Good morning. Thank you for waiting. Welcome to Cury Construtora's conference call to discuss the third quarter of 2021 results. With us here today, we have Mr. João Carlos Mazzuco, CFO, Mr. Ronaldo Cury, IRO, and Fábio Cury, CEO. We would like to inform that during the company's presentation, all participants will only be able to listen to the call. We will then begin the Q&A sessions when further instructions will be given. In case you need any assistance during the conference, please request the operator's help by touching star zero. We also would like to inform that the conference call in Portuguese will be presented by the company's management, and for the English conference, there will be simultaneous translation. This meeting is also being broadcast simultaneously on the internet via webcast.
Before proceeding, we would like to mention that forward statements are based on the beliefs and assumptions of the company management, and on information currently available to the company. They involve risks and uncertainties because they relate to future events, and therefore depend on circumstances that may or may not occur. Investors and analysts should understand that conditions related to macroeconomic conditions, industry, and other factors could also cause results to differ materially from those expressed in such forward-looking statements. We will now turn the floor to Mr. Fábio Cury, who will begin the presentation. Please go on.
Good morning, everybody. Thank you for following this meeting by Cury third quarter 2021. Representing Cury today we have besides me, Ronaldo Cury, who is our IRO, and João Mazzucco, our CFO. We will present the most important highlights of our operational and financial performance of Cury on this 3Q21.
At the end, we'll open for Q&A. During this quarter, we celebrated our first year with the dedication of our customers and clients. In nine months, we are beyond our largest sales and SoS expectations because of the high demand of the market and the selectivity of our market. We closed the quarter with low stock levels and maintaining those margins at the same levels in spite of the inflation in construction goods that we had. Our operational result had a record BRL 720 million in launches, 74% of SoS in the last 12 months, and BRL 682 million sales. Our financial results followed our well-succeeded performance with net revenue for BRL 156 million, and even with the negative impact of inflation in the goods, we closed the quarter with gross margin of 38.3%, reflecting our strategy in focusing in all the cost chain and the applicability of our products.
The net margin was 15% with cash generation of BRL 65 million in the quarter. Ronaldo will bring the operational results.
Good morning, everybody. Now on slide 5, I will explore the highlights of our performance. In the nine months of 2021, we have reached BRL 2 billion launches. In the 3Q21, we reached BRL 720 million in launches, 81.5% as compared to 3Q 2020. Six projects were launched during this quarter, three in São Paulo and three in Rio. They are Mérito Sabará, Rio Wonder Mauá, Dia Celeste, Pirituba, Q Wonder, and Cais do Valongo. Once again, as it had happened in the previous quarter, we gave more attention to Porto Maravilha region. The sales success of the first phase in the second quarter motivated us to anticipate for August the launching of the second phase that was programmed for the end of the year. It is called Rio Wonder Mauá.
377 units that were totally sold at the end of the quarter. In September, we also launched the third phase that was programmed for next year. It is called Rio Wonder Cais do Valongo, with 387 units, of which when we closed the quarter, we had sold 239. In São Paulo, we emphasized the Mérito Sabará construction in the southern zone, with 832 units launched in the beginning of August 2021, with high sales performance closing the quarter with 759 units sold. On slide six, to see the sales performance in the quarter. Stimulated by resilient demand, but also counting with well-positioned products strategically localized. With our experienced sales personnel, we reached the growth of 66.3% in net sales as compared to the same period of the previous year, registering BRL 682 million in the quarter. Demand remains consistent for launches as well as for stock sales.
Stock that remains in healthy levels with only BRL 21 million of PSV in ready stock, a reduction of 10% compared to 2Q21. That is 3% of our net sales. We would like to emphasize that in spite of the increase in the mean price of the units sold in 14% as compared to 3Q 2020, our SoS remains in high levels, reaching 45% in the quarter and 74% year-to-year, what contributed to sustain our margins. On the other slide to talk about our land bank. In the 3Q21, we closed with a total of BRL 11.5 billion, starting at 9.8% comparing to 2Q21. Even considering the record level of PSV launch in this quarter. Still on that slide, we talk about financial highlights. Our solid cash generation that reached BRL 64.7 million in the quarter.
With that, I give the floor to our CFO, João Mazzuco, to give more details on our financial results. Please, João, you may proceed.
