initiates its activities
intermediating
properties
1935 40´s
50´s
60´s
70´s
80´s
90´s
00´s
Launch one of the
first buildings under
the condominium
concept
First TV
advertisement for
a real estate
development
Start of long term
partnership with
Gomes de Almeida
Fernandez (Gafisa)
Launch and sell of 14
office buildings at Av.
Paulista
Launch and sell of 11
office buildings at the Faria
Lima region
Creation of the launching
system with sales stands
and marketing materials,
attracting customers
specially during weekends
Identification of Marginal
Pinheiros as an attractive
area and launch one of
the first buildings in the
region
Start up of sales of hotel
condominium (Flats)
Partner of Grupo Espírito
Santo in selling one of the
largest launching in Lisboa:
Parque dos Príncipes
Introduction of the
concept of condominium
clubs
First “Top Imobiliário”
award, in 1993 – Largest
Brokerage Company
Lopes becomes an important player at
the segment of gated communities
Triples in size in a decade,
strengthening its leadership
Wins its 16th consecutive
“Top Imobiliário”
Lopes’ IPO
Lopes starts its geographic expansion
process
Lopes’ website become leader on real
state market
Joint Venture with Itaú Bank in order to
create CrediPronto, our mortgage
company.
Lopes’ follow-on
The company’s first
logo
Becomes reference in real
estate launchings and
presents its new logo
The Brokerage Market Has No Other Company With Our History
and Track Record
5
Simple and Focused Value Added
Business Model
Main Distribution
Channel in the Industry with a
National Footprint
Low Risk Business
with a Diversified Client Base : Cash
Generator Company
Already scaled down to face new
market conditions
Unmatched Scale and Reach
Experienced Management Team
and Outstanding Track Record
Investment Highlights
6
7
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Joint Venture with Banco Itaú to
provide mortgage loans
Low, mid and high-income segments
Mortgage Loan Primary Market Secondary Market
Focus on secondary market, with a
unique model of own stores and a
network of licensed brokers
Growth through acquisitions
LPS Brasil: Unique Business Platform
+
7
8
2Q10 3Q10 4Q10 1Q11 2Q11 3Q11
BRAZIL 2.5% 2.7% 2.5% 2.4% 2.4% 2.4%
Primary
SP 3.0% 3.2% 3.1% 2.9% 3.0% 3.0%
Habitcasa 1.8% 1.9% 1.9% 1.9% 1.9% 2.1%
RJ 2.2% 2.1% 2.1% 2.2% 2.0% 2.2%
Other
Markets 2.1% 2.3% 2.1% 2.1% 2.1% 2.1%
Secondary
SP 2.5% 2.4% 2.3% 1.9% 2.4% 2.3%
RJ - - 2.3% 2.4% 2.5% 2.4%
Other Markets
- - - 2.1% 2.4% 2.4%
Lopes Net Commission
9
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Virtuous Cycle of the Business Model Creating Strong Barriers to Entry
Strong Established Base
Leading, nationally recognized brand
Present in 12 Brazilian states and in the Federal
District
Extensive distribution channel
Database with more than 1.9 million clients
More than 360 homebuilder clients
Leadership and Wide Range of Products Indisputable Sales Performance
Speed of sales of 22.6% in 9M11,
and 52% for Habitcasa
R$12.8 billion in contracted sales
in 9M11.
Most visited website in the real
estate sector: near 12 million
visitors in the first nine months of
2011.
Retention of Talent
Largest sales force: over 15,000
independent brokers
Attracts and maintains its sales force
Leader in the primary market
One-stop-shop: unique and
complete solution for the client
: unique platform to
develop the secondary market
: partnership with one
of the largest retail banks in the
world, Itaú Unibanco
9
Institutional Website
10
Visits on www.lopes.com.br
Source: Google Analytics,
The most visited
website in the real estate market
Strong investment
in online media
Increased
generation of Leads
Higher sales
conversion
• Over 12 million unique accesses in
the first nine months of 2011
•600 launches and more than 45
thousand units in the secondary
market
• Mobile version compatible with
over 5 thousand kinds of cell phones
• First brokerage company to launch
an App for iPad
• Leader in presence in social
networks
Competitive Advantage
Competitive Advantage: A single, integrated and solid Company
“Lopes” culture in all
business units of different
states
National Integration
of Systems
One single brand,
recognized by the
market
Identity that stands
Lopes out from the
competitors
11
LPS Brasil’s Market Mix
53% 52% 54% 49% 50% 46% 48% 44% 45%
5% 6% 5% 5%
11% 19% 18% 24% 21%
16% 14% 14% 17%
9%
12% 9% 8% 7%
7% 12% 10% 11% 12%
10% 11% 12% 12%
6% 6% 6% 6% 6%
5% 2% 2% 8%
13% 10% 11% 13% 12% 8% 12% 10% 7%
3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11
São Paulo
Rio de Janeiro
Brasília
South
Northeast
Other*
*Other: Ceará, Estpírito Santo, Minas Gerais, Goiás and the city of Campinas 12
LPS Brasil in the Primary Market
13
Lopes is exclusively focused on providing value-added real estate brokerage services to its client-developers, with a permanent concern of avoiding conflicts of interest
Formal relationship through agreements
Over 360 Clients
1,903,925 prospects included in our data base
Client-Developers Client-Buyers
Ho
w d
o w
e d
o
bu
sin
ess
?
