MRV Engenharia e Participações (MRVE3) Q2 2024 earnings summary

Executive summary

• Record net pre-sales reached R$2.539 billion in 2Q24, with R$1 billion in June; gross margin on new sales was 34%.

• Net revenue rose 18.0% YoY to R$2.09 billion and EBITDA increased 18.6% to R$286 million.

• Launches, pre-sales and production increased YoY in MRV Real Estate Development; Resia continued to generate substantial cash outflows.

Financial highlights

• 2Q24 gross profit rose 39.0% to R$544 million; adjusted profit attributable to shareholders was R$76 million, up 41.0% YoY, with adjusted net margin of 3.6%.

• Adjusted cash generation was R$9.2 million in 2Q24, versus R$24.8 million in 1Q24 and negative R$161.5 million in 2Q23; excludes R$68.5 million in swap accounting effects.

• 1H24 net operating revenue was R$4.19 billion and gross profit was R$1.10 billion; the period reported a net loss of R$236.7 million.

• Total assets were R$27.07 billion and equity was R$7.64 billion as of June 30, 2024.

Outlook and guidance

• 2024 guidance reaffirmed: net revenue R$8–8.5 billion, gross margin 26–27%, and cash generation R$300–400 million; 1H24 cash generation was R$32 million.

• Operational performance reinforced confidence in guidance; average ticket continued rising above inflation, supporting further expansion in new-sales margins.

• Resia planned sales for 2H24, with expected cash generation supported by continued leasing velocity.