Good morning everyone, thank you for holding. Welcome to Cury Construtora's conference call to discuss the first quarter 2023 results. With us here today we have Mr. Fábio Cury, the CEO, Mr. João Carlos Mazzuco, the CFO, and Mr. Ronaldo Cury, the IR officer. We would like to inform you that during the company's presentations all participants will be in listen only mode. We will go on to the question and answer sessions when further instructions will be given. In case you need any assistance during the call, please request the help of the operator by pressing star 0. We would like to inform you this conference call is in Portuguese and will be presented by the company's management. There will be simultaneous translation into English. The event is being broadcast simultaneously on the Internet via webcast.
Before proceeding, please bear in mind that forward-looking statements made herein are based on the beliefs and assumptions of the company management and on information currently available to the company. They involve risks and uncertainties as they relate to future events and therefore depend on circumstances that may or may not occur. Investors and analysts should understand that macroeconomic conditions, overall industry conditions, and other operational factors could cause results to differ materially from those expressed in these forward-looking statements. I would now like to turn the floor over to Mr. Fábio Cury, who will begin the presentation. You may proceed, Mr. Cury.
Good morning, everybody, and thank you for attending the earnings release call for Cury Construtora in the first quarter 2023. Besides myself, we have Ronaldo Cury, our IR Officer, and João Mazzuco, our CFO.
During the conference, we will be presented the main highlights and the operational and financial highlights. At the end, we will be holding a question and answer session. This month, Cury Construtora celebrates 60 years of history, an important milestone in our trajectory. It is with great pride that we announce our performance in the last quarter, where we surpassed historical records. In the last 12 months, we launched nearly BRL 4 billion in PSV and sold over 15,000 units. In the last quarter, we reached the mark of BRL 1 billion in net sales for the first time, an exceptional result that fills us with satisfaction. This achievement is the result of the commitment and dedication of our entire team, which today places Cury among the largest and most respected home builders in the country.
We believe that this successful journey has occurred due to our loyalty to the ethical, strategic, and operational principles that have guided us since our foundation. We will continue to work hard to build an ever more promising future for Cury and for our customers. We continue our assertive strategy of developing our products in the metropolitan regions of São Paulo and Rio de Janeiro, regions that concentrate a large part of the demand in the Brazilian real estate market. In the first quarter of the year, we have Connect São Mateus with a PSV of BRL 124 million, and Guarulhos with a PSV of BRL 177 million. In São Paulo Epicentro, PSV BRL 378 million in Rio de Janeiro, where all the units have been sold because of their strategic locations and high quality.
In this regard, we are very satisfied with another aspect of our strategy, which is to concentrate a greater volume of launches in the first half of the year. For the second consecutive year, we have seen strong demand from the segments we focus on. In April, we have already carried out four launches, highlighting Rio Branco 220 development in Niterói with a PSV of BRL 257 million and 711 units. The speed of sales has been promising, with more than 45% of the units sold. We are confident that this region has great potential and will bring results as important as Porto Maravilha in the city of Rio de Janeiro. We have been closely following and participating in discussions on the consequences of changes in the remuneration of the FGTS, the main funder of Minha Casa, Minha Vida.
The fund guarantees subsidized values and income for the acquisition of affordable properties, allowing low-income families to have access to decent housing. Our product mix in this segment is responsible for approximately 70% of our sales. We understand that the fund contributes to the reduction of the housing deficit. We have defended the maintenance of its housing policies. We have decades of experience. We are prepared to continue operating with flexibility and agility, facing both new and old challenges in the sector through efficiency and generation of consistent results. I would now like to give the floor to Ronaldo to present the operational and financial results. Good morning to everybody. On slide 6, we will explore the highlights of our operational and financial highlights for the 1st quarter of 2023. In the 1st quarter, 2023, we had a total launch of BRL 1.420 million.
