LPS Brasil - Consultoria de Imóveis S.A. (LPSB3) Q3 FY2025 Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and thank you for waiting. Welcome to the earnings webinar of LPS Brasil to discuss the results for the third quarter of 2025. This event is being recorded and LPS. [Operator Instructions] Before proceeding, we would like to clarify that any statements that may be made during this webinar regarding the business prospects of LPS, projections, operating and financial goals constitute the beliefs and assumptions of the company's management. Forward-looking statements are not a guarantee of performance and involve risks, uncertainties and assumptions as they refer to future events and therefore, depend on circumstances that may or may not occur. Investors and analysts should understand that general conditions, industry conditions and other operating factors may affect the future results of the company and lead to results that differ materially from those expressed in such forward-looking statements. Now I'll turn the floor over to the Investor Relations Officer, Mr. Cyro Filho, to start the conference. Mr. Naufel, you may start.

Good afternoon, everyone. Thank you for your presence at another LPS Brasil teleconference. We'll have a presentation of our Vice President, Francisco Lopes Neto; and then our Financial Officer, Paim. First, let's start with a message from Marcos Lopes, our CEO.

Good afternoon. Thank you for your presence at another LPS Brasil teleconference. Lopes maintaining its strategy this quarter, given the continuation of the scenario observed in the first half of 2025, marked by funding constraints and high interest rates. Even in this challenging context, the company preserved its profitability and cash position, reinforcing its commitment to operational efficiency. The real estate sector continues to show positive activity levels, especially in the Minha Casa Minha Vida program. At CrediPronto, we remain focused on portfolio growth, aiming to increase profit generation and strengthen our market share. During the third quarter of 2025, Lopes launched 33 projects, totaling a launch value of BRL 6.2 billion. Intermediation transactions totaled BRL 3.5 billion during the period with more than 4,000 units sold. CrediPronto ended the quarter with an average loan portfolio balance of BRL 17.9 billion, having financed 1 billion in contracts during this period and achieving a market share of 6.9% among private banks according to data from [indiscernible]. As a result of the company's performance, EBITDA was BRL 22.9 million in the period, and the EBITDA margin was 44.4%. We recognize that funding constraints and high interest rates directly impact all of the company's business areas. However, we remain attentive to market conditions in order to adjust our strategies and capture opportunities in a sustainable way. Thank you all. And now I hand the floor over to Mr. Cyro Naufel, who will present the results.

