Good afternoon, ladies and gentlemen. Thank you for waiting. Welcome to MAHLE Metal Leve for the first quarter of 2022 results conference call. With us here today, we have Mr. Daniel Brasil Alves, Marketing and Corporate Communication Manager, Mr. Daniel de Oliveira Camargo, Executive Accounting Manager, and Mr. Fábio Lopes Peres, Executive Finance Manager. This event is being recorded and all participants will be in a listen only mode during the company's presentation. After MAHLE Metal Leve remarks, there will be a question -and -answer session when further instructions will be provided. Should any participant need assistance during this call, please press star zero to reach the operator. This event is also being transmitted simultaneously through the internet via webcast, and it can be accessed through the investor relations website of the company, where the presentation is also available. Participants may view the slides in any order they wish.
The replay will be available shortly after the event is concluded. Let me remind you that those following the presentation via the webcast may post their questions on our website, and those questions will be answered by the IR team after the conference is finished. Before proceeding, let me mention that forward statements that may be made during the teleconference related to business perspectives of MAHLE Metal Leve, forecasts, operational and financial goals are based on the beliefs, on the assumptions of the company's management and on information currently available to the company. Future considerations involve risks and uncertainties because they relate to future events and therefore depend on circumstances that may or may not occur. Now I will turn over to Mr. Daniel Camargo, who will begin the presentation. You may proceed, sir.
Good afternoon, ladies and gentlemen, and welcome to the first quarter conference of MAHLE Metal Leve. We will talk about the results of the first quarter of 2022. First of all, we wish that all of you are well and healthy. At the end of this presentation, we will be available for questions and answers. On slide two, you can see our agenda. We are going to address some highlights, then we are going to give you a market overview, net revenue performance, financial management, CapEx and depreciation, and at the end, as I mentioned, the Q&A session. On slide three, you will see some of the highlights for this quarter that relates to its performance. The net sales revenue totaled BRL 190 million in the first quarter of 2022, which accounts for a 6.6% increase vis-à-vis the first quarter of 2021.
As also mentioned in this slide, there was a growth in all markets. In the domestic OE market, there was a 13.5% growth. In the domestic aftermarket, 10.4% growth. In the aftermarket exports, a 34% growth. The only exception will be the original equipment exports market that had a decline of 7.1% due to the negative impact of the exchange rate. Also, as mentioned in the ordinary general assembly meeting on April 27, it was approved the distribution of dividends totaling BRL 469 million related to the financial year of 2021. This is 100% of dividend payout of the net profit of the year after legal deductions. Now I would like to turn over to Daniel Brasil, who is going to give us an overview of this market.
Thank you, Daniel Camargo. Good afternoon, everyone. Once again, I would like to thank you for attending our earnings call where we are going to address the results of the first quarter of 2022. Let me start on slide four. Here you can see the sales and production of vehicles for Brazil and Argentina in the first quarter of 2022 vis-à-vis the first quarter of 2021. In the first block here you see light vehicles and in the second block, medium and heavy vehicles.
For light vehicles, sales had a 24.7% drop. In Argentina, a drop of 8%. Combined Brazil and Argentina, there was a total of 22.2% drop in sales. We started this quarter with a weak situation due to influences such as variants of COVID-19 in the beginning of the year. There was a very high level of absenteeism. Also, we had some other problems in the beginning. The increase in the price of vehicles, the increase in interest rates and also disruptions in the supply chain that led to shortage in some of the components.
The beginning of the year was very challenging when it came to sales of vehicles. In terms of production in Brazil, there was an 18.5% reduction, a growth in Argentina of 17.7%, and combination of those two countries led to a drop of 13.5%. In Argentina, there was a growth because of an increased production of pickup trucks. There was a change in the market. They tend to have a higher market share of pickup trucks and SUV, like Hilux. That was reflected in Argentinian production. The combined results of those two countries led to a drop of 13.5%. Now, in medium and heavy vehicles, there was a 2.6% increase in sales in Brazil, a flat result in Argentina vis-à-vis the first quarter of 2021, and a combination of those two countries, there was a 2.3% growth.
