Company Presentation May 2011 · 2016-08-09 · 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10...
Transcript of Company Presentation May 2011 · 2016-08-09 · 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10...
BlancSão Paulo - SPLaunched in March/11
CompanyCompanyPresentation
May 2011
Contents
Brazilian Real Estate Sector Overview
Company Overview
Cyrela and Living - Operating Performance
Living – Economic and Super Economic segments
Fi i l R lFinancial Results
AppendixAppendix
Le JardinCuritiba - PR Launched in Dec/10
BrazilianReal Estate
S t O iSector Overview
A Booming Real Estate Market: Strong Fundamentals
The Brazilian real estate market is posed to benefit from a favorable environmentLow Supply of UnitsLow Supply of UnitsHigh Demand for HousingHigh Demand for Housing Low Supply of UnitsLow Supply of UnitsHigh Demand for HousingHigh Demand for Housing
3. Rising Housing Deficit(1)
Expanding the market for housing (Millions of housing Units)1. Population and families
In millions PersonsYear
2007
2017E
Families
60.3
75 6
Population
189.1
211 2
Personsper family
3.1
2 8
5.46.7
5.8
4 N b f H M P
2017E
2030E
75.6
95.5
211.2
233.6
2.8
2.4(2)
1991 2000 2008
4. Number of Home Moves per PersonLow number of home moves as compared to other countries
BrazilBrazil 1.8x1.8x
2. Monthly income evolution
2007 2030(E)
In millions of families Growth rate(%) per year
BrazilBrazil
MexicoMexico
1.8x1.8x
4.0x4.0xup to R$ 1,000
from R$ 1,000 to R$ 8,000
31.7
27.2
29.1
60.4
more than R$ 8,000 1.4 5.9
-0.4%
3.9%
7.1%
Cyrela is positioned to take advantage of the positive Brazilian real estate environment
G-7G-7 9-10x9-10xTotal 60.3 95.5 2.0%
4
Cy e a s pos t o ed to ta e ad a tage o t e pos t e a a ea estate e o e t
(1) Considers demand in excess of supply.(2) 2008: considering new methodology.Source: IBGE (Brazilian Institute of Geography and Statistics), Brazilian Central Bank, Ministry of Cities, Fundaçāo Pinheiro, FactSet, Bloomberg, Fundação Getulio Vargas and Wall Street Research.
Real Estate PricesIn 12 and 24 months, until September 2010, Brazil ranked first in the list of countries with the highest
real estate appreciation.
Real Estate Appreciation – 12 monthsReal Estate Appreciation – 12 months Real Estate Appreciation – 24 monthsReal Estate Appreciation – 24 months
5.1%South Africa 5 1%Indonesia
7.4%
7.3%
6.7%
Taiwan
Finland
Norway
7.8%
7.0%
6.7%
5.1%
Finland
China (Shanghai)
Austria
Indonesia
20.6%
16.4%
11.5%
Hong Kong
Israel
Australia
18.9%
17.5%
10.8%
Australia
Taiwan
Norway
33.5%
24.6%
22.9%
Brazil
Latvia
Singapore
46.4%
33.1%
24.5%
Brazil
Israel
Hong Kong
NEIGHBORHOOD / CITY Price of usuable area per sq. m. (R$)
Price per unit of 150 sq.m (R$ million)
Price of usuable area per sq. m. (R$)
Price per unit of 150 sq.m (R$ million)
Leblon - Rio de Janeiro (ocean view) 20 thd 3,0 North - Florianópolis (ocean view) 9 thd 1.3Jardim Europa - São Paulo 12.5 thd 1.9 Meirelles - Fortaleza (ocean view) 8 thd 1.2
5
Northwest sector - Brasília 12 thd 1.8 Clube Espanhol - Salvador 7.5 thd 1.1Vila Nova Conceição - São Paulo 9.5 thd 1.4 Batel. Ecoville - Curitiba 4.5 thd 0.7