Thank you, Marcos. Now we start the company's presentation, starting with the highlights on Slide #4. For financial revenues, we had a net revenue of BRL 51 million, a decrease of 2% compared to 3Q '24. In the first 9 months of '25, net revenue is BRL 151 million, 11% plus than the same period of last year. The EBITDA of the company was BRL 22.9 million in the third quarter, 11% higher than the same period of last year. In the quarter, the EBITDA margin was 44.4% as highlighted in the initial message by Marcos, and it's the highest quarterly margin since 2011. In the first 9 months of the year, the EBITDA was BRL 55.5 million, 7% above the same period of last year. The net income control of the controlling company ex-IFRS had an increase of 43% compared to the same quarter of last year, BRL 15.6 million. In the first 9 months, it was BRL 32.6 million, 54% compared to the same period in 2024. CrediPronto ended the quarter with BRL 17.9 billion in portfolio balance, 13% higher than 3Q 2024. CrediPronto profit sharing was BRL 12.7 million in the quarter and BRL 33.3 million in the first 9 months, 58% to 66% higher than the period -- same period last year, respectively. Cash and equivalent generation was BRL 17 million in the third quarter and BRL 11 million in the first 9 months. Next slide. Lopes launches totaled BRL 6.1 million. Operations in São Paulo had the highest number of launches, 46% of total, while Rio de Janeiro launched 40%. We show the states in which there were launches in the first 9 months of the year. On the next slide, we see the results of Lopes intermediations. Lopes has brokered BRL 3.5 billion in the quarter, 4% less on a year-to-year basis. In the first 9 months, it was BRL 9.5 billion, 2% less than the same period of '25 -- '24. We are present in -- we have 163 stores. Next slide shows the geographic breakdown followed the main state was São Paulo, 40%, followed by Rio de Janeiro with 38% and the other regions together accounted for 22% with a total of BRL 774 million. On the next slide, #8, we show the division between primary and secondary markets. The primary market, which accounts for the main number of intermediations of the company accounted for 75% and 72% of units intermediated. On the next slide, we see the indicators regarding Lopes Portal. At the top chart, we see the organic visits to the website. And at the lower part, we see leads from organic searches generated by Lopes portal, which totaled 170,000 in the last 12 months. The next slide shows CrediPronto highlights. The mortgage volume by CrediPronto is BRL 1 billion, 16% lower than the same period. However, considering the 9 months of 2025, the volume is 25% higher than 2024, reaching BRL [ 3.16 billion ]. The amount grew by 14%, showing the market -- growth in market share of the company. At the lower part of the slide, we can see the CrediPronto portfolio reached BRL 17.9 billion and Lopes has -- holds 50% of that portfolio. On Slide 11, we see the main highlights of CrediPronto in the third quarter as well as the first 9 months of 2025. As said, the funded volume accounted for BRL 1 million and BRL 3.1 million in the first 9 months. Number of contracts has risen 16%, reaching 6,637 contracts. The average LTV is 60%. The average rate is 12.7% and 12.4% for 9 months. The average month or terms is 361 months in the quarter and 362 in the year. In the lower part of the slide, we can see that the profit sharing reached 12.7% that reached -- that added to 8.3% of origination revenue totals BRL 21 million. In the first 9 months of this year, the total revenue was BRL 63.5 million, while in the same period of '24, it amounted to BRL 41.7 million. On Slide 12, we see the virtual P&L with BRL 12.6 million in the quarter, and that's the 50% of profit sharing attributed to the company. On the right, we see the net result and its recognition in the results of LPS. On Slide 13, we can see that the net revenue in the third quarter of '25 was BRL 51.6 million, 2% less than the same period in '24. In the first 9 months, it was BRL 151 million, 11% above the net revenue in the same period of 2024. On Slide 14, we see that operating expenses decreased by 10% when compared to the same period of last year. And year-to-date, operating expenses amounted to BRL 95.5 million which is 14% higher than 2024, and that increase was mainly caused by the transfer banking correspondents because of the higher volume of credit facilities granted by CrediPronto in the period. In the next slide, we see EBITDA and EBITDA margin. 32.7% in the 2025 in the last 12 months view, keeping the company's focus on operational efficiency. On Slide 16, we see the results by segment before IFRS. In the consolidated column, we can see that the net income before IFRS was BRL 17.6 million, while the amount attributed to controlling shareholders was 16 -- BRL 15.6 million. On the next slide, the total revenue was BRL 37.8 million, while the attributed to controlling shareholders were BRL 32.6 million in the first 9 months of 2025. Now in Slide 18, we see the IFRS impact on the company's results, and that refers to the amortization of intangible assets losses with accounts. We also see gains and losses in cash and net effect. And we suggest that the analysis are made with -- without taking into account IFRS impacts. On Slide 19, we see the development of cash flow and cash flow from operating activities. The third Q '25 was BRL 63.5 million, almost twice the amount of the previous year, causing cash -- it was BRL 23 million that a total amount of BRL 63 million and plus financial transactions. So these were our comments, and we thank you all for attending, and we remain available for any questions you may have. [Audio Gap]

This is Robson speaking. We have a question about whether there has been an impact on -- regarding the news of the termination of a contract with a franchisee in Rio de Janeiro. There was no financial impact and the contract remains in force, the agreement. We would like to make that clear. Thank you, Robson. We were asked to give some clarification on the drop of the volume intermediated by the company in the quarter. It's important to highlight there was a decline in the total amount intermediated only 4% regarding the third quarter of '24. That was mainly due to the fact that in the third quarter of '24, there were 2 sales of -- or commercialization of land in the BRL 400 million that were one-off event. So that was not a repeated event. So if you consider this BRL 400 million sale of -- we would have an increase in the intermediated PSV. Also, there was a drop in more than 30% in the launched volume due to the fact that there are uncertainties in the economy and high interest rates, so developing -- real estate developers are waiting in order to make new launches. There was a question about CrediPronto that concerning what is the driver for the increase in market share. We can attribute that to a very efficient strategy to increase capillarity and the presence in the company throughout Brazil, increasing the number of bank correspondents and therefore, the number of credit facilities granted or loans granted in addition to the search of -- for excellence in services granted for those who are interested in getting a loan. So based in technology, also providing the lowest turnaround time to give or to provide a loan, so that's very highly valued for those in need of a loan. And with regard to Lopes fee, we haven't seen any decline in intermediation fees. On the contrary, they are maintained and there's a certain agreement on -- in terms of fee levels. So there's no pressure regarding that and no decline in intermediation fee. These were the questions we received. With that, we would like to thank you again for attending this teleconference earnings call and for LPS Brasil. And thank you again, and have a good day.

The webinar of LPS Brasil has now ended. Thank you all, and have a good day.