1Q13 Results Presentation
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1Q13 Results Investor Relations
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Transcript of 1Q13 Results Presentation
1Q13 Results
Investor Relations
Disclaimer
This material is a presentation of general background information about Rossi Residencial S.A. (“Rossi”) as of the date of this presentation.Information contained herein has been summarized and does not purport to be complete. This presentation shall not be considered an advice ofinvestment by potential investors. This presentation is strictly confidential and may not be disclosed to any third person. There are norepresentations or warranties, express or implied, regarding the accuracy, fairness, or completeness of the information presented herein, which shallnot support any decision of investment.
This presentation contains statements and information that are forward-looking pursuant section 27A of the Securities Act of 1933, as amended, andSection 21E of the Securities and Exchange Act of 1934. Such forward-looking statements and information are only predictions and cannot assureRossi’s future performance. Investors have been cautioned that any such forward-looking statements and information are subject to many risks anduncertainties relating to the operations and business of Rossi and its subsidiaries. As a result of such risks and uncertainties, the actual results ofRossi and its subsidiaries may be materially different from any future result expressed or implied in the forward-looking statement or informationcontained herein.
Although Rossi believes that the expectations and assumptions reflected in the forward-looking statements and information are reasonable and havebeen based on data currently available to its officers and directors, Rossi cannot guarantee future results or events. Rossi does not assume the
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been based on data currently available to its officers and directors, Rossi cannot guarantee future results or events. Rossi does not assume thecommitment of update any of the forward-looking statement of information.
Securities may not be offered or sold in the United States unlesss they are registered or exempt from registration under the Securities Act of 1933,as amended. Any offering of securities to be made in the United States will be made by means of an offering memorandum that may be obtainedfrom the underwriters. Such offering memorandum will contain, or incorporate by reference, detailed information about Rossi and its subsidiaries,their business and financial results, as well as its financial statements.
This material is for distribution only to person who (i) have professional experience in matters relating to investments falling within Article 19 (5) ofthe Financial Services and Markets Act of 2000 (Financial Promotion) Order 2005 (as amended, the “Financial Promotion Order”), (ii) are personsfalling within Article 49 (2) (a) to (d) (“high net worth companies, unincorporated associations etc”) of the Financial Promotion Order, (iii) areoutside the United Kingdom, or (iv) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may otherwise lawfully be communicated orcaused to be communicated (all such persons together being referred to as “relevant persons”). This material is directed only at relevant personsand must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this material relatesis available only to relevant persons and will be engaged in only with relevant persons.
This presentation does not constitute an offer, invitation or solicitation of an offer to subscribe to or purchase any securities. Neither thispresentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.
Index
Opening Remarks and Estrategic Planning: Leonardo Nogueira Diniz | CEO
Operational Results: Rodrigo Martins | Commercial Officer
Engineering: Renato Diniz | Enginner Officer
Financial Results: Rodrigo Medeiros | CFO and Investor Relations Officer
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Focus
G&A
Financing Transfers
2013-2015 Strategic Plan | Update
Focus on cash generation and profitability
Focus in house restructuring and transfer of financing
G&A Expenses efficiency
2013-2015 Strategic Plan Achievements 1Q13
� Operational Cash Burn of R$ 24 MM
� 19% decrease versus 1Q12
� Transferring 72% of potential clients in 1Q13 and
almost 90% of the potential cash collecting.
Favorable outlook due the advanced stages of
structuring the in house team
Land Bank Disablement of the Land Bank outside from the launching
pipeline
Business Units Search for financial/strategic partners for Urbanizadora
and Properties
� On going initiatives of disablement in line with
the 2013-2015 Strategic Plan for the quarter
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Partners
Rossi Vendas
Operation
Income Segment
increase Rossi´s stake in the launches up to 95% of the
total PSV, excluding JVs Capital Rossi (Manaus) and
Norcon Rossi
Increase Rossi Vendas stake in the total sales
Operations focused on 7 metropolitan regions (+JVs),
where it ranks among Top 3
Focus on medium-/high-income segments (average price
between entre R$ 200 k and R$ 1 million)
� Rossi Vendas amounted to 58% of Rossi’s Gross
Sales vs 51% in 1Q12
Construction
Compensation plan
Rossi will execute 90% of the construction with its own
engineering team
Long-term incentives based on cash generation and
profitability
� Rossi already executes 50% of the constructions
� Construction beginning in 2013, 90% will be
Rossi´s
� Approval of the Program in the Board of
Director´s Meeting
� Implementing goals and KPIs and also hiring a
specialized consulting company
and Properties
� New launches will be aligned with the 2013-2015
Strategic Plan
Operational Results
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Contracted Sales
Gross Sales - R$ million | 1Q13 Income Segment Breakdown ¹ (% Rossi) | 1Q13
810
471
285
123
1Q12 1Q13
Rossi Partners
1.096
-46%
593
Conventional52%
MCMV24%
Low Income (s/MCMV)
19%
Commercial5%
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Metropolitan Region Breakdown (% Rossi) – 1Q13
¹ Low Income: average price between R$ 170 and R$ 200 k;MCMV:Units launched in the Minha Casa Minha Vida Program.
