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2010 Presentation
Presenters
Marcos Lopes – CEO
Francisco Lopes – COO
Marcello Leone – CFO and IRO
Bruno Gama - COO CrediPronto!
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This presentation does not constitute or form part of any offer, or invitation or solicitation of any offer to purchase,
sell or subscribe for shares or other securities of the Company, nor shall this presentation or any information
contained herein form the basis of, or act as inducement to enter into, any contract or commitment whatsoever.
This presentation contains financial and other information related to the business operations of Lopes –LPS Brasil
Consultoria de Imóveis S.A and its subsidiaries (“LPS” or the “Company”) as of and for the period ended
December 31th 2010. It should not be considered as a recommendation for prospective investors to sell,
purchase or subscribe for securities of the Company. The information presented herein is in summary form and
does not purport to be complete. No reliance should be placed on the accuracy completeness of the
information contained herein, and no representation or warranty, express or implied, is given on behalf of the
Company or its subsidiaries as to the accuracy completeness of the information presented herein.
This presentation contains forward-looking statements. Investors are advised that whilst the Company believes
they are based on reasonable assumptions by Management, forward-looking statements rely on current
expectations and projections about future events and financial trends, and are not a guarantee of future results.
Forward-looking statements are subject to risks and uncertainties that affect or may affect business conditions
and results of operations, which therefore could materially differ from those anticipated in forward-looking
statements due to several factors, including competitive pressures, Brazilian macroeconomic conditions,
performance of the industry, changes in market conditions, and other factors expressed or implied in these
forward-looking statements or disclosed by the Company elsewhere, factors currently deemed immaterial.
The forward-looking statements contained herein speak only as of the date they are made and neither
Management, nor the Company or its subsidiaries undertake any obligation to release publicly any revision to
these forward-looking statements after the date of this presentation or to reflect the occurrence of unanticipated
events.
Forward-looking statements
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Program
I. Highlights
II. Operational Results
III. Credipronto!
IV. Financial Results
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Highlights
Highlights
•In 2010, LPS Brasil was the absolute leader in the primary market, both in number of Launches and Sales aswell as in Revenues, EBITDA and Net Income.
•LPS Brasil reached its highest levels of: Contracted Sales, Mortgages Sold, Net Revenue, EBITDA and NetIncome.
•In 2010, LPS Brasil achieved R$15.6 billion in contracted sales, R$14.4 billion only in the primary market. In the4Q10, sales totaled R$4.7 billion, R$3.6 billion in the primary market.
•LPS Brasil sold 56,633 units in 2010, 54% higher than 2009, and 34% of which in the low income segment. Wesold 17,408 in the 4Q10, 37% higher than 2009, and 34% of which in the low income segment (less than 150thousand).
•LPS Brasil Net Revenues totaled R$338.7 million in 2010, the greatest in the sector of real estate brokerage. In4Q10, Net Revenues achieved R$108.4 million.
•In 4Q10, CrediPronto! granted mortgage loans worth R$213 million, amounting to R$600 million in 2010,exceeding the guidance in 20%. The portfolio balance at the end of the period was R$707.1 million.
•EBITDA was R$168.6 million in 2010, 68% higher than 2009. In 4Q10, it was R$60.5 million, an 18% growth over4Q09. EBITDA Margin was 50% in 2010 and 56% in 4Q10.
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Highlights
•LPS Brasil posted Net Income of R$53.2 million in 4Q10, up 88% over the same period last year, and R$132million in 2010, 437% higher than 2009. Net Margin was 39% in 2010 and 49% in 4Q10.
•In 2010, our operation in the Secondary Market, Pronto!, has already become profitable, with a Net Income ofR$13.6 million.
•Net Income Assigned to LPS Shareholders was R$108.5 million in 2010 and the Net Income Assigned to Non-Controlling Shareholders was R$23.5 million.
•In 2010, we announced a new partnership plan for the Company. The new plan comprehends moreexecutives, aiming at strengthening the relationship between the Company and its main talents and a longterm commitment. The new plan does not exceed the 5% dilution upper limit.