In production, there was a 4.1% growth in Brazil, 8.4% , growth in Argentina, and combined t hese countries, 4.8% growth. Here we see the comparison basis is a little bit lower one vis-à-vis the year of 2021, because there was a growth in the second half of 2021. But the market of heavy vehicles also faced trouble. Some of the OEMs were giving their employees vacation because of shortage of components. That is also true for heavy vehicles this year. If we add up the month of April, just to have an idea of the perspectives, if I go back to light vehicles, we would have a - 22% drop in the quarter. If you had the year-to-date results involving April, it will be - 20%. And this week, ANFAVEA also communicated the daily levels of sales in May. In the beginning of the month, also indicated improvements.
This is why we have a more positive perspective for the upcoming month. ANFAVEA kept its forecast to wrap up 2022 with a growth of 8.4% in the sales of light vehicles. And if we do the same calculations for production, those - 13.5%, if calculated in year -to -date, it will be - 8.4%. And ANFAVEA also maintained its forecast of 9.5% growth for the whole year. If we see the performance in production is better than the performance in sales, this shows improvement in exports, especially to Colombia, Chile, and Central America. Although Brazil and Argentina had a drop in other markets to which we sell Argentinian and Brazilian cars, that improves the results of production. And also the perspectives are very more conservative following along the lines of ANFAVEA forecast. But there was a mild growth considering vis-à-vis 2021.
If we can compare our prospects for 2022 as a whole, it is still going to be a challenging year. There is an increase in the prices of cars, increase in interest rates, increase in components, not only based on semiconductors. The perspectives for the second half of the year is better than in the beginning of the year when we had problems with absenteeism, COVID-19, floods, and also different health issues. For heavy vehicles, just bringing April into the numbers, we can see in sales, 2.3%. Year -to -date, April, it is 0.9%. In production, 4.8% goes down to -3.8%. There was a slope in heavy vehicles last year. ANFAVEA has also maintained the projections for the whole year, 10% growth and 8.2% increase in production. MAHLE somewhat more conservative, but we still anticipate growth, small growth, considering 2022 over 2021.
In 2023, there is going to be the introduction of heavy vehicles, Euro 6, which was expected. This is something that is going to somewhat impact the second half. We might have a positive surprise concerning numbers. This is how we see production and sales of vehicles in Brazil and Argentina. Now let us go into slide five. Here we see vehicle production in North America and Europe. Let us start from North America. First quarter 2022 over the first quarter 2021, there was a decrease of light vehicles, 1.3%, and 19% drop for heavy vehicles. In Europe, light vehicles, 14% drop, heavy vehicles, 6% drop. The war has certainly affected the European market. Shortage of components.
Asia, China, and the zero COVID-19 policies have really impacted shortage of components in addition to the European crisis. For 2022 over 2021, there was a 7% for light and heavy-duty vehicles for North America. For Europe, the perspective is 3% growth for light and heavy-duty vehicles. But the projections have been constantly downgraded. I would say we were just expecting some minor growth compared to 2021. The year has been as trying as last year. In 2020, there was drop all over the world. In 2021, we could see some levels trying to pick up again, far from 2019. But in 2022, as a result of inflation, war, pandemic, semiconductor components, we still are not anticipating a recovery of the market. This is something that has really impacted vehicle production at large in the market. Now, slide six.
Here we have net revenues from sales of MAHLE Metal Leve, OEM and aftermarket, export and domestic. First quarter 2020, then second column, volume over price, third column, exchange rate, fourth column, first quarter 2021. The three last columns show percentage variations, volume over price, exchange rate impact, and revenue variation. Original equipment, domestic market, 13.5% increase. Performing above the market average, which was production of vehicles. The main factors to explain this increase in revenues are the following: product mix, so heavy-duty vehicles have performed better than light vehicles. In addition to mix, there has been a positive impact for MAHLE Metal Leve concerning the light vehicle manufacturers, which are performing better than other manufacturers. The third factor concerns selling of instruments for new products, tools and instruments for new products, and also sales of services, OES.