Ho
w d
o w
e m
ak
e m
on
ey
?2
, 3
$ 0.19
$ 0.07
$ 2.14
$ 100
$ 10
Total Price
per Unit
Down-
payment
Gross
Commission
$ 0.85
$ 1.15
Agents +
Managers
Re
ve
nu
e R
ec
og
nitio
n
$ 4.40 ²
Developer
1 Data until Dec-10 2 Data from the LTM
$ 2.00
$ 2.40
Net Commission Premium Contract Advisory Fee
Simple and Focused Business Model…
14
Lopes is focused on providing its clients with a full range of consulting services, from land procurement advisory to product formatting, development and sale
Value-Added Services Across the Development Cycle
Determines
the Site’s Vocation
Masters Market
Research
Formats Product Meeting Buyers’
“Wants and Needs”
Develops
Marketing Campaign
Optimizes Media
Negotiations
Coordinates
Product
Launching
Events
Individual Sales Strategy
Created to Each Product
Coordinates Product
Launching Events
15
Lopes is Growing Nationwide
SOUTHEAST REGION São Paulo – Beginning of operations in 1935. Acquisition of 60% of Capucci
&Bauer, in October 2007, for R$9 million (7.1x P/E 2008) and an earn-out
payment. Acquisition of 51% of Itaplan, in September 2011, for R$29.2 million
(R$10.6 million + R$18.6 million earn out).
Rio de Janeiro – Entry by greenfield operation, with beginning of operations in
July 2006, with LCI-RJ. . Lopes acquires permanently an additional 10% stake
of Patrimóvel, in July 2010, and more 31% in October 2010 (51% total).
Espírito Santo – Acquisition of 60% of Actual, in July 2007, for R$5.76 million
(7.0x P/E 2008) and an earn-out payment.
Minas Gerais – Entry by greenfield operation with beginning of operations in
February 2008. Acquisition of 51% of Brisa, in September 2011, for R$5.5 million
(R$1.9 million + R$3.6 million earn out).
SOUTHERN REGION States of Rio Grande do Sul, Santa Catarina and Paraná – Acquisition of 75% of
Dirani, in May 2007, for R$15.1 million (7.5x P/E 2008) and two ear-out
payments. In July 2008, Lopes acquired the 25% left by the call/put
mechanism.
MIDDLE WEST REGION Federal District – Acquisition of 51% of Royal, in November 2007, for R$12
million (9.0x P/E 2008) and an earn-out payment.
Goiás - Greenfield operation with beginning of operations in August 2008.
NORTHEAST REGION Bahia - Greenfield operation with beginning of operations in October 2007.
Pernambuco – Acquisition of 60% of Sérgio Miranda, in August 2007, for R$ 3
million (10.0x P/E 2008) and an earn-out payment. In September 2009, Lopes
acquired the 40% left by the call/put mechanism. In 2010, there was a transfer
to LPS Fortaleza –of 100% (one hundred percent) of the capital stock of LPS
Pernambuco.
Ceará e Rio Grande do Norte – Acquisition of 60% of Immobilis, in January
2008, for R$2.4 million (10.0x P/E 2008) and an earn-out payment.
Lopes tracks developers’ regional movements, consolidates its
position as the largest consulting and sales player
PR
RJ
BA
SP
RS
ES
SC
PE
MG
DF
CE
GO
RN
Source: Lopes RI 16
HIGH
MEDIUM-HIGH
MEDIUM
ECONOMIC
BUSINESS UNITS
Sales Expertise in all Market Segments
Local
Usable Area
Sales
Location
Usable Area
Sales
Location
Usable Area
Sales
Location
Usable Area
Sales
Capital Augusta – Aug/11
Location
Usable Area
Sales
CASE
CASE
CASE
CASE
CASE
17
Consolação/ SP
38 / 54 m2
157 un. – R$ 10,150/m²
99% sold.
