SAO PAULO, Nov. 14, 2011 /PRNewswire/ -- Gafisa S.A.
(Bovespa: GFSA3; NYSE: GFA), Brazil's leading diversified national
homebuilder, today reported financial results for the third quarter
ended September 30, 2011. The
financial statements were prepared and presented in accordance with
IFRS and in Brazilian Reais (R$). Further details of the Company's
third quarter 2011 results may be found on the Gafisa website:
www.gafisa.com.br/ir.
Commenting on the results, Duilio
Calciolari, CEO of Gafisa, said, "We are pleased to report
quarterly results led by a strong recovery in our operating
margins, as the share of older lower margin developments continues
to diminish in our overall product mix. Gross margin for the
quarter was 29.5%, an increase on both a year-on-year and
sequential basis. Subsequently, our EBITDA margin also
improved to 20.1% for the third quarter."
"Despite these improvements, we expect to continue to see some
pressure on the EBITDA margin during the coming quarters as we
complete the delivery of the higher cost legacy Tenda projects and
lower margin Gafisa projects from our geographic expansionary
period as well as implement some aspects of our new strategic
plan."
"While sales velocity of launches during the quarter was 50%,
indicating strong demand for our projects, we have deliberately
decided to slow the growth of launches for the remainder of 2011
and stabilize 2012. This change is part of a more comprehensive
strategic plan we are in the process of implementing, that will
help us to achieve improved profitability, positive cash flow and a
reduction in our overall leverage."
Calciolari added, "While the Brazilian economy has moved into a
more rational growth phase, overall the fundamentals remain sound
to support long term growth for the homebuilding industry. We are
confident that our strategic plan will allow us to focus on the
strong pockets of opportunity for our brands and set the stage for
continued market leadership in the future. We fully understand that
this strategy may impact the size of our firm for some years to
come. However, these are necessary actions and we believe will
prove a highly successful trade-off in the longer term."
Third Quarter Results
- 3Q11 launches reached R$1
billion, a 15% decrease compared to 3Q10. Launches for the
first nine months of 2011 totaled R$2.9
billion, representing 56% of the mid-range of full-year
launch guidance of R$5.3 billion.
This has resulted in a downward revision to 2011 guidance to
between R$3.5 billion and R$4
billion.
- Pre-sales reached R$1.04 billion
in 3Q11, a 3% increase compared to 3Q10, reflecting better sales of
launches in 3Q11, which reached 50%. Consolidated VSO was
23.1%.
- Net revenues, recognized by the Percentage of Completion
("PoC") method, reached R$1 billion,
a 5% increase compared to 3Q10, due to higher recognition coming
from recent launches.
- Adjusted Gross Profit (w/o capitalized interest) was
R$297 million, 8% higher than the
same period of 2010, with a 34% Adjusted Gross Margin.
- Adjusted EBITDA reached R$202.2
million with a 20.1% margin, a 2.5% increase over
R$197 million in 3Q10, due to the
delivery of higher margin products by AlphaVille and Gafisa.
- Net Income was R$46.2 million for
3Q11 (4.6% Adj. Net Margin), a 60% decrease compared to 3Q10.
- Net Debt/Equity ended the quarter at 75.3%, supported by a
securitization of part of Gafisa's receivables totaling
R$200 million.
Details of strategic plan
A new strategic plan designed in consultation with management
consultants Bain & Co, and based on an evaluation of each of
the Gafisa, AlphaVille and Tenda businesses which commenced in
July, will foster long-term sustainability and profitable growth by
improving margins, generating cash flow and reducing leverage.
Key elements of the strategy include:
- A new organizational structure establishing P&L owners by
brand in order to enhance the focus on and exploit the unique
qualities of each business line.
- Expansion of highly targeted regions of the country with proven
potential for profitable development of each brand segment through
2014.
- A turn-around strategy for Tenda which conserves capital by
only launching units that can immediately be transferred to CEF and
developing a scale advantage to optimize the use of aluminum mold
technology which facilitates a lower cost structure.
