Moura Dubeux Engenharia S.A. (MDNE3) Earnings Call Transcript & Summary

Good morning, everyone. We'll now start the presentation of results for the fourth quarter of '23 for Moura Dubeux. I'm Alan Aquino. And today with us, we have Diego Villar, CEO of the company; Diego Wanderley, CFO; and Diogo Barral, Director of Investor Relations. [Operator Instructions] Remembering that any declarations that may be made during the presentation are based on premises of Moura Dubeux. The future considerations are not guarantees of results as they involve risks and uncertainties independent of situations which may or may not occur. Villar, go ahead.

Good morning, everyone. We're here presenting the closing of the year of 2023 of the operational and financial data of Moura Dubeux, and I wanted to talk a little bit about what was the year. And Diego and Barral will talk about it in more detail during the presentation and make comments for you and will answer any questions you might have and try to give you a little bit of the expectation -- of our expectations for 2024 and give you a few highlights of 2023 where we commemorated 40 years of history. And we believe to recognize this legacy, we brought the best results in our history. From any angle that you may observe, this is except for one that I'd like to mention, Moura overdid -- overcame their results. I would say that the only thing that we would like to do, which is completely expected in our cycle, was the question of the generation of cash. We're in a cycle of burning cash with the improved margins and revenues and sales and a good working of VSO and the natural flow of cash generation. We present this -- cash came due to the large volume of execution of projects being done. Some of them is announced in 2023 and which will happen during most of 2024, but we'll talk more in detail about that when we talk about our level of debt and the generation and burn -- and cash burn. I want talk about the number of launches, where we had a reduction of 13.6% based on our 2022 base, which was on purpose. It wasn't because of the market demand. Our share, our share, which is important, but it grew significantly, the share over the last 4 years. The research from the Zap, Data Zap indicate that 25% of the medium and high-income market in the states that we work in belongs to us. So we have grown even more. And the decision to launch less is much more anchored on the -- on our premise. And our directive of leverage as a cycle in 2023 and '24 is of tremendous demands for cash. We decided not to tolerate any net debt above our level. We closed at a very close to 0 for 2023. But we know that during 2024, we will have to go up to 20% leverage. And after that, we'll go back to net cash. So anchored on this is our demand VSO, operational capacity and the land bank that Moura Dubeux has. But even launching less, the company has been able to increase its net sales in 10.4%, reaching almost BRL 1.5 billion. And based on the guidance and the VGV sold, the biggest level that we've ever had in this 40 years, it was translated into a VSO of 46%, a slight change from our level from 2022. But I'd also like to mention that taking a picture of 2021, where we had launches in southern Pernambuco for the Beach Class products on the beach, this is the most stable period, which puts us in the middle- and upper-level companies in terms of sales velocity. And we have to consider also that, and Diego will mention further ahead, one of the lowest levels in the company -- in the sector and our level of cancellation. And a lot of those cancellations, which are already low, are migration to other products in our portfolio. And we've been improving our -- the good performance of our sales. And because of that, each year, we have been having more revenue. We reached a level of BRL 1.151 billion in net revenue in 2023, 44% above the level of 2022. And this will also be the trajectory for 2024. We'll have another increase -- important increase in revenue because part of this is already contracted. And with the evolution of our construction projects, we'll be able to bring on a faster level than in 2024. Here's an important data for you. We're in a cycle between condominium projects of BRL 100 million expenses per month. You can see how much we are in our cycle of execution of projects compared to the growth of last year. We grew by 50% in 2022 compared to '23, going from BRL 260 million to BRL 400 million, climbing from BRL 260 million to BRL 400 million, which is a growth in our profit of 40 -- of our net profit of 48.1%, reaching a level of BRL 158 million in profit for 2023. Consolidated, in fact, we solidified our turnaround. We are today a company profitable and more than profitable. We're a company with a net margin among the highest level companies and a return on the -- and our ROE, return on equity, one of the best in our segments. On the right-hand side, we're talking about the -- looking from the bottom to top, we reached 12.4% of average return on equity, an increase of 3.1% in relation to 2022. And we are now close to the 2-digit level. And we also see that soon, we should get close to 15%, which is our objective in the medium term. Our net margin of 13.5%, also had a slight increase of 0.4% in relation to '22, remembering that 48% nominally. And the gross margin reached 34.7%, almost 34% when it's adjusted compared to 2022. It's interesting because the gross margin grows even when a number of good construction companies have had aggression on their gross margin due to cost adjustments in there. And Moura Dubeux quarter-by-quarter, year-on-year has been presenting an improvement in gross margins. So going forward, I'm going to leave the highlights -- the operational highlights for Diogo Barral and then the final -- the financial numbers for Diego Wanderley, and I'll come back at the end for the Q&A. Thank you very much.