•We started in 2010 our process of consolidation in the secondary market. We acquired 6 companies in thatyear and another 2 in 2011. Besides, we acquired the control of Patrimovel, market leader in Rio de Janeiro, inOctober 2010.
•In the second half of 2010, we raised R$207 million through a primary offering. The proceeds will be used forour project of consolidation in the secondary market.
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Financed Volume
216% 4Q10 x 4Q09
279% 2010 x 2009
Contracted Sales
138% 4Q10 x 4Q09
111% 2010 x 2009
Contracted Sales
49% 4Q10 x 4Q09
66% 2010 x 2009
Mortgage LoanSecondary Market
LPS Brasil Net Income51% 4Q10 x 4Q09
51% 2010 x 2009
LPS Brasil: Unique Business Platform
Primary Market
26% 34% 41% 49%
1Q10 2Q10 3Q10 4Q10
2238
4860
16 27
36 53
34%48% 55% 56%
4Q10 Performance - Comparative Analysis
8
50%
R$169
R$339Net Revenue
(R$ million)
EBITDA Margin
R$132Net Income(R$ million)
EBITDA(R$ million)
Net Revenue, EBITDA Margin, Net Income andNet Margin Analisys
63 80 87
108
Highest EBITDA of
the history of the
Company, and a
Margin in the
same level as in
the IPO.
Highest Net
Income of the
history of the
Company.
Net Revenues
Record in the
Real Estate
Services Sector.
39%Net Margin
2010
45%
R$100
R$225
R$25
11%
2009
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Operational Results
10
6,599 10,857
15,271
27,479
4Q09 2009 4Q10 2010
65%
(R$ MM)
80%
Launches
Launches Volume Units Launched
27,791 39,491
64,255
106,084
4Q09 4Q10 2009 2010
42%
65%
Contracted Sales
(R$ MM)
Contracted Sales
11
Units Sold
In This Year, We Achieved Our Record in Contracted Sales
2,8514,236
8,658
14,364
210
500
599
1.267
4Q09 4Q10 2009 2010
4,736
3,061
9,257
69%
55%
15,630
12,273 16,412
35,512
53,917
458996
1,376
2,716
4Q09 4Q10 2009 2010
17,40812,731
37%
54%
56,633
36,888
Gross and Net Revenue
Net Revenue
12
(R$ MM)
Gross Revenue
(R$ MM)
In This Year, We Achieved Our Record in Revenues.
79.5 119.3
249.6
373.3
4Q09 4Q10 2009 2010
50%
50%
71.8 108.4
224.7
338.7
4Q09 4Q10 2009 2010
51%
51%
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Lopes' Consolidated Sales Speed Habitcasa’s Sales Speed
Sales Speed over Supply
*Management information,The Sales Speed over Supply is obtained based on the quarter’s contracted GVS compared to inventory and launches. The values are the average sales speed of the quarters.
25%34%
2009 2010
61% 59%
2009 2010
VGV Contratado
14
40%
44%
11%5%
13%
40%24%
23%17%
41%20%
22%
34%
46%
14%6%
4Q09
4Q09
4Q10
4Q10
Sales by Income Segment – Primary and Secondary Markets
Units Sold
Contracted Sales
Total units sold = 17,408
Total Contracted Sales = R$4,736 million
40%
42%
12%6%
Units Sold
Contracted Sales
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Total units sold = 56,633
13%
39%25%
23%
Total Contracted Sales = R$ 15,630 million
16%
38%22%
24%
34%
45%
15%6%
2009
2009
2010
2010
Sales by Income Segment – Primary and Secondary Markets
Contracted Sales
46%
19%
12%
3%
10%
9%
São Paulo Rio de Janeiro Brasília Campinas South Region Other Markets
52%
6%
14%
5%
12%
11%
4Q104Q09
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Contracted Sales by Geographic Region – Primary and Secondary Markets
Total Contracted Sales = R$4,736 million
54%
12%
4%
8%
9%
12%
Secondary Market
São Paulo Rio de Janeiro Brasília Campinas South Region Other Market
Contracted Sales 2010
17
44%
19%
12%
4%
10%11%
Primary Market
Contracted Sales by Geographic Region – Primary and Secondary Markets
Total Contracted Sales = R$ 15,630 million
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In 2011, we announced the new stock option model for the Company’s executives
New Stock Option Plan
Partners
Associates
Employees
To align the interests between
executives and the Company’s Investors
To strenghthen the long term
commitment Professional x Company
creating a new concept of partnership
Maintenance of 5% of maximum
dilution approved in the original plan
The new plan comprehends more executives, aiming at strengthening the
relationship between the Company and its main talents
Objectives
LPS Brasil in the Mortgage Market
CrediPronto!