Developer: Esser
Saúde/ SP
55 m²
Bosque da Estação – Jul/11
52un. – R$7,250/m²
100% sold.
Developer : Zogbi
São Paulo/ SP
47 / 55 m²
Reserva do Horto – Aug/11
102 un. – R$ 4,400/m²
90% sold.
Developer : Jose Turecki
Guarapiranga/ SP
43 / 46 m2
Dez Guarapiranga – Aug/11
181 un. – R$ 3,220/m²
100% sold.
Developer : Cury
Sumaré/ SP
32 / 449 m²
Office Sumaré – Sep/11
125 un. – R$ 5,000/m²
80% sold.
Developer : Rossi
LPS Brasil in the Low Income Segment
18
HABITCASA: Focus on Low Income Segment
Focus on Low Income Segment
Units up to R$ 300 thousand
The Habitcasa brand is applied in all Lopes’ markets
19
20
11%
36%
25%
29%
3Q10
3Q10
3Q11
3Q11
Units Sold
Contracted Sales
Total units sold = 12,929
Total Contracted Sales = R$4,286 million
11%
31%
22%
36%
30%
44%
17%
9%
42%
36%
12%
10%
Sales by Income Segment – Primary and Secondary Markets
LPS Brasil in the Secondary Market
21
Pronto!
22
Pronto has 248 stores in 11 States + Federal District : 48 owned stores and
200 licensed brokers
SOUTHEAST REGION
São Paulo – Acquisition of 51% of VNC, in July 2010, for R$7.1
million (R$ R$1,8 million + R$0,3 million of investments + R$5,2
million of earn out ).
Acquisition of 51% of Plus Imóveis, in August 2010, for R$11.7
million (R$4.7 million + R$7.0 million of earn out).
Acquisition of 51% of Maber, in September 2010, for R$17.3
million (R$6.0 million + R$11.3 million of earn out).
Acquisition of 55% of Local, in December 2010, for R$25.6 million
(R$10.0 million + R$15.6 million of earnout)
Acquisition of 60% of Erwin Maack, in March 2011, for R$8.4 million
(R$2.9 million + R$5.5 million of earn out)
Acquisition of 51% of Condessa in July 2011, for R$4.9 million
(R$1.9 million + R$3 million of earn out).
Acquisition of 60% of Imóvel A in October 2011, for R$24.3 million
(R$10 million + R$14.3 million earn out).
Rio de Janeiro – Acquisition of 51% of Self Imóveis, in July 2010,
for R$ 2,6 million (R$900 thousand + R$1,7 million of earn out)
FEDERAL DISTRICT :
Acquisition of 51% of AçãoDall’Oca in April 2011, for R$12.2 million (R$3 million + R$9.2 million of earn out).
SOUTH REGION
Rio Grande do Sul – Acquisition of 51% of Ducati, in December
2010 forR$15,5 million (R$5.3 million + R$10.2 million of earnout).
Paraná – Acquisition of 60% of Thá, in February 2011, for R$20.9
million (R$7.4 million + R$13.6 million of earnout).
23
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Present in 11 states and the Federal District
– Covers 91% of the Brazilian GDP
– 48 own stores
– 200 licensed brokers
– Strong presence in São Paulo and Rio de Janeiro
Unique one-stop-shop business model
Solid client base
Strong internet presence
Diversified products in the portfolio
Unique Platform Poised for Growth Well Defined Acquisition Model with a Successful Track
Record
Appreciation and alignment of interests
– Earn-out
– 51% ownership stake
Natural Consolidator
Potential synergies:
– Scale and reach: network effect
– Access to mortgage financing
– Expertise of LPS Brasil management
Pronto!: A Natural Consolidator
Acquisition strategy:
– Companies with expertise in their regional markets
– Companies with limited access to capital
– Well positioned in relevant markets
– Widespread network
Successful acquisitions through the years
– 11 acquisitions since July 2010 focused on the secondary market
– Benchmark for future partners
– Accretion
23
Strengthening of mortgage origination and other related services.
Leadership position
in their respective
markets
Management
Excellence High Value Brands
Joint Venture Lopes Itaú
Lopes and Itaú created the first and biggest pure mortgage company of Brazil.