Thank you, Villar. Good morning to everyone. I'm going to continue here with our launches. In the fourth quarter, the company net PSV, with a reduction of 20% in relation to the period of the previous year, in advance of 40% in relation to the third quarter of 2023 compared year by year. We closed the year launching BRL 1.6 billion, a reduction of 14% in relation to the number from 2022. Of this BRL 1.6 billion were in corporation and a little bit more in the condominium model. Following sales, we sold BRL 396 million in the third quarter -- in the fourth quarter, in advance of 44% and a reduction of 3% in relation to the third quarter. Once again, next is looking at the yearly vision, where we saw basically sold BRL 1.5 billion in advance of 10% in relation to 2022. And when we look at the breakdown, we see of this BRL 1.5 billion, BRL 664 million were in corporation sales, and BRL 818 million were done in the condominium model. Here in the upper part of the slide, we bring a composition of our sales where we add the incorporation sales and the condominium vision. Closed sales, we get to a sale -- a gross sale of BRL 440 million. And eliminating the cancellations, we have net sales of BRL 397 million. And talking about this cancellation, we have a graph below where we show in the fourth quarter, our volume of cancellations totaled BRL 45 million, and that's why we closed the year with BRL 160 million in cancellations. But it's important to recognize that we always mention that this graph at the side, which shows the 66% of this volume of cancellations during the year is in the Moura Dubeux portfolio. We consider that the migration from units and change of proprietors were motivations that remained, and this money stays in-house. So even when we take those numbers out, then those that remain with the company, the sales started to show only 4% of cancellation of gross sales. And we understand that this is a very healthy level in relation to our operations. Going forward, we have our PSV. We have the consolidated sales and the top line. We have the number of the last 12 months and in the lower line, a number for the quarter. On the right-hand side, the same with the launches, which I think is important to mention and point out that in our PSV, once again, these are 14 consecutive quarters in which the company has maintained a level of PSV over the last 12 months above 40%, which signals that the company has been assertive in its launches and shows the resilience of the real estate market in our region, principally when we say the medium and upper-class and second residences. So this way, we closed the year with a PSV of 46.3% and for the quarter of 18%. Looking at our stock, besides the fact that the company has presented an increase of approximately BRL 100 million in relation to the third quarter, we closed the year with BRL 1.860 billion in the stock, in stock on hand. But even though this evolution, we have been able to reduce the months of coverage of sales. If we had 17 or 18 months at the beginning of the year, we closed '23 with 15 months of coverage, which is really due to the good sales performance during all of 2022 -- 2023. We break this down, this BRL 1.8 billion, BRL 432 million our launches, 60%. 70% or BRL 1.3 billion are under construction, and only 7% are units ready to occupy stock totaling BRL 122 million. Here on the right-hand side, we have a breakdown by region. We're able to visualize that our stock has a concentration in the Ceará state and Pernambuco state. Ceará was a place where we advanced greatly in number of launches. So it's natural that we have a little bit more stock there. But it's interesting to detail that in this pizza that we also see Salvador representing only 7% with BRL 132 million in stock, a very low stock for the size of that market. And this is the reason why we have -- we are in this pipeline, a relevant project or interesting projects to be launched this year in that market. And in the final graph below, we break down of our business model. We can see that basically, half and half our stock is divided between condominium and incorporation development. So to close off the operational part, starting with our land bank, we closed the year with 66 -- 65 properties, BRL 8.7 billion in PSV, once again, reinforcing that not just -- it's not just an important number, but it's also very well distributed. When we look at -- we analyze the participation of each start in our business -- each state in our business plan and this BRL 8.7 billion. With our acquisition, we've been making approximately 63 through physical swaps and 56% in cash. Underway, we closed the year with 52 projects. 31 are projects for incorporation and 31 are condominium -- 21 are development and 31 in condominium. Also, bringing on the projection for the deliveries per year, for '23, we delivered 9 projects. Of these 9, we had a relevant amount in the condominium area. However, in '24, we can see that of the 12 projects that we foresee to be delivered contractually completed, and of these 12, we see a participation of incorporation, 7 development incorporation projects and 5 condominium projects. Now I'm going to pass it over to Diego Wanderley to continue with our financial data.

