Earnings Call: Q4 2024

Mar 14, 2025

Summary

2024 launches rose 63% to BRL 1.6bn, while revenue grew ~50% and net profit reached BRL 405m. A record BRL 2.6bn launch program is planned for 2025, with margins, buyer financing and cash deployment key watchpoints.

Morning, ladies and gentlemen, and welcome to EZTEC's Q4 2024 earnings conference call. I am Pedro Lourenço, in charge of the company's investor relations department. For this presentation, we have Mr. Sabrum, CEO of the company, Flávio Ernesto Zarzur, board member and Vice President, Samir El Tayar, Vice President of the administrative board, Marcos Ernesto Zarzur, a council member, Marcelo, Vice President and Sales Director, and Mr. Fugazza, IR Relations Director. Please note that this event is being recorded, and all participants will be in listen-only mode during our presentation. After that, we will begin the Q&A session, at which point in time we will provide additional instructions. If you require any assistance during this conference call, please request assistance through our support.eztec.com.br site. The site is ri.eztec.com.br. There you will also find the slide deck in our download center. The information is available in BRL. Before we begin, I would like to mention that statements made during this conference call regarding EZTEC's business prospects, projections, and operational and financial goals constitute the beliefs and assumptions of the company's management, as well as information currently available. Forward considerations are not performance guarantees. They involve risks, uncertainties, and assumptions as they refer to future events, and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, such as industry conditions and other operating factors, can affect EZTEC's future performance and could lead to results that differ materially from those expressed in such forward-looking statements. Now, I would like to give the floor to Mr. Emílio Fugazza, Financial and IR Director, who will begin the presentation. Thank you, Pedro. Good morning, everyone. It is a huge pleasure to be here at this event to present our results for Q4 2024. Let's start by talking about the performance in our launches. After launching two projects in Q4 2024, valued at BRL 262 million, we are at BRL 1.6 billion in launches, which is a 63% growth over 2023. The major highlight in launches for 2024 is the average speed that we had compared to the first quarter on average. We had 44% sales in the first three months of each launch. This is performance that we also expect to see in 2025. Now let's look at net sales, where we also had a record, approximately BRL 1.7 billion, which is the result of gross sales of almost BRL 1.9 billion. This is also a record for us. In the first quarter to the fourth quarter, we saw significant development in quarterly net sales, reaching a record in Q2 2024. About some operational highlights for our deliveries. The deliveries in 2024 were very timid. However, it is worth remembering that 87% of everything we delivered has already been sold. This means that we did not compose inventory at the company, which is always welcome because it gives us continuity for our launches. In 2025, we saw the largest volume of launches expected and forecast in all time, that is BRL 2.6 billion. They include projects from all sorts of income classes, from low to high scale. The vast majority has already been sold. This ensures that the amount of inventory is not going to be a significant factor for 2025. For some operating highlights, here we have some upcoming launches to show you how we are doing. We began the year launching Agami Park Residences. It has a VGV of BRL 326 million. It is in the district of Moema in the South District of São Paulo with various different sizes, all considerably large. Next, we have SP 360° Smart Living, which is near Ibirapuera. The VGV is BRL 300 million. We have started assigning the transfer contract, and it is a very successful launch. They range from 24 to 35 square meters. Lastly here, we have Alt Studios by EZTEC, which is the same type of building as the Smart Living one with BRL 108 million in VGV. Now for our financial highlights. Starting with net revenue, we had an increment of roughly 50% in our revenue comparing 2024 to 2023, from BRL 1 billion roughly to BRL 1.5 billion roughly, which surpassed our expectations, largely thanks to the Pinheiros region. With the increase of net revenue, we also see a rise in gross profit, which reached BRL 533 million. The major highlight there is our 37% quarterly profit, which is a 6.5 percentage point increase up from 30.9% from Q2 2024. Here we also have the INCC. During the year 2024, we had great performance lower than the INCC rate. The highlights for gross margins mean lower cost for the company during the year. This is a significant factor informing our forecast for the year 2025. Now our financial results, which is always a highlight because of how important it is in the company's bottom line. It responds for almost 40% of the company's EBITDA. We are talking about BRL 132 million that we obtained in 2024, compared to BRL 85 