Good morning and thank you all for holding. Welcome to Even's earnings call concerning the results of the second quarter of 2026. I would like to point out that for those who need simultaneous translation, the tool is available on the platform. To use it, you have to click on the button interpretation, the globe icon at the bottom of the screen, then choose your preferred language, Portuguese or English.
To listen to this teleconference in English, there is an option to mute the original audio in Portuguese by clicking on mute original audio button. We would like to inform you that this event is being recorded and will be made available on the company's investor relations website at ri.even.com.br where the complete material concerning this earnings call will be available. It is also possible to download this presentation by way of the chat icon in both Portuguese and English.
During the company's presentation, all participants will have their microphones on mute. Following that, we will begin the questions and answer session. To ask questions, click on the Q&A or raise hand icons at the bottom of your screen and type in your question to join the queue. When you are called, a request to activate your microphone will show on the screen, and then you must activate it to ask your question. We would like to advise you to ask all your questions at once. We would like to clarify that any statements that might be made during this teleconference regarding Even's business prospects, as well as its operating and financial projections and goals, are based on the beliefs and assumptions held by the company's management and on information currently available.
Forward-looking considerations are not a guarantee of performance and involve risk, uncertainties, and assumptions since they refer to future events, and therefore depend on circumstances that may or may not happen. Investors should understand that general economic conditions, industry conditions, and other operating factors may affect Even's future outcomes and may lead to results that materially differ from those expressed in these future considerations. Here with us today are the Chief Executives of the company, Mr. Marcelo Dzik, CFO, and Mr. Marcio Moraes, CEO. I will now give the floor to Mr. Marcelo Dzik.
Good morning, everyone. We are pleased to present Even's results for the second quarter and the first half of 2026. Let us begin with the main indicators for the first half year. Launches totaled BRL 281 million in the period. Net sales amounted to BRL 408 million. In the quarter, we delivered a project with two phases that amounted to a PSV of BRL 122 million, Even's share. In the first half year, two projects were delivered, amounting to BRL 590 million of PSV.
Concerning our financial indicators, the gross profit for the period was BRL 112 million, translating to an adjusted gross margin of 33.4%, which represents an important increase of 7.5 percentage points in the annual comparison. The backlog and inventory margins were at 38.8% and 32%, respectively. Even's net income in the second quarter was BRL 31 million, with an ROE in the last 12 months of 11.1%. In the first half year, comprehensive net income, which is when we include the results of sales in SPEs we control, was BRL 77 million. On the next slide, we present net income history of the operation in São Paulo for the last 14 quarters.
We can see consistency in profit generation quarter-over-quarter and an increase in profitability, mainly driven by the gradual recovery of margin and by gains in operating efficiency and capital allocation. On this slide, we show you some images of the quarter's launch, Renato 410, a high-end luxury development located in the Itaim neighborhood with a PSV of BRL 231 million. Now we present the sales performance. Net sales volume in the quarter was BRL 156 million with a consolidated SoS of 4%, and in the first half year, net sales volume was BRL 408 million. Regarding cancellations, we ended the quarter with BRL 69 million. In the first half year, the volume of cancellations was BRL 118 million. We continue to have a very healthy receivables portfolio that is increasingly concentrated on high-end projects. Moving on to the next slide.
We delivered in the quarter the project Joaquim in Brooklin neighborhood with BRL 122 million of PSV and a total of 163 units. Next, you can see some images that highlight the quality of our delivery. We ended the period with an inventory worth BRL 3.5 billion, mostly in the high-end and luxury segments. These are products that are well located and with good liquidity. It is worth noting that our finished inventory represents only 8.3% of total volume.
Out of the inventory under construction, 67% is scheduled for delivery from 2029 onwards. The projects to be delivered in 2026 were 80% sold by the end of the second quarter, as we can see in the graph on the bottom right-hand corner of the slide, next to the breakdown of percentages sold by year of delivery. Our land bank amounts to a PSV of BRL 5.3 billion.
It is located mostly in prime neighborhoods in the south and west sides of the city of São Paulo, and is concentrated on the high-end and luxury segments. On the next slide, we present our solid capital structure. We ended the period with BRL 787 million in cash. Net debt totaled BRL 699 million, which represents 30% of the company's shareholders equity. In this quarter, operating cash burn was BRL 95 million, driven by the disbursements related to the acquisition of an exclusive plot of land in Vila Nova Conceição neighborhood. Also in this quarter, we paid out BRL 30 million in dividends. With that, I now give the floor to Even CEO, Mr. Marcio Moraes.
Good morning, everyone. Thank you investors, analysts, and employees for attending this call. In this half year, we witnessed a more challenging market where we reduced the volume of launches and were more mindful of sales and the cost of construction, since the international environment still generates uncertainty about the cost of inputs. In this context, Even is protected on three fronts. The first one is the receivables portfolio, which is robust and indexed to the INCC, as well as larger than the cost being incurred for the completion of all our construction work.
