Direcional Engenharia S.A. ($DIRR3)

Good afternoon everybody. Welcome to the earnings release of Direcional Engenharia with regards to the 4Q '25, we welcome our investors, the analysts, that are with us and everybody that is in this video conference. I am with Ricardo Gontijo the CEO; Paulo Sousa, CFO and Director of Investor Relations. In this event, for investors and analysts, we will give you, firstly, the results of the quarter and the whole year. And then we will open to questions and answer. We also have with us -- in the Direcional YouTube we're live. And we have the link, which is available in our IR site and also we have the link of the transmission and also downloads of the material we will show you. We are recording the event so that afterwards, we can put in our Result Center. So we will begin with the presentation. I'll give the floor to Ricardo who will give us the main highlights and initial comments.

Good afternoon, everybody. Thank you for your participation here in our call. It's also always a huge pleasure to be sharing our results and being able to comment what we've done, what we delivered, show you how we see our segment here. Well, firstly, I would like to begin with Page 3, where we see the main highlights of 25. And I think it's interesting to show you this journey, a slightly longer vision of the -- in time, right? Not only '25, I'd like to share what we did in these last years comparing data all the way from 2019, where we noticed we multiplied the volume of launches in the company. We multiplied it by 3.5x. On the other time, sales were multiplied 4.7x. And in this scenario where we have a very relevant growth, most importantly here is to show you this growth process where we have operated with more scale. And this has occurred in a way we see the right growth way, where we grow gaining competitiveness where we benefit from this greater scale we've obtained. And also, we've been able to have relevant gains in synergy where we've seen a growth in revenue at a rate that is over the expenses, superior the experience. So my first analysis here this greater scale we've been operating in is our gross margin. So you can see in this period between 2019 and 2025, we went from an adjusted growth rate, adjusted by interest. And when we do this analysis and also interest we played from financing to production, here, we have the capture of gain inefficiencies that the company had. So you see that our gross margin went from 34.5% in 2019 and reached 42.1% in 2025. In the fourth Q, specifically, the growth margin reached 42.8%. So when we analyze the whole year, comparing '25 to 2019, we had a granting of 7.6 percentage points. We've used the scale to have a better supply with -- negotiations with supplier. We've used this, and this has been translated in a very clear way greater competitiveness by the company in terms of cost and production. Another analysis that I find very interesting, but is not here in this slide, when we analyze our SG&A commercial expenses and administrative expenses in '25, the SG&A represented 18%. 2025, it dropped to 15.3%. So as well as having delivered an important increment in gross margin. We've also had relevant dilution of expenses. And this is why that in this interval, in the 6-year interval, we have net margins going from 6.9% to 17.4%. So basically, a little more than 7 percentage points in gross margin gain and 6 percentage points through the reduction of expenses, dilution of expenses, totaling a little more than 10% of gain in net margins. So once -- as we grow, we become more competitive. So this growth that we had clearly demonstrates the way we believe that growth should occur. Well, now going to Page 4 and still in highlights here, we have one of the main metrics we analyze in the company, which is the ROE, return on equity, where we reach when annualizing results -- when we're analyzing it we have an ROE of 44%. It's a record for Direcional and certainly one of the most expressive in our sector and also compared to all companies that work in capital-intensive sectors like ours. And also it's important to highlight that this growth I highlighted in the previous page, occurred with a very relevant capital volume returning to our shareholders. And we've opted in the payment of dividends here for a return on capital to our investors. So when you look 2025, it was more than BRL 1.150 billion paid in dividends and BRL 26 million paid or the return to the shareholders through the buyback of shares. So this is a very expressive return. Not only over the equity but also a return of capital to our shareholders, allowing us to have growth by returning capital. So this is an important highlight to make here. Well, now going to Page 6 and now looking at the main operating highlights last year. In terms of launches, when comparing '25 to '24, we had a 25% growth. We reached a little more than BRL 6.8 billion last year. And in my opinion, the highlight was the growth we had in the Riva segment. So when we isolate the launches of Riva launches, comparing both things, Riva grew 43%. So here, I want to use this opportunity to highlight our capacity to use the opportunities that emerge, often in very short-term deadlines. And this huge -- growth came as a consequence of the Level 4 of Minha Casa Minha Vida that occurred in June last year. So we used this opportunity created in June last year. And in the second semester last year, we had a strong growth of Riva, and the growth in launches happened with the maintenance of the sales that was very solid, too. To the right here, sales, net sales, last year, we sold a little more than BRL 600 million, 3% growth compared to '24. And here, it's important to highlight that share in the sales went from 79% in '24 to 83% in '25. So this has been a priority here in the company. We have been building, executing, selling and working to generate results to our shareholders. So we use our execution capacity so that these results can translate in an increasingly greater share for the shareholders of the company. Also, it's important to share with you, and it's something that I really consider very relevant is that in the fourth Q '25, we sold a little more than BRL [ 1.518 billion ] And in Paolo Sousa's presentation, you will see when we analyze the volume of revenue in our fourth Q, considering the SPEs that are not consolidated in statement of accounts. When we analyze the sales, we consider 100% of what was sold. So comparing revenue with sales, it's critical for us to consider the revenue that went through the accounting statement and one that went through the SPE not consolidated. But as a result, it goes to the minority interest line. And we delivered revenue that was equivalent to what we sold. What do I want to say here? Well, the gap that existed 18, 24 months ago between sales and recognition of revenue, and at the time, demanded us to place all our attention on our engineering, execution of our work. So the gap between sales and revenue would close through growth in revenue, reaching close to sales. And this could occur so that we could maintain our efficiency, right? Because this is the trade of the company is our competitiveness here. And this gap was closed. Do we have revenue in the same level as sales. And this occurred, as I showed in the previous slide, with a gain in competitiveness, which translated into gains in margins. And from the point of view of execution and engineering, we have the huge comfort. We know that if there is -- there are opportunities we believe can materialize with important gain in affordability and this should the current program, in the proposal set to the meeting on the 24th of March of the [ Curating ] Board, we should use this gain of this new opportunity to capture a great volume of families that will enter our market, and they will be addressable with this gain in purchasing capacity, which will exist if our proposal is approved. So from the point of view of execution, today, we are in a moment. It gives us a lot of comfort to use these opportunities and also knowing that all of this efficiency and this competitiveness that we have certainly will remain in case the opportunity materializes itself. Now we give the floor to Paulo so that he goes to the financial highlights of 2025. And in the end of his presentation, I will be at your disposal for questions and answers. Paulo.