million in 2023. This is also essentially the fruit of the growth in our chattel mortgage portfolio, which increased significantly over the year 2024. We also forecast similar results for 2025. Half of this is financed by IGP and half by IPCA, and on average, that means 10% a year considering inflation. The creation of these new units is at a higher rate than the average rate in our portfolio. This brings us closer to net profit and ROE. They were significant for the year, BRL 239 million in 2023 to BRL 405 million in 2024. This is the result of BRL 127 million in net profit in Q4 without any non-recurring effects. I would like to remind you all that this variation in the third quarter. Apologies. Unfortunately, we have lost the audio from the main floor. There is a significant amount of equity allocated to Star Towers and also in the EZTEC corporate. The residential business is really driving our results. We have got BRL 408 million in net profit, and that is approximately 14% ROE. This brings us to our capital structure. Just to clarify for everyone, this is the makeup of our debt availability. I would like to inform everyone that in the 2024 graph, we have BRL 544 million from the holding. This interacts with the corporate debt, which involves the corporate structure, the property security, and liquidity. EZTEC S.A. has BRL 244 million in net cash. Our financing, we should mention, in 2024, had an average cost on the order of 8.9% per year. This is also linked to the liquidity and availability in our SFH. This gives us net debt of BRL 366 million, and it is entirely based on production financing at much lower cost than the standard interest rate in Brazil today. To wrap this section, looking at our dividends, total dividends for 2024, we see BRL 245 million. This corresponds, of course, to 60% of our net profit from the year. We should mention our next payout is going to be the fruit of the net profit we had. So BRL 30 million in dividends that will be paid out to our shareholders on March 21st, 2025, and the payment date will be March 31st. Just to conclude, we have two subsequent events that are significantly important for the company. The underwriting of the Adolpho Lindenberg company, who will be controller. We will be controlling this company. We now have 46.8% of that company's shares, and today we pay approximately BRL 130 million with no cash effect, only participation in the JVs that we've already worked on together. Of course, the paying up of that debt which EZTEC has on the Adolpho Lindenberg construction company. We have issued our first CRI corporate debt instrument. It was BRL 375 million. We actually issued the additional batch. There were two series that were issued. The first were bi-yearly interest, and the second one was in bullet interest. This is a CRI format, therefore, it is exempt from corporate interest. This has been issued with the consultancy from Itaú BBA, and we thank them for their support. Before we move on to the Q&A section, I'd like to pass the floor to Mr. Silvio Ernesto Zarzur for some initial comments. Good morning, everyone. I'd like to thank everyone for being here and listening to us. I'd like to say that in spite of the challenging scenario, we're very confident in the company's results. Our company is very well established, increasingly more mature, involved in ongoing processes with commercial advantages that are significant for selling and marketing our properties. Our sales structure supports us very well. Our financial structure supports that, and the administration has been working as well to improve our results for the year, and I think we're going to do that. I think that's the key. Once again, thank you all for being here. I'll pass the floor to Flávio for him to add. Good morning, everyone. I agree with Silvio. I have witnessed the confidence and maturity that EZTEC has. Something that should be mentioned and made very clear is our capital structure. It is extremely robust, and it makes us very comfortable from now into the future. At a time like this is exactly what we could hope for, and it's what we have. The properties that we own, the positionings that we adopt, they all make us very confident about the future. We will now begin the Q&A session. All right, thank you. We now begin the Q&A session. We'll begin with sell-side questions following a previously established order as long as you have the raise hand mode activated. After that, we will answer, time permitting, questions submitted through the chat. If time does not permit, please submit your questions by email to the RI contact available on our site. That way, our investor relations team will be able to answer your question. The first question comes from Mr. Pedro Lobato from Bradesco. Please, Pedro, you may proceed. All right. Sorry, I was muted. Good morning, everyone. Thanks for taking the time. I have two questions. The first is about the product mix for the year. Now that you've announced these first launches, I would like to understand what your mindset is when you look into the upcoming months in 2025, and what is the profile of projects for low, mid, and