Pre-net sales, BRL 1,078 million, with 43% speed of sales and operating cash generation of BRL 1.8 million. In terms of our net revenues, we attained BRL 595 million, with a gross margin of 37.5%. Net income of BRL 94.1 million with a net margin of 15.8%. In this quarter, we launched eight developments, six of which are located in São Paulo, three in Rio de Janeiro. The highlights are Connect São Mateus in the eastern part of São Paulo, with a PSV of BRL 184 million, with more than 93% of the units sold. Epicentro, located in Porto Maravilha region in Rio de Janeiro, that was launched in February of this year with a PSV of BRL 378 million, with more than 86% of the units already sold.
In March, we sold Energy Guarulhos with a PSV of BRL 177 million, with more than 85% of the units sold. We will now go on to page number eight to speak about the performance and speed of sales. In the first quarter, we reached 43.4%, with an increase of 2.4 percentage points vis-à-vis the fourth quarter, 2022, and 2 percentage points vis-à-vis the same period last year. We continue to observe a very strong demand for our products. It is important to highlight that in the first quarter, 2023, our launching activity became more intense thanks to the strategy of concentrating most of the launches in the first half of the year.
Cury ended the first quarter with BRL 1.4 billion PSV, 198.1% represented by units launched by works that are still underway and 1.1% of concluded units. We go on to slide number 9, where we can observe to the left in the graph that during this quarter, our mix of sales was more focused on the high brackets of the program and outside of the program Minha Casa, Minha Vida. To the right, you see the advance of the average price of the units sold in the first quarter of 2023. The average price was BRL 267.2 thousand, an increase of 8.9% when compared to the fourth quarter of 2022, and an increase of 16% regarding the third quarter of 2022.
The variation in the average price of the units, of course, has a great influence on the units launched during the period that are sold at cost price. We go on to slide number 10, presenting our land bank. In the first quarter of 2023, we ended with a total of BRL 9.9 million in potential PSV. This corresponds to more than 38,000 units. You also see the variation of our operational cash reaching BRL 135 million during the quarter. We will give you greater detail on our financial results through Mr. João Mazzuco. Good morning, everybody. We're now on slide 12, where we're showing you our net revenue. In the quarter, we reached BRL 595 million with an increase of 33% vis-à-vis the same period last year.
Regarding the fourth quarter, we had an expressive increase in sales, but a lower evolution of works impacting the revenues. The revenues had a growth of 2.5% vis-à-vis the fourth quarter 2022. On page 12, you see our gross profit with a growth of 37.5% vis-à-vis the same period in 2022. Our gross margin reached 37% in the first quarter and is very much in line with what was reported in 2022. On slide 13, we show you our net income. We reached BRL 91.8 million in the first quarter of 2023, an increase of 48.3% when compared to the first quarter of 2022. On this slide, we show you the net income and net margin of the operation reaching 92.1% in the first quarter 2023, an increase of 48.4%.
We had a profit of BRL 63.8 million compared to the first quarter 2022. On slide 14, you will see the profile of our total gross debt. We ended the first quarter with BRL 298.4 million. We began the first quarter with net cash of BRL 273 million, a reduction of BRL 308 million that we had at the end of the fourth quarter. In the first quarter, we anticipate the payout of dividends representing BRL 60 million, representing the profit in 2022. Our net debt cover EBITDA added up to 26% and our debt schedule extends to 2028. On slide 15, you see our return on equity with 48.2% considering the last 12 months. Now, this consistency in the sector shows that the operation has remained loyal to its operational principles.
Thank you very much. I return the floor to Fábio. In March, at the board, we approved the innovation policy. We also committed a commission to guide our strategies, the programs and initiatives to foster innovation in the company. With this, we would like to enhance productivity and efficiency in our products as well as in our internal processes, fostering competitiveness of the company in the market and increasing our resiliency to face the challenges and continue on with our activities. Taking advantage of the fact that we're celebrating 60 years, I would like to thank the founders of the company, Elias and Carlos Cury , that have had an impact on the lives of thousands of people, clients, shareholders, and employees. We have more than 60,000 apartments built and with an impact on the policies in the country.
