Good morning everyone, and thank you for holding. We would like to welcome you to Cury Construtora's conference call to discuss the second quarter 2022 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. As a reminder, during the company's presentation, all participants will be in listen-only mode. Ensuing the presentation, we will begin the question and answer session when further instructions will be given. Should anybody require assistance during the conference, please request the operator's help by pressing star zero. We would like to inform you that this conference call in Portuguese will be presented by the company's management, and there will be simultaneous translation for the English conference. This event is being broadcast simultaneously on internet via webcast.
Bear in mind that the 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 overall macroeconomic conditions, industry, and other factors could also cause results to differ materially from those expressed in such forward-looking statements. I will now turn the conference over to Mr. Fábio Cury, who will begin the presentation. You may proceed, sir.
A good day to all of you, and thank you for attending the earnings result call for Cury Construtora for the second quarter 2022. Representing Cury, besides myself, we have Ronaldo Cury and João Mazzuco, our CFO.
During the conference, we will present the main financial and operational highlights for the second quarter 2022, and at the end we will be opening for questions and answers. When we began the year 2022, our goal was to seek better results than those obtained in 2021. Despite the complexity of the challenges that lay before us, our trust relied on a tested and proven strategy of our team and products. Six months later, we're very proud of our results that we are presenting here. After the first quarter, the second quarter of 2022 allowed us to have even better results, reaching records in sales transfers and launches. We ended the period with a strong cash generation, and although there was an intense increase in construction material, we're working with levels very similar to those of previous periods.
Now, we have carefully selected our land bank, and this was fundamental for our success. For example, Porto Maravilha in downtown Rio de Janeiro. We launched Pátio Nazaré in June of 2022, the 5th launch totaling PSV of BRL 924 million, with a total of 2,800 and some units that were very successful for all the projects launched. Of course, we will have a very important presence in that location. We have so many stories of success in São Paulo, and I would like to highlight the developments in the city of Mooca in the east of the city. We already have three phases of Cidade Mooca with more than 1,800 units. Villa Sardegna launched in May of 2022 with more than 80% of the units sold.
The inflationary pressure, especially on construction material, continues to be a challenge for the cost of our works. As a counterpoint, we're facing a very stringent control of costs and expenses, but especially through the readjustment in the price of the units. I would now like to give the floor to Ronaldo Cury, who will refer to the financial and operating results.
A good day to all of you. We go on to slide six, where we will explore the details of our operating and financial performance in the second quarter 2022. We had a total of launches of BRL 1 million, net sales about BRL 897.5 million, net SoS of 41.6%, and operating cash generation of BRL 80 million.
For the entire year, we had total launches of BRL 1.8 million, net pre-sales of BRL 1.7 million SoS net, SoS of 56.7% and operating cash generation amounting to BRL 97.5 million. We report a net revenue of BRL 602.8 million, a gross margin of 35.8%, net income of BRL 92.9 million, and a net margin of 15.4%. For the six months of 2022, the net revenues were BRL 1.1 million with a gross margin of 36.3%. Net income amounting to BRL 156 million and net margin of 14.9%. In this quarter, we launched seven developments, five located in the city of São Paulo, two in Rio de Janeiro.
The highlights were Villa Sardegna in Mooca, located in the east of São Paulo, with a PSV of BRL 87 million with more than 80% of our units sold. Exclusive Miguel Yunes in the southern region of São Paulo with a PSV of BRL 210 million, development with more than 70% of its units sold. Vargas 1140, an iconic development in the downtown area of Rio de Janeiro, launched in May with a total PSV of BRL 127 million and more than 40% of the units sold. We go on to slide number eight to speak about the sales speed. We continue to observe a consistent demand for our products, and we have been very successful in increasing prices.
The average launch price reached BRL 297,000 in the second semester, 48% higher than the same period last year, and 23.5% higher than the first quarter of this year. Our speed of sales was 41.6% and remained stable compared to the first quarter of 2022, with a drop of 5.2 percentage points vis-a-vis the second quarter in 2021. For the entire year, it was 56.7%, a drop of 5.4 percentage points vis-a-vis the same period last year. Cury, in the first quarter, had an inventory of BRL 1.3 billion of PSV, 98% represented by the units launched, works or units under construction, and only 12% of units concluded.