Thank you, Ricardo. Good afternoon, everybody. It's always a pleasure to be able to share with you our results. And so I will begin with Slide #8. In continuing with what Ricardo described in the result. Our revenue in the quarter grew when compared to last year, 33%, reaching BRL 1.226 billion here. And quarter after quarter, it grew 6%. And annual, we reached BRL 4.300 billion revenue and a growth of 30% and compared to '24. So our execution works following our business, we buy the land, we launch, we sell, we execute the works. We do -- we have been able to do this. Even in the fourth Q, where seasonally we have -- we began with the rainy period, and it's not always possible to begin or accelerate works. We still accelerated growth in revenue. It's important to stress at a smaller growth in sales. Here, we have total revenue -- total net revenue. Here, it's in this red bar in the chart. You have the revenue of the SPVs, we don't -- do not consolidate in the results, right? So here, we have our effort linked to sales here in the previous slides, we have total sales. So here, we have sales talking to the revenue. The bar BRL 1.533 billion revenue and the same in sales, we closed the gap that existed between works and sales. It's pari-passu and once again, reinforcing the capacity of being able to build, deliver projects and follow the schedule of our business. So this revenue reached BRL 5.5 billion this year. So of 24% growth compared to BRL 4.4 billion last year. So here, we see a dilution to -- so since the revenue, we consolidated grew 30% and the total revenue grew 24%. There is a dilution of the SPVs that we have a joint control with partners and an increase of our results here. Now going to the next slide, Slide 9. We have gross margin here. And so here we have the quarter. Our gross margin in the quarter was BRL 42.8. It's the best in history it grew another 0.7% this quarter compared to the previous quarter. When comparing to the fourth Q last year, we went from BRL 39.4 to BRL 42.8. So this year, we broke the barrier, right? We broke records. We continue growing our margin every quarter. So we closed the year with a consolidated margin of 42.2, more than the 42, growing almost BRL 400 million when compared to last year. And here, to the right, so this makes us very comfortable right in our rev margin, which is very high, a deferred revenue, right, very high. An inventory of BRL 4 billion revenue to be received. So we have a lot of results here with a very high deferred revenue the deferred revenue here this inventory sold units, but they haven't been built yet. So once we build this inventory will go through our accounting statements right our financial statements and gives us results. So we've been able to do everything according to our history we have a high maintenance of gross margin in here, and it will continue. To continue here going to the next slide and talking about net profit. Here, we talk about the operating net income, net profit. So this is excluding eventual nonrecurring events in our results. And the highlight here compared to the right, which is an accounting property annual vision, we have BRL 32 million profit. We had a nonrecurring impact that happened during this year. So this is a slide with a margin of 17.4% in the year, in keeping with the previous year, a slight increase plus the growth of results of 31% year after year. Also, the quarter was the best one in our history in net profit, a margin of 17.2. And to the right, you had the accounting profit, what was for our shareholders, BRL 789 million with nonrecurring results of 32% gross margin, net margin of 18.2%. So amazing results delivered here. Annualized growth of 50% a year from 2020 to '26 going from a net margin of 7% to 18%, right? So we're growing correctly, gaining margin, delivering more results. And lastly, now the next slide here, just a quick update on capital structure. This is where we have all the -- all our decisions come from Our net debt closed the quarter with BRL 500 million, BRL 533 million. We wanted to optimize return to our shareholders. We closed the year with a record in cash, more than BRL 2 billion in cash, almost BRL 2.2 billion growing 35% compared to the previous year, a very long debt, 64-month average period. The chart on the right, the gray bars. It's a very dilated schedule, right? So here, we have -- this gives this comfort so that we can operate and work without the leverage consuming our energy, right? So this is something we deal with every day, but with comfort and -- and also, we have time to focus on operations. And I think that this is our strong brand, yes, our strong thing. So briefly, this is it. So now I will give the floor back to Andre so that he can moderate the Q&A sessions.

