Good afternoon, ladies and gentlemen, and thank you for waiting. Welcome to the conference call to discuss the earnings of LPS Brasil for the first quarter of 2020. Here with us, we have Mr. Marcos Lopes, CEO, Francisco Lopes Neto, Vice President, Beatriz Machert, Investor Relations Officer, and Robson Paim, CFO. I would like to inform that this event is being recorded and all participants will be in listen-only mode during the conference and the presentation of LPS Brasil. After that, we'll start the Q and A session when further instructions will be given. Should any of you need assistance during this call, please request the help of the operator by pressing star zero. This event is also being transmitted simultaneously online via webcast and can be accessed at the address www.lopes.com.br/ri, where the corresponding presentation is available. The slides will be selected and controlled by you.
The replay of this event will be available shortly after it has ended. We remind you that the participants of the webcast may send questions to LPS via website that will be answered after the conference call is finished. Before proceeding, we would like to clarify that any forward-looking statements that may be made during this conference call regarding the business prospects of LPS, projections, operating goals, and financial goals are based on assumptions and beliefs of the company's management. Forward-looking statements are not guarantee of performance as they involve risks, uncertainties, and assumptions, and they refer to future events, therefore depend on circumstances which may or may not occur. Investors and analysts should understand that general conditions, industry conditions, and other operating factors may affect the future results of the company and lead to results which differ materially from those expressed in such forward-looking statements.
First, Mr. Marcos Lopes will make the presentation of the operating results. Francisco Lopes will present the CrediPronto results. Finally, Ms. Beatriz Machert will speak about the financial results. Then we'll open for the Q and A session. Therefore, I would like now to turn the floor over to Mr. Marcos Lopes. Please, you may start.
Good afternoon, everyone. I would like to thank you again for attending one more earnings release conference call of LPS Brasil to present the results of the first quarter of 2020. Here with us in this presentation, we have Francisco Lopes Neto, our Vice President, our Investor Relations Officer, Beatriz Lavieri, and our CFO, Robson Paim. As you all know, the pandemic of COVID-19 had a significant impact on the world economy since the beginning of this year.
For us, this impact was clear with the closing of sales stands and real estate agencies in the second quarter of March. It's worth remembering that the first quarter is marked by the seasonality of the real estate market in view of the late carnival and the launch of new projects, which was concentrated precisely on that month. With the public policies to mitigate the spread of COVID-19, about 40% of launches scheduled for the quarter were postponed. With the lockdown scenario, we created contingency committee to cautiously plan the next months, always prioritizing the health of our staff and also preparing to preserve cash. With everybody working remotely, we made adjustments that allowed it to reduce operating costs.
At the same time, we played a key role in the successful industry effort to include our brokers in the emergency payment made by government, allowing the associate agents to go through this period with peace of mind. Since then, we increased our commercial efforts and launched an unheard-of campaign in the market, the real estate online exhibit that allows users to buy property online, offering tools such as 360 video and virtual tour, and allow them to close a deal without leaving home, everything online. This initiative was only possible because we had a digital process project in progress. In this period, the investments of the company were focused on the continuous transformation of our operations. We believe that our efforts will play under differentiated position once the activities are resumed after the pandemic.
Let's start the presentation on slide five with the highlights of the first quarter of 2020. Slide five. We had a PSV launched over BRL 1.5 billion with an increase of 25% when compared to the first quarter of 2019, and another 12 projects were scheduled to be launched until the end of March, but as a result of the lockdown, these launches were postponed by real estate developers. CrediPronto continued to present a growth in the first quarter of 2020 and had an increase of 56% in the financed volume. Our net revenue totaled BRL 29.7 million, 15% higher than the first quarter of 2019, with highlights to earnings received from CrediPronto, which accounted for 35% of the net revenue in the quarter. The EBITDA of the company amounted to BRL 5.9 million, with a significant improvement when compared to the BRL -2 million of last year.
We closed the quarter with an EBITDA margin of 20%. With regard to the digital project, we capped our investments planned and made the first deliveries on schedule with the MVP of the new website. For the next quarters, we intend to continue with our deliveries. On slide seven, we will talk about the launches for the first quarter of 2020. On the left of the screen, you may see that the volume launched in the first quarter of 2020 was BRL 1.5 billion, with 15 projects launched after Carnival, which is a 25% increase in volume when compared to the same period of last year.
Analyzing the launched PSV of the region, we see that 92% of launches were concentrated in the state of São Paulo, 60% in the capital, and 31% in the interior of the state, with the highlight of the town of Mogi das Cruzes, and 9% in the other regions and towns of the metropolitan area. Though 12 projects have been postponed, it's important to highlight that based on our pipeline and distribution of projects in the first quarter, we start to observe an upturn in the market in other regions, in addition to the city of São Paulo. Now, slide number eight. You can see in detail the results from transactions closed in the first quarter of 2020. On the chart on the left, we see the consolidated figures of the company. That is the total transactions closed of our own operations added to the PSV of franchises.