Before just to make a little comment about our operation, we started '24 with various deliveries. We've already delivered 2 buildings here in Pernambuco. We have another one in Ceará and Rio Grande do Norte and Bahia, which reported 12. That's our expectation. We're also being conservative and also why we have the expectation of reaching this peak of this net equity close at the end of the year and beginning of this reversion of cash. In this point, while we're most conservative in launches, for 2023 -- for 2024, we would tend to be more aggressive, first of all, because in '23, we worked on 2 big projects, as we mentioned here in the past. And also in the management, we speak about that, the Meridian hotel and the old Pestana -- and the old Othon Palace. And then these projects should be launched this year. They're already in our business plan. So together, this will bring an impact in Bahia with an acceleration of these assets. And at the same time, these are projects that will tend to bring better margins due to their locations and the type of project -- product that we're building, and we'll address as we see in Salvador and we prepare the market for these 2 projects. With this, we also launched this year the first project which was launched in 2018 in Parque do Cais, a big project in the central area of Recife, backed approximately 100,000 square meters, where we had several projects already approved, which we should launch this year. These are projects which will bring better margins for the company as well. We also see the projects of the Mood line. So we're very enthusiastic about -- and optimistic about this business plan for 2024 with the caution that we always bring in relation to our business. But we see that we will tend to see -- have a growth in launches, which will also turn into increased sales with the perspective -- operational perspective. So now I'm going to pass it over to Wanderley to talk about the finances, and then we'll talk a lot more.