Thank you, Paolo. Thank you, Ricardo, for your presentation, too. Well, in order to begin here before anything else, I would like to suggest to our investors and analysts, those of you that want to ask your questions, use your raise your hand here. Our first question comes from Fanny Oreng, Santander.

Well, two questions. First, with regards to the changes in the program. For us, it is clear that Direcional benefits because of its exposure, it has to Level 3 and 4 and also because of the increased affordability, which is very expressive because of the huge increase in the band, the range of average income necessary here for this. I want to understand what is the strategy you're thinking for speeding up the net sales considering these benefits that will happen partly from April? Second question aligned to the potential speed up of VSO net sales speed is considering the cash here. So could you tell us how you see the outlook for cash generation in 2026. So these are my two questions.

Thank you, Fanny. Let's go. Well, I will answer the first question and Paulo, the second one with regards to cash generation. What was sent for approval to the Board in terms of adjustments in the income ranges and cap prices, so units could be eligible for each one of the levels. In this case, it went to 3 and 4 where the 3 cap would be from 380 to 400, and 4 from 540 to 600. Also, we have all four levels, right, 1, 2, 3 and 4, where incomes are incremented and clients that were in a superior range become eligible for the inferior ranges, right? So I think there is a strong impact in the gain of purchasing capacity of those families that have access to lower interest rates. And we have a greater volume of products, specifically Riva products eligible here. In case there is an increase from Level 4 from BRL 500,000 to BRL 600,000. And also Level 3, which is very positive. We always like to follow up on the impact after measures enter into effect. But we are very excited with the positive impact these adjustments might have from the point of view of demand. What I can say in terms of margins, we have operated with very healthy margins. This quarter, you saw a stabilization of the deferred revenue. There is no impact, no perspective of continuity, of adjustment in the deferred revenue. It should remain in this level, which is a natural adjustment from one quarter to the other. The gross margin still had an increment 42.8% when we adjust this. The interest rate taken in the level of the SPVs, which is a record in gross margin and also this gain in affordability for us should translate into an increment in net sales speed without us going after any kind of price adjustment as a consequence in this purchasing capacity. The increase in net sales, the main leverage we have today for the increment of ROE and cash generation the impact is more relevant, more than margins. So very quick calculations here, considering the percentage of average advance of our works a little more than 40%, close to 50%, considering we have approximately BRL 5.5 billion of products to be able to be commercialized in 1% of -- an increase of 1% of net -- net sales speed represents almost BRL 100 million, right? So the gain in DSO, it has a huge impact. And this where we're focused is what we're going after. And the search for net sales speed as well as an increase in purchasing capacity gain, including a huge amount of families in the market we have, we have made strong efforts, specifically our sales team, our own sales team, incrementing the sales of Direcional and Riva and online sales. And we see that this is the path that we have to continue trailing and investing in time so that, in fact, we have a gain in net sales. Our sales force has been very relevant here. Now we're give the floor to Paulo to talk about cash generation. But if you have any other question, please ask me so that I can cover this detail relative to this first point where we talk about the expectation of gain in net sales speed because of the changes in the program. But before Paolo answers your second question, I want to stress here, when analyzing some reports that were released. With regards to Direcional data, we have seen some relevant failures in the calculation of cash generation in the company. And I want to say that our team here is at your disposal to clarify these analysis because -- so that our cash generation can be analyzed in the same way by all analysts. And I think different interpretations. Some enough point, a very strong, very wrong, so they should be clarified. So now going back to -- Now Paulo, I'll give the floor to talk about cash generation.

Thank you very much, Ricardo. Now also with regards to cash generation, we have in our material that we disclosed, the composition of our cash generation, operating cash, right? And the calculation and our objective is to purge all the nonrecurrent effects that impact cash generation. And so that we removed the cash generation to get to the operation. And we are available for those of you that have questions, we can do the calculation again using our financial statement, and it's not difficult to get there. And Fanny, now with regards to the cash generation outlook. When we -- the results of our business, right? When we see the results, in order to grow, we have to have cash in the operations. The way we operate and the states we operate in our business model. So as we grow we need to finance this growth and have cash for operations. And we see this when growth drops, the cash comes back because this is cash that is certain of a return, right? We transfer almost 80%, 85% of what we sell in the plant. So when you sell, you transfer, all you have to do is to build and with this gross margin that we have, we're going to have cash left over, and we are comfortable here. And as we grow, we saw in the slide that Ricardo showed the growth in 7 years. Our launches grew 3.5x. Last year, our launches grew 25%. So this year, we're going as Ricardo said, we will use all the opportunities that emerge -- will emerge. So the normal outlook of our business, well, we're already deaccelerating because of the growth in launches next year. But as the operations do the catch-up as I said, and with the maintenance of a healthy net sales speed, the cash comes back. Last year, we generated cash as we showed in our disclosure material. And this cash generation oscillates. There are quarters that it goes up and down, sometimes more, sometimes less. So one quarter more, one quarter less because sometimes it doesn't make sense right to launch during Carnival. So we do it afterwards. In the fourth Q we have a huge 13th salary to paid. We provisioned this year we paid in the end. So there are several events that impact quarterly actions, right? But we have a growth in cash generation every quarter. So this is our main focus here. I spent all day long here talking about net sales speed, cash generation. Our business has to generate cash, and we really do believe that our operations is in the right path for this. I don't know if I was able to answer your question, Fanny.