Direct and exclusive access to its
customer database
Seamlessly integrated operation with
Lopes’ sales process, including an
incentive compensation plan
Lopes media exposure
Service excellence
Competitive financing terms and
conditions
Speed and quality of processing
Experienced credit analysis
Successful exposure to the lending
business and in joint ventures
24
25
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Differentiated Model: One-Stop-Shop
Winning Model
Secondary Market: a significant potential for origination
48 own stores and 200 licensed real estate brokers in 11
states and the Federal District
Selective acquisitions to replicate the successful formula
used in the primary market
37% of Pronto!’s contracted sales are financed by
Credipronto!
Distinctive channel for clients in the secondary market
Over R$1.6 billion in financing
Incipient market in Brazil with huge expansion potential
59% of CrediPronto! transactions are originated through
Pronto!
Use of LPS Brasil’s platform and significant reduction in
CAPEX requirement
Focus
Relevance
Growth
Potential
Synergies
25
26
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
CrediPronto!
In 3Q11, CrediPronto! financed R$358 million, reaching R$895 million in mortgage loans in 2011.
26
Financed Volume
(R$ MM) (R$ MM)
Accumulated Volume Sold*
*It doesn’t include amortization.
154
358
3Q10 3Q11
132%
591
1,699
sep/10 sep/11
187%
Mortgages Portfolio
CrediPronto!
The Average Portfolio Balance in 3Q11 was R$1,272 million.
(R$ MM)
27
178
1,436
Opening portfolio balance Ending portfolio balance
Sep/11
707%
Jan/10
217 247 291 331 385
437 474 529
591 654
727 804
854 928
1,013 1,113
1,219
1,340
1.461
1.598 1.698
1.843
Accumulated Sales Volume *
CrediPronto!
(R$ MM)
28
CrediPronto! financed over R$143 million in October 2011.
*Not including amortization.
11%
29
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Credipronto!: Unique Partnership to Capture Mortgage Loan Market Potential
Evolution of Origination (base 100 = Jan-10)1
Business Highlights
Profit Sharing with limited credit risk
Leverage on LPS Brasil’s points of sale
Differentiated process of approval and release of funds
Unprecedented credit in the market
Innovative Real Estate Financing Process
Notes: 1 ABECIP (as of December 30th, 2010) and Company. Ranking based on June/2011 origination 2 Excluding Caixa 3 Bacen
+ Market
Leader
Largest Private Bank
in Brazil
High Growth Potential – Real Estate Financing equals only 4% of Brazilian GDP2
Credit Analysis Assessment ofthe Property
Legal Analysis Issuance of theContract
Release ofResources
24 hoursUntil 3
workingdays
2 working
days
3 working
days
5 working
days
Efficiency in Release of Credit
29
1,4% 1,9% 1,7%
Market Share CrediPronto!
2,4% 2,4%
100
168 177
245 241
376
411
125 145 147 144 179
209
1T10 2T10 3T10 4T10 1T11 2T11 3T11
Credipronto! Mercado
3,0% 2,8% CrediPronto! already has a Market Share of
5.4% among private banks (excluding Caixa)
It is responsible for more than 15% of the mortgage portfolio of Itaú
Total market financing 3T11: R$12.8 billion and R$32.5 billion in the 9M11 (including Caixa)
Brazilian Real Estate Market
30
31
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Growth 2007 - 2030
Significant Creation of Demand
Demographic Bonus Population Pyramid (millions of people)
Expansion of Class C (% of the population) Number of Families by Income Segment (millions)
40%
60%
80%
100%
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
Economically active population = 15 – 64 year-old
Dependence Index
(8%) 78% 160% 233% 291% 433%
2003
2008
11%
49%
24%
16%
Classes A and B Class C Class D Class E
8%
37%
27%
28%
Source: IBGE, Bird, Febraban and FGV
31.7
15.5