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CrediPronto!
20
R$600 MM in Mortgages
Average LTV of62%
2,176 ContractsAverage Periodof 272 months
Average Rate of 10,1% + TR
2010
204
804
dec/09 dec/10
Financed Volume
CrediPronto!
(R$ MM)
21
67
213
158
600
4Q09 4Q10 2009 2010
216%
279%
(R$ MM)
294%
Accumulated Volume Sold*
*It doesn’t include amortization.
In 2010, CrediPronto! financed R$600 million, surpassing its financing guidance for the year.
Mortgages Portfolio
CrediPronto!
The Average Portfolio Balance in 2010 was R$403 million.
(R$ MM)
178
707
Opening portfolio balance Ending portfolio balance
297%
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Accumulated Sales Volume *
CrediPronto!
(R$ MM)
23
217247
291331
385
437474
529
591
654
727
804
100
200
300
400
500
600
700
800
The financing amount of CrediPronto! grew by 12% per month in 2010.
*Not including amortization.
Financial Results
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Net Commission
2.8%
2.5%
2.1%
2.5%
2.8%
2.5%2.3%
2.6%2.8%
2.2% 2.1%
2.5%
3.0%
2.1%2.3%
2.7%2.8%
2.1% 2.1%
2.5%
São Paulo Rio de Janeiro Other Markets Brazil
4Q09 1Q10 2Q10 3Q10 4Q10
Net Commission by Market
* According to BRGAAP standards** Includes adjustments according to the CPCs published in 2010
Net Income 2010
26
(R$ thousand)
49.997
2009
Reported Net
Income 2009*
23.981
2009
Net Income 2009 –
IFRS**
132.031
2010
Net Income 2010 -
IFRS
108.527
Net Income Assigned to
LPS Shareholders ¹
23.504
Net Income Assigned to
Non-Controlling
Shareholders ²
23,504
When comparing and :
49,997
108,527
2009 2010
Net Income(R$ Thousand)
117%
49,997
23,981
132,031
108,527
1- LPS Shareholders through LPSB3 share
2- Subsidiaries Shareholders
Results 2010 - IFRS
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2010 Income
(R$ thousand)
2010 Income Statements Lopes Pronto! Olímpia LPS Brasil
Gross Revenue 335,750 36,724 863 373,337
Revenue from Real Estate Brokerage 321,248 (4,599) (44) 316,605
Revenue to Accrue from Itaú Operations 14,500 - - 14,500
Net Revenue 305,847 32,125 743 338,715
(-) Operating Costs and Expenses (148,440) (12,169) (6,025) (166,634)
(-)Stock Option Expenses (CPC 10) (3,268) - - (3,268)
(-) Expenses to Accrue from Itaú (952) - - (952)
(-) Other nonrecurring revenues (expenses),
net 724 - - 724
(=)EBITDA 153,911 19,956 (5,282) 168,586
EBITDA margin 50.3% 62.1% -711.0% 49.8%
(-) Depreciation and Amortization (18,669) (3,361) (18) (22,048)
(+/-) Financial Result 27,067 (1,532) 1,045 26,580
(-) Income and social contribution taxes (39,521) (1,486) (81) (41,088)
(=) Net Income for the year 122,788 13,578 (4,336) 132,030
Net Margin 40% 42% -584% 39%
Attributable to:
LPS Brasil Shareholders 108,527
Non-Controlling Shareholders 23,504
Net Income – IFRS Adjustments
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97,481
23,948
11,148
5,631 11,255 4,570 7,650
3,725 2,573
108,524
BRGAAP
Income
Call Patrimóvel
Adjustment
Discount Amortization
of Intangible
Assets
Differed
Income Tax
Financial
Expense with
Earn-Out
Put Loss LPS
Pernambuco
Net Income
Assigned to
LPS
Shareholders
IFRS