Another quick question to Ricardo. I know you don't give a guidance, right? But is there a net sales speed level where you'd say this level, I would be very happy with. This is what we want with all our initiatives. I don't know if you could say this. Maybe it exists, but I don't know if you can disclose this.

Well, here, we have no problem even because the volumes and launches and sales that end up impacting the effective results. The net sales speed is a consequence here. We're not talking about launches nor sales, but the net sales speed levels that we had in the third -- in the quarters last year had a strong impact, specifically the Direcional segment was concentrated in December. BRL 1.700 billion of the BRL 1.800 billion that we launched in the semester. And we've been working with net sales of 25%. This is quarterly. This is a level we consider a healthy, solid, but here with a controlled inflation, the main cost increase we have in production coming from -- so when we analyze materials, everything is under control. The construction process we adopt, labor has a relevance that is lower than the more common things that we have. So our costs come from labor. And once this happens, we become more and more competitive when compared to other companies. So when we have the total cost considering what labor and materials represent, we see a very controlled cost increase in this moment and the very expensive capital in our country. So although we say 25% is a good level in this level to be more than 25% has no pushback from our side. Because in general, we operate with lower net sales did when we are concerned with a potential cost increase because the hedge we have here is the unsold inventory and price readjustment of this inventory. Once we have the sale, the price becomes fixed in nominal terms. So when we have a concern with regards to the potential inflation in the future to operate with a lower net sales speed is -- so that we can mitigate this is healthy. In this moment, we don't see problems with inflation which would justify holding back on sales. So in spite of the levels of the second and third quarters last year, semesters is healthy. We want to exceed this. And this is our expectation here.

Next question, Bruno Mendonca, Bradesco BBI.

Ricardo I want to ask your question with regards to how you have considered the next cycle or the next harvest of projects. We see you're going from a very well-executed cycle. Number of sales closing the gap with regards to revenue, closing the gap with regards to sales. So we still -- we see the reported margin very close to the deferred margin, which is a margin that you historically not to the deferred revenue perhaps this won't be forever, right, recurrent, but it seems that we're going towards stabilization, specifically with regards to Direcional right, which we have in our mind is a really big model. So now I'm going to consider a number here is the number of land lots that you bought, an acquisition of 8.3 billion land plots in the quarter, so reaching to BRL 53 billion of land bank. So it's many years of launches here, right? So my question is how have you been thinking about this? How does all of this sum up? That's my first question. So how have you know this, the margin of these new projects? And the margin of these new plots, this new land, do you see -- do they come in lower margins than the ones being reported and also the dimensioning of the company because of the size of the land bank. Is there room for an additional PSV in the first line? And how -- and when will we see this in the results?

Bruno, thank you for your question. With regards to the plots acquired in the fourth Q, although it's been a very expressive number. I would say that this is a one-off volume. Three specific land lots that had a stronger relevance from this 8 billion acquired, it was more than in the quarter, right? But 3 had a more relevant impact because there were really big projects. But this is not the trend from here on. There isn't a priority in incrementing the amount of our land bank. These were opportunities that materialized themselves. All of them simultaneously in the same quarter. So land lots negotiation contracts take longer than 3 months. And coincidentally, these were lands where -- of which negotiations were concluded in the quarter. But this is not a trend from here on. The trend is to have more stabilized lands, right? And margins, Bruno. What has happened is the following. We launched a certain level of margin. We consider in our feasibilities and future inflation expectation, parting from the assumption, our price remains fixed. So the expectation of future inflation comprises our cost for acknowledgment of revenue. But even if we are able to increment the sale price, quarter-after-quarter, and we do this analysis, if our price is within the market prices more or less we adjust prices, and this gain in price becomes a margin. And as a consequence, once we have this price increase, the projects have an increment in margin in time in case inflation is closer to the inflation that we foresaw during the moment of launching and where we consider it in the cost of our project. Launches in the fourth Q., in spite of reported gross mark being 42.8% was -- it became 40, right? And when we launch the margin is lower than what is materialized in time because we increment this price as we compare it to the market reality around us. So we're going to have a gain in margin So the margins and launches in the fourth Q were very healthy. And we did not change any assumption in the moment we did the acquisition of the land lot with regards to the minimum and margin and minimum return that we have to deliver. What I think can happen from here on in a scenario where our margins should converge to a level below 42.8 that we disclosed, since -- our main priority is net sales speed. There is a possible lower increase in price, but then we will have the conclusion of the units in the shorter period. From the point of view of return of capital where we invest in this project, a shorter sale without margin increase, it brings about a greater return. So I think an eventual convergence margin to a lower level should occur as long as you have a corresponding increase in net sales speed. And this is what we want, but the margins of the launches in the fourth Q were very solid. And from the land lots bought, there is no change in assumption here because we have a land bank, which is very healthy, and there is no reason to acquire lands making any kind of concession in the assumptions that we have. We should be buying land in more favorable conditions. So there is no change in change, healthy margins here and strong comfort. When you see the size of our deferred revenue, very solid, right? So we have a strong comfort in the margins we should deliver. Size of the company. What we're going after, as long as there is a demand as long as there is very little capital allocated to deliver this growth. This little capital allocator means we're operating with high net sales speeds. From the point of view of execution, I would say, today, we are we have a greater comfort than we had last year where we still had this gap between sales and revenue to be closed. And this gap has been closed with a level of comfort in the execution of projects and reflected in the margin we're delivering. And because of the scale we gain and this growth happen in areas we've been working for 7, 8 years, there was no opening of any new state in the last 7 years. The scale we're is translating itself into greater negotiation capacity, acknowledgment of our name, brand and credibility. And as we were able to grow, becoming more competitive, becoming more efficient in terms of gross margin and dilution of expenses, we're going to use the opportunities, but the growth is not our objective. Our objective is net sales speed. If we have demand, we will launch more and execution today is something that gives us more comfort than 12, 18 months ago. So this will happen as long as the demand materializes.