Real Estate Industry and the Economic CycleBrazilian National Construction Cost Index (INCC):
Materials vs. LaborBrazilian National Construction Cost Index (INCC):
Materials vs. LaborNominal Average Income vs. Construction costsNominal Average Income vs. Construction costs
15 2%
11.9%
15.2%
10.4%9.3% 1150.0
1250.0
1350.0
3.2%
7.8% 7.5%
5.5%5.4% 5.7%5.0%
8.2%7.7%
6.0%
850.0
950.0
1050.0
-0.5%
2008 2009 2010 2011 2012
650.0
750.0
Jan-
05Ap
r-05
Jul-0
5O
ct-0
5Ja
n-06
Apr-0
6Ju
l-06
Oct
-06
Jan-
07Ap
r-07
Jul-0
7O
ct-0
7Ja
n-08
Apr-0
8Ju
l-08
Oct
-08
Jan-
09Ap
r-09
Jul-0
9O
ct-0
9Ja
n-10
Apr-1
0Ju
l-10
Oct
-10
*2010, 2011 and 2012 prospect numbers
INCC Materials Labor
J A O J A O J A O J A O J A O J A O
Nomimal Average Income Accumulated by INCC Labor
During the 2005-2009 period, 722,000 new hires were registered in the Real Estate Industry
During the first half of 2010, 230,000 net hires were added to that figureg , , g
Average income of R$ 699.90 in January 2005 moved up to R$ 1,227.40 at the close of June 2010,
a nominal rise of 75%
6
a nominal rise of 75%
Source: MCM Consultores
Brazilian Saving Accounts and Mortgage System
Uses SourcesUses
65%
52%Individual mortgages
100%
65%
Individual mortgages
g gProperties up to R$
500,000
Construction loans
SavingsAccountsDeposits
and construction
loans13%
Average loan up to R$ 500,000 Cost of
TR + 6.17% p.a.
Saving Accounts(R$ billion)
299.9
30%
Properties over R$ 500,000
Monthly averageor last 12
months average
18 %
253 630% Compulsory
Deposits
months average(the lowest)
253.6
5% Free Usage
7
Dec/09 Dec/10
Source: Santander
Funding Analysis (SBPE)
Annual Growth Rates Bottleneck
Scenario Mortagage Saving Deposits Year Mortgage
outstanding
With 40% of annual growth in
mortgage and 20%Deposits outstanding1 50% 25% Aug-2012 2582 40% 20% Dec-2012 2533 30% 20% Jan-2015 370
mortgage and 20% in saving
accounts, the funding will last
4 15% 0% Mar-2013 168 aprox. for 2 years
Scenario 2
252
Mortgage FundingRequirement
(65% exigibility rule)
252
83.1 87.5 104.0124.9
146.3174.8
(65% exigibility rule)Dec-2012
2005 2006 2007 2008 2009 2010
MortgageOutstanding
253
28.1 34.5 43.6 59.787.4
131.4
8Source: Brazilian Central Bank, Company projections.
g
Dec-2012
28.1
2005 2006 2007 2008 2009 2010
Luzes da MoocaSão Paulo - SPLaunched in Nov/10
Company OverviewOverview
Cyrela Brazil Realty
2005 2006 2007 2008 2009 2010
Launches R$ 1.2 R$ 2.9 R$ 5.4 R$ 5.5 R$ 5.7 R$ 7.6Launches(billion)
R$ 1.2 R$ 2.9 R$ 5.4 R$ 5.5 R$ 5.7 R$ 7.6
Pre-sales(billion)
R$ 1.0 R$ 1.9 R$ 4.4 R$ 5.1 R$ 5.2 R$ 6.2
Landbank(mm sq.m)
3.0 4.9 8.8 11.2 12.6 13.7
Living’s units launched 0 720 6 7 thd 11 1 thd 16 1 thd 15 3 thdLiving s units launched 0 720 6.7 thd 11.1 thd 16.1 thd 15.3 thd
Gross Margin* 48.5% 42.2% 41.2% 38.0% 34.5% 31.4%
EBITDA Margin* 27.1% 22.3% 22.9% 16.5% 22.3% 16.5%
Net Margin* 22 3% 21 7% 24 7% 9 8% 17 8% 12 3%Net Margin 22.3% 21.7% 24.7% 9.8% 17.8% 12.3%
Number of cities 3 8 47 55 66 67
Employees 202 327 529 514 946 1,512
Seller Brokers & Team 100 200 743 637 1 265 1 425
10
Seller Brokers & Team 100 200 743 637 1,265 1,425
*Adjusted for IPO expenses and according to BR GAAP before Law 11,638 until 2007.