Good morning, everybody. On slide nine, our net revenue is BRL 456 million in the third quarter, what represents a growth of 40% vis-à-vis the same period of 2020. The accumulated on this 9M21 grew 56% as compared to the same period of 2020, with a revenue of BRL 1.25 billion. Our gross profit in the second quarter was of BRL 175 million, growing 42% compared to 2020. Considering the first nine months, we reached a gross profit of BRL 158 million, what represents a growth of 59% year-to-year. In spite of the inflation and cost and construction, we still maintain a gross margin in historical levels with 38.3% in the third quarter and 36.7% in the accumulator of the year.
It is important to clarify that these margins have incorporated inflation adjustments in the launching of our constructions. Factors that allow us to maintain our margin, and the highlight is because of our capacity of readjusting our sales prices with more sales participation. We were included in Casa Verde e Amarela program, so sales of this second group represented 44% of the sales in the first nine months of 2020. In 2021, this value dropped to 23% only. I want to comment that our rev margin is aligned with our gross margin. We have a contribution that is quite relevant of the last launches, very strong in sales for this year. With the three phases of Porto Maravilha, two of them launched in this third quarter, and Mérito Sabará also launched in the same quarter, and the other one launched in January, but still much under construction.
All this have been almost totally sold. That organized the revenue margin, that is quite high. In slide 10, we emphasize the net income. The controller reached BRL 67 million in this quarter. That represents an average of 36% as compared to BRL 49 million in 3Q20. In the accumulator of the year, the attributed profit of the controller is BRL 196 million, more than twice as compared to 2020. This value represents 96% of the profit of the activity that went beyond the mark of BRL 200 million in the year to year. We also gained in net margins more than 11.6% in 2020 to 15.7% in 2021, in a nine-month period. In slide 11 now, we highlight our net debt. We closed with BRL 390 million against BRL 277 million in December 31st last year.
We concluded in this quarter our first public emission of debentures and captured BRL 200 million due in 60 months. We still have a very solid capital structure with net cash, BRL 165 million, representing - 26% of the net equity. Our debt is quite concentrated in the long term. On slide 12, our return on average equity. We continue with low use of own capital, so our ROE is in high level, so we can grow our results, maintaining a high rate of distribution of dividend payout. We distributed a lot as compared to last year, 72%. Our cash generation in the first nine months 2021 were of BRL 145 million. Now I give the floor to Fábio again.
Thank you, João. Thank you, Ronaldo. Now I'd like to emphasize some things that happened in the last quarter.
During October, we won the Prêmio Master Imobiliário, Real Estate Master Award, initiative of Secovi, FIABCI, International Real Estate Federation in the professional category. The recognition has to do with the change promoted by Cury Único, Viva Mais, in compliance to, in Engenho Novo region in Rio, a region that was abandoned and devastated. That award recognized the positive impact that our constructions cause in the surroundings, improving the structure and quality of life there. We also had the disclosure of changes in Casa Verde e Amarela program, increasing the price of the units and the reduction of the interest, Poupança Mais, by Caixa Econômica Federal. These were important for Cury, making it possible to offer better products at attractive rates, guaranteeing maintenance in a, to a demand that is resilient.
As presented in previous slides, we went beyond many of our internal goals in this 9M21. We could register margins in healthy stances, even with the inflation that we had in construction goods. For the coming quarters, we will maintain our planning to deliver an even better quarter in 2022. Observing the macroeconomic scenario, we will remain conservative in our feasibility to guarantee robust margins in our constructions. We believe in a resilient demand where we act offering quality products at fair prices. We remain confident in our business model. Thank you all for your participation, for being interested in Cury. For anything you may need, the IR team is at your available. With that, we close our presentation. I would like to ask the operator to begin the Q&A sessions. Good morning to all, or good day to all. Thank you.
We'll now begin the Q&A session. If you have a question, please touch star one on your phone. At any time, if your question is answered, you may remove from the queue by pressing pound or star two. The questions will be taken in order as they are received. Please take your phone off the hook as you make your question so we're going to have a better sound quality. Please wait as we collect the questions. Our first question comes from André Dibe, Itaú BBA. Good morning.
Thank you for the presentation. I have two questions, actually. The first one has to do with this gross margin that is quite strong. Could you comment a little bit more about the main factors that impacted on that with this significant increased margin? If it was just an increase in prices or what? Also about pro soluto portfolio.