- Expanding AlphaVille, which boasts gross margins of
approximately 50%, significant barriers to entry and competitive
advantages, in the product mix.
In order to achieve these goals, Gafisa will slow the rate of
launches in 2011 to between R$3.5 and R$4
billion. The company will continue to launch Gafisa products
as long as the sales environment is strong for each product. Tenda
launches will be based on Gafisa's ability to immediately transfer
the units to the Caixa Economica Federal (CEF). Additionally,
Gafisa's focus at Tenda will be to deliver units in progress.
Gafisa has some R$400 million yet to
transfer to CEF from finished units. Gafisa also intends to expand
AlphaVille in our product mix and allocate the capital necessary to
leverage the competitive advantages it has within this brand
segment.
Outlook
Gafisa is on track to achieve a full-year EBITDA margin within
the previously stated guidance range of 16%-20%. In the first nine
months of 2011 the EBITDA margin reached 16.1%.
The company expects to finish the year with total launches of
between R$3.5 – R$4 billion. The 2011 forecast equates to a 30%
drop on previously stated guidance of between R$5 – R$5.6
billion, reflecting a more conservative strategy which
focuses on long term profitability and cash flow generation.
Gafisa expects to become cash flow positive during coming
quarters and to achieve a net debt to equity ratio below 60% over
the next quarters.
Conference Call
The management of Gafisa will host a conference call in English
on Wednesday, November 16, 2011, at
9:30 p.m. US EST/:12:30 p.m. Brasilia time. To access the call, dial +1
(516) 300-1066 from the United
States and other countries and enter the code Gafisa. A live
webcast of the conference call will be available on the internet at
www.gafisa.com.br/ir.
Consolidated Income
Statement
The Income Statement reflects the impact of IFRS adoption, also
for 2010.
|
|
|
R$ 000
|
3Q11
|
2Q11
|
QoQ
|
3Q10
|
YoY
|
9M11
|
9M10
|
QoQ
|
|
|
Net Operating
Revenue
|
1,005,490
|
1,041,344
|
-3.4%
|
957,196
|
5.0%
|
2,847,190
|
2,792,223
|
2.0%
|
|
|
Operating Costs
|
(708,614)
|
(822,424)
|
-13.8%
|
(681,275)
|
4.0%
|
(2,146,626)
|
(1,984,154)
|
8.2%
|
|
|
Gross profit
|
296,876
|
218,920
|
35.6%
|
275,921
|
7.6%
|
700,564
|
808,069
|
-13.3%
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
|
Selling Expenses
|
(68,298)
|
(61,970)
|
10.2%
|
(53,887)
|
26.7%
|
(181,773)
|
(166,321)
|
9.3%
|
|
|
General and Administrative
Expenses
|
(59,711)
|
(60,389)
|
-1.1%
|
(59,317)
|
0.7%
|
(176,407)
|
(171,860)
|
2.6%
|
|
|
Other Operating Revenues /
Expenses
|
(10,395)
|
(8,649)
|
20.2%
|
(2,187)
|
375.3%
|
(30,025)
|
(11,392)
|
163.6%
|
|
|
Depreciation and
Amortization
|
(21,855)
|
(22,754)
|
-4.0%
|
(8,305)
|
163.2%
|
(56,974)
|
(27,324)
|
108.5%
|
|
|
Operating results
|
136,617
|
65,158
|
109.7%
|
152,207
|
-10.2%
|
255,385
|
431,172
|
-40.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Income
|
31,619
|
21,697
|
19.0%
|
36,417
|
-13.2%
|
77,980
|
101,275
|
-23.0%
|
|
|
Financial Expenses
|
(89,740)
|
(50,563)
|
66.0%
|
(56,432)
|
59.0%
|
(195,965)