Thank you, Diego. Good morning, everybody. When I talk with the net revenue in the fourth quarter of '23, we started with BRL 283 million, 36.5% above '22 and a falloff of 6.3% compared to the third quarter of '23. It's important to mention that we did 4 launches -- condominium launches in the fourth quarter of '23, of which we only recognized only one of them. So the other 3 parcels will be coming into the 2024 numbers. On the right-hand side, we have the accumulated for the year. We closed '23 with BRL 1.151 billion of net revenue, 44% above the BRL 800 million of '22. And here, we're able to see again both the growth of revenue from incorporation and development as well as with the events of the [ markets ] as well as the revenue from the condominium business due to having launched more condominiums this year than in the year of 2022. On the right-hand side, we bring the breakdown of the revenue approximately 60-40, 60% for incorporation and 40% for condominiums. For the net profit -- gross profit, looking at the gross profit, we bring the adjusted numbers capitalized. In the fourth quarter, we wound up with BRL 107 million, 77% -- 75% above the third quarter of '22 -- fourth quarter of '22 and 8% below the third quarter of '23. It's also the same explanation. What's impacted the revenue impacted our gross profit with the condominiums -- only 3 of these condominiums which were not recognized in the quarter. And the margin was 38% for the quarter, complied with the third quarter and also above the margin for the fourth quarter of last year. We closed the year with BRL 400 million, an increase of 50% in relation to the year of 2022, I think most importantly, maintaining or increasing the gross margin, getting to 36.7%. On the right-hand side, we see the breakdown of this net profit -- gross profit. 52% came from condominiums and 48% from averages, 48% and incorporation of 48.5%. When looking at expenses, on the left-hand side, looking at BRL 105 million, which is 6.4% of our gross sales and a percentage increase in relation to 2022 with unnatural events of the incorporation. The expenses with commissions is recognized in this velocity and also a slight increase in the number of sales in one year compared to the other. On the right-hand side, we have the administrative expense. We closed 2023 with BRL 87 million in relation to our sales, 5.3% compared to 2022. When we compare it to the net revenue, we see a dilution of these expenses coming from 9.3% in '22 to 7.6% in 2023. Looking at the adjusted EBITDA. We closed the fourth quarter with BRL 45 million. And the accumulated for the year, we closed with BRL 203 million, 93% better than in the year of 2022 and a gain going from 13.4% to 17.6%. This is clearly due to the dilution of the expenses with the growth of the operation. Looking at the results, we bring a net profit, which was BRL 34 million in the fourth quarter. During the year, it was BRL 156 million, which is the biggest for one year profit in the history of the company, I think when compared to 2022, 48% -- approximately 50% above the profit of 2022. So even with the maintenance of our margins, it was a tight increase going from 13.1% to 13.5%. We still did that. Finally, we bring the ROE analyzed, 11.4%, always growing in recent quarters, in line with our planning. Now we bring results to appropriate already contracted and incorporation. On the left-hand side, BRL 285 million in growth, a growth at 8.5% with an average margin of 33.9%. In closed sales in the segment of condominiums in the middle graph, BRL 25 million in profit and 27%, a growth of approximately 50%. And in the administration fees, a growth of 16%, totaling BRL 243 million in fees to be realized at the end of 2023. And to close the financial highlights, we bring the cash generation and cash burn and our level of debt. We closed the third quarter with BRL 36 million debt net debt, which is 2.7% of our equity. We burned BRL 60 million in this third quarter -- in this quarter, in the fourth quarter, as we have communicated to the market. We are in the cycle of cash utilization due to the delivery of these construction jobs which are being delivered. For this year, we have relevant deliveries in the incorporation sector. And actually, we're going to burn cash for more -- for 2 or 3 more quarters until we hit the peak and then start to come back to generating cash in the fourth quarter and during the year of 2025. So I'm going to close here the financial part of our presentation, and I pass it back to Alan to run the Q&A.

[Operator Instructions] And the first question comes from [ Juan ] from XP. He asks about the launches for 2024 and from the standpoint of volume, diversification in segments between condominium and incorporation. And I believe, Diego, maybe you can answer that one.

Okay. [ Juan ], thank you for the question. I think as far as launches, I'm going to detail a little bit. We're excited with the year. We started very well in terms of sales. We have 3 projects which are iconic projects to be launched, the Othon Palace and the Novo Cais project in Recife and others. We also have the acceleration of launches of the Mood. We're going to launch some Mood here in Recife, Mood Aurora with 2 towers, very similar to what was the Fortaleza last year. We have launches -- we've done launches in Natal. We have other launches to do in other [Foreign Language]. We also launched a building in Maceió. So our business plan for 2024 -- 23 is -- versus '23 is growth. As far as the business model we use, the premise, we take the condominium to the maximum that the market can absorb, which is always in our interests. Condominiums don't consume any cash in its development or if there is, the purchase of land, which many times many people ask this question. But at the same time, it mitigates risk, which, as we mentioned various times, the risk of cancellations, directions of overruns. And during 2023, we did the launches of condominium projects, which had an excellent performance of commercialization and which helped us to expand even more this operation in other states, such as the same hotel in Alagoas, which is 100% sold, and in Ceará Cumbuco, where we have already sold more than 50% and with an even bigger project, which is already with the condominium installed and which is recognized. So this is a model that we should follow. So we bring with this business plan of condominiums, which is as much as we can. And we also do incorporation this year in 2024. And probably going forward, we're going to have more relevance in the launches of incorporation, tell us the characteristics of the condominium in a different way. The diminishing of -- we tried to do as much as we can in the Mood project with the clients from the associative model a few days or a few months after the sale. This favors the flow of execution of the projects, and Mood is not only more standardized and less dependent on labor and faster for the execution technology. We also understand that it mitigates risk, and that's not because we charge more, but because of the risk of labor and the risk of personalization. And we're talking not a beach unit, but a beach project. But today, it's not like that. So also, the risk of a longer cycle of execution, subject to inflationary pressures. So we tend to put Mood with a bigger mix inside of our business model, starting in 2024, growing for '25 and '26. So in this way, we see our business model for '24. We believe that we've already been through the principal points of your question. Okay, Alan, your next question?