high income? How do you see that mix for 2025? My second question is about gross margin. When we look at the reported gross margin and the backlog, EZTEC alone, not including the equivalency project, this is at a very similar level from what we had. What does that indicator look like moving forward? Is there room for improvement? Are you going to replace the vintage? Do you have any strategies there you could share with us? Thank you. Pedro, thank you for your question. This is Silvio speaking. I want to speak a little bit about the launches for the year. We are going to have all sorts of launches. We have lots of products for investors. Yesterday, we submitted paperwork for Prumariz, which has already been doing very well. We are going to have studios there which measure up to 40 sq m, and we are selling well there. We have got high income, mid income. We have got a few Minha Casa Minha Vida projects coming out later in the year through partnership. We have two partnerships that we have signed, one with Kuli and a partnership with Surella, which is represented by Vivas. We are going to have a very varied mix of projects. We have got Minha Casa Minha Vida, and we have got apartments that cost BRL 35,000 per sq m. We have got very upscale and very affordable properties as well, and others yet that are in partnership with Lindenberg. I want to mention something. When we talk about margins, you mentioned prices, and I am going to talk about the reduction in G&A. When we look at the increase in margin that we saw, this is not only linked to increases in price. It is also linked to reducing the G&A. This allows us to have a lower percentage cost when we start playing at a higher level. It does involve some price gains. This is going to be an instrument that we are going to use, but our greatest expansion in margin is going to be by improving our G&A numbers. Higher sales lead to better G&A numbers, which lead to better margins. I want to remind everyone that the accelerating inflation in our calculations is going to have a positive influence on the company's results. You may have seen that we did not have a significant jump gain in 2024. Sorry, we did have, and this is likely to be repeated. We are going to have expressive, significant financial gains over the coming year. Thank you, Silvio. Pedro, when you talk about the gross margin and the backlog, as you mentioned, this is linked to the growth that we have been obtaining quarter after quarter. In Q4, it was 38%, and we are now at 40.4%. This growth is linked to the INCC, yes, and when the INCC starts shaping into the levels that it currently is at, this gives us an important effect on our portfolio. It is not just about the cost of each venture. Let us say 30%-40% over the lifetime of each venture. However, 100% of that portfolio is being corrected by the INCC, and the margin responds to that. Another important fact is that our engineering is increasingly gaining structure. This is the purpose when these restructurings were done a little over a year ago, and we are now reaping the fruits. I think the fruits of the engineering work is that they will continue to be reaped over the year 2025. We do not give any guidance, but our gross margin is encouraging us, and that is what we believe. Our gross margin is transforming gradually into our backlog margin over the developing quarters. Did that answer your question? Yes, it did. Thank you, Silvio. Thank you, Emílio. Have a great day, Pedro. Thank you. Our next question comes from Elvis Credendio from BTG Pactual. You may proceed, sir. Good morning, everyone. We have two questions. First, about the deliveries, which you did mention in the release. This is one of the challenges you have for the year. I would like to understand what you see as the biggest challenges on this side. Is that the worsening real estate credit rates of late? What about the aspect of passing that forward or actually incorporating those changes into the company and the company's resources? Secondly, also linked to the chattel mortgage portfolio. We have been seeing companies in the sector selling these portfolios. I would like to hear your opinion about this topic. Do you see any possibilities for selling portfolios, in your opinion? Or should you not sell a portfolio? If so, why not? What can be done vis-à-vis that capital? I want to mention this scenario is apparently a challenge, a challenging scenario. Let me start again. Elvis, thank you for your question. We have a challenging scenario when it comes to interest rates. We have lemons, and we want to make lemonade. When we propose our financing at 12% plus IGPM, which is the financing that is being offered to the final takers, this gives us a good profit margin. We believe we are going to have significant volume of those products. I would rather not mention specifics, but we estimate that this type of financing is going to consume part of the company's cash. In our radar, we also have the option to do securitization if necessary, if the numbers are not what we wish. Working at 12% plus IGPM with the property guarantee does not seem like a bad proposition