It grew also, and it's going to have an effect on sales. I would like to understand if you had any change in your stance. Thank you.
Good morning. Good morning, all. Thank you for your question. André, about the gross margin. The gross margin comes aligned with what we have always mentioned. It's been positively impacted by the quality of the launches. We had very strong launches in this quarter, where there is this first POC of a land plus that contributes to the gross margins. It's quite strong as far as that is concerned. Mérito Sabará, that we have emphasized here. 900 units with almost 90% sales in the quarter. It's the quality of our new launches, the quality of our land bank, and these are launches that we have been working to maintain the margin and at high levels.
The budget is adequate considering the inflation and with price adjustments that allow us or enable us to maintain these good margins. About the pro soluto, we're not changing anything in our policy. We remain with the same policy of receivables. We have a portfolio that's even healthier than it has always been due to this increase in our constructions, the mean price of the units, the quality, and the increased participation of the units or the constructions out of the program. We are quite comfortable with our policy here of without resource or recourse, and we don't intend to change it.
Okay. Thank you.
Next question comes from Elvis Credendio, BTG Pactual .
Good morning, Fábio, Ronaldo, João. Two questions. First, about launches. If you could comment your future launches and what have you been thinking about next year in volumes and product mix.
Because on one hand, we have the interest going up and for the Casa Verde e Amarela, the prices went up and we have something on Group 3. How are you seeing your product mix between Casa Verde e Amarela and SBPE for this scenario? The second question is about leveraging and capital allocation, because you had a good cash generation, so it's leveraged. You have announced rebuying shares. What's your target leveraging and what are you thinking about capital allocation? More buyback or more on dividends or going to invest more in land plots? You have mentioned that Porto demands more cash. This is it. Thank you.
Good morning, Elvis. This is Fábio Cury. I will answer the first one and then I give the second for João.
About launches, you saw on the release that we have reached our goal for the year at the end of this quarter of BRL 2 billion. We have a fourth quarter that is quite strong ahead of us, so we should have around BRL 700 million, BRL 600 million to launch in the fourth quarter of this year. So we reach BRL 2.6 billion, BRL 2.7 billion in 2021. About 2022, we have a pipeline and that is quite aggressive allocated already. What we have been mentioning is that it all depends on the macro situation, what is going to happen. So we have good plots that have been bought in the first quarter, everything approved with the plane ready to take off. We always say, let us not launch a good thing in a bad moment. We have a very aggressive year, even more than this year ahead of us.
Depending on the situation, we will not launch a few things and we will not launch good things in a bad moment. So this is the situation. 2021, we have arrived where we wanted. Next quarter is going to be quite strong. 2022, maybe even better than 2021. You asked about the mix. The mix, this year we have 15% within the second level, 50% on the third level, and 36% with SBPE. Above the program, more than that we should be working on next year.
The next question, I will ask João to talk about leveraging.
We have been maintaining a capital structure that is quite stable. If you look at the previous quarters, it is always around 20%, 25% of net debt over PL. The net cash in this structure has been enough to finance our growth. So strong cash generation.
You saw that the only company in the economic sector that has a cash generation that is positive and solid in all the quarters. I would not need to change the company to finance growth. On the other hand, we have a PL that is considered low if we compare the sector as a whole. So to just leverage the company intentionally to bring to a level of net debt over PL that is more neutral, maybe you are going to have one that is lower that may not be good for the investors. So we will keep growing, generating cash, paying off dividends, paying out dividends, and maintaining the net debt on this, maybe reaching a more neutral level, always thinking about distributing dividends, paying the shareholders at a level that we find adequate. The program has been announced. We will see when it is a good timing.
Our objective is to deliver value to the shareholders. If we think the shares are at a level that we should buy to deliver value to the shareholders, we will do that. Right now, I cannot tell you when this is going to happen because nobody knows how the market is going to behave.
Thank you. I think it is quite clear. Thank you.
Our next question comes from Aline Caldeira, Bank of America. Good morning.
Thank you for answering my question and for the presentation. I would like to talk about the margin topic in this quarter. It was quite good. I would like to understand, how are the margins if I separated two segments inside and outside the program, the margins of the products in the program are flat at the end, or the price conveying still will give you a better margin, or how do you sense that?