Is there a cash impact here on this huge harvest of land. We've been very disciplined in buying land through swaps, because today, we don't have the need to increase our land bank. So I would say that cash exposure in our purchase of plant has been minimum, but cash exposure occurs in the process of approval of the execution of the project and environmental permits. So if you consider last year, BRL 90 million we had, in terms of disbursement in projects and of projects and environmental permits. And there is an impact here because since it is small in the sale -- in the volume of sales, but still, we need this for approval project and to have the permits.

Next question, BTG Gustavo Cambauva, you have the floor.

Two questions here. The first one, Ricardo you touched upon the growth. And when you started, you were very emphatic, right, saying, if the conditions of the program continue favorable and with huge chances of increase improving even more in the short term. You said that Direcional is ready to capture these gains and eventually grow here more. So I would like you to explore this a little more specifically from the point of view of engineering. Because I remember 1 year ago, you said that engineering was a point of attention, paying attention on the ball, not running any risk here and allowing things to leave to one's control. And '25 was an excellent year for the company. So I would like you to tell us a little bit about that because we hear competitors saying that it's more difficult with regards to engineering, some supply, some kind of equipment, specifically labor. So I would like to understand from you it's because of the exposure in some states where things are easier, you state you're in, right, in areas you're in. Are you more prepared to continue with this growth. I would like to understand the reason behind this greater comfort that you have. And my second question, well, beginning of the year, how things are January and February. These are months where we have different seasonalities, right? But I would like to understand, after the fourth Q that you had with a very good launch volume, but a weaker net sales fear, whether you would be able to recover this in the first quarter.

So well, it's important to make a disclaimer here in spite of us showing to the market that we feel comfortable in our execution capacity. And we're very satisfied to have been able to close this huge gap that we had between sales and revenue. And since we did the follow-on in June '23, when the capital went from BRL 260 billion to BRL 350 billion for Minha Casa, Minha Vida, we raised capital use this opportunity we delivered a sales launch growth, very expressive, right, from '23, '24. '24 we had a huge growth of sales when compared to '23, BRL 3 billion in something in '23 and '24, almost BRL 6 billion in sales. So it was a huge growth. And it's natural when you have this very relevant sales growth, and then you have a greater number of execution of ForEx, but it only makes sense if we can capture synergies and have greater gains in competitiveness as fruit of the scale. And this cannot occur because with a loss of the efficiency. We have to be prepared for this. So we have clearly shown the market that our growth happened in a consistent way, where you've seen quarter-after-quarter gain in gross and net margins, right? Specifically, if you exclude the number of the minority risk -- the minority interest, minority had a growth, right, in the last quarter. So if you see what they represent, you will see that our net margin had a relevant growth in '25 when compared to '24. We had a growth with gain in gross margin and gain in SG&A reduction here. So there's no dilution here comparing '25 to '24. So our engineering it is a huge comfort for us with eventual opportunity that can materialize themselves. Our revenue is in the same level as sales, very solid levels. And I think that the fact that we have a greater geographic diversification than other companies, right? This gives an even greater comfort from the point of view of execution capacity. Certain areas have a great availability of labor than in others. So this is certainly a point that makes sense. And then you have the construction process that we use which is less intensive in labor. So it's where we use which is the -- which is much better than more -- more common kind of construction processes. So construction process and geographic diversification is important. And it is not in our plan to begin operations in other areas. As the -- as long as growth is happening in areas where we work in, and we have already the knowledge of the area, we will continue. Your second question, how we see January and February. It's important to compare January and February. The numbers of the current quarter compared to the previous -- the same quarters in the year. So February -- January is a holiday month and February is Carnival. But when we compare our sales volume here to last year, we see an important growth number. So it's important to say that we have an important growth volume. On the other hand, it's also important to say that we began this year with a great volume available for commercialization. And net sales is this, sales volume and the number of units available. March is relevant in the first quarter. It's important to see the performance in March. But when we see the beginning of this year, we have important growth here in nominal terms that certainly does encourage us. And with the adjustments expected for the program, we believe we're going to have a very positive year.

Just to add to this number, consider in January and February -- I'm comparing January to January last year, February to February. So these months were stronger, right?