Comparing the first quarter of 2020, we had a decrease of 27%, totaling BRL 1.1 billion in the period. Our own operations, mainly in the primary market, were impacted by the effects of COVID-19, both in launches that were postponed as well as in sales stands that were closed. Therefore, the variation of the quarter was 39%, closing the period with BRL 508 million of PSV of transactions closed. In franchises, the decrease was 10% in the volume of transactions closed in the period, impacted by the lockdown in March. Since franchises are more exposed to the secondary market, the impact of seasonality in this area is smaller. On slide number nine, we see the results of transactions closed, segmented by region.
Notice that the state of São Paulo continues to be the main market, both in our own operations as well as in franchises, with a reduction in the share of this market in our own operations for the reasons I have mentioned. Sales in the south region, especially in Londrina, had a growth and closed the quarter with 27% of total transactions, explaining the increase of the share of this region. On the right, we see the distribution of transactions closed by franchises. São Paulo continues to account for the largest part, with 66% of the total, and then comes Rio de Janeiro market, that remained as the second most relevant, 24% of PSV of transactions and 8% on stores, which is explained by the high exposure to the primary market of the region. On the left, we see the geographic distribution.
We currently operate in 10 states and federal districts, 102 stores, 18 of them are own stores and 84 franchises. Now let's move on to slide number 10, where we see the results of sales over supply and sales over launches. Starting the analysis by the indicators of the capital of São Paulo, we see a reduction in both indicators. Especially in the capital, we could observe the impacts of the social distancing since we had an increase in the supply of new projects launched after Carnival, but with little working days to sell them. Therefore, we closed the quarter with 5.6% of sales over supply and 12% of sales over launches. In the chart to the right, we see the analysis of consolidated figures. We see a smaller impact on consolidated indicators since the effect of the capital of São Paulo is diluted amongst other operations.
In addition, the result better than that of São Paulo is due to the good performance of a few projects launched in other regions, which in turn had a reduced launch volume in recent years, which contribute to a better absorption of the products launched in these locations. Still here, we can see the distribution of transactions closed by Lopes amongst the projects recently launched and products in inventory. As usual, the concentration of transactions closed remained in products launched in the last six months. These were my comments about the operating results of the company. Now I turn the floor over to Francisco, who will speak about CrediPronto. Then Beatriz will present the financial results of the company. Thank you.
Thank you, Marcos. Good morning, everyone. I'm pleased to make some comments here about CrediPronto. Actually, the operations have a very good performance, which translates the results.
We are really proud of the operation that is doing so well. Highlighting on slide number 12, I would like to talk about the growth of CrediPronto, seeing its good performance March against March. This is a month where we already had the pandemic starting in Brazil, and our performance was BRL 164 million in March. March against March, we had a growth of 41%. We have also noticed that an important trend is the portfolio repository, and the average balance is growing. We have the differentiation between prepayment and what is added in terms of new mortgages every month. On the right side, you can see a growth from the first quarter to the fourth quarter to the first of 2020, a 20% growth. It used to be on average a 2% growth between prepayments and new mortgages.
These were the average quarter-against-quarter of this repository. In this first quarter of 2020, this growth almost doubled when compared to the average, so it is +3.5% . Customers continue to prepay, but since we have had a growth in originations, we have made the average balance grow. Comparing the first quarter of 2020- 2019, we see a growth of 56%, which is higher than more than 180 times the average of private banks, which have grown 20% in the same period. It means that we have gained market share. The market share we calculate is of 5.2%. Finally, on the upper right of the slide, we can see the profit-sharing recognition in this quarter, totaling BRL 11.5 million.
As a note to the slide, we say the March of 2020, a profit sharing of BRL 3.6 million that will be recognized in the second quarter of 2020 due to the contract rule that it should take place more than 40 days afterwards. So, it also shows the profit sharing in these last three months, around BRL 3 million. On the right, the lighter shade is the origination revenue based on commissioning. So it is not exactly part of the profit that comes from Itaú portfolio and CrediPronto. We thank you for the opportunity to be able to explain the details about CrediPronto performance. Now I turn the floor over to Beatriz, our Investor Relations Officer, because she will present the financial highlights. Thank you very much and have a good afternoon.
Thank you, Francisco. Good afternoon, everyone.
We now move on to the financial results, as you can see on slide number 14. This slide, we see the reconciliation of the gross revenue of the company. Looking at the table on the left, we see transactions closed of BRL 508 million, multiplied by net commissions of 2.04%. We have revenues from transactions of BRL 10.3 million. To this revenue, we sum the revenue from other segments, franchise royalties, BRL 1.8 million, profit sharing commissions of 1% received from CrediPronto in addition to our revenues. To total the gross revenue in the period, you must add also BRL 3.6 million deferred revenue from upfront of CrediPronto that does not have a cash effect for the company. On the right table, we have the distribution of commissions by region.