We go on to slide number nine, where in the graph to the left, we can observe that we are ever more focused on the higher brackets of the Casa Verde e Amarela program and others. The graphs to the right show us the advance of average price in the units sold. In the second semester, the average price was BRL 238,000, an increase of 3.5% vis-à-vis the first quarter 2022, and 14.3% vis-à-vis the second quarter 2021. For the entire semester, the average price was BRL 234,600, an increase of 13.5% vis-à-vis the last year. The price readjustment has become one of the main measures to preserve and hedge our margins. We go on to slide number 10 to show you the Cury land bank.
In the second quarter of 2022, we ended with a total of BRL 9.6 million in potential PSV, corresponding to more than 41,000 units, a reduction of 3.1% vis-a-vis the previous quarter, due to the very strong volume of launches that we had in the second quarter. On slide number 10, we show you our cash generation that reached BRL 80 million in the quarter, with an increase of 11.6% vis-a-vis the second quarter 2021. Now, for the entire year, the generation was BRL 97.5 million, 21.9% higher compared to the same period in 2021. With this, I would now like to give the floor to our CFO, João, who will give you more details on our financial results. João, you may proceed.
A good morning to all of you. We continue on with slide number 12, and we highlight the growth of net revenue, a growth of more than 30% vis-a-vis all of our comparative periods. We reached BRL 602.8 million for the second quarter. We have gone beyond BRL 1 billion. In slide 13, the highlight is that we continue to maintain a stable gross profit, a drop of three percentage points compared to the first quarter. Once again, because of our launches offset by the price increase that we have in our launches, a strategy that those who accompany our results are aware of. We're also benefiting from the same strategy and the increase of average price, and we ended the quarter in 40.6%.
In the second quarter and the six months, we had a very strong growth of launches with a high margin and units that were sold very positively. In slide number 14, we have a net income that reached BRL 86.3 million in the second quarter of 2022. This is for the holding. This represents an increase of 9.8% vis-à-vis the comparison year-over-year and an increase of 39.4% when compared to the first quarter of 2022. For the six months, net income reached BRL 148.2 million, an increase of 15.2% vis-à-vis the same period in 2021. The net margin for the quarter stood at 14.3%, five percentage points above the margin of the first six months.
In slide number 14, we show you the consolidated net income of BRL 92.9 million for the second quarter of 2022, an increase of 20.6% when compared to the BRL 77 million in the second quarter of 2021. 46.5% higher than the first quarter of this year. For the entire year, we reached 156.3%, an increase of 21.2% vis-a-vis the same period in 2021. Net income stood at 15.4%, 1.2 percentage points higher than the first quarter of 2022. In slide number 16, we show you our debt profile. We ended with BRL 399 million, and in practice, the same levels of December of 2021. We have had movements in our corporate debt.
We ended the second quarter with cash representing 35% of our net equity. Now, this index increased in the six months vis-a-vis last year by an average of 25% in the last periods. It's worthwhile recalling that we have BRL 156 million of dividends that will be paid this year. Once again, this will bring the index to our historical values. In an environment with high interest rates, it's important to have sound values in net cash. Our debt profile extends for the coming four years. In slide number 17, we highlight the return on average equity. Our message is that despite the growth reported, we're still generating cash and using our working capital very scantily, and the capital is above 50%. I will now return the floor to Fábio Cury. Thank you, Ronaldo Cury. Thank you, Fábio Cury.
Well, the second half of the year reserves additional challenges. We have more opportunities in the CVA. We can have an increase in the term of payments offered by the Caixa Econômica Federal, going from 30 - 35 years, alterations in the bracket for sales, bringing changes in the program and more propitious rates. Of course, we will continue to observe a high demand because of this, with room for the readjustment of prices and maintenance of our margins. While we go through this inflationary period, we're convinced that upon closing the year 2022, we will surpass the results that we achieved in 2021. During the 59 years, we have evolved in all fronts, in engineering and sales, and we have taken an important step when it comes to further valuing our ESG policies.
Cury, as part of its DNA, has an important commitment of working with products that will service the lower income brackets, and we believe that we have room to move forward in this commitment and in this important journey with an ever more sustainable company. Thank you very much to all for your participation and interest in Cury. Should you have any question, the IR team is at the disposal of all investors. Very well. With this, we would like to conclude the presentation, and we would like to ask the operator to begin the Q&A session.
Well, thank you. We will now go on to the question and answer session. Should you have any question, please press star one. If at any moment your question has been answered, press star two to withdraw yourself from the queue. The questions will be answered in the order in which they are received. We request that you please pick up your phones when posing the question, enabling us to have optimal sound quality. Our first question is from Gustavo Cambauva from BTG Pactual.