January was strong and February was stronger. And the growth in February relative to February last year was greater than the growth of January compared to January last year.

Now next question, Elvis, BBA.

Sales going beyond the effect of Minha Casa, Minha Vida. Is there anything internal that you're doing in-house right, that you're already doing or can do in order to improve, migrate the current and net sales speeds to higher levels. You're talking about 25%, even higher levels. So these initiatives continue. And just how much -- considering the Northeast, right, if you can increment the net sales in the region? And can you collect more in the Northern regions. So that will help migrate these to the net sales speed to higher levels. And considering the changes of Minha Casa, Minha Vida, how has this driven the net sales speed, right? You're talking about cash generation, not grow the leverage, how you see this between launches and cash generation? Up to what point can you launch more considering the program and initiatives that are in the pipeline?

Elvis, sales, it is interesting. But to add to what I answered in Cambauva's question, where we've noticed a higher nominal volume of sales compared to last year, always with the caveat that we also had more products available for sale in the beginning of this year when compared to last year. But we've noticed the great -- a better performance in the Northeast, a greater growth of sales when compared to '26 to '25, this is happening in the 3 capitals we work in the Northeast Fortaleza, Recife and Salvador. These are the greatest growth we've had and has come from these regions we are in, we operate in. So our operations more recently has happened in the Northeast. And once it becomes even more mature, we've noticed a gain in speed -- sales speed. And during this period of maturation of activities, although they are 6, 7 years, it takes a long time for us to reach a minimum scale in each place we operate in. So I believe that in '26, we will reach BRL 300 million in launches in each one of these areas. Recife, Salvador, Fortaleza, we've already done this. But obviously, we'll be gaining in net in speed sales and also when we begin working more and more with suppliers in the region, we gain here too. But the Northeast has been a positive surprise in this beginning of the year. I think also as we have scale, we reinforce our house, which has been an important measure. And we have some changes being implemented in our online sales part. It's still very new. But with results here in these pilots we began doing and they're very encouraging. And in case we continue with this, we will roll this out to other areas in Brazil. So I think the online here, we're going to have certain measures that are positive. But everything is very gradual, it doesn't go from one month to the other. Things happen during -- in time, it's gradual. It's not from one day to the other. With regards to the trade-off, the increment of launches versus cash generation, it's perfect what you're saying. But I would say that the increase in launches will occur in case the net sales speed of these launches are more, it exceeds an important level. We have here as an internal trigger. So in the beginning of the works that happened 6 months after launches then we will have an important part of the costs covered by sales and transfers so that we can have demand, a working capital demand that is minimized. In case this opportunity materialized itself. I don't want to say that this priority -- our priority is the growth in launches. No, it is sales. And in case products become lower than we believe is healthy, we have the capacity of replacing these products when we analyze our land bank. At the end of the day, it means an increase in launches, but we closed the year with more than BRL 5.5 billion of large products launches available for commercialization. And our initial priority, fruit of an increment in sales is to reduce the level of inventory. And in case the net sales remains to allow us for the first 6 months of sales and all costs are covered, then we can begin incrementing launches in that specific market where product availability for commercialization goes below margins, we believe healthy because we have products to sustain our labor force, our labor to attract an even more competitive team here. But growth -- what is the priority is sales growth, not launches.

Next question Rafael Rehder, Safra Bank.

I have two questions here that I would like to touch upon. The first one, could you tell us about the potential end of the scale, 6:1? Have you done internal studies to calculate the impact or this chain impacts, the value that entities in the sector are passing? And who talks with the government of the entities or the government. The second point is the potential revision of the master plan in Belo Horizonte, the impact for Direcional and would there be room to grow launches even more in the capital?

In end of scale, 6:1 scale. In the case of Direcional, the impact is lower then it would be in the average of the sector. And since entities represent the sector, they always adopt the average of the impact of the change with the end of 6:1. The number of hours being worked during the week. Because of the construction process we use, we end up being less intensive in labor in more than the rest of the sector. So the impact, which is the average of -- in the sector, but it's natural. There's no way we can't say that the end of the scale is 6:1, it's inflationary there is an increase in production costs, and this will be transferred to price. What I want to stress is that in our case, we end up having lower impact, and this makes us even more competitive when analyzing the scenario in the country as a whole, but it's natural that the cost for all companies will grow. This will mean a higher price for the population and the growth proportion in terms of price increase will occur for the different companies, right, will occur in different scales. And in our case, it will be lower than in those companies that have more intensive construction process and more labor. In the discussions with the government have occurred through entities they have done this process, conducted this process. And I mean, it's more adequate that this happens, right? More appropriate that this happened. So I think the conversation with [indiscernible] is very important, and they've done this. With regard to the revision of the master plan in Belo Horizonte, it is very positive. It's very transformational for downtown there. I think it will have a very expressive impact when we look at how the downtown area is more degraded and what can happen in terms of the revitalization of Belo Horizonte. It is in the city council to be voted in because it's going to be voted and it's going to be based on the benefits that will create for the safety. And we've looked at this region very closely. We have an important volume of land there already acquired and some in negotiation processes. But I think it's an interesting opportunity, but it's always important to say that the metropolitan region of Belo Horizonte is 20% of our business. There is an impact, it's positive. It will mitigate other surprises that we might have and that we don't foresee the end of scale 6:1 can mean an increase in prices. We increased the oil prices. This might mean an increase in freight. Okay. So we have a series of other points that have an effect of mitigating these adjustments even more than compensating it. So the revitalization process is very positive. We have a relevant operations in the region. And I think we'll certainly take -- we believe it's going to be -- it's not going to be a transformation for our business. There is slight improvements that help us in time, right? Downtown Belo Horizonte, downtown in Belo Horizonte is one more opportunity.