|
(181,816)
|
7.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Taxes on
Income
|
78,496
|
36,292
|
116.3%
|
132,192
|
-40.6%
|
137,400
|
350,631
|
-60.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Taxes
|
(5,858)
|
10,147
|
-157.7%
|
(823)
|
611.8%
|
10,592
|
(27,649)
|
-138.3%
|
|
|
Income Tax and Social
Contribution
|
(17,958)
|
(11,590)
|
54.9%
|
(9,661)
|
85.9%
|
(37,698)
|
(27,384)
|
37.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income After Taxes on
Income
|
54,680
|
34,849
|
56.9%
|
121,708
|
-55.1%
|
110,294
|
295,598
|
-62.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
Minority Shareholders
|
(8,463)
|
(9,737)
|
-13.1%
|
(5,108)
|
65.7%
|
(25,259)
|
(16,911)
|
49.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
46,217
|
25,112
|
84.0%
|
116,600
|
-60.4%
|
85,035
|
278,687
|
-69.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Balance Sheet
|
|
|
3Q11
|
2Q11
|
QoQ
|
3Q10
|
YoY
|
|
|
Current Assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
912,359
|
1,163,080
|
-21.6%
|
1,231,143
|
-25.9%
|
|
|
Receivables from
clients
|
4,002,213
|
3,653,708
|
9.5%
|
2,727,930
|
46.7%
|
|
|
Properties for sale
|
2,130,661
|
1,988,093
|
7.2%
|
1,447,266
|
47.2%
|
|
|
Other accounts
receivable
|
146,461
|
201,492
|
-27.3%
|
155,795
|
-6.0%
|
|
|
Deferred selling
expenses
|
30,493
|
20,588
|
48.1%
|
38,028
|
-19.8%
|
|
|
Prepaid expenses
|
13,599
|
9,533
|
42.7%
|
16,423
|
-17.2%
|
|
|
7,235,786
|
7,036,494
|
2.8%
|
5,616,585
|
28.8%
|
|
|
Long-term Assets
|
|
|
|
|
|
|
|
Receivables from
clients
|
1,867,969
|
2,171,302
|
-14.0%
|
2,411,275
|
-22.5%
|
|
|
Properties for sale
|
416,717
|
346,658
|
20.2%
|
388,649
|
7.2%
|
|
|
Deferred taxes
|
353,212
|
353,445
|
-0.1%
|
367,788
|
-4.0%
|
|
|
Other
|
215,695
|
187,536
|
15.0%
|
252,324
|
-14.5%
|
|
|
2,853,593
|
3,058,941
|
-6.7%
|
3,420,036
|
-16.6%
|
|
|
Property, plant and
equipment
|
74,939
|
81,135
|
-7,6%
|
63,825
|
17,4%
|
|
|
Intangible assets
|
219,490
|
215,624
|
1,8%
|
209,687
|
4,7%
|
|
|
294,429
|
296,759
|
-0.8%
|
273,512
|
7.6%
|
|
|
Total Assets
|
10,383,808
|
10,392,194
|
-0.1%
|
9,310,133
|
11.5%
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
Loans and financing
|
475,969
|
689,412
|
-31.0%
|
789,331
|
-39.7%
|
|
|
Debentures
|
206,336
|
153,788
|
34.2%
|
214,561
|
-3.8%
|
|
|
Obligations for purchase of land
and advances from clients
|
469,642
|
526,560
|
-10.8%
|
460,470
|
2.0%
|
|
|
Materials and service
suppliers
|
185,185
|
225,692
|
-17.9%
|
292,444
|
-36.7%
|
|
|
Taxes and
contributions
|
291,649
|
294,716
|
-1.0%
|
234,394
|
24.4%
|
|
|
Taxes, payroll charges and
profit sharing
|
75,140
|
66,772
|
12.5%
|
69,594
|
8.0%
|
|
|
Provision for
contingencies
|
27,770
|
21,598
|
28.6%
|
8,001
|
247.1%
|
|
|
Dividends
|
102,767
|
102,767
|
0.0%
|
52,287
|
96.5%
|
|
|
Obligation for
investors
|
148,000
|
143,000
|
3.5%
|
0
|
|
|
|
Other
|
180,055
|
90,339
|
99.3%
|
171,417
|
5.0%
|
|
|
2,162,513
|
2,314,644
|
-6.6%
|
2,292,499
|
-5.7%
|
|
|
Long-term
Liabilities
|
|
|
|
|
|
|
|
Loans and financings
|
975,751
|
1,013,961
|
-3.8%
|
371,843
|
162.4%
|
|
|