Good morning, and I do have two questions at my end. The first referring to the recent changes in the CVA program. If you believe that these alterations represent an opportunity of working with more projects in Phase 2. You have worked within and outside of the program, and perhaps these changes will make the Faixa 2, the second sector, more attractive for the company. My second question also refers to the changes in the program, and, well, these are valid only for this year.
I would like to gain an understanding, given the relevance of these changes for this year, if it makes sense to anticipate some projects to fully benefit from this at present. Perhaps smaller players will grow because of these changes. I would like to gain an understanding of how you have been planning your launches for the second semester. Thank you very much, and have a good day.
Good morning, Cambauva. Thank you for the question. Well, for the first part of your question referring to higher attractiveness in level 2. Well, in truth, it has improved, but we do not believe that it is sufficient for Cury to once again begin working in this level 2. Our positioning in levels 3 and 4 continue to be more sustainable, more positive.
The quota holder has a great deal to gain with the projects that we will be developing in the second half of the year. Projects that will be launched, and there has been a drop in the rate of 2.6 - 2.7. Above these levels, the quota holder would pay 8.1, and this aids and abets our sales. We do have strategic launches. We were able to anticipate our pipeline for the year. We worked with almost 2/3 of what we wanted in a single semester. Because of these new measures, I think we will achieve our goal. Now, your question, therefore, we don't understand that level 2 is our focus, and what we are going to do is accelerate what we have in levels 3 and 4 because of the measures in this third quarter of 2022.
Thank you very much, Fábio. Now, which is the challenge? Is it one of approval to be able to have sufficient launches in the second half of the year? I remember that you had remarked that your intention was to accelerate the first six months because we have elections in the second half of the year. In terms of land bank, are you going to have more approval, something commercial? Which is your great challenge to be able to have strong launches and deliveries in the second half of the year?
Well, there's a bit of approval, and it also depends on the timing. We are doing well in July and August, and going forward, we will have the beginning of the electoral campaign. During the moment of elections, we do have to be more cautious, more attentive not to launch our units at a bad moment, and because this is something that could halt our launches. Perhaps it's not so much the approval, but instead the right timing. We want to make sure that we don't have the intensive launches that we had in the first semester. We're going to go from September and October in a calmer way. These are 40 days of the electoral period, and we're going to have to hold back precisely because of the elections. Thank you.
Thank you very much.
Thank you, and have a good day. The next question is from Rafael Rehder from Safra Bank.
Good morning, and thank you for the presentation. Now, to refer back to what you said, which are the changes in the program, and if they have any impact on what you are doing directly? You have greater stability in your portfolio, or are you continuing to grow? Thank you very much.
Good morning, Rafael. Good morning to all of you, and thank you for the question. We have been discussing this, and we have already received this question. Now, through our direct sales, we believe that the level that we have at present is quite a sound level. We don't necessarily have any interest in increasing the launches for direct sales. Of course, because of the changes in the program, there has been a greater search and changes in the normal financing and in the Verde e Amarela program.
Of course, we could increase our direct sales. We could do this. There is nothing that would impede us from doing that. Now, however, if this increases excessively, we're going to lose out on the benefits offered by this program. We're going to have more cancellations and perhaps an impact on cash generation. We would have to anticipate our receivables. This is truly not a policy or strategy of the company for the time being.
Well, thank you. Thank you. That was very clear, and congratulations for your results. Have a good day.
Thank you.
Our next question is from Raul Grego from Eleven Financial. The next question, once again, is from Raul Grego from Eleven Financial. Raul, you have the floor. You may proceed.
Can you hear me? Good morning, and my doubt refers to the cancellations. You have had an increase in this quarter that stands at 9% vis-à-vis your sales. Now, with the price rises, a more significant price rise, what is happening in terms of your control of the cancellations vis-à-vis what happened last year? Has there been an increase in the cancellations because of your new price positioning?
Good morning, Raul. Well, cancellations are certainly not out of control. We report them quarter-over-quarter. We did that last year. We have already reported that rate of 9%. Therefore, there is absolutely no lack of control, no problem because of the price hikes that we had, and no impact on our portfolio. In truth, what we observed is that we had two consecutive quarters with an increase in sales.
In terms of the management of our portfolio, what we're doing is accelerating the cancellations to be able to fulfill the demand for products. Some products, more specifically, everything that we launched this year has had an extremely strong sale. If you have too many delays in a process of transfer of one of our clients, we tend to be somewhat less tolerant with this delay. This is a policy that we have put in practice. We did not comply with the term of transfer when we observed difficulties to be able to generate new sales. This is what has been happening. But we're quite within our normal levels, our historical levels.