Just on what you just said, [indiscernible] of Santander says -- asks if -- what is the -- how is the company preparing for BRL 3 billion in 2025 and the team in sales and engineering, who were the principal [ chairman ].

Very good, Alan. A good question. First of all, we don't give guidance that we're going to arrive at BRL 3 billion. We have a number of -- in 2024 bigger than in 2023, but we'll be presenting this further ahead because we do not assume a commitment to grow just to grow. We do not allow -- we did not release -- we do not lose control of our leverage, neither do we permit that the PSV or cancellations be -- could be compromised, which are fundamental to our model to the accompaniment of our business plan. To give you an idea, Diogo Barral talked about our land bank. We have 66 properties, BRL 1.6 billion PSV -- BRL 1.6 billion in PSV. Of this amount, we're working simultaneously in the development of these projects and almost double what we have. So what we do one project or another, we have been very, very cadenced in complying with our business plan. But this doesn't mean that we're going to always advance. We perceive that these indicators require a precision. So when we look at 2025, we see Moura Dubeux with this volume of condominiums that you saw in the past with growth in incorporation or in development. But in the Mood model, why is Mood -- it's not so simple to grow, but it has its advantages. Number one, we're not going to increase the sales team, the financial team or the development team because of this. Mood is not for each project, a different project like Moura Dubeux. When we look at the medium term, we have a good number of condominiums of incorporations in the brand with the Moura Dubeux brand. So we have space to grow without affecting quality or performance or client satisfaction. We see Mood as the principal avenue for growth. And we'd see, it doesn't imply in the same complexity of products to the scale that we prioritized the repetition, the rapidity, the repetition. So we don't believe that we're going to have an increase in G&A due to that, nothing that's significant and nothing that can change that, which that percentage tends to fall in 2024. So we see an increase in the number of direct employment. But even so, Mood is smaller. The number of activities in a project like Moura Dubeux is much better than in the construction process of Mood. So we want to be competitive with the company to simplify the process of execution and diminishing its cycle of execution, but not opening up the profitability. We're going to reach this level in the growth of the Mood product.

Very good. Pedro Lobato of Bradesco asks if, in the first quarter of '24, will we have a recognition -- a stronger recognition of revenue? And [ Daniel Veloso ] adds, do you know the impacts of -- with the revenues in the fourth quarter?

I think I can run that question. As I commented a little bit about the falloff in revenue in the fourth quarter of '23, it's natural that we should expect, yes, a higher revenue in the first quarter of '24 for that motive, because of the delay in the recognition of the condominium fees launched, which were already made -- earned in 2023.

[ Andrei ] from Itaú asks about the capital consumption and what can we expect for 2025.

I think, again, we're not going to talk about that here. What we see is the capacity to distribute between 40% and 50% of the profit of the previous year. So it should be the level of payout that we should follow. But of course, this is a discussion that we're going to still have with the Board and what would generate more value for our stockholders.