Stock Performance – CYRE3
Ownership Breakdown(May, 2011)
Stock Performance*400
200
250
300
350
Outros49.1%
Black Rock Inc.5.3%
Carmignac
50
100
150
200 Carmignac Gestion
7.8%
Grupo Janus5.2%
-
Dec
-05
Mar
-06
Jun-
06
Sep
-06
Dec
-06
Mar
-07
Jun-
07
Sep
-07
Dec
-07
Mar
-08
Jun-
08
Sep
-08
Dec
-08
Mar
-09
Jun-
09
Sep
-09
Dec
-09
Mar
-10
Jun-
10
Sep
-10
Dec
-10
Mar
-11
%
Grupo Controlador
Free Float: 67.3%
* Adjusted data by paid dividends
Cyrela Ibovespa32.6%
Paid Dividends
Payment date Action CYRE3 Dividend yield(R$/share)
6/24/2011 (-) Paid dividend 0,3370 2,09%5/11/2010 (-) Paid dividend 0.4703 2.24%
17% growth in the last 3 years
11
5/11/2009 (-) Paid dividend 0.1854 0.87%5/16/2008 (-) Paid dividend 0.0410 0.19%9/25/2007 (-) Paid dividend 0.1687 0.80%5/10/2007 (-) Paid dividend 0.0852 0.40%
Guidance 2011 - 2012Xxxx
Launches and Sales for 2011 - 2012
Guidance 2011 2012
Launches 7 6 t 8 5 8 7 t 9 8Launches (R$ billion)
7.6 to 8.5 8.7 to 9.8
Sales (R$ billion)
6.9 to 7.7 8.0 to 8.9(R$ billion)
% Cyrela > 78% > 80%
Margins over net revenue for t k 2011 and 2012Living’s stake
Living - Launches 2011 2012Gross
2011 3.0 to 3.5
2012 3.7 to 4.5
Gross Margin 27% to 31% 31% to 35%
EBITDA Margin 15% to 19% 18% to 22%
12
Getúlio Vargas Prime OfficesPorto Alegre - RSLaunched in Dec/2010
Cyrela and LivingCyrela and LivingOperating
performance
Cyrela and Living Operating Results
15 projects launched in 1Q11
3.9 thd units sold in 1Q11
75.9 % of 1Q11 sales were related to inventory sales
Launches(R$ million)
Sales (R$ million)
5 393 1 5 452 7 5,678.9
7,609.9
5 241 1
6,172.4
5,955.32,916.6
5,393.1 5,452.7 ,
4,391.9 5,144.2 5,241.1
93 3%-6.3%
1,004.21,924.4
3,332.3 3,783.64,464.8
,
481.6 907.2
1,211.3 596.3
1,152.5
755.01,368.8
2,815.53,458.0
4,088.04,777.5
869.0 844.0
1,023.0
1,915.1
1,065.8 998.6
+ 93.3%
2005 2006 2007 2008 2009 2010 1Q10 1Q11
Cyrela Partners
2005 2006 2007 2008 2009 2010 1Q10 1Q11
Cyrela Partners
14
Sales Speed Cyrela + Living
Inventories on March 31, 2011: R$ 5.2 bn (100%) and R$ 4.1 bn (%CBR) 6.8 months of sales*
Sales over Supply (VSO)Contracted Sales of Inventory (R$ million)
66.8%60.7% 61.5% 62.4%
73.3%
56 1%
75.9%
37.6%
52.4%
37.8% 36.5%
56.1%
43.4%
21.2%
37.6%
25.4%35.7%
26.2%34.3%
51.9%
728.9828.9
539.3 1,940.9 1,630.9
2,268.5
1,539.9
2,541.4
16.5%349.4
1,212.0 414.1 269.6 185.5 315.8
1,014.4 1,439.7
284.2 676.5 580.3
2,002.1
241.1
702.6
728.9
638.4 296.5 296.4
524.0
616.5
781.5 863.4
445.1 757.5
1,052.0 1,052.5
566.1 481.9 839.8 1,065.8 1,025.4 998.6
1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 12M1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Sales of Launches from the Quarter Sales of Inventory % Sales of Inventory