UBS, Tainan Costa.

I know you don't have a guidance, but considering 2 things for '26, the minority line in gross margin. This is the minority interest. This is the first quarter we had an idea of this line with the acquisition of Riza and Riva, considering BRL 75 million, can you analyze it for '26? Or was there an effect, the minority interest and the sale that contributed to a higher amount this quarter, considering revenue increase. Would that make sense, 5%, 6%? And the second is the gross margin for '26 saying -- what actually said is very comfortable here. The deferred margin seems to be very healthy. So we want to know how this -- the dynamics of the -- this margin for '26. Do you see potential gains, all this level, 47 -- well, thank you.

So Paulo.

The first question with regards to minority interest. There are several factors here, right? We have if Riva and [indiscernible] go with different intensities. This will change. With regards to the fourth Q, we had a nonrecurring effect, not relevant, but increased this line by BRL 6 million, the specific SPV, where we have a consortium. There was an appropriation of results of the previous semester quarter. So it was slightly higher than it should be. Not relevant, but at least in the fourth Q, it wouldn't have been so much. But you're right, this quarter, the share that will be the deeper revenue here that will be happening in '26. And the greatest impact is Riva. So it's not very distant here, a little bit here, a little bit more, but it shouldn't change so much. With regards to gross margin, this is an even more difficult question. Ricardo talked about this, and if he wants to add, it is price versus construction price. When we look at our deferred revenue, we feel comfortable, the stability of the deferred revenue going from 44% to 45%, right? It gives us the comfort. If we execute the works according to the expected, we will have a very stable margin in relation to what we're delivering now. We can also see that our inventory has a good margin. We can calculate this based on our financial statements, we have a good margin of inventory. New launches, in the fourth quarter, it was a margin close to 40% adjusted. So there are several components from here on. Two that are very relevant is inventory and deferred margin gives us a good comfort here because we know that we have good margin here. Ricardo, would you like to add to this?

No, I think this is it.

Next question, Andre Mazini, Citi.

Much has been answered, but some follow-ups here. The first one is to confirm how much there were in savings of works in -- how much we saw here? Was there a lot of savings in -- of works, recurring? And the second question, what will change effectively in that zone to that material from the local government. Can you build higher? Is there an amount that's not going to have any more? Will it occur the way you want, garage, no garage. Specifically, what is changing here that will improve the densification of the zone 2 in Belo Horizonte?

Paulo, help me with any details with regards to savings. In this fourth Q, there wasn't a significant recognition of savings, given this one-off effect from margin going up. The net effect between certain inputs where there are price adjustments was not a reduction in budget that would justify an increase in margin. So this margin is -- there's nothing one-off here. There's nothing one-off here. Nothing that -- one-off that can lead us to say that the margin from here on would have a significant reduction. And also a caveat here. This margin level is the greatest we delivered in history and margin -- recurring margins, there was nothing recurring here in the fourth Q with regards to the master plan in Belo Horizonte, when we consider downtown, the center, right? Those regions that are being impacted by the master plan. There have been an increase in the construction process by 70%. So if you consider the central region, where the coefficient was 5, it's going to 8.5. There are other regions where the coefficient was less than 5, it's been incremented by 70%. The point is that this increment today to go from 1 to the maximum potential occurs via the purchase from -- a grant from the local government and security that comes from properties that have been -- and it goes to other areas in the city, selling this TDC originated from the fact that this building has been this property. So the increase of 1 to the maximum has a cost, and it will stop here. And also, it gives you the possibility of building 70% more than what is done today because the proposal hasn't been approved by -- yet. So you have all in the infrastructure, right, downtown, you have everything there. So this increase in the population of downtown, the city will not increase costs and the attraction for the developer is big. And there is also a proposal of exemptions of certain taxes for these buildings being created, built in this region, and it is very positive for the buyer. Mazini, we don't know what's going to be approved. There might be one adjustment or another, but we believe the attraction here will certainly increase with these changes.

Igor Machado, Goldman Sacs.

A follow-up here with regards to the changes in Minha Casa, Minha Vida program. It was clear [indiscernible] said that depending on the demand, you can launch more. But I want to understand the breakdown of the company related to the levels of the program. Can you increase exposure here or reduce exposure? Anything will help us here.