All of this makes us ever stronger with the confidence to continue on in the future. Thank you all very much, and thank you for your preference for Cury. Should you have any requests, the IR team is at your entire disposal. With this, we would like to end the presentation, and we would like to go on to the question and answer session. Thank you. We will now go on to the Q&A session. Should you have a question, please press star one on your phone. If at any point your question has been answered, you can press star two to withdraw from the queue. The questions will be answered in the order they are received. We request that you please pick up your handset when posing a question to ensure optimal sound quality. Please hold while we poll for questions.
Our first question comes from Alínea de Sá from Bank of America. Good morning, Fábio, Ronaldo, Mazzuco. Thank you for taking my question. You have already mentioned this, but I would like to explore what is happening with the company, with the FGTS new remuneration program. They are going to increase exposure outside of the program. How much flexibility do you observe in this? My second question also refers to your dividend policy. Do you think that the payout of dividends in the company could be affected by all of this? Good morning, Ali. This is Fábio. The dividends, of course, will not be impacted. We do have a policy of paying out 50%- 60% of the profit of the group.
This year, because of the credit that has been postponed that we are keeping for the end of the year, we have paid the dividends that you have seen. We're awaiting the decision of the Supreme Court to see what will be done with FGTS. 40% of our developments are being sold outside of the program. We have created scenarios A, B, and C. Of course, this will not impact the company considerably, we believe. Well, thank you. Thank you very much. Our next question comes from Igor Catone from XP. Good morning, everybody. Thank you for taking my two questions. The first refers to your project in Niterói. What is going to happen with that region? What are you going to be doing as Cury in the region of Rio de Janeiro? Secondly, you have four projects that have been launched.
If you could remark on what you're intending to do in the second quarter and onwards. Thank you. Good morning, Igor. Well, Niterói was a very pleasant surprise. We carried out the first launch, and it's doing exceptionally well. I believe that, yes, it could become a new Porto Maravilha in a smaller scale. We have a region of Parcas with enormous potential. This is a region that had been forgotten and that Cury is discovering and revitalizing. We have mapped out units and enterprise with BRL 200 million in PSV that has already been sold. We have more than 50% of the units sold in less than one month. We do have other developments there, and there's a region where we can develop quite a bit. In the second quarter, we have already had significant launches.
We do have other developments. We're maintaining our strategy, as you know, of focusing on the first half of the year, a very strong half of the year with a large number of launches. In the second quarter, we also will have several launches, thanks to the very significant demand for our developments. In the second quarter, therefore, we will have robust launches, very similar to those of this first quarter. Thank you. That's very clear. Thank you very much. Our next question comes from Rafael Sacks from Safra Bank. Good morning. Thank you for taking our questions. We have two questions at our end. First of all, I would like to speak about the Caixa Federal funding rate that has had an increase. Will this have an impact, a considerable impact on the company?
Secondly, let's think about the first bracket, Faixa 1, of Minha Casa, Minha Vida. Are you going to go back to launching in that range? Are you thinking about launches in that range one, Faixa 1, still this year? Thank you very much. Good morning, Rafael. This is Ronaldo Cury speaking to you. The Caixa Federal did increase their credit rates in April, the impact so far has been irrelevant. They have not impacted the sales of April, neither have they impacted the sales in May. We're being very prudent, of course. We're thinking of new strategy, thank goodness, the impact has been very low. In terms of Faixa 1, range one of Minha Casa, Minha Vida, we do know that the federal government has tried to come up with partnerships at the municipal level and local level.
Of course, we're awaiting the standardization of this process to see if it is worthwhile recovering what we were doing or not. What I can guarantee is that we're going to fully analyze this. 40% of our revenue arose from that in 2014, 2015. Presently, it represents a maximum of 5 or 10% of our revenues. That was very clear. Thank you very much. Our next question comes from Elvis Credendio from BTG Pactual. Good morning, Fábio, João, and Ronaldo. I have two questions once again. Your revenue has increased BRL 15 million approximately. What has happened specifically to see this leap in your revenue, especially in the first quarter?