15* Considering the calculated monthly pre – sales guidance mid range
Landbank
PSV of R$ 44.6 bn (100%) and R$ 38.5 bn (%CBR)
31 plots of land acquired in 1Q11 with PSV of R$ 3.6 bn
Land Plots by Segment
p q Q $
79% of landbank acquired through swaps
245 projects with 182 000 unitsCyrela 73%
Living245 projects with 182,000 units
All land plots related to 2011 launches have already been acquired by 1Q11
Living27%
Land Plots by RegionCyrela’s Landbank – 100%
( R$ billion)
RJ36%
14.512.9
São Paulo30%
Southeast others
2%5.4 6.4
12.9
5.32%
South6%
Northeast17%North
6%
MidWest3%
Super Economic Middle Mid-High High-End
16
17%6%pEconomic
g g
Delivered and Transferred Units
Volume Transferred by segment
444 7 460.8
172.7153.0
138.8
444.7 460.8431.4
272.0 307.8 292.688.7119.5
203.6
65.8114.9
53.7
1Q10 2Q10 3Q10 4Q10 1Q11
3.9 units delivered in 1Q11 in 18 projects
Living MAP
R$ 1.1 billion in PSV of delivered units
Living delivered 1.9 units in 8 projects, with PSV of R$ 243.6 million
96% of delivered units in 1Q11 have already been sold
17207 construction sites at the end of March, of which 89 are Living's projects
Vitória MaguaryBelém - PALaunched in November/10
LivingLiving Economic and Super pEconomic segment
Living’s Launches
Living: 30.1% of PSV launched and 32.8% of PSV sold in 1Q11
2.4 thd units lauched in 1Q11 70% within the “MCMV” Program
Launches(R$ million)
Sales(R$ million)
1 806 6
2,231.5 CAGR 05-10 = 126.5% CAGR 05-10 = 153.3%
1,350.6
1,726.4 1,804.1 1,499.0
1,806.6
919.71,250.3 1,332.2
641.1 411.5 327.4
602 11,039.4
1,323.71,688.8
883.5
323.7 346.5
-20.4%+ 7.1%
442.6 306.9 268.943.8
2006 2007 2008 2009 2010 1Q10 1Q11Li i P
602.1236.5 222.5
84.8
2006 2007 2008 2009 2010 1Q10 1Q11
19
Living PartnersLiving Partners
Living’s Landbank
Potential PSV of R$ 12.0 bn (100%) and of R$ 10.4 bn (% Living)
19 plots of land acquired in 1Q11 PSV of R$ 2 0 bn19 plots of land acquired in 1Q11 PSV of R$ 2.0 bn
72% of landbank paid through swaps
A i it R$ 127 3 thdAverage price per unit - R$ 127.3 thd
Living’s Landbank – 100% Breakdown by Regiong(R$ billion)
Breakdown by Region
RJ25%
São Paulo35%
5%
Southeast others
5.46.3
others3%
South12%
Northeast5%
North12%
MidWest8%
0.3
Super economic Economic Middle
20
12%Super economic Economic Middle
“Minha Casa, Minha Vida” Program
Living in MCMV (BB / CAIXA)Living in MCMV (BB / CAIXA)TOTAL 43,192
Breakdown:Breakdown:Submitted 2,572
Approved for sale 11,103
To be contracted 5,084
Contracted 24,433
Living - Transferred From the total transferred units, 2009 696
2010 10,887
about 80% were under the MCMV program
2 301 units were transferred in the1Q11 2,301
Total 13,884
2,301 units were transferred in the first quarter of 2011.