Igor, what we noticed for this year, there is a burdensome budget from the FGTS and the pre-sold social fund which has an expressive increase when compared to the last year. When we consider the subsidy, the proposal for this year was BRL 12.5 billion, and we sent to the Board for an increment to increase it to BRL 13 billion, which is very close to last year. . So the space for increment in Level 3 and 4 is greater than 1 and 2 where you have a limited effect, right? The availability of subsidy, which is the subsidy here might be the problem. So Level 3 and 4 with the changes that can be approved on the 24, they certainly make sense. On the other hand, Level 1 is interest, an increase of income from 2,850 to 3,200, increases the purchasing capacity of these changes. And there is a change in taxes from 4 to 1. So certainly, it's attractive Level 1 because of this. But we have to consider subsidy and levels 3 and 4 because of the volume of budget in very burdensome resources, which is very big, I think there's no kind of bottleneck here. These are segments we are very careful. We are looking at it very carefully, and we believe there's going to be an opportunity here.

João Pedro Rodrigues.

Congratulations for the deliveries and focus on the strategy. We have 2 questions here. First, I want to explore in more details what you imagine can come from PSV because of the partnership with Moura Dubeux that was done? And in your plans to grow sales more than launches, right, if the partnership is in line in terms of diluting more risk without incrementing launches, right? And could you share with us the governance process in terms of planned approval? Is there a collegiate shared between the 2 companies? How are you going to divide the sales team and approvals? This is my first point. Second, the reform, an exemption of BRL 5,000, right, the tax reform. So we know there are new people here being placed in the map, right? A greater market opening itself. And I want to understand if you have a vision here, with regards to how Caixa should address this client in terms of credit score? And if this changes anything here in terms of -- in your portfolio, transfer deadlines, terms, an increase of these informal clients, right?

Well, I think the partnership with Moura has some points that are very important. One, the Moura brand and its presence in the Northeast is relevant. This will have an impact in the acquisition of differentiated and special areas. And when we are together, I think access to these areas will certainly become easier. And I think this is positive for the operations in the long term. And we have a gain in scale that is significant in a short period of time because we'll be operating together. So independent of the marginal growth coming from this partnership. I prefer not to go into details here, right? But let's say, the volume of launches doubled. Each company has 50% of the share. Nothing changes for both. But since both together have doubled the size, this is very relevant from the point of view of access to the client, attractivity here of the sales force. I think the whole thing can be very positive and is in keeping. We noticed a strong benefit where we have more mature operations and the fact that we operate with them will give us a maturity in a shorter period of time. And this is what we want in this work together. With regards to your second question, the impact of the exemption of income tax for those that make up to BRL 5,000, certainly, it will have a relevant impact in the representativeness of the informal income between -- among those that acquire our product. Specifically, using before the beginning of the context, let's imagine before, let's -- if we were to analyze the banking statements of the person of the family. If that statement, if there was a certain level of income that was over -- that was above the exemption limit where that person did not pay income tax, one should presume that his income is below the exemption limit, which last year was well inferior -- was much inferior, less than BRL 5,000. So I believe that people, families of which income tax exemption was lower than BRL 5,000, they had lower purchasing capacity than they have now. So the impact of sales can come from this change where people have a greater income that is greater than what they had last year. So I think the increment of demand should come from this change, which is very relevant, almost doubled the income that ended up being exempt from taxes, right? So this will include several families that did not have a purchasing capacity. And now they will have, but we have to wait and see. But I think this is going to occur during the second semester this year. It's not from one day to the other. This change will be gradual, but I think it should happen. Once again, let's wait to see because I think it's too early to presume this as a truth.

One more question here. Marcelo Motta, JPMorgan.

A quick question. If you could mention the dilution of the G&A, the selling, Ricardo said that it increased. There wasn't a dilution this year. So I want to know if this focus here in net sales, if the level will continue above what we saw in '23 and '24. In terms of G&A, there has been a constant dilution. Do you think you have already been able to use this line here.

Well, the growth in revenue always comes with a benefit, right? Although it's not the main focus, but it generates opportunities. The -- it ends up impacting the gain in efficiency.

To add here to the commercial expenses, I don't think they should have an increment even with a search for an increase in net sales, we shouldn't expect that the increment of a net sales should be accompanied in the increase of commercial expenses, but the reduction of the level of commercial expenses as a proportion of revenue shouldn't happen, it should generate in the level that we delivered in '26. When we talk about G&A, we also had an expressive reduction in the last 2 years. We went below 6% of the revenue. And when we look from here on the pace of revenue growth will occur in proportion that is lower than in the last 2 years, our revenue grew in the last 5 years, grew every year. And so here, we show you the vision, the cash generation should happen. This cash generation occurred because of events, the market consider nonrecurrent. And with the reduction of the pace of revenue growth has reached the sales, will also has as a consequence, an increase in cash generation. So it's probable that the G&A as a proportion of revenue will remain at levels that are close that we had in the second semester last year. The pace would tend to reduce from here on. I don't think there is room for so much change looking from here on for so many -- so much dilution.

We have no more questions here. No more hands raised. So I would like to close our Q&A session and also thank you for your participation. And also, we are at your disposal for any questions you might have. To close our earnings release of the 4Q '25, I'll give the floor to Ricardo.

I would like to thank you for your participation. Your Q&A was very, very wealthy, we were able to answer very important questions. I would like to use the occasion to thank our team. We are very satisfied with the results we've been able to deliver and we see several opportunities to continue with this journey here with constant improvements. There are a lot of things here in the loop that we want to do, and we will translate this in improvement in performance. Thank you very much, everybody, and have a very good day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]