I would like to understand your expectation regarding the other quarters during the year, because you will enhance your work in development during the rest of the year. The second question refers to your pro soluto portfolio with a significant growth as well as growth in your sales. In the construction sector, are you thinking perhaps of selling off your pro soluto portfolio? Would this represent an incentive for the company? Thank you very much. This is João Mazzuco. Good morning. If we look at the first quarter, and we have all said that it is a quarter where seasonality does not favor our works, it's of course natural to wait for a drop in this resetting compared to other quarters. It was a very strong quarter in terms of launches, on the other hand.
This last effect offset the initial effect, we were able to observe this growth in sales, a strong growth in sales vis-à-vis the first quarter 2022, and a marginal growth vis-à-vis the fourth quarter of 2022. It was a combination of these two effects that we had this increase in sales and a minor evolution in our works. This minor evolution of works is due to January and February. In March, we had a more favorable condition, we're already attaining our cruising speed that we had planned and that we have budgeted for the year 2023. Let's imagine sales are doing very well, we do hope that these favorable winds will continue. Of course, there's a question mark when you're projecting the future.
If we continue with the demand and the sales level, which is what we expect, our setting will improve going forward until the end of the year. Regarding the pro soluto portfolio, what we tend to say is the following: We have a cash position that is quite sound. We have a good balance. When you look at our debt, net debt over P&L, it's quite sound. We have a rating, of course, that has favored us with a good rate in the capital market operations. To think about selling pro soluto only if the cost is very attractive. We're continually speaking with several groups. We're, of course, being provoked. We do not fully discard carrying out an operation with pro soluto, but it's not part of our plan. We have a sound cash.
We don't need to raise money. We also have a cash balance that is quite comfortable. Sometimes, would it be better to raise cash? Let's imagine a capital market where the dust is settling. We see an improvement in terms of construction. Well, perhaps we could sell off pro soluto. We could increase the volumes or to be raised at a lower cost. Everything will depend on the cost of funding, perhaps in this case. I see that. Thank you very much. That was very clear. Our next question comes from André Dib from Itaú BBA. Good morning, Fabio and everybody else. Thank you for taking my question. The first question refers to the generations of your program.
Do you think that you should begin putting the company on hold, on wait to avoid stress, or do you think there will be room to continue going forward? The second question is, what is your vision on the cost dynamic? Of course, there has been an increase in labor, a significant increase in construction materials that we observed in the first quarter. Do you see any room for any savings in your works? Will you begin to recognize these savings, and will all of this have an impact on your results in 2023 going forward? Good morning, Dibe. This is Ronaldo. I will speak about that framework of changes and then speak about the impact on the company.
Recent conversations with the government and in the different cities with the personnel of Caixa Econômica Federal have shown us that they have a good budget for 2023. In truth, they cannot come to a standstill and wait to see what will happen with the FGTS. There is a question. There will be a curating council that will be nominated, and the expectations are enormous in this case. We're going to wait for this council to be nominated. There will have to be an increase in prices for Caixa. Caixa is sort of forcing this process. We still do not know how much the increase of cost in the program will be. Of course, there will be the normal subsidies.
In moments where the Selic rate is quite high, there was a movement of almost 350% going towards the fourth range of the program. Next steps, the nomination of the curating council. We will hear the proposals. What happens with a company regarding this? As Fábio said, all of this will be welcome. We have a very strong first half of the year. In the second half of the year, of course, there will be a greater weakness in the market. Having said this, I would like to give the floor to Fábio to refer to the price increases that we have had. Well, to speak about costs here, André, what I can say is the following. If we look at the scenario of inflation going forward, we truly can't make any bets.
We can't bet on a reduction, but neither do we see an increase in prices similar to the first semester of 2022. Perhaps there is a slight inflationary pressure, but it's within the INCC. We did observe price increases that were practiced by some suppliers in steel. This did not have an impact on Cury. Of course, you never know what is about to come. Some favorable winds in terms of the material. There had been a drop in the cost of installation material, and there is stability in this area. What does all of this mean? This cost variation, of course, is not uniform homogeneous. When you speak about a range of products, some of the works, depending on their stage, can benefit from favorable cost variations.
