Release Date: November 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- EZ TEC Empreendimentos e Participacoes SA (BSP:EZTC3, Financial) reported significant growth in net revenue, with over 100% increase from Q1 to Q3 2024.
- The company achieved a gross margin of 34% in Q3, with future projections firmly above 40%, indicating strong profitability.
- Sales speed has improved significantly, with almost half of the total projected sales sold within the first three months of each project launch in 2024.
- The company has a well-distributed landbank valued at BRL10.355 billion, sufficient for the next three years, reducing the need for immediate land acquisitions.
- EZ TEC announced an extraordinary dividend payout of BRL180 million, reflecting strong financial health and shareholder returns.
Negative Points
- The medium income segment in São Paulo has lost strength, potentially impacting future sales in this category.
- Interest rate increases have affected client mortgage approvals, posing a challenge for future sales.
- The company faces uncertainties in the macroeconomic environment, which could impact future growth and sales.
- There is a significant reliance on the fiduciary sale portfolio, which could pose risks if not managed effectively.
- The company's inventory levels have increased, particularly in the high-income segment, which may require strategic management to avoid overstock.
Q & A Highlights
Q: Can we expect extraordinary dividend payouts over the next few years given the current net debt level?
A: Silvio Ernesto Zarzur, CEO, mentioned that while the 25% dividend payout is certain, any extraordinary payouts will be evaluated on a term-by-term basis. The strategy will be reassessed as needed in the future.
Q: What is the outlook for the medium income segment in São Paulo, considering recent trends?
A: Silvio Ernesto Zarzur, CEO, explained that despite the reduced participation due to the "My Home, My Life" program, EZTEC has well-located ventures with the right products that have been selling quickly. The medium income segment remains a strong focus for the company.
Q: Are you planning robust growth in launches next year, and how do you view launch margins?
A: Silvio Ernesto Zarzur, CEO, stated that the company is prepared for robust growth, with five offices ready to start the year. However, this depends on macroeconomic conditions. Antonio Emilio Clemente Fugazza, CFO, added that launch margins are expected to remain strong, with adjustments over time due to economic factors.
Q: How is the demand for final customers evolving, and what percentage of 2025 deliveries have been paid?
A: Flavio Ernesto Zarzur, Chairman, noted that the company is well-prepared for operational deliveries, with a significant portion of financing coming from fiduciary sales. Antonio Emilio Clemente Fugazza, CFO, added that about 30% of the upcoming harvest has been paid, and the company is vigilant about defaults.
Q: What is the company's strategy regarding the fiduciary sale portfolio, and have you received offers to purchase it?
A: Silvio Ernesto Zarzur, CEO, confirmed that the company receives frequent offers to purchase the portfolio, but EZTEC is efficient in managing it. The portfolio is seen as a strategic sales instrument, and any surplus may be passed on when advantageous.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