Gross Sales breakdown (% Rossi) | Launch Year
Non-Strategic Regions25%
Porto Alegre18%
São Paulo15%
Campinas9%
Curitiba7%
Norcon Rossi (Aracaju/Recife)
7%
Capital Rossi (Manaus)
6%
Rio de Janeiro6%
Brasília5%
Belo Horizonte2%
2009 and Prior43%
201122%
201021%
201215%
29%45% 49% 57% 58%
71%55% 51% 43% 42%
2009 2010 2011 2012 1T13
Sales Speed
Rossi’ Vendas Share | % of Gross SalesSales Speed (last 12 months)
63%
68%65%
60%61%
69%
67%
59% 58%
69%
1Q12 2Q12 3Q12 4Q12 1Q13
Sales over Supply (SOS) Sales over Supply (Delivered units)Rossi Vendas Other Brokers
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Sales Cancellations (% Rossi) | R$ MM
171
283 323
522
127
1Q12 2Q12 3Q12 4Q12 1Q13
-76%
-26%
Land Bank
Residential Land Bank :
� Rossi´s PSV of R$ 8.4 bi, equivalent to
approximately 3 years of launches;
� Only land that passed the new feasibility tests
as per the company’s new standards was
retained;
Land Disablement in ling with the Strategic Plan
Land Bank Breakdown
Residential Land Bank | Income Segment (% Rossi)Residential Land Bank | Metropolitan Region (% Rossi)
R$ 1Q13 4Q12 Chg. (%)
Land Bank 15,991,407 18,364,389 -13%
Rossi Residencial 8,394,398 8,838,835 -5%
Disablement ¹ 2,856,344 3,425,710 -17%
Rossi Urbanizadora 4,740,665 6,099,844 -22%
¹ Land returned and/or sold
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Norcon Rossi25%
Rio de Janeiro22%
São Paulo 16%
Porto Alegre12%
Campinas10%
Belo Horizonte7%
Capital Rossi4%
Brasília 3%
Curitiba1%
From R$ 200K to R$ 350K42%
Above R$ 500K33%
From R$ 350K to R$ 500K15%
Low Income9%
Commercial1%
Engineering
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Engineering
Rossi´s Construction Team
Team fully remunerated with construction cost and delivery schedule for the fifth year in a row;
Training (partnership with USP and UFRGS);
227 292
+29%
125
199 +59%
# of Trained Employees
10
2012 2013
# of units delivered
6.254
9.490
17.598
2.342 3.089
2010 2011 2012 1Q12 1Q13
+52%
+85%
+32%
2012 2013
Financial Results
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Financial Highlights
24%21%
38,6%
26,8%
Net Revenues (R$ million) Gross Profit (R$ million) and Gross Margin¹ (%)
831
720
1Q12 1Q13
24%21%
-13%
255
11438,6%
26,8%
1Q12 1Q13
-55%
12
14%
10%22,0%
16,0%7,5%
-1,4%
¹ Adjusted Gross Margin
Net (Loss) Income (R$ million)Adjusted EBITDA (R$ million) and Adjusted EBITDA Margin (%)
183
11322,0%
15,7%
1Q12 1Q13
-38%
63
-10
7,5%
-1,4%
1Q12 1Q13
-116%
Deliquency and Cash Collection
727
598544
437489
1Q12 2Q12 3Q12 4Q12 1Q13
4,5%4,1%
3,6% 3,4% 3,3%
9,0%
7,6%
6,5%6,1% 6,2%
1Q12 2Q12 3Q12 4Q12 1Q13
Delinquency Rate (Delinquency/Total Receivables) Outstanding Balance (Falling Due) | R$ MM
13
469
651
1Q13 Actual 1Q13 Potential
Past Due Falling Due
611696
1Q13 Actual 1Q13 Potential
Transferring clients (100%) | R$ MM Cash Collection (100%) | R$ MM
Indebtedness | (R$ MM)
Indebtedness
Indebtedness Maturity Schedule | (R$ MM)
R$ MM 1Q13 4Q12 Chg. (%)
Gross Debt 4,209 4,529 -7%
Cash and Equivalents 1,315 1,696 -22%
Net Debt 2,894 2,834 2%
Net Debt / Equity 124.3% 123.3% 1.0 p.p.
Indebtedness | Breakdown
Construction Financing
67%
Debentures21%
Working Capital10%
Receivables Securitization
2%
14
759 1.007
470 402
314
611
338 308
2013 2014 2015 +2016
Corporate Debt SFH
1.074
1.619
807710