8.4
3.3 1.1 0.3
29.1 27.6
21.8
11
4.3 1.6
Up to R$1k
R$1k to
R$2k
R$2k to
R$4k
R$4k to
R$8k
R$8k to
R$16k
Above
R$ 16k
2007A
2030E
31
106% 104%
88% 84%
81%
68% 65%
48%
42% 40% 38%
35%
22% 22% 19%
15% 11% 11% 10%
6% 5% 5% 5% 4% 3% 3% 2% 2% 2% 1% 1%
Source: Goldman Sachs, Abecip, BCB
Mortgage Market
Mortgage Market as a % of GDP
32
33
R: 176
G: 17
B: 22
R: 180
G: 180
B: 180
R: 90
G: 90
B: 90
R: 255
G: 155
B: 155
R: 253
G: 231
B: 227
R: 159
G: 159
B: 159
R: 192
G: 192
B: 192
R: 231
G: 231
B: 231
R: 255
G: 155
B: 155
Growth Drivers
Housing deficit
– 7.2 million houses (2009)
Incipient mortgage loan market
Declining interest rates
Rising employees’ income
Growing availability of long-term funding
Increasing secondary market financing
Increasing family turnover
Market Potential for Real Estate Financing
Source: Bacen and ABECIP Notes: 1 Data from 2006, except for Brazil (2009) 2 FGV’s Center for Social Studies, 2010 3 Represents the number of times a family moves to a different house during their lifetime. Source: Credit Suisse
Mortgage Loan Access (% by Social Class)2
7.7%
5.0%
3.0%
1.7%
Classes A and B Class C Class D Class E
4.0x
1.8x
9.0 – 10.0x
G-7 Mexico Brazil
Family Turnover3
5.4
6.7
7.9
6.3 5.8
1991 2000 2006 2007 2008
Quantitative Housing Shortage (millions of homes)
33
3578
2471
2234
3.430
2517
3687
Average (Units Sold/Launched) = 0,85
Average (Units Sold/Launched) = 1,2
Units Launched and Sold SP Capital
Sales Speed Metropolitan Region of São Paulo
Year Units Lauched Units Sold
2008 34.500 32.800 2009 30.100 35.800 2010 37.300 35.870 08M11 16.600 20.400
Units Launched
Units Sold
R$/m2
SPMR Real Estate Market Overview – Prices
Source: EMBRAESP
Nominal
INCC Adjusted
Evolution of Average Launches’ Prices in SP
R$/m2
35
1360 1370 1550 1620 1740
1930 2230
2470
2850 2890 3050 3000
3200 3480
4470
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
4120 3880
4180 4140 4070 4180 4390
4190 4340
4040 4040 3770 3680 3730
4570
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
Lopes’ Confidence Index
36
118,0
133,1
100,0
125,0
82,0
116,9
Expectation Index Lopes' Confidence Index Present Situation Index
(base: jan/2009=100)
Source: Lopes Market Intelligence
Lopes’ Confidence Index (LCI) – September/11
Lopes is the first company to create a Real Estate Consumer Confidence Index.
37
Lopes’ Confidence Index intend to measure clients confidence, so Lopes can follow and anticipate, in the short term,
housing purchase tendency.
The sample has 591 interviews, with Grande São Paulo resident clients, which contacted Lopes in the last 3 months and
are interested in purchasing a new home.
Lopes’ Confidence Index (LCI)
September/11
Sales Speed Over Supply
38
39
24.5% 22.3%
2Q11 3Q11
51% 45.5%
2Q11 3Q11
Lopes' Consolidated Sales Speed Habitcasa’s Sales Speed
Sales Speed over Supply
*Management information, The Sales Speed over Supply is obtained based on the quarter’s contracted GVS compared to inventory and launches.
Operational Highlights
40
(128, 128, 128) (255, 225, 225) (192, 192, 192) (0, 0, 102) (128, 0, 0) (154, 186, 222) (234, 234, 234) (243, 250, 255)
(255, 128, 128) (255, 204, 153)
Contracted Sales’ Historical in the Primary Market*
•Unaudited managerial information.
• 2010 considers 100% of Patrimovel sales
Total GVS – Primary Market
(in R$ thousands)
591 850 1,166 1,253 1,556 1,853 2,545
4,873
9,370 8,658
14,364
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
41
(128, 128, 128) (255, 225, 225) (192, 192, 192) (0, 0, 102) (128, 0, 0) (154, 186, 222) (234, 234, 234) (243, 250, 255)
(255, 128, 128) (255, 204, 153)
Contracted Sales
(R$ MM)
Contracted Sales
42
Units Sold
In this Quarter, We Achieved R$ 4.3 billion in Contracted Sales.