Others could be hampered, once again, depending on the stage at which each work is at. The question that you posed, if we're going to have any gains from this is a question we have heard recurrently in our conversations. What I say is that it is still too early on to recognize gains in our budget or having a positive impact on our margins. Maintaining the margins at the level that we have delivered between 7.5% and 8% is already a victory for us when there was a drop of inflation. All of this began in the last quarter of 2022. I'm beginning some works now during this present day period, and I could have budgetary gains. To recognize any gains, I will have to first of all look at the advancement of my works.
I think all of this will be pushed into 2024. We're not counting on that yet for the year 2023, André. Thank you. That was very clear. Thank you and have a good day. Our next question comes from Hugo Gracio from Citibank. Gentlemen, good morning and congratulations on the results of the company. We have two questions. The first, referring to your share inside and outside the market. You have increased your share outside of the program. What are you going to do with your prices in 2023 with all of these novelties coming into the market? Which is your mindset in terms of the pipeline? Will it be ever more flexible, which has been your decision? Going on to the second question. If you could refer to that increase of SG&A during the quarter. Thank you very much. Good morning, Ugo.
This is Fábio. Our share that is approximately 40% outside of the program is what is in our land bank, has been for the last 12 months, will be part of the launches this year, and this is what we forecast will happen during this year. That is our strategy, and this is what we have been doing. We don't intend to make any changes because of what is happening. This is the strategy for the time being. It's not because of this new source of funding that will come about. We had already been working with that strategy, and we'll hold on to it in the percentages that we always have. There might be an increase, but we are presently at 40%. I will now give the floor to João to respond to your second question. The SG&A, Ugo. Good morning.
Our SG&A is very much in line with what we had been doing. We have maintained it between 5.5% and 6%. I would like to convey the following. Any gain in operational leverage has to be looked upon with a light in terms of what we have. We have been maintaining this range of SG&A. SG&A vis-à-vis revenue in 2020 was 8.5%. In 2020 to 2021, the operation grew with launches almost 90%. In 2021, the growth was higher than 30%. Between 2021, the SG&A grew practically 10%, which is very little. Of course, we will have to make some adjustments in our in-house structure.
If we maintain what we have been reporting an SG&A of 5.5%, up to 6% on the net revenue percentage, I think we will be very consistent. This is the figures that we should deliver, I'm sorry, in 2023 as well. Now in the first quarter, there are a series of additional expenses. We have been making significant investments in IT. Of course, you capitalize this, but this means higher recurrent expenses. We're also resuming some very important initiatives with customer relationship that had been put aside during the pandemic. More specifically, where face-to-face relations have had to be transferred. We are now back to a more face-to-face situation. We're holding more event assemblies, the delivery of keys face-to-face. All of this, of course, represents higher costs.
As a whole, our SG&A dynamic will remain in balance based on the indicators I have just mentioned. Simply to complement is the share of landbank and of Cury and in launches. We have seen great changes in our share throughout the Cury history. We have gone through all of the programs that existed in the market. Presently, our share is 40% in Range 4 and 60% in Range 3. For activity in the lower ranges, and if we understand we have to navigate in these lower ranges. If we see an excessive concentration in São Paulo, we will go back to those lower ranges. If we see that the opportunity lies in the higher ranges, if we need to increase that, we will do that. That's the feature of the company to quickly move towards areas where there is greater opportunity.
That was a wonderful response. Thank you very much, gentlemen. Our next question comes from Bruno Mendonça from Bradesco BBI. Good morning, everybody. Thank you for taking my questions. We have two at our end. The first about transfers. In the quarter, there is a significant difference between the number of units sold and those transferred. I would like to refer to that. The second refers to a direct portfolio that has not been very explored. If you could refer to the profile of buyers that fund this directly, your portfolio, I believe, represents BRL 30 million. If you see an opportunity of accelerating this modality to offset perhaps a loss of credit or potential exacerbation in credit from Caixa Federal. Bruno, good morning. This is João. Well, to speak about transfers, the analysis of transfers, let's think about this.