21
Financing: Interest and Term Impact
10 15 20 25 30Loan Term (years)
10 15 20 25 30Loan Term (years)
Monthly Installment (R$) Minimum Wages Required 2005 (monthly salary)
10 15 20 25 3012% 10 8 8 7 711% 9 8 7 7 710% 9 7 7 6 69% 9 7 6 6 68% 8 7 6 5 5R
ate
(%)
10 15 20 25 30120 180 240 300 360
12% 1377 1152 1057 1011 98711% 1322 1091 991 941 91410% 1269 1032 926 872 8429% 1216 974 864 806 772e
(%) Model:
U it V l R$ 120 0008% 8 7 6 5 57% 8 6 5 5 56% 8 6 5 4 45% 7 5 5 4 44% 7 5 4 4 3R
eal I
nter
est R9% 1216 974 864 806 772
8% 1165 917 803 741 7047% 1115 863 744 679 6396% 1066 810 688 619 5765% 1018 759 634 561 515al
Inte
rest
Rat
e Unit Value: R$ 120,000
Loan-to-Value: 80%
Mortgage Effort: 30%
3% 7 5 4 3 32% 6 4 3 3 3
4% 972 710 582 507 4583% 927 663 532 455 4052% 883 618 486 407 355
Re
10 15 20 25 30Loan Term (years)
10 15 20 25 30Loan Term (years)
Monthly Installment (R$) Minimum Wages Required 2010 (monthly salary)
10 15 20 25 3012% 14 11 10 10 1011% 13 11 10 9 910% 12 10 9 9 89% 12 10 8 8 8at
e (%
)
10 15 20 25 3012% 2066 1728 1586 1517 148111% 1984 1637 1486 1411 137110% 1903 1547 1390 1309 12649% 1824 1461 1296 1208 11598% 1747 1376 1204 1111 1057R
ate
(%) Model:
Unit Value: R$ 180,0008% 11 9 8 7 77% 11 8 7 7 66% 10 8 7 6 65% 10 7 6 6 54% 10 7 6 5 4ea
l Int
eres
t Ra8% 1747 1376 1204 1111 1057
7% 1672 1294 1116 1018 9586% 1599 1215 1032 928 8635% 1527 1139 950 842 7734% 1458 1065 873 760 687R
eal I
nter
est R Loan-to-Value: 80%
Mortgage Effort: 30%
22
4% 10 7 6 5 43% 9 6 5 4 42% 9 6 5 4 3
Re3% 1390 994 799 683 607
2% 1325 927 728 610 532
Mirai OfficesBelém - PALaunched in Oct/2010
Financial Results
Financial Results (R$ million)
Net Revenue - (R$ million)Net Revenue - (R$ million) EBITDA - (R$ million)EBITDA - (R$ million)
4,087.8
4,890.1 911.3
808.3
1,707.3
2,847.4
248.5
390.5 461.0
224.7
- 38.1%+6.0%
689.0 1,116.7
,1,132.4 1,200.7
200 2006 200 2008 2009 2010 1Q10 1Q11
157.8 224.7
139.2 22.9% 22.3% 22.9% 16.2% 22.3% 16.5% 19.8% 11.6%
2005 2006 2007 2008 2009 2010 1Q10 1Q112005 2006 2007 2008 2009 2010 1Q10 1Q11
Net Profit - (R$ million)Net Profit - (R$ million)Backlog - (R$ million)Backlog - (R$ million)
34.4%
729.3
600.3 5,033.4
5,920.2 5,762.0
34.4%31.1% 31.0%
127.8 242.3
422.1
277.7 174.2
74.218 6% 21 7% 24 7% 9 8% 17 8% 12 3% 15 4%
- 57.4%
24
74.2 18.6% 21.7% 24.7% 9.8% 17.8% 12.3% 15.4%6.2%
2005 2006 2007 2008 2009 2010 1Q10 1Q112009 2010 1Q10
Revenue to be Recog. Gross Mg. To be Recog.