for me. We can use that money for better things, and if that does become true, if we can in fact use it for better things, then we will shift that money around. I also want to highlight that we have a great relationship with banks, and the company is currently at its best time ever. The ease and strength that we have to help with the transfers really depends on how willing the banks are, and they are our allies here. Conversely, the company is very well prepared to advise and contribute to clients so that they can effectively make those payments. Like I mentioned, we have lemons and we are going to make lemonade. I think we are going to do very well with those transfers. I do not think we will run into any operational challenges for us. I am very comfortable here, to be very clear. Just to add, from the perspective of sales made for deliveries in 2025, the sales have been very well made. These are clients whose average payment is higher than 30%. All clients that do have some kind of a problem are brought to the termination department. The portfolio is very safe. The only issue is the rate the banks offer, and depending on the rate, the banks may not be able to offer all the credit that the client requires. That is where the power of our chattel mortgage portfolio comes in. That is why we believe that there is going to be a significant improvement by having that portfolio. Elvis, did we clarify that for you? Yes, you did. Thank you, Emilio. Thank you, Silvio. Have a good day. All right. Thank you, Elvis. Our next question comes from Mr. Kiefer Kennedy from Citibank. Mr. Kennedy, you may proceed. Good morning, everyone. Good morning, EZTEC team. I would like to explore the gross margin in the context of the sell-through rate. You saw that there was a valuation in this last year, which is super positive. I understand that this margin is composed over time. So I would like to understand, I will refer to it as the trade-offs, the speed that you have in mind for 2025 and for accelerating sales, because naturally, a margin that has been there for longer tends to improve. So how do you envisage this situation, accelerating sales and making up the margin over time? My second question pertains to the performed inventory. There was a significant investment in this quarter, which I do also think is positive. So I wonder if there are any numbers that the company is waiting for or forecasting or expecting with regard to selling that inventory, and that acceleration by quarter, whether it was done for a specific reason. I would really like to hear your take on those performed inventories in your portfolio. Good morning, Kennedy. I will speak about our inventory now. Our inventory is very well-positioned. They are very well-built, and they have been delivered. The ones that have not yet been delivered are in the last, final stages of construction. We had also a very strong remaining units campaign. So we are going to continue to have significantly accelerated inventory sell rates, just like last year, and we were able to reduce our overall inventory. So we are very confident that we are going to sell finished and nearly finished products. I believe we are going to continue to perform very well. I want to remind you that there is a cost for products, and these products have low product costs. They were accounted for many years ago. Our chattel mortgage portfolio supports us in that inventory sale. We have got strong support from the banks who help us with financials. This campaign that Marcelo mentioned is very aggressive. We have been investing heavily on that. We have got Mariana Weickert, who is running our campaign. So I am confident that our performance will be at the levels that we expect. I forgot to add, Kiefer, on the topic of inventory. We sold BRL 458 million, which means roughly 75% of our inventory has been performed. We now close the year with BRL 600 million. So this inventory will shift with the new deliveries, but we do not really expect to dilute a significant portion of that inventory because these things take time. We need to wait for enough time for the transfers and payments to go through. These properties really gained a lot of traction, and will continue to do so through the future. Looking at the gross margin with regard to margins, there is a terrible component, which is AVP. Over 2024, that rate was extremely high because the rates for Brazilian instruments were very high. Our AVP is built with the NTN-B rate as its basis. This gives us a gross margin for sales that we performed regarding to our launches at a lower rate than we expected. We expect to see two effects. Over time, this trend will reverse and give us access to that gross margin that is currently held back. The INCC as well, which is something we are going to start working with. More sales will mean higher net margin because we will be further diluting, and the INCC will help us to improve the gross margin. I think we've answered your question. Do you agree? Yes, that was very clear. Thank you. Thank you, Kiefer. Moving on now. We've got a question from Mr. Igor Machado from Goldman Sachs. Good