Tecnisa (TCSA3) Q1 2024 earnings summary

Executive summary

• Q1 gross sales rose 62.9% YoY to R$249.4m, while net revenue was R$87.4m and net loss was R$20.7m.

• Recanto Oliveiras launched in Jardim das Perdizes; management planned R$5.3bn in launch PSV through 2026 and targeted improved profitability.

• Cash generation reached R$57.4m; cash and financial investments totaled R$205.7m, while net debt was R$556.3m.

Financial highlights

• Net revenue was R$87.4m, down 37.5% YoY; gross loss was R$7.8m versus gross profit of R$28.8m in 1Q23.

• Adjusted gross profit was R$5m, with a -7.4% adjusted gross margin; adjusted gross loss excluding financial charges in cost of sales was R$5.5m.

• Adjusted gross profit including equity-method projects was R$17.8m at a 15.4% margin; adjusted EBITDA was R$4.3m, with a 4.9% margin.

• Net financial expense was R$7.5m; finance costs net of income were R$7.5m, versus R$1.9m in 1Q23.

• Other operating income of R$9.9m included a R$15.5m gain on the sale of a 5% Jardim das Perdizes stake.

Outlook and guidance

• Planned launch PSV totals R$5.3bn through 2026: R$1.7bn in 2024, R$1.5bn in 2025 and R$2.1bn in 2026; guidance indicates 46%–50% gross margin.

• Recanto Oliveiras launched with 424 units and R$583m PSV; its first tower was 45% sold as of May 6, 2024.

• Planned Jardim das Perdizes launches include Bosque Cerejeiras, with R$430m preliminary PSV, and Reserva Flamboyant, with R$588m; each has a 52.5% project share.

• Five project completions were expected in 2024, with management citing their contribution to deleveraging and expecting results to improve as construction progresses.

• Liquidity priorities include completed-inventory and non-strategic land sales, receivables assignments, dividend inflows and administrative expense control.