Accounts Receivable (R$ million)
Accounts Receivable Receivable Schedule
11,858
And Costs to be incurred38.6%2011
1,741 Finished units: IGP-M + 12%Under Construction: INCC
15.6%
22.3%
2013
2012
10,117
3 976
23.5%After 2013
3,976
Constructed units
Schedule of costs to be incurred(sold units- R$ million)
Units under constructionConstructed units
Construction costs to incur – sold units1,427.4 2011
1,359.3 2012
25
1,189.0 Further years
Liquidity
Debt(R$ million)
BalanceMaturity Cost(R$ million) March 31, 2010Maturity Cost
SFH 2,142.0 2010 to 2014 TR + ~ 10.4% p.a.
Debentures 1st issue 500.0 2012 ,2013,2014 CDI + 0.48% p.a.
Debentures 2nd issue 42.6 2018* CDI + 0.65% p.a.
D b 3 d i 350 0 2014 CDI 0 81%Debentures 3rd issue 350.0 2014 CDI + 0.81% p.a.
Debentures 4rd issue 300.0 2014 115% CDI
Nov/2010 Nov/2011Bradesco (stand-by) and others 221.5 Nov/2010, Nov/2011, Nov/2012, Nov/2013 CDI + 0.81% p.a.
Loans (foreign currency) – US$ 50 million 48.9 Jun/2012 Libor + 4.3% p.a.
Total Debt withSFH 3,605.0
Total Debt without SFH 1,463.0
Cash and Cash Equivalents (1 213 6)
Net Debt with SFH
LTM EBITDA= 3.3
Cash and Cash Equivalents (1,213.6)
Net Debt withSFH 2,391.4
Net Debt without SFH 249 4
LTM EBITDA
Net Debt without SFH
26
Net Debt without SFH 249.4 Net Debt without SFH
LTM EBITDA= 0.3
* Interest rate renegotiation in Jan/11
Pre-Sales to be Recognized
2007R$ million 2008 2009 2010
1,597.1
4 515 2
Sales to be recognized at the beginning of the period
Net sales recorded in the period
4,081.6
3 974 4
5,124.2
4 324 6
5,224.0
5 945 24,515.2
(2,030.3)
Net sales recorded in the period
Revenues recognized in the period
3,974.4
(2,930.8)
4,324.6
(4,192.3)
5,945.2
(5,976.5)
3 933 0Net Sales to be recognized at the end of the period 4 937 2 5 033 4
(149.0)Taxes (3.65%) (187.0) (190.7)
6 136 2
(215.9)
(2,604.7)
3,933.0Net Sales to be recognized at the end of the period
Cost of units sold to be recognized (3,217.2)
4,937.2
(3,300.8)
5,033.4
(4,079.0)
6,136.2
(26.3)Selling Expenses (37.6) (14.7) (22.9)
1,327.9
33.8%
Gross profit to be recognized
Percentage of gross profit
1,719.9
34.8%
1,732.6
34.4%
1,818.3
31.1%
27
Host ParaisoSão Paulo - SPLaunched in August/10
Appendix
Cyrela’s History
•Cyrela 2nd Follow-on
• 4th debenture issue, in the amount of R$ 300.0 million2010
•2nd debenture issue in the amount of R$ 499 5 million
Cyrela 2 Follow-on •3rd debenture issue in the amount of R$ 350.0 million•Merger of Goldsztein Participações into Cyrela
2009
2008
•Cyrela 1st debenture issue, in the amount of R$ 500.0 million•Spin-off of Cyrela Commercial Properties (CCP)
•2 debenture issue in the amount of R$ 499.5 million
2007
2008
•Merger of Brazil Realty into Cyrela Vancouver and creation of Cyrela Brazil Realty
•Cyrela 1st Follow-on 2006
g y y y yEmpreendimentos e Participações S.A (CBR) •Cyrela’s IPO
•Cyrela subsidiaries are grouped under Cyrela Vancouver2004
2005
•Beginning of the partnership of Cyrela with RJZ Engenharia, in Rio de Janeiro
•Cyrela subsidiaries are grouped under Cyrela Vancouver
1996
2000
2004
•Brazil Realty, a joint Venture with Argentine company IRSA, is founded
•Brazil Realty’s IPO
1994
1996
29•Cyrela is founded in São Paulo, SP
•Cyrela Construtora is founded and Seller (own sales team) is created
1962
1981
Geographical Expansion
Presence in 67 cities in 17 states of Brazil, Buenos Aires in Argentina and Montevideo in UruguayLiving is present in 47 cities and 12 statesg p
200920092006200620052005
AC
AM
RR
RO
PI
MAPA
AP
TO
CERN
PE
ALSE
PB
AC
AM
RR
RO
PI
MAPA
AP
TO