Debentures
|
1,740,673
|
1,736,027
|
0.3%
|
1,551,407
|
12.2%
|
|
|
Obligations for purchase of
land
|
194,654
|
183,619
|
6.0%
|
177,412
|
9.7%
|
|
|
Deferred taxes
|
401,071
|
395,440
|
1,4%
|
483,373
|
-17,0%
|
|
|
Provision for
contingencies
|
123,950
|
126,811
|
-2,3%
|
126,327
|
-1,9%
|
|
|
Obligation for
investors
|
312,000
|
317,000
|
-1,6%
|
380,000
|
-17,9%
|
|
|
Other
|
560,609
|
454,349
|
23,4%
|
195,702
|
186,5%
|
|
|
4,308,708
|
4,227,207
|
1.9%
|
3,286,064
|
31.1%
|
|
|
Shareholders'
Equity
|
|
|
|
|
|
|
|
Capital
|
2,734,155
|
2,730,789
|
0.1%
|
2,729,187
|
0.2%
|
|
|
Treasury shares
|
-1,731
|
-1,731
|
0.0%
|
-1,731
|
0.0%
|
|
|
Capital reserves
|
267,159
|
262,970
|
1.6%
|
251,489
|
6.2%
|
|
|
Revenue reserves
|
741,212
|
741,212
|
0.0%
|
422,373
|
75.5%
|
|
|
Retained earnings/accumulated
losses
|
85,036
|
38,818
|
119.1%
|
278,687
|
-69.5%
|
|
|
Non controlling
interests
|
86,756
|
78,285
|
10.8%
|
51,565
|
68.2%
|
|
|
3,912,587
|
3,850,343
|
1.6%
|
3,731,570
|
4.9%
|
|
|
Liabilities and Shareholders'
Equity
|
10,383,808
|
10,392,194
|
-0.1%
|
9,310,133
|
11.5%
|
|
|
|
|
|
|
|
|
|
Consolidated Cash Flows
|
|
|
|
3Q11
|
3Q10
|
|
|
Income Before Taxes on
Income
|
|
137,401
|
132,192
|
|
|
Expenses (income) not affecting
working capital
|
|
|
|
|
|
Depreciation and
amortization
|
|
56,974
|
8,305
|
|
|
Expense on stock
option plan
|
|
12,789
|
3,075
|
|
|
Unrealized
interest and charges, net
|
|
117,130
|
62,805
|
|
|
Warranty
provision
|
|
7,160
|
5,272
|
|
|
Provision for
contingencies
|
|
34,672
|
15,462
|
|
|
Profit sharing
provision
|
|
6,425
|
6,538
|
|
|
Allowance (reversal) for
financial instruments
|
|
6,385
|
-
|
|
|
Allowance (reversal) for
doubtful debts
|
|
(5,990)
|
|
|
|
Decrease (increase) in
assets
|
|
|
-
|
|
|
Clients
|
|
(605,178)
|
(593,100)
|
|
|
Properties for
sale
|
|
(314,861)
|
18,636
|
|
|
Other
receivables
|
|
(33,718)
|
(61,342)
|
|
|
Deferred selling
expenses and prepaid expenses
|
|
5,133
|
(17,436)
|
|
|
Decrease (increase) in
liabilities
|
|
|
-
|
|
|
Obligations on
land purchases and advances from customers
|
|
121,485
|
(4,279)
|
|
|
Taxes and
contributions
|
|
45,160
|
83,933
|
|
|
Trade accounts
payable
|
|
(5,276)
|
47,899
|
|
|
Salaries, payroll
charges
|
|
|
(10,000)
|
|
|
Other accounts
payable
|
|
(56,465)
|
(82,636)
|
|
|
Cash used in operating
activities
|
|
(470,774)
|
(384,676)
|
|
|
Investing
activities
|
|
|
|
|
|
Purchase of property and
equipment and deferred charges
|
|
(60,597)
|
(11,008)
|
|
|
Withdrawls
|
|
416,814
|
380,786
|
|
|
Cash used in investing
activities
|
|
356,217
|
369,778
|
|
|
Financing
activities
|
|
|
|
|
|
Capital increase
|
|
4,957
|
16,288
|
|
|
Follow on expenses
|
|
-
|
-
|
|
|
Capital reserve
increase
|
|
-
|
40,722
|
|
|
Increase in loans and
financing
|
|
708,729
|
272,118
|
|
|
Repayment of loans and
financing
|
|
(876,601)
|
(456,951)
|
|
|
Assignment of credit
receivables, net
|
|
373,600
|
19,785
|
|
|
Proceeds from subscription of
redeemable equity interest in securitization fund
|
|
(10,405)
|
(4,000)
|
|
|
CCI
|
|
(37,698)
|
-
|
|
|
Paid taxes
|
|
80,000
|
-
|
|