morning, everyone. Thanks for taking my questions and everyone's questions. I'd like to better understand how the company is considering the aspect of leverage. You paid out that extraordinary dividend, and the company has always had low leverage, and that did go up recently. I'd like to better understand the return to shareholders. What are your thoughts and what do you think about those returns? Let me explain, Igor. You mentioned leverage. A significant portion of those funds come from the BRL 110 million increase in chattel mortgaging portfolios. Our portfolio is going to increase this year. It's a multiple of what we had last year. This leverage is relative. We need to be careful. We need to be wise and decide whether we're going to keep our leveraging or if we're going to pass on a little bit of that expanded portfolio. We could have done that and kept our leverage, but we've decided not to do that. We chose to use that as guarantees. Our structure is now healthier than it would have been otherwise. If I had to say something in the medium term, I'd say we are going to keep our leverage at that level it's currently at. This could be done by increasing the dividend distribution methods or through some other methods that we will implement when we consider the interest rates that we have moving forward. We like this new leveraging positioning, and I hope we will be able to use it in more cases for the company. This improves our ROE, and it also makes us feel more profitable. Not just feel, it makes us more profitable if you look at the return over the portfolio. Did we answer your question, Pedro? Ficou claro, pessoal. Obrigado. Yes, it was very clear. Thank you, Igor. [Foreign language] Our next question comes from Luiz Capistrano from Itaú BBA. [Foreign language] Pessoal, bom dia. Obrigado pelo espaço aqui. Queria saber um pouco mais da visão da companhia sobre a posição de HIS e HMP que a gente está vendo em São Paulo essa semana, que foi muito forte. Foi uma das notícias mais difíceis. A demanda por HIS amainou, enfraqueceu. Queria entender a posição da companhia, se como é que nesse ambiente especial vocês estão vendendo bastante pra HMP. Então, queria pegar um pouco dessa visão de vocês, se vocês não comentou o quanto vocês se aproveitam dessa legislação nova. Bom dia, tudo bem? Aqui é o Flávio. Aqui nós estamos muito confortáveis com a nossa exposição ao HIS. Todas as nossas vendas foram feitas de acordo com a legislação. Então, o nosso posicionamento é perfeito pra aquela cota de solidariedade na última semana que foi criada. Então, a gente está dentro do que é proposto na lei. E sempre tem que ser feito as revisões pra estar um pouco mais exposto. Eu não vejo nenhum motivo pra gente fazer alguma alteração naquele mix. Está dentro do nosso radar. Let me give an example. We sold an HIS venture in Q4, the Connect Estação João Dias. It's a fully HIS venture, but it was entirely passed on to cash. And it meets these HIS requirements set forth by Brazilian law. This is no accident. This is the reason why our sales speed for our social ventures, such as Minha Casa Minha Vida, it is lower. And sometimes people ask us: "Oh, why don't you have sales that you see in classes A and B, upper and upper middle class?" Well, because making them fully able to be fast forward involves a dynamic, and at the end of the day, you will be able to end with confidence, including legal confidence. Que é a nossa visão do HIS. Eu queria só complementar o Emílio sobre esse posicionamento. Eu falo assim A quantidade de clientes que vêm frequentando nossos plantões, surpreendentemente. E essa venda que a gente abriu ontem, vendemos mais de 150 apartamentos no primeiro e segundo dia. Então a gente está muito animado que ela continue as visitas muito aceleradas. E o Esther Towers tem condição de ser entregue no final do ano, uma torre, estamos trabalhando para isso. E inclusive é um item que a gente ia comentar, e eu já tinha combinado aqui, que as visitas para locação já começaram a acontecer. Então é um cenário que a gente fica animado, que estamos trabalhando para conseguir a ocupação do prédio, o que aceleraria a entrega do empreendimento como um todo, que está na dependência dessa locação. Se alguém quiser completar. Eu só queria completar uma coisa. As vendas de ontem, abriu ontem o plantão às 15:00, nós vendemos cerca de 80 unidades em praticamente 8 horas. O Marcelo falou um pouco mais, a gente deve atingir um número bem maior que esse até o final da semana. Contratos aprovados. A gente apontava 150 contratos aprovados. Mas a gente deve atingir um número maior até o final da semana e está indo muito bem. Só isso que eu queria complementar para deixar mais claro. Eu só queria falar uma coisa, quando eu falei em BRL 1 billion, em torno, cada um dos empreendimentos que a Cada tem abrido, é total. A nossa parte é 50% de cada, só para deixar mais esclarecido. Então em torno de BRL 1 billion cada um dos dois, 50% é nosso. Só para reforçar o que o Marcelo falou do Esther Towers, realmente, naquela região é um empreendimento único, ele é um empreendimento que está acima dos outros. As pessoas que têm