HBR Realty Empreendimentos Imobiliários (HBRE3) Q1 2025 earnings summary

Executive summary

• Net revenue grew between 9.5% and 21% year-over-year, reaching up to R$45.6 million in 1Q25, with adjusted EBITDA up as much as 16.1% and margin expanding by up to 2.7 p.p.

• Operational highlights include the inauguration of W Hotel, strong ComVem platform performance, and expansion in malls and corporate assets.

• ComVem Patteo Klabin opened with 91% occupancy, and the platform surpassed 50,000 sqm GLA, with net revenue up 25%–29.3% and NOI up nearly 30%.

• Sale of Hilton Garden Inn approved in April 2025, supporting deleveraging and asset recycling strategies.

• The operating portfolio comprised 49 properties (246,628 m² GLA), with a development pipeline of 161,784 m² GLA.

Financial highlights

• Gross revenue increased up to 17.5% year-over-year, reaching as high as R$50 million; net revenue up to R$45.6 million.

• Adjusted EBITDA rose between 13.1% and 16.1% year-over-year, with margin at 44.5%.

• NOI declined up to 3% due to initial impact of W Hotel's fixed costs.

• Net loss for 1Q25 was R$27.3 million, compared to a loss of R$13.0 million in 1Q24, mainly due to higher financial expenses and impairment charges.

• CapEx for Q1 2025 was R$22 million, down from R$72 million in Q1 2024, reflecting disciplined capital allocation.

Outlook and guidance

• Continued strong results expected from ComVem and HBR Malls, with normalization of same-store sales after Easter timing effects.

• Additional rooms at Hotel W to be released in 2Q25, ending soft opening and enabling full-capacity operation.

• Asset sales, including mature properties, are targeted for 2026, with ongoing negotiations and positive buyer interest.

• Capex for new projects is being reassessed, with R$947 million in total investments planned through 2031.

• Robust pipeline with multiple ComVem and 3A projects scheduled for delivery through 2027.