CERN
PE
ALSE
PB
AC
AM
RR
RO
PI
MAPA
AP
TO
CERN
PE
ALSE
PB
SC
PR
SP
MG
GO
MT
BA
MS
RJ
ES
DF
SC
PR
SP
MG
GO
MT
BA
MS
RJ
ES
DF
SC
PR
SP
MG
GO
MT
BA
MS
RJ
ES
DF
RS
BuenosAires
RSRS
+ +
% ofBrazilian
% ofBrazilian 90 5%(1)80 5%47 9%
30
GDP CoveredGDP Covered
(1) Considers 2007 data, most recent.Source: Company and IBGE.
90.5%( )80.5% 47.9%
Cyrela Brazil Realty Group
Development and Construction Joint Ventures and Partnerships
Sales ServicesSales Services
31
2016 Olympic Games
R$ 14bn of PSV in Rio de Janeiro of which almostBarra da Tijuca RJ
Strategically positioned landbank in Rio de Janeiro
R$ 14bn of PSV in Rio de Janeiro, of which almost
90% is located in Barra da Tijuca
Barra da Tijuca was chosen as the location for the new
Barra da Tijuca - RJ
C Barra da Tijuca was chosen as the location for the new
Olympic Games facilities, such as the Olympic Training
Center and the Olympic Village. Such facilities and their
Cidade Jardim Centro
Metropolitano
benefiting to the region will endure for long after the
Olympic GamesGleba F
Future facilities ofUntil 2016, more than R$100 billion of investments
expected for the projectPenínsula
Future facilities of Olympic Games
2016
► The civil construction sector is expected to account for approximately 10% of the investments
$
Península
► The local government announced R$ 11.4 bninvestment in transportation infrastructure to facilitate access to the region
32Source: Rio 2016 official Olympic project
Cyrela is the best positioned real estate company to profit from the 2016 Olympic Games
Typical Cyrela Project (without swap)
Launch Go-ahead Delivery Completionof payments
Construction6M - 18MLicensing
Pre sales 0 50 70 90 100 10080 95
Up to 100M18M 24M 30M 36M12M6M0M
Licensing
Pre-sales 0 50 70 90 100 10080 95
% Budget Costs - - 26% 54% 100% 100%38% 73%
Revenues - - 18 49 100 10030 69
Assumptions for this example:
Collections(cumulative) - 7 14 28 35-50 10020 34
Potential sales: R$ 100 million
Considering gross margin of 35% (land cost 15% and construction 50%)
33
Considering gross margin of 35% (land cost 15% and construction 50%)
Does not include financial revenues deriving from customer financing
Typical Living Project (without swap)Shorter operating cycle: 24 months
Launch Go-ahead Delivery Financing
18M 24M U t 28M12M6M0M
0 - 6 monthsPre-Launching
Construction
Contracted Sales(cumulative)
- 70 80 10090 100
18M 24M Up to 28M12M6M0M
%Construction Cost - 14% 34% 100%81% 100%
RevenuesRevenues(cumulative) - 10 27 10073 100
Collections(cumulative) - 6 11 2013 100(cumulative)
Assumptions for this example:
Potential Sales: R$ 100 million
34
Considering gross margin of 30% (land cost 10% and construction 60%)
Client is fully financed by the banks after keys handover
Short Cycle Process
Launch Go-ahead DeliveryFinancing
0 – 6 monthsPre-Launching
12M 16M Up to 20M8M4M0M
Construction
Living Corporate EnvironmentEngineeringProduct
Servicing the client from purchase onwards, through a single communication channel: the Customer Servicing Platform
Use of “Lean Construction” ConceptAssembly lineReduction of waste and costs
Simple, standard and easily executed projects focused on low income segment. Standardization of: g
In-house and trained sales forceFinancing availability through CaixaEconômica Federal
Enhancement of construction methods for popular housingIncreased productivity and quality during works execution
► Land acquisition► Real Estate Development► Sales g
Increased costumer satisfactionPrice defined by product (not by sq.m.)