The second one is our construction company, experienced and with proven capacity to deliver our projects while meeting deadlines and keeping costs under control. The third one is our capital structure with around BRL 800 million in cash and leverage at 30%. This combination allows us to go through the cycle overcoming our challenges and at the same time taking advantage of opportunities that come along.
An example of this was the purchase in the first half of the year of a building to be demolished in Vila Nova Conceição, near Praça Pereira Coutinho, where we will develop a project with a PSV estimated at BRL 225 million, Even share. In addition to four other plots of land in Pinheiros and Jardins that amount to BRL 1.3 billion in PSV, Even share. For the second half of the year, we are preparing special launches on high-end projects with cutting-edge architecture.
They are more resilient to market fluctuations and with proven demand. Among them, I would like to highlight two exclusive locations, a project on Avenida República do Líbano, and another one near Esporte Clube Pinheiros. Our financial results remain consistent and continue to evolve. We have a robust cash position and cooperating capacity and a high-quality pipeline of projects for coming cycles. Thank you again for your attendance.
We are now available for questions. We will now begin our Q&A session. Remember that to ask questions, you must click on the Q&A or raise hand items at the bottom of your screen and type in your question to join the queue. When you are called, a request to activate your microphone will show on the screen, and then you must activate it to ask your question. We would like to advise you to ask all your questions at once. Beginning with our first question comes from Herman Bradesco BBI .
Good morning, Marcio and Dzik. Thank you for taking my questions. I have two questions. The first one, a highlight of the quarter, which is the gain of BRL 55 million. I would like to understand the rationale for this operation, if it was reducing risk or increasing value, and if we will see other similar operations looking forward. The other one is concerning gross margin. We see that it is a very healthy level, but the accounting gross margin fell in relation to previous quarter. I would like you to explain this drop and what we can see looking forward.
Hello, Herman. Thank you for your question. Dzik here. I have two questions. Concerning the sales of our equity in some operations. This follows a rationale we have been applying other operations along the years. The idea is to take advantage of our capacity to generate yields without increasing our costs and our risks. So, this was a high-volume project. We sold part of it and generated a very good result with this operation.
Concerning margins and the consequences of our gross margin without being adjusted, they were caused by the decrease in our net revenue and the maintenance of our financial expenses, and also the volume of cancellations in the quarter. When we consider the carryover of these financial expenses and the cancellations that came in line with a lower net revenue, we see a decreased gross margin, but our adjusted gross margin is in line. More important than that, when you look at our backlog inventory, it is reaching very good levels. When we look at a wider window, we see a growth in 2024, 2025, the intention is to continue this advantage.
It is clear. Thank you.
Our next question comes from Matheus Meloni, Santander. You may ask your question.
Well, good morning. Thank you for taking my questions. My first question is concerning, I would like to understand how you see the competition in São Paulo's market. I would like to understand if you have some kind of specific lever you can operate to increase sales, because the margins are a little tighter. The second question is concerning what you expect in terms of launches for the second half, and if it is part of your strategy to reduce the volume of launches and focus on sales of inventory. I would like you to see where your mind is at regarding this issue.
Hello, Matheus. Marcio here. Thank you for your question. First of all, concerning the competition, what we have been following is that the largest volume in the city was last year, but this year we have seen a decrease in this volume, even from our competition in the search for new areas, new land. We do not operate on the Minha Casa, Minha Vida affordable segment. We have been seeing that for next year, competition will decrease even further as a result we have been seeing in the market right now.
This does not give us any slack, but the market is adjusting to the size of demand, and we will keep on our cycle. Concerning your second question, about launches. We have one more launch for this half year that we put off because we are waiting for a clear vision from the market. We have been having a lot of visits, a lot of interest to purchase, but we have seen a delay in the decision. The period between the first visit and signing the contract is around 90 days. This is too long in relation to what we saw last year.
The interest is still strong, but the decision is still focusing on what Brazil will be like in 2027 in terms of interest rates, what is the best thing to do with the money. This is because of the market, and Dzik now will talk about launches a little more.
A few questions here. The volume of launches this year, we have just mapped out the market. If you look at our operation here, even in RFM, in a simplified way, for projects of units of over BRL 2 million where we are concentrated, when you compare with the first quarter of last year, the decrease in volume of launches was really significant, more than 50%. This, of course, decreases the competition and makes it easier for the sales of our projects. The launches for the year, as Marcio said, let me give you some references.
The previous two years were around BRL 2 billion, our participation, but we see this year something closer to BRL 1 billion. We are more selective, of course. We are focusing on higher-end projects with proven demand. Let me give you two examples. One near Pinheiros neighborhood, that is a very high PSV, near República do Líbano is another one, and we will launch on the second half year. There was a potential, we have a good land bank to launch a little bit more than that, but given the market circumstances, the scenario nowadays is something close to BRL 2 billion, not above that.