ido lá, têm observado quão eficiente é a nossa laje e quão a arquitetura é desafiadora na questão daquele heliponto. Então eu vou até falar com o Pedro, um dia nós vamos levar, eventualmente, o pessoal de banco para conhecer o prédio como um todo, o conjunto como um todo. Não é que é uma conta, que se você falar assim: "Quanto custou por quanto vai alugar?" Mas se nós vamos alugar, vai alugar, e no tempo nós vamos recuperar. Essa é a situação. Recuperar o investimento feito, mas não é aquilo que a gente imaginava no começo. Rafael, conseguimos endereçar suas perguntas? Não. Ficou superclaro. Obrigado, pessoal. Bom dia. Obrigado, Rafael, bom dia. Obrigado, Rafael. Nossa próxima pergunta vem então do senhor Antônio, do Banco Santander. Senhor Antônio, pode prosseguir, falou? Bom dia a todos, obrigado aí por receber minha pergunta. Good morning, everyone. Thank you for taking my question. Alguns pontos que eu queria checar. I actually have two points I would ask. O primeiro é: o que foi da melhora de vintage nas safra de 21 e 22? What drove the improvement in vintage from 21 to 22? Is it just improvement in price or the products in those vintages? E a segunda: qual o seu processo de decisão para seguir com a compra do Extra? And second, what is the decision-making process to move forward with the Extra property? E ainda na linha do Extra, você tem algum posicionamento do projeto? And is there a positioning for that project already in case you do not participate? Vou falar. O Extra está chegando aí, vou falar, no final. Well, that Extra property is nearing the end of the acquisition process. Quero lembrar que é uma aquisição condicionada, ela não é uma aquisição compulsória. I'd like to remind you that this is a contingent acquisition. It is not mandatory. Nós estamos muito animados, a gente deve seguir em frente com isso, mas também tem que estar dentro das condições que a gente está combinando. We are very excited. We are going to move forward with it, but it is contingent. There are certain conditions that are involved. Simplesmente falou de condicionalmente, mas tudo tem que seguir, tudo ao longo do que está acontecendo. I should mention that we've got a project that has been created. This is going to occur after we incorporate the project. It is fully contingent, and we are positioned a little bit lower than our direct competition, which is to sell approximately 15%-16%. Our product mix there would allow us to sell much more. A gente vender por esse valor, eu vou estar vendendo lá um produto que eu tenho que entender e fazer uma análise razoável. If I had a need to do that. Tem 20%, 25% a menos do que o concorrente direto dela. We've got something like 25% less than our direct competitors. We're very comfortable in that position. Ele é considerável. It's a very large venture as well. It surpasses BRL 3 billion. Estamos aí tentando depurar todas essas coisas, porque a gente está visando em chegar um final de We're working to really make the most of those numbers. A gente tem que aguardar para ver como é que vai desenrolar tudo isso. But currently, we need to wait and see how things develop. Silvio, thank you. Antônio, you asked about the 2021 and 2022 vintages. In their ventures, they have ventures that are going to be delivered in 2025 and some in 2026. But those ventures from 2021 or in 2022, we have Unique Green. These are all examples of strongly established ventures by EZTEC, and this current administration knows what it is doing. The engineering department is able to skillfully find optimizations. So the improved margin is precisely matching that vintage. Now I believe we will continue to reap fruit in 2025. Antônio, did we answer your question? Yes. Yes, you did. That was very clear. Thank you, and congratulations on your results. Thank you, Antônio. Have a great day. Our next question comes from Ms. Ana Júlia from UBS. You may proceed. Good morning, everyone. Thanks for taking the time. We have two questions. The first is about cash and dividend generation. Thinking about that BRL 2.6 billion in delivery, if you could share with us, please, what does the company currently think about cash generation and dividends over the coming years? Can we expect to see any kind of acceleration or extraordinary dividends? Second question is, what do you think about the purchase of properties and competition in São Paulo thus far this year? What is the property purchase process like? That involves cash as well, and trades as well. Hi, Ana. Good morning. All right. Let's talk about cash generation and dividends that you mentioned, specifically with regard to 2025. Specifically, when we look at the numbers, we're at BRL 2.6 billion. What we're selling is approximately BRL 1.9 billion. For that to work, we have the following math. Approximately 40% of that has already been paid for by our clients to us. There's also approximately BRL 500 million to BRL 600 million in financing for production to be paid up with regard to those properties. That's where what you mentioned comes in. We're going to create chattel mortgages because this is the major challenge for the deliveries in 2025. The