|
Net cash provided by financing
activities
|
|
242,582
|
(112,038)
|
|
|
Net increase (decrease) in cash
and cash equivalents
|
|
128,025
|
(126,936)
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
|
|
|
At the beginning of the
period
|
|
256,382
|
353,008
|
|
|
At the end of the
period
|
|
384,407
|
226,072
|
|
|
|
|
|
|
|
Net increase (decrease) in cash
and cash equivalents
|
|
128,025
|
(126,936)
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
About Gafisa
Gafisa is a leading diversified national homebuilder serving all
demographic segments of the Brazilian market. Established over 56
years ago, we have completed and sold more than 1,000 developments
and built more than 12 million square meters of housing only under
Gafisa's brand, more than any other residential development company
in Brazil. Recognized as one of
the foremost professionally managed homebuilders, "Gafisa" is also
one of the most respected and best-known brands in the real estate
market, recognized among potential homebuyers, brokers, lenders,
landowners, competitors, and investors for its quality,
consistency, and professionalism. Our pre-eminent brands include
Tenda, serving the affordable/entry level housing segment, and
Gafisa and AlphaVille, which offer a variety of residential options
to the mid to higher-income segments. Gafisa S.A. is traded on the
Novo Mercado of the BM&FBOVESPA (BOVESPA: GFSA3) and on the New
York Stock Exchange (NYSE: GFA).
Only financial data derived from the Company's accounting system
were subject to review by the Company's auditors. Operating
and financial information not directly linked to the accounting
system (i.e., launches, pre-sales, average sales price, land bank,
PSV and others) or non-BR GAAP measures were not reviewed by the
auditors. Additionally, financial statements and operating
information consolidate the numbers for Gafisa and its
subsidiaries, and refer to Gafisa's stake (or participation) in its
developments. To view a more detailed review of third quarter
results filed with the Brazilian Comissao de Valores Mobiliarios
("CVM"), please visit Gafisa's website www.gafisa.com.br/ir.
This release contains forward-looking statements relating to the
prospects of the business, estimates for operating and financial
results, and those related to growth prospects of Gafisa. These are
merely projections and, as such, are based exclusively on the
expectations of management concerning the future of the business
and its continued access to capital to fund the Company's business
plan. Such forward-looking statements depend, substantially, on
changes in market conditions, government regulations, competitive
pressures, the performance of the Brazilian economy and the
industry, among other factors; therefore, they are subject to
change without prior notice.
Contact:
Luciana Doria Wilson
Investor Relations
Phone: +55 11 3025-9297/8404-2500
Fax: +55 11 3025-9348
ri@gafisa.com.br
Media Relations (Brazil)
Debora Mari
Maquina da Noticia Comunicacao Integrada
Phone: +55 11 3147-7412
Fax: +55 11 3147-7900
Email: Debora.mari@maquina.inf.br
SOURCE Gafisa S.A.