These are the four factors that can explain the results, in addition to the fact that we have launched new products, new parts, which have all added up to an improved performance compared to the market. Original equipment exports, 7.1% variation, primarily due to the exchange rate variation. We have just seen the decrease in production of vehicles in North America and Europe. MAHLE Metal Leve performed quite well considering the situations, primarily because of the mix. North America, we have heavy-duty being increased and also market share gains in some products that amounted to 1.9% increase in revenues of original equipment. Aftermarket domestic sales, 10.4% increase, - 10.8% of the exchange rate impact. In the domestic market, it concerns primarily Argentina, because we have an aftermarket operation in Argentina. The conversion of pesos into real had a negative impact. 21.2% volume over price impact. Very good performance.
The main factors is, first, a demand being increasing. It does happen when new cars, new vehicles are not selling a lot. Aftermarket sales seems to improve. Maintenance of used cars and in addition to gaining more market share and working on our inventory levels. I believe these are the three main factors, but primarily the high demand on aftermarket. Aftermarket export had a 34% increase, exchange rate impact of - 5%, volume over price, 39.1% growth.
Quite a good recovery after the pandemic for these aftermarket applications. Total aftermarket, 15.2% increase in net revenues. If we add up both markets, original equipment and aftermarket, 6.6% increase in revenues. Let us go to slide seven, where we can see consolidated exports by geographic region. First quarter of the year, 2022 over 2021, an increase in Latin America and in Europe. If we look historically, the participation of South America, it is 16.8% over 12.8% in the previous quarter last year. Really a very important participation of South America, and it goes without saying. Let me hand it back to Daniel Camargo.
Thank you, Daniel Brasil. Let us go to slides eight and nine to talk about our P&L. Slide eight, we have gross margin. As we have shown, our net sales revenue had a 6.6% increase, but costs have also increased 13% for the period, which is something that had been happening for a while. In the first quarter 2022, especially in March, there was a considerable increase in raw material prices, aluminum, resins.
Our company management has been working to just translate that supplies price increase into prices to consumers. But as you know, this is not something that can be done simply overnight. But this is number one priority of our company management. The gross margin that we can see, 26.5% in the first quarter 2022, is higher than what we had in the last quarter last year, which is something positive. Next slide now. Here we see the summary of P&L expenses.
First, selling expenses that were increased, especially because increased freight costs and variable selling expenses. General and administrative expenses were reduced. This drop is a result of the efforts made to bring in synergy and productivity gains across indirect areas of the company. The third line, we have also our other operating income expenses and R&D expenses that are being driven by the main trends of the market, especially regional trends and also automotive programs. On the last slide, you see other operating expenses. They have kept the same level in absolute numbers when we compare both periods. We did not have anything extraordinary that has taken place that had an impact on operating expenses. I will turn over to Fábio Peres to talk about the financial results.
Good afternoon. As you know, we have been talking about this chart in the previous quarters. We will compare the first quarter of 2022 vis-à-vis the first quarter of 2021. This table has three blocks: net income, exchange rate fluctuation, and also monetary variation. We reached BRL 11.8 million net interest income in the first quarter of 2022, and it was BRL -23 million in the first quarter of 2021. The revenue comes from the levels of investments and also an increase in the SELIC rate we observed in the last month.
We usually make investments at 100% of CDI. Combined with the investments that we make in our Argentinian subsidiary, in total, we had BRL 14.1 million in net interest income. The amount of interest rates was BRL 4.3 million higher. Then we also have the interest rates from our loans. That would be our average debt was reduced by 21%. In average in 2021, we have about BRL 248 million in the first quarter of 2022.
There was a reduction in the volume of debt and also in the average cost of our debt. BRL 4.3 million last year versus BRL 3.5 million this year. When you consolidate volume and cost results, we had a BRL 5.1 million reduction. Also, ICMS tax that also had an impact on this line. Talking about exchange rate variation, we had BRL 10.2 million negative because of the exchange rate variation that took place in the end of March, where hedging operations were performed. What happened in the last week of that month had the hedging for the first week of April. This is why there was a negative result in the end of March. Here we see the exchange rate variation of BRL 36.6 million. The hedging results BRL 21.1 million. BRL 15.1 million net. We also have a positive exchange rate variation with some transactions.