Reconciliation of BRGAAP Income and IFRS Income
(R$ thousand)
51,086 60,461
100,310
168,586
4Q09 4Q10 2009 2010
EBITDA
EBITDA
(R$ Thousand)
EBITDA Margin
18%
56%
71%
29
68%
45%
50%
30
Secondary Market Acquisition
Acquisition
dateJuly 8th, 2010 July 23rd, 2010 August 17th, 2010 September 9th, 2010
Share 51% 51% 51% 51%
Payment R$7.1 million R$ 2.6 million R$11.7 millionR$17.3 million
Acquisition
dateDecember 10th, 2010 December 20th, 2010 February 1st, 2011 March 21st, 2011
Share 55% 51% 60% 60%
Payment R$25.6 million R$ 15.5 million R$20.9 million R$8.41 million
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ASSETS
Cash and Cash & Equivalents* R$ 278.5 million
Receivable From Clients R$ 78.9 million
Cash Position
Acquisitions Payment
(R$ thousand)
4Q10 1Q11 2Q11 Total
Aquisitions – Primary 5,854 86,185 5,648 97,687
Patrimóvel 51,835 51,835
4Q11 1Q12 4Q12 1Q13 3Q13 4Q13 1Q14 3Q14 4Q14 1Q15 Total
Aquisition- Secondary 9,641 8,591 5,810 11,139 1,300 4,899 12,425 400 4,899 10,546 69,649
Total 219,649
CrediPronto!
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(R$ thousand) P&L 2010
Amount financed 600,030
Portfolio opening balance 177,688
Portfolio ending balance 707,053
Portfolio average balance 403,587
Financial Margin 9,773
% Spread 2.42%
(-) SalesTaxes -919
(-) Total costs and expenses -22,087
(-) Expenses Itaú -3,471
(-) Expenses Olímpia -12,551
(-) Commissions -5,945
(-) Insurance and sinister (+/-) -120
(+/-) Bank correspondance -
(+) Other Revenues (Financial) 2,153
(-) Allowance for Doubtful Accounts -3,210
(-) IRPJ/CSLL 302
(=) Net result -13,988
% Net margin -143%
50% Profit Sharing -6,994
*The managerial P&L measures the results of the JV. Olimpia’s Results and all Revenues and Expenses incurred by Itau are considered.
• The numbers of the managerial P&L were audited for 2010 by Ernst&Young and, due to its managerial nature, it does not follow accounting standards.
Appendix
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Primary Market
Contracted Sales Units Sold
34
(R$ MM)
2,851 3,610
8,658
12,356
627
2,008
4Q09 4Q10 2009 2010
Lopes Patrimóvel
49%
66%
14,364
4,236
12.273 14.371
35.512
47.154
2.041
6.763
4Q09 4Q10 2009 2010
Lopes Patrimóvel
34%
52%
53.917
16.412
Secondary Market
Contracted Sales Units Sold
35
(R$ MM)
210 288
599
1.013 212
253
4Q09 4Q10 2009 2010
Pronto! New Acquisitions
138%
111%
500
1,267
458 623
1,376
2.268
373
448
4Q09 4Q10 2009 2010
Pronto! New Acquisitions
117%
97%
2,716
996
4Q10 Earnings Conference Call
Portuguese English
Date: 03/25/2010, Friday Date: 03/25/2010, Friday
Time: 10h00 a.m. (BR Time) 09h00 a.m. (NY Time)
Time: 12h00 p.m. (BR Time) 11h00 a.m. (NY Time)
Telephone: (11) 4688-6361Password: LPS Brasil
Telephone Brazil: (11) 4688-6361Telephone US: +1 888-700-0802Telephone other countries: +1 786 924-6977Password: LPS Brasil
Replay: Replay:http://webcall.riweb.com.br/lopes/ http://webcall.riweb.com.br/lopes/english/
CONTACTS
Marcello LeoneCFO and IROTel. +55 (11) 3067-0015
Samia NemerIR ManagerTel. +55 (11) 3067-0257
E-mail: [email protected]/ir
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