Well, thank you.
Thank you very much, and have a good day.
The next question is from Ygor Altero from XP. Good morning, and, congratulations for your results.
We have two questions at our end referring to the program and the quota holder. What will happen in terms of representativity in the sales with this slight drop? The other question refers to margins. I understand that your margins have increased, which means that perhaps you will not be able to further increase prices. Now, having said that, can we imagine a gross margin that will be higher than those 36%-37%? Thank you.
Hey, good morning, Ygor. This is Ronaldo speaking. About that quota holder, well, we have had these price hikes, and we have not been able to quantify this yet. We had significant increases through these quota holders and the reduction that they had. We had already been increasing our prices. When it comes to the quota holders, it brings us greater comfort so that we can maintain the same levels of speed of sales.
Ygor, good morning. Well, I made it very clear in the presentation that we have had several successive sales and extremely strong launches that do already come with a strong margin. Because of this, there is an increase in margin. I would not like to speak about a margin increase going forward. We are still faced with a scenario with excessive inflation. What we do observe is, the results of the strategy that we have put in practice. Of course, the goal is to end up with a strong margin, continue on strongly with our launches. Of course, this will cover our margin and bring us sufficient leeway so that we can continue on with a price increase.
We're still not working with that perception of increasing margins in the future. It's always going to be around those 36% that we have reported. Perhaps this is the best that we can expect for the present moment.
Thank you. That is very clear. Thank you, João. Thank you, Ronaldo.
The next question is from Fanny Oreng from Santander. You may proceed.
Good morning. Good morning, Fábio, Ronaldo, and João. My first question is, given the increase in the average price and given the increase in your sales during these six months, we're looking at the details of your funding, and we see that you have allocated more capital to the program. I think it was 56.7%, and now we have 32.4% allocated to the program. Perhaps this could have a negative impact. My second question refers to the panorama of costs. Perhaps the scenario will be more benevolent when it comes to the construction costs. Which is your opinion for this? Thank you very much.
Fanny Oreng, good morning. Let me respond to the first question. Well, I'm going to apologize because we heard the question in a rather choppy way. If I do not fully answer the question, please come up with a follow-up question. What we like to say is the following: the increase in sales over the speed of sales in the program, which is what you referred to, our sales as part of the program are not necessarily reaching the ceiling of the program.
I would like to remind you that in the launch, we have sold at average prices and above what we observe as part of the program as it grows, that it has reached, that ceiling of BRL 264,000. Even with a growth of sales, I think there is still room for growth, within the program, and perhaps this is what has happened. We hike up the prices. Because of the price of the development, we have a number of units outside of the program developments that we have created with a different focus. Even as part of the program, we still have more room for an increase in prices. I hope this responds to your question.
Thank you. It does.
Thank you.
Referring to the cost, Fanny. Good morning, this is Fábio. After the first quarter that had sufficient turmoil because of the war in Ukraine, we're becoming more stable in the second quarter, and the third quarter will be ever more stable. We don't know if this stability will remain, but of course, we are working with more stabilized inputs. Wood, copper, aluminum, some of them have had a price drop, others are fully stable, which means that we can say that we are at a moment of stability. We truly don't know if this stability will extend for longer periods. It's very difficult to forecast, Fanny, but presently, we are in a better situation than we were vis-à-vis the first quarter. I can't bet that this will be for the long term. It's too early to say that.
Thank you, Fábio.
Thank you very much.
Besides steel, is there any other relevant cost that you can foresee?
Well, a very important cost that still is fluctuating is cement. Cement is an input with several fluctuations during the year. There was a drop of 3%. This is the figure we have in-house. The other construction materials also with a drop, wood, copper, and hydraulic material. But what causes us greater problems continues to be the cement. Thank you.
Thank you very much, Fábio, and congratulations for the results.
Thank you, Fanny.
Ladies and gentlemen, we would like to remind you that should you wish to pose a question, please press star one. We have a question from the webcast from Carlos Herrera from Condor Insider.
Do you continue to see a strong demand for the developments in the third quarter of 2022? And the construction price, has it begun to drop?
Hello, Carlos. Good morning, and thank you for the question. Yes, the demand continues to be very strong. Our developments are still delivering very good results. Now, regarding the construction cost, I think Fábio has just responded to this. There has been a minor drop.
At this point, we will end the question and answer session. The Cury Construtora com-