But the other transactions have to do with accounts receivables. Accounts that were going to be paid in foreign currency. They also provided a negative result of BRL 22.3 million. As a natural hedging, we use the ACC operations to be able to be more synergistic in the operations we perform. In total, we had BRL 10.2 million of exchange rate variation. But in the monetary variation, this is the result of some tax legal suits and also some labor legal suits that are adjusted at 2% a year, or if the SELIC rate is higher, it is corrected based on the SELIC rate. When you look at the net financial result, we have BRL 4 million in expenses in 2022 versus BRL 6 million in 2021. This indicates a BRL 2 million improvement. On slide 11, we can talk about our debts.
In the first chart on the left-hand side, you can see the net cash status. In December of 2021, we had BRL 246 million, and in end of the March, BRL 293 million. This means a BRL 47 million improvement. Reduction in loans and also a growth in cash. On the right-hand side, we can see how our loans are distributed. 5.65% are located at FINEP. This is an investment line for research and development, and that accounts for 54% of our investments and the rest 45%, ACC and NCE. The cost of that is 5.65% for those at FINEP and 1.83% at ACC in an average cost of 3.55%. In the charts below, we can see how our maturities are distributed. In the short term, BRL 141 million and in the long term, BRL 90 million.
The BRL 107.8 million, whose maturity date you see it's May 2022, has already been renegotiated, and it's going to be due on May 2023. On slide 12, we can see the investments that were made in the first quarter of 2022. BRL 17.7 million in the first quarter of 2022, BRL 25.1 million in total depreciation, and those investments account for 70% of the depreciation. We see that the amount that was invested accounts for 2% of our total net sales revenue.
It's important to say that in November last year, an investments plan for 2022 was approved, totaling BRL 107 million, that are going to be disbursed along 2022 according to the needs and also according to our expectations of maintenance costs and our plans, also retrofitting of our industry complexes. We are going to move to the Q&A session, and we are going to be open to entertain your questions. Thank you.
Ladies and gentlemen, we are going now to begin the question-and-answer session. If you have a question, please press star one. To withdraw it from the list, star two. The first question comes from Marcelo Motta of JP Morgan.
Good afternoon. I have two questions. First, if you could please tell us more about market perspective for the second half of the year. You've said you were expecting to have an improvement. The beginning of the year is always impacted, and there was a shortage of semiconductors and Omicron variant. Can you anticipate some coming improvement for the next month, some orders being placed, or do you just expect things to pick up again as of the third and fourth quarter? And finally, CapEx plan. You want to have BRL 108 million. The first quarter was somewhat weaker than if you had been distributing it linearly throughout the quarters. Just to know if you are expecting to have lower CapEx this year than what had been approved.
Good afternoon, Marcelo. This is Daniel Camargo speaking. Your first question about future perspective, future outlook. In May, we have been already selling more. Even rental cars companies, they need some maintenance and additional parts. Last year, there was a shortage of products. There was demand, but there was shortage of components, so this was a problem. We believe there is going to be recoveries of the second and third quarter. This week we heard from ANFAVEA and this point was clearly made. This is something we have been witnessing in May. There is high volatility of course. We have to monitor things very closely and constantly make the fine-tuning and allocating accordingly our resources to meet the needs of manufacturers. We have to relate very closely with them. But this is something we do expect to see coming shortly.
Now, Marcelo, this is Fábio speaking. Concerning your second question about CapEx. Historically at MAHLE, the first quarter is somewhat slower, as you pointed out. This is repeated every year, and then investments take place as of the second quarter to the very end of the year, where we use all our plan of investment. Exactly where we are going to make our investments can be seen on page 145 of our release, and there you will see exactly how we are going to allocate our resources. As of the second quarter, we are going to make more and more investments up to the end of the year in December. Except if the market goes into chaos, BRL 108 million will be spent up to December. Have I answered your question? Do you still have any remaining questions?
No. Crystal clear. Thank you very much.