question is, what percentage of our clients will obtain financing from the traditional banks, and what percentage of clients will obtain financing from us? Clearly, starting in July and August, the math will be very well-positioned to find out how much cash will be left. Within that math that I set out, you can have an idea that we're going to have stronger net cash generation, but roughly 40% will be generation of chattel mortgage portfolio by reducing net cash. The administrative board will decide what to do, whether that's reinvestment or repurchase or something else. That'll be discussed over the year. Just to add, because Emílio was very apt when he made his comments. Everything should start pointing to us paying for the Extra property. It is a significant property. It's an expensive property. Depending on what happens, we will direct our funds, whether that's through chattel mortgages or we'll transfer those payments. Whatever we decide to do, it will all be considered calmly and rationally over the year. With regard to purchasing properties, we continue to receive many offers of good real estate, and that includes both transfers and financial payments. We are looking at the transfers. We always look at our land bank because we don't want to increase our land bank excessively. First, we do look at the land bank, but we always keep in mind that when we reduce the land bank, we have the option to quickly purchase real estate at great prices with positive margins. With regard to the competition that you mentioned, yes, competition is fierce, but it is fiercer in certain regions, specific ones. I have no doubt that, let's say in a region where competition is very fierce, there is a lot of real estate being bought up for high rates, and then that has to be resold later on. We're not always focused on competition because we want to buy competitive and viable real estate. When you go somewhere that doesn't have so much competition, of course, you are going to have fewer launches and therefore fewer opportunities to make good sales. It's not always easy, but we're very accustomed to working in this way. We have shifted our sights a little bit away from the competition. Now, that's one aspect. But when we look at the exchanges, this is something that makes things easier for us. Can you imagine that a buyer, when they want to make a transfer, most of the large companies like us, they prefer to focus on credibility just as we do. This is an option that we do use when it is strategic. All right. Thank you. You answered my questions perfectly. Thank you for your questions, Ana. Our next question comes from Mr. Jonathan Koutras from JPMorgan. Jonathan, you may proceed. Good morning, Silvio, Emílio, and the team. Congrats on your results for Q4. My question is about the last mile costs. As Emílio mentioned, we expect the INCC rate to remain stable in the short term. Are you operating in line with those rates? What about the low-income properties? Where do you see the needle shifting? Hi, Jonathan. Good morning. Thank you for your question. As Emílio has mentioned, we are securing development of our ventures at lower than INCC rates. Yes, we are concerned with the scarcity of labor. We're looking for opportunities for improvement and improved building and construction practices, whereby you can guarantee the execution cost of a given project. We're developing our systems, but we are already very confident that we have already moved into that new phase. Now, moving forward, Minha Casa Minha Vida and savings in the Minha Casa Minha Vida program are initially supported by our partners. But yes, there are other conditions, and we are developing in-house projects to work on that internally. That's a second process. I have no doubt that this next phase of engineering is going to be a resounding hit as it was in the past. When we talk about processes that we are implementing in the engineering department, they are significantly linked to industrialization. To give you one example, and this is not something that is exclusive to us, we are studying the option to build in ready-made bathrooms. This will reduce the amount of time needed on each construction. We are also investing in our own equipment, which also reduces the need for labor and guarantees quality in the construction. Jonathan, were we able to shed some light on your question? Yes, you did. Thank you, Marcelo, Emílio, Silvio. Thank you very much, Jonathan. Have a great day. Moving on, and apparently this is our last question from Ruan Argenton from XP Investimentos. Good morning, team. Thank you for taking my question, and congratulations on the results. There is one point I want to explore with regard to the competitive nature of launches. You recently made an important acquisition. in some real estate in São Caetano. Historically, you've always explored the metropolitan São Paulo regions more broadly, and we've seen that at least in the last year, that seems to have dropped slightly. Do you see that exploration of the greater São Paulo region, metropolitan region, as a way for finding better opportunities? That's one question. The