Let me also add to what Wanderley mentioned. Because these are commitments that we've assumed and for which we work, we also highlighted what's our perspective for immediate work for our stockholders for 2023. We have always said it's the distribution. We're focused on growing the company, be able to deliver to the client in a surprising way that would overtake his expectation, the quality of the product and maintain the margins through the process. It's an energy, a very great energy to make margins grow, especially in this environment of 2022, which is very high, bringing in effect several companies operating with inflation above that, which was measured by the Getulio Vargas Institute. So what we see is to finish these projects, which are very well advanced because -- which are reflected in our NPSs, which are -- with the NPS that we expect perceived by our clients. And our focus then is the distribution of profit as soon as possible. As we explained previously, this year, especially in the fourth quarter, we will reverse the losses of the early quarters. And we'll have space for this payment. Executively, we're working in the company to -- in a recurring way to every half -- in the first half of 2025 to pay dividends to our stockholders. This is our business plan. And as Wanderley mentioned, that's what we're focused on right now. It doesn't mean that because now we have built the detailed numbers and present them to the Board, and the Board is still the maximum payment of dividends since most maintained in the cash drawer of the company to maintain it in a net cash position so we can get rid of the less debt. We have to make this stock grow, and that's what our model has today. From 2020 until now, we've completed with all the promises that we passed to you. And that's what we see -- how we see the company at the end of this year and the beginning of next.

[indiscernible] asks about the share in the region, competition in our markets and if we see any other player who is expanding like Moura Dubeux did.

Very good question because we just received this market research that we ordered. Like all research, it has data and statistics which are not exactly picture of the market, but from the market. What can I say? We've -- since 2019, we've been looking at the last 10 years in the real estate market. And the medium to higher income won't bring what is faithful with the information and the participation of the company and in the market. There is seasonality. So we look at this. When we look at 2018, we see Moura Dubeux, the leadership of the higher income market in the region. But it was a market that was much more competitive, principally influenced by the 2019 to 2016 that from 2016 forward, we had in the market, which was -- has grown very regionally. The local players are going into new states and looking at these builders for medium and high-end market. To grow in this market, gaining share and occupying empty space, which is what happened. According to this last research, for '23, we reached 25% of our units -- in units that were launched and sold. And that's the space -- that's what the company occupies in that space. Again, 1/3 of the market and due to the markets are different, but we'll send it in that level. We saw that the market in the northeast is going forward with a slight growth year-on-year, but still distant from the size of the market was in 2016 and '15. In São Paulo, 2023 is at the peak of the market has ever had, our market. But basically, the principal motor of this market has been the quantity of competitors and new launches. So we generate a scarcity in the medium on the shelf in the northeast market of only 9 months, very low. You see that the performance of Moura Dubeux is very competitive. And with the turnover in our stock, all the quarters we present, we've been transferred to our stocks and been able to sell with a gain of value and the scarcities that we're working with. Mood, where we have an avenue for growth, occupies another vacuum, even bigger closed due to the increase in costs between '21 and '22. And many are buying this equation to get there. The acquisition of the land and the phase of execution of the 2 towers, one is already done. That's where we look at these projects so we can continue in the same way. We have gone even -- we want to deepen our participation in the market, increase our share, being more and more recognized. We haven't seen any other player expanding, whether it be in the southeast or in the Northeast occupying the space, which brings the level of competition, regional competition, where we see good companies, good competitors who compete with us generally in various locations.

[ Pedro Soares ] asks if there's any expectation for expansion into new segments or new markets in the short term.

[ Pedro ], I hear this question quite a bit because very so often, it says, should we make some low -- some popular housing or lower medium? We don't see -- we don't believe that what we know we had to do is the medium and high-end apartments. So we don't expect going to the low-end, low-price housing. We have no expectation to go into the government programs, not just opportunism. But we were going -- if the government changed for 350,000 to 500,000, then several Moura Dubeux products couldn't fit into that project. But the standard product that's similar to the Minha Casa Minha Vida products. What we don't want try to do is the upper end -- middle and upper end, where we're recognized in the market. To expand into other regions, no. The only strategic ambition that we have for growth is to be recognized nationally as a builder of excellent profitability with products and operating in the northeast market, northeast Brazil markets. So we want to increase this expectation nationally, and we are able to produce good results principally if it was through real estate products -- through the real estate products that we built.

[ Diego Cruz ] of [indiscernible] asks if any cost that's worth discussing for 2024.