There is a delay vis-à-vis the sales when we have a very strong quarter in terms of sales. The highlight is that the sales came specifically stronger in the month of March when we see sales over transfer. Of course, there is that slight detachment, distancy. If we see transfer over sales, it's natural that we had a drop in the first quarter from that viewpoint. If we look at the fourth quarter, we launched less, and in the third quarter, we also sold less. If we take into account that element of delay, it's natural to see a slight drop of transfers in subsequent months. In the second quarter, a very normal situation, an increase in the units transferred. Nothing referring to the cash or the operational situation of Cury.
Regarding this direct portfolio, first of all, it's the profile of a customer with a better financial capacity than pro soluto. Of course, it varies a great deal in our enterprises. If we look at developments with a lower average ticket, more within the range of Minha Casa, Minha Vida, it will represent a small part of the direct portfolio, representing 3%, 4%, 5%. When we think about developments with a higher ticket of more than 6%, that direct portfolio will go beyond 30%. Everything is very connected to the average ticket. Where we have a higher average price, we have a higher share of the direct portfolio, and it will continue in this way going forward, depending on our developments. To increase our direct portfolio because of this compensation would be positive.
We don't want to move away very far from this volume that we have in the direct portfolio because our strength is what sustains our cash, the credit that we work with. We tend to believe to maintain the levels we have been maintaining. I think this will be very sound for us. Thank you. Thank you very much. Our next question comes from Thainan Costa from UBS. Good morning, Fábio, Ronaldo, and João. Thank you for taking my question. You showed a breakdown in the average prices and the prices above BRL 269,000. How does this match your earnings if 60% of your sales are part of the Minha Casa, Minha Vida program? How are these data conversing if they are part of the Minha Casa, Minha Vida program? This is Ronaldo speaking.
This is an operational issue. On page number 9, for example, we have a graph that shows that 50% of the sales are part of the program. On the next page 10, we have 2% of the developments as part of the Minha Casa, Minha Vida program. This is simply an operational element. We end up transferring this price of BRL 160 to BRL 270,000, a considerable difference, and this operational difference is caused by this, especially in Rio de Janeiro. Well, thank you very much, Ronaldo. Our next question comes from Thainan Costa from Santander. Good morning, everybody. Thank you for taking my question. In truth, I have two questions. I'm not asking for guidance, but perhaps a direction in terms of the trend of cash generation. This is my first question.
My second question refers to your master plan. We know that São Paulo and Rio de Janeiro are working on their respective master plans. Does Cury see a potential for improvement in each of these cities, especially in Rio de Janeiro? Thank you very much. Good morning, Fanny. This is João. Cash generation. We expect to grow the cash generation with an increase of our activities. This is no novelty. If we look at the Cury cash generation, we have been growing year-on-year. The first quarter is very much in line with what we have always published. If you look at the first quarter in the last years, we have had a neutral cash generation, 0 to 10 million BRL, that is our profile of increasing cash generation during the year.
This is what has been projected, and this is what we hope to deliver throughout 2023. In terms of growth for 2023, we will also increase cash generation. Regarding the Rio de Janeiro master plan, we do have quite a few expectations. We think it will be a true evolution, especially because of the Cury development. The chamber there is doing very good work and creating a new standard for the HIS development, speaking with society, with class associations, and the results should be very positive. They're benefiting the access of the cities. So far, this is the expectation that we should end up having a final product that will be very positive. We are participating considerably in these conversations, and it is fundamental to be able to produce low income housing developments for the coming 10 years.
What I can say is that Cury has constantly participated in these conversations along with other home builders and the society, I am convinced that the master plan will be very positive for Rio de Janeiro. In São Paulo, it's more of a revision in terms of social interest housing. There's very little to be changed. We're speaking about middle and higher income, and they're discussing other issues that they're trying to enhance. It is in Rio where we're working more intensely so that we can have a more significant and positive text for the city of Rio de Janeiro. Thank you very much. Thank you all for your answers. The Cury Construtora conference call ends here. We would like to thank all of you for your attendance. You can now disconnect and have a very good afternoon.