second question is, what is your product perspective for the second half of the year? We see that we are potentially moving toward an economic deceleration, and this will, if happen, will be particularly important and impactful for the medium income brackets. So what do you think in that sense? Thank you for your question. I'd like to say a few words about the São Caetano property. I supported the board in purchasing that property. We believe that this property is able to stand out in terms of competitiveness. Because when we move into a new region, we've done some amazing ventures such as in Osasco and Guarulhos, and I have no doubt that São Caetano is going to reproduce those major investments. It's a huge city after all. So we start in phases, in phased sales. So I'm very confident. To add to your answer, we're going to be extremely aggressive this year at a quarter by quarter rate. So in this Q1, we want to launch 3 ventures. In Q2, we again want to launch 3 ventures. But this is all going to be forecastable for each end of quarter, and we will revise our strategy quarter by quarter. So we have a very aggressive quarter by quarter strategy and also a strategy that's very efficient. Over the past 12 months, we've also been selling better than the previous quarter each and every time. So if some kind of an issue occurs, then we are fully able to take a pause and plan for the future. In the metropolitan region, we once again are launching in Osasco a very significant venture. We have 3 launches planned for Osasco. They're not all this year, but during this year and the first semester of next year, we're selling over BRL 1 billion or launching over BRL 1 billion, I should say. So we've got a very significant product mix. So we have lots of different investor products, middle class products, upper class products. We have products in partnership with Lindenberg. When Lindenberg launches, EZTEC is a partner, and so we also launch. These ventures are worked on jointly. So we have a breadth of products that allows us to test strategies for each category. So this aggressive strategy that Marcelo mentioned will work as follows. When we get to the end of the quarter, then we will go back and measure. We can't plan without seeing what the results are first. And we don't want to lose out on any opportunities. We're not going to do business by speculating. We're going to do business by looking at concrete numbers. Does that answer your question? Yes, that was very clear. Thank you. Thank you very much, Ron. We now conclude our Q. Oh, there is a question that was asked in the chat, but it was very similar to a question that Júlia asked. So Mateus, I believe your question has already been answered. Therefore, we will conclude the Q&A session and now move on to final remarks. I want to mention that the company is very optimistic. This is not a positive macro scenario, but within that context, the company is optimistic. It's also vigilant. We run our business with an eye to what's happening. As long as the business is performing well, and it is, we know that we are very well supported by our board, represented by Flávio. We are supported by the council as well. We're going to keep moving forward. We're confident we're going to have a better result this year. I want to thank everyone for being here. I'd like to highlight Samir, who is our patriarch here today, and always by our side, as are we. We are always eager to help you. We've got Pedro, we've got everyone from the IR team always available for all of you. Have a great day, a great weekend. God is Brazilian, and I think that says it all. The entire board is very excited about the structured growth that we have planned for the past couple of years, headed by our President, Silvio, as well as Flávio as Chairman of the Board. With support of everyone at the board, all the Directors and C-levels at EZTEC, we have been able to, once again, have strong engineering departments committed to cost and quality and meeting our deadlines. Our sales agreements are very aggressive and always looking for improving our margin and developing products while constantly being on the search for more efficiency. We always look to the market for its trends, and we are supported by EZ Sales, which gives us the support we need to sell everything we produce. I'm very confident that this year, if they let us, we are going to have results that are even better than last year by keeping our margins or even improving them compared to last year. I'd like to thank everyone. We are all together. Thank you. I'd like to conclude by thanking all the shareholders who were involved in working with us and who answered our surveys. You help us improve continuously. We are always alert to your feedback, and I'd like to invite you to observe the improvement we made to our spreadsheet. That is in line with the feedback you provided. Thank you all for taking part in our call, and I'd like to invite our other shareholders to join us for our upcoming earnings calls. This concludes EZTEC's earnings conference call. As I mentioned, all the materials are available on our website.