I think it is clear.
Our next question comes from João Pedro Rodrigues, XP. You may now ask your question.
Good morning. Thank you for taking my question. I would like to ask you first, concerning the scenario of default in your portfolio, how you see the pró-soluto concession, these loans, these mortgages taken by the clients, if they are decreasing, if you see a decrease in volume. This is a more recurring issue in your industry, this deterioration of your portfolios. I would like to understand how you see that.
You already answered it. Thank you. If the competition for new land in the high-end luxury is decreasing, because there are many companies focused on the affordable segment. I would like to understand how you see an improvement in the purchase of land. If you are being able to pay less, if you are being able to pay more through swaps with extended deadlines. If this will translate into margins, backlog margins. If this will actually refer to higher margins in the future?
Hello, João Pedro. Thank you for your question. I'm going to answer the first one, and Marcio will talk about the competition. Regarding our portfolio, I think because of the profile of our projects, we are talking about projects with BRL 2 million above. Our portfolio is still very healthy. We have been disclosing it. We have been talking about cancellations, which have been stable at a low volume and in line with what we expect.
Our portfolio does not show any sign of a change in environment and an increase in default. Even though we see the market, we work in an industry with a payment condition that punish the client very much. Our current situation is very comfortable, especially what you mentioned. We do not operate exactly if we need something special, something specific, some remaining inventory of older cycles. But we do not work with absolutely high-end.
Marcio here. Concerning the competition for land, I've already mentioned this, but this really facilitates the purchase of land by us. We were spending more capital to buy this land because of competition, especially high-end. Nowadays, we can have more projects in a swap way and the return of land that were not sold. So we have been having great opportunities to look at this land. We have been more selective, more careful. Retaining cash is our main focus now.
But yes, the performance is improving, and it will probably reflect on higher margins in the future. We also see in neighborhoods where there is more population density, we have seen the purchase of whole buildings. So these are projects that take a little longer, which is the case of Vila Nova Conceição. We bought a lot with a building with 12 apartments that will take some time to be demolished. But concerning higher area lots, which in São Paulo are very difficult to find, there's very little supply for this. But yes, it will mean higher margins in the future.
Thank you. Our next question comes from Juliana Veiga, Itaú BBA. You may now ask your question.
Good morning, everyone. Thank you for taking my two questions. The first, I would like to understand your strategies for increasing the sales of inventory. When you look forward, if you have some commercial strategy, more specifically to sell this inventory, and if this will reflect on discounting prices for the units. My second question concerns the deliveries, your pipeline of deliveries looking forward. What is your LTV portfolio, and consequently, what is your expectation regarding cash generation by the company that we can see for 2026, 2027, and your ideal level of leverage you are expecting to achieve in these future years?
Juliana, Marcio here. Let me talk to you about your first question. We have two different segments here. The finished inventories which belongs to the older cycle. We have been following a strategy of having events to sell this finished inventory. It is giving us some results, but it depends more on the situation of the country to increase. Now, concerning the inventory under construction, we have been holding the price.
We have not been giving discounts because of the volume of deliveries that is very concentrated on 2029 and forward. We have time to keep our price and our margins. Maybe if the market improves, we will be able to do that. We are not working with the discounts. Rather, we are showing that our projects have good pricing, good products, and are ready to move in. Dzik, now we answer your second question.
Just to complement what Marcio said before we talk about portfolio and cash. We had a more difficult quarter, but we also respect the macro cycle of our projects. Launch is a moment to sell, and the quality of the finished inventory also sells very well. We launched big projects in the high-end industry with longer cycles, so we had fewer sales. But when we look at our finished inventory, it has been consistently below 10%, 8% in this quarter. Like Marcio said, 67% of the non-finished inventory will just be ready in 2029 and onwards.
But we are paying a lot of attention to the quality of our products, and we have a lot of time until the delivery of these products. You asked about our LTV. Our average LTV is around 50%, so our portfolio is very strong. It is typical of a high land portfolio. Concerning the cash burn linked to the projects that we launched, these are projects for three, four year in terms of construction. Deliveries will happen after 2029.
Our planned cash burn is around BRL 200 million a year for this year. We have already burned a good part of this cash, and we expect to burn a little more in the second half of the year. But for 2027, we have some uncertainties given the current scenario and the volume of launches this year, next year. This volume of launches may vary a lot, but our macro planning is some cash burn in these years until 2029, when we will see a reversal in this trend and a cash generation given the cycle of our projects.
We remind you to ask questions. You must click on the Q&A or raise hand icons at the bottom of your screen and type in your question to join the queue. The Q&A session is now closed. We would like now to give the floor back to the company for their final remarks.
I thank you all for attending this call. We will see you again in our next earnings call. Thank you.
The earnings call concerning the results of the second quarter of 2026 is now concluded. The investor relations department is at your disposal to answer any further questions you may have. Thank you all to the attendees, and we wish you a nice day.