► Construction► Customer Relationship
Prices from R$90,000 to R$ 200 000
Source: Company
15% cost reduction expected200,000Units from 45sq.m. to 75sq.m
35
Source: Company
Cost Overrun – Impact on earnings in 4Q10
Impact on earningsConstruction Sites with cost overrun
Cost Overrun– 5% Cyrela
35%
R$ 533.6 million
9M10R$ 162 8 MM* R$ 75.8 MM
R$ 533.6 million
R$ 3,2 bi 35% R$ 162.8 MM
4Q10Third PartsBudget Cost
Base** 65% 4Q10R$ 370.8 MM* R$ 244.3 MM
Third Parts65%
Base**
70% of the costs overrun concentrated on 30 construction sites* Urban Developments Included
Delivery Timeline of Construction Sites with Costs Overrun
** Budget Cost Base from Dec/09 of R$ 10.2 billion10 construction sites represents 40% of the costs overruns* Urban Developments Included
70.4%
36
29.6%
2011 2012
Cyrela’s Share in Projects
Cyrela’s Share in Projects (%)
> 78%
> 80%
2011
2012E
E
79%
78%
> 78%
2009
2010
2011E
64%
69%
79%
2007
2008
2009
83%
66%
64%
2005
2006
2007
83%
0% 20% 40% 60% 80% 100%
2005
37
Organic growth in construction sites
Adequacy of the organic growth strategy in the construction sites, with reduction on the use of
third parties constructorsthird parties constructors.
Cyrela's Share in Construction Site ManagementCyrela s Share in Construction Site Management
e > 70%2011E
47%
60%
2009
2010
34%
47%
2008
2009
44%
28%
2006
2007
74%
0% 20% 40% 60% 80% 100%
2005
38
Contact IR
Cyrela Brazil Realty S.A. Empreendimentos e ParticipaçõesAv Presidente Juscelino Kubitschek 1455 3rd floorAv. Presidente Juscelino Kubitschek, 1455, 3rd floorSão Paulo - SP – BrasilCEP 04543-011
Investor RelationsPhone: (55 11) 4502-3153 [email protected]
www.cyrela.com.br/ir
Statements contained in this press release may contain information which is forward-looking and reflects management'scurrent view and estimates of future economic circumstances, industry conditions, company performance and the financialresults of Cyrela Brazil Realty. These are just projections and, as such, exclusively based on management's expectationsof Cyrela Brazil Realty regarding future business and continuous access to capital to finance the Company's businessplan. Such future considerations rely substantially on changes in market conditions, government rules, competitor's
39
plan. Such future considerations rely substantially on changes in market conditions, government rules, competitor spressure, segment performance and the Brazilian economy, among other factors, in addition to the risks presented on thereleased documents filed by Cyrela Brazil Realty, and therefore can be modified without prior notice.