We -- a stockholder of ours, who is always involved our market events for Moura Dubeux, it's good to see you and participating with us in our webinar. No, I don't see this. This concern is already off the radar. We believe that all of the builders here that we have seen. On the contrary, we've seen their costs totally under control because what we have to be careful is that occasionally, there may be one or another supplier who misses a delivery period or something which is not the absence of labor, but a program of development and training of labor. So we went from 1,200 in 2020 to almost 6,000 employees on average during 2023. So I want to put all of this army into the company. It's only possible because we invested more and more in development, information of these and training of these employees and commitment. We've spoken about the MD Social, which began last year, which was -- received the award of the best project for social inclusion in civil construction. And it's a project in which we not only train this labor and qualify it, but we also include gender training women as carpenters, bricklayers, et cetera, something -- areas that were traditionally controlled by men. Today, it's easy to find women in the construction sites of Moura Dubeux. At the same time, as I said here, we've been investing in advancing in the technology of Mood so that we can mitigate and reduce this. Our margins are stabilized, as Wanderley mentioned, even with growth in our margins. So we can expect that in truth that with this aspect for 2024 is stability, in this case, an improvement.

[ Diego Guilherme Rodrigues ] asks if we could comment on the chronogram of the Pestana and Othon for this year.

[ Guilherme ], this is an excellent question I can't answer. If I had to say, if I would say we'd be releasing this month, somebody who knows this product, which has been coming, it's an incredible product. The entire team in Bahia is doing something that will change the landmarks of -- and more than 250 projects are being launched in Moura Dubeux and as we put on the cover of our book and the history for the next 40 years. But without a doubt, we're working this -- working on this as fast as possible. The fact that Pestana has -- already has its approval approved by the municipality. And the other one, we're still in the phase of legalization of -- not of the property, but of the project. It's an incredible project. We want to retrofit the existing building, a new residential building with more than 500-meter apartments, a project which will mark the land -- the skyline of Salvador.

I'm going to close our questions and answers, and I'll pass it back to Diego for any final comments.

Thank you all very much. And first of all, thank you, our clients, for their clients and the Moura Dubeux products. We've been advancing on various aspects, not just in the condominium, but also in other cities, other markets. Beach Class is doing very strongly. And we just launched the Beach Class Iracema in the city of Fortaleza, 100% sold very quickly already in March. We're going to present these results in the sales performance, and we have other products to launch during the year. So operationally, our work sites are evolving. Right now, we're at the peak of production right now. Right now, we have more than 6 months, the projects that will be delivered, which are advanced in the prospect of clients, with the quality which I'm sure can be improved, but it's already excellent. We have a spirit and untiring spirit to improve the quality perceived by our clients. Operationally, Mood has more and more transformed into a company, whether it be consolidated by the end of last year. We did a launch -- second launch in [indiscernible], which changed the level of our services there. And soon, Aracajú will have another launch. And we're excited because with that, we're consolidating our entry into those markets one year ago with our project. And today, now it's already a reality to see how quickly we've been able to expand into these markets. We closed the 2 gaps that existed in our region. And financially, our results are improving from the standpoint of attention that it's not just my involvement, but also the entire team. We look at our cash flow every week. I look at this process every week. And as a question of cash burn, we are following even better than we -- preliminary data had -- our planning had as foreseen, but we know that we cannot negotiate with it. And we have in mind that we have to return this capital to our stockholders, and that's what we're looking at this moment. Starting in the next semester and next year, we're going to see the payment for them if construction is going well and the costs the company that is -- and our engineering is doing well. And our business plan this year will be one of the most incredible that we've done in our history, not just due to certain iconic projects, but also by the volume that we're going to present to the market. Thank you all very much for being with us and the confidence that you deposit in the company, and I expect to attend to your expectations, have a very important education, surprising in a certain way and expect with that, we'll be able to reward the efforts, the confidence you deposit in us. Have a good Thursday to everyone. I'll lend our IRs with you for any doubts or questions or clarifications that you might have. Thank you very much.