3,345 3,326
272 960
3Q10 3Q11
3,617 18%
4,286
9,940 10,872
340
2,057
3Q10 3Q11
10,280
26% 12,929
(128, 128, 128) (255, 225, 225) (192, 192, 192) (0, 0, 102) (128, 0, 0) (154, 186, 222) (234, 234, 234) (243, 250, 255)
(255, 128, 128) (255, 204, 153)
R$ 1 BI
R$1.8 BI
R$ 1.5 BI
Secondary Market
Non-listed homebuilders
Listed homebuilders
43
Contracted Sales Breakdown
Contracted Sales
Contracted Sales= R$ 4.3 billion
22%
43%
35%
Financial Highlights
44
3Q11 Results
45
3Q11 Results
(R$ thousand)
Lopes Pronto! CrediPronto! Consolidado
Gross Revenue 80,981 25,868 8,356 115,206
Revenue from Real Estate Brokerage 77,356 25,868 534 103,759
Revenue to Accrue from Itaú 3,625 - - 3,625
Earn Out - - 7,822 7,822
Net Revenue 67,946 21,704 8,290 97,940
(-) Operating Costs and Expenses (44,988) (19,058) (3,416) (67,462)
(-) Stock Option Expenses (CPC 10) (469) - - (469)
(-) Expenses to Accrue from Itaú (238) - (286) (524)
(=)EBITDA 22,250 2,646 4,589 29,485
EBITDA Margin 32.7% 12,2% 55.4% 30.1%
(-) Depreciation and Amortization (6,005) (6,030) (10) (12,044)
(+/-) Financial Result 22,625 173 162 22,960
(-) Income and social contribution taxes (4,690) (1,622) (406) (6,717)
(=) Net Income for the year 34,180 (4,832) 4,335 33,683
Net Margin 50.3% -22.3% 52.3% 34.4%
(=) Net Income for the year
- Attributable to Non Controlling Shareholders (3,963)
- Attributable to Controlling Shareholders 29,721
Net margin after Non Controlling Shareholders 30.3%
CrediPronto!
46
(R$ thousand) P&L 2010
Amount financed 600,030
Portfolio opening balance 177,688
Portfolio ending balance 707,053
Portfolio average balance 403,587
Financial Margin 9,773
% Spread 2.42%
(-) SalesTaxes -919
(-) Total costs and expenses -22,087
(-) Expenses Itaú -3,471
(-) Expenses Olímpia -12,551
(-) Commissions -5,945
(-) Insurance and sinister (+/-) -120
(+/-) Bank correspondance -
(+) Other Revenues (Financial) 2,153
(-) Allowance for Doubtful Accounts -3,210
(-) IRPJ/CSLL 302
(=) Net result -13,988
% Net margin -143%
50% Profit Sharing -6,994
*The managerial P&L measures the results of the JV. Olimpia’s Results and all Revenues and Expenses incurred by Itau are considered.
• The numbers of the managerial P&L were audited for 2010 by Ernst&Young and, due to its managerial nature, it does not follow accounting standards.
• General (0,5%)
47
Allowance for Doubtful Accounts
Automatic credit score – 100% of the new contracts
For delays higher than 29 days
Example of P&L with a contract de financiamento para um imóvel de $200:
Ex: Sale for
$300
Ex: Sale for
$150
Month 8
$100
-$60
+$200
$240
Month 1
$100
-$60
-
$40
Month 2
$100
-$60
-$5
$35
Month 5
$100
-$60
-$25
$15
+$100: Profit for the bank
-$50: Loss of the bank
• Specific (variable)
Sale of the
recovered property
Recovery of
Property
¹ Including general allowance
Default
Financial Margin
Expenses¹
Specific Allowance
Result
Additional Information
48
Two seasonality components:
• Natural variation in sales related to holidays or vacation periods over the year. The first quarter is more significantly affected by summer vacations and the week of Carnival celebrations.
• Variations in sales stemming from the sales pipeline in the real estate development market, in which projects launched are subject to licensing and permit requirements, which account for significant distortions in a quarter-over-quarter comparison.
Lopes’ Contracted Sales Seasonality
Unstable sales behavior in each quarter accounts for variations in yearly sales
49 * The seasonality can not be verified in 2008, because of the effects of the world financial crisis.
17% 18%
14%
23%
15%
19% 21%
31%
22%
32%
24% 25% 25% 22% 23%
29% 28% 26%
37%
29%
41%
16%
33% 30%
2005 2006 2007 2008* 2009 2010
1Q 2Q 3Q 4Q
Ownership Structure
Total of 56,562,283 common shares
Ownership Structure Post-IPO
50
32%
8%
18%
34%
7% 1%
Rosediamond LLP
F.I.M. Crédito Privado Mocastland
Administradores
Investidores Estrangeiros - Free Float
Investidores Nacionais - Free Float
Pessoa Física