Hi, Aline. We do not have a rule that is black and white. Within the program, we have launches that have very good or better constructions that have very good margin. One of the things that impacts the margin is the plot negotiation. Our costs are quite well controlled. We have constructions that have been quite well budgeted. Sometimes, one that I sold back there or that I am selling now, it brings a margin that is quite positive even for constructions in the program. What we have today is we have been launching more and more out of the product, and this budget brings a higher margin. Our feasibility have been worked over so that we maintain a level of margin that is quite healthy. As I launch or more out of the program, we will have a larger contribution of these constructions. The budget has incorporated inflation.
The adjustments have been done. From now on, we hope to maintain this healthy margin that we have so far.
Okay. It is clear. Just a follow-up. How do you see the competition in procurement of land plots, especially when they are not in a program like on the fourth level? We see that people were focusing more in mean income. What do you see in this sense?
Hi, Aline. This is Fábio Cury. It is a natural competition that always was there. The players are always the same. Cury Construtora is something new for us. Almost historically, we have bought land plots that are more focused to the program. We have been doing all that for last time, for shorter time. What we see is we keep buying, so we do not see anything new in land plot purchasing or acquisition.
What we see is the same thing that we see for Casa Verde e Amarela program. We see the same difficulty to buy outside of the program.
Perfect. Quite clear.
To ask questions, you can just Next question comes from the webcast, Carlos Herrera from Condor Insider . What are the most important risks and opportunities of the company?
Hi, Ricardo, this is Ronaldo Cury. The risks are the risks of the sector. If you get our inference statement, it is quite well highlighted there, the risks. They are pertinent to the sector. Sometimes less funding, inflation, different points. What I can say is that everything is under control, and the opportunities that we see, like João Carlos Mazzuco and Fábio Cury highlighted, the acquisition of good land plots, this is where we may have opportunities. I can emphasize Porto Maravilha region. We did that investment there.
We started on the second quarter, and it went on during the third quarter. We have acquired other plots there. This is a space of opportunity. We see that opportunities always go through good business. Our next question, also from the webcast. Alcides Camargo from Pacifica. Good morning. Congratulations for the results. Considering land bank? Our land bank, Fábio Cury has commented, we are always looking for new opportunities. We like to have terrains with margins or plots. We do not buy just any plot. We are quite selective. Our land bank closed the third quarter in BRL 11.4 billion. What is about 55,000 units. So we are comfortable in staying some time without any further acquisition, but our new business team is still looking for good opportunities in São Paulo, and Rio, and Campinas, which are the regions where we are at.
Next question from Vitor Lima, Provo Capital. Thank you for the call.
I have a question. I would like to understand your commercial expenses as compared to the revenue. If you compare year-to-year, you had more launches than you had last year. Maybe the commercial team increased and also had a growth in your commercial expenses. I would like to understand if there was any change in the commercial policy to have this increase in expenses, or is this the new level of commercial expenses maybe because of the quality of the constructions? It's a public that's more sophisticated. Just to understand this better.
Vitor, good morning. Well, usually our G&A over expenses are quite stable. They have been reported around 9%, 9.5%, and in this quarter increased a little bit more. What impacts the most this index, it's with clients' repass.
This, when you compare, like with the commission, we had a quarter with important impact, and that is a little bit heavier when you consider these expenses in the quarter. This is what increased this index. We sometimes have more expenses with advertisement this quarter also because of launches, strong launches, and this may have an impact of 50 to 100 dips as far as that is concerned over the net revenue. The policy of the company has not changed. What we have is this variation, especially when you transfer too much, then it incurs in higher costs of transference in this moment. But I would say that our commercial expenses over net revenue should remain stable in around 9.5% ± , as it has been happening.
Thank you, João. Congratulations for the results.
Next question from webcast. Jose da Silva.
In relation to the expansion of your actions, do you intend to expand to other states?
Not really. Our strategy is maintained in the regions where we are at, São Paulo, and Rio, and Campinas, and we believe we have a lot to grow in those regions. We still have a large share to grab on those regions. We have a lot to develop in São Paulo, Rio, and Campinas, so we should remain in those regions.
I would like now to give the floor to Mr. Fábio Cury for his final remarks. Please proceed.
I would like to thank you once again and wish you all an excellent last quarter, and we'll meet next year for our next release. Thank you and have a very nice day.
This concludes Cury Construtora's conference call. Thank you very much for your-