We noticed that the city of São Paulo has higher commission than the other regions, given its combination of products.
When compared to the first quarter of 2019, there was a slight increase in net commissions due to the reduction of the exposure of products of the economic segment, which had a lower commission on average. As we see on the information below, that which is Publish is the one that has fulfilled all the requirements. On slide 15, we see the net revenue and the costs and expenses in the quarter. In the revenue analysis, we see a growth of 15%, totaling BRL 29.7 million in the period. The increase in net revenues was boosted mainly by CrediPronto, which contributed to 50% of the results. 35% came from revenues or earnings from the operation, and the other 15% from commissioning by origination. The transactions closed and franchises have reduced their share in the quarter due to impacts of invoiced intermediations, as commented by Marcos.
On the left, we see the total vision of cost and expenses totaling BRL 23.7 million, with a reduction of 14%. In addition to specific reductions such as infrastructure, we had a reduction in provisions for contingencies in the quarter. The total of legal expenditures plus contingencies were reduced by BRL 2.9 million. In the next slide, number 16, we see the comparison of EBITDA and the net income of controlling shareholders in the quarter. On the left, we see EBITDA and EBITDA margin. At the end of the first quarter, we had BRL 5.9 million of positive result, an improvement of almost BRL 8 million, and we ended the quarter with a margin of 20%. Of course, this improvement in EBITDA is due to the contribution of CrediPronto.
Likewise, on the right you see the net income of controlling shareholders, and there has been also a significant improvement of almost BRL 8 million in the results, reducing losses. So we closed the period with BRL 1.2 million of losses. On slide number 17, we see the results of the quarter by segment. The transactions closed segment had a negative contribution margin with a loss in the quarter of BRL 9.2 million, strongly impacted by the reduction in sales. Franchises, although impacted as well, had a contribution margin that was positive given our business model extremely asset light. CrediPronto, in turn, played as higher share in the results of the company by receiving JV profits and commissionings over origination. Therefore, we closed this quarter with BRL 5.9 million EBITDA. On the next slide, we see the effects of IFRS in our earnings.
Generally, we had variations in calls and puts records, which justify the variation of the line, the financial results. The total impacts coming from these reassessments added up to BRL 7 million approximately without any cash effect as shown in the slide. Again, we recommend the analysis of our figures without these impacts for a better understanding of the company's results. Finally, on slide 19, we see the cash variation in the period and the total cash available of the company at the end of the quarter. On the left, we see the cash generated from operating activities, which was positive at BRL 7.4 million and significantly better than that observed in the same period of 2019, which amounted to BRL 1 million. On the right, we see a sum of all activities of investment and finances. There was a cash burn of 5.4%.
Our activities of investments are related to the digital project that, as mentioned by Marcos, remained a priority. Therefore, we closed the quarter with BRL 119.7 million in cash and financial investments of BRL 30 million , which give us a total balance of BRL 150 million of cash in banks. These were the financial results, and now we can move on to the Q and A session. Thank you.
Ladies and gentlemen, we will now start the Q and A session. To ask a question, please press star one. To remove your question from the queue, please press star two. Please wait while we collect the questions. Our first question comes from Pedro Lobato, Bradesco BBI.
Hello, everyone. Good morning. Thank you for the call. I have a question about CrediPronto. In the first quarter, you have presented a very significant growth in the mortgage volume, and you mentioned about this increase in market share above the average growth of the market. I have a broader question. How do you see the potential growth of CrediPronto in terms of mortgage volume, and how much relevant will it be in the future results of Lopes? Considering the scenario of a reduction of interest rates as well as a potential decrease in the amount charged for loans or financial for real estate loans by banks, in terms of interest rate, how do you see the scenario for the coming months?
Thank you for the question. This is Francisco speaking. It is interesting this subject that you raised because CrediPronto, when we realized that the scenario may not be very favorable, but how can we achieve such results that are positive in an important portion of March despite COVID-19? It has grown 40% when compared to March 2019, nonetheless. I think part of the answer is the capacity to provide services quickly. CrediPronto was able to meet an important portion of our customers by closing the deals. We had to be quick and efficient, and we are as competitive as the other loan facilities offered by major banks in terms of rates. We were able to close the transactions quickly, and we have most of our systems digitized, so that was very helpful to achieve results already in March, beginning of the pandemic.
I do not like to make forward-looking statements about results and trying to see the future here, but I believe that we have seen good results in terms of mortgages now. I believe that the further reduction of interest rates, making credit facilities cheaper, will also have an impact in our segment because the Selic interest rate has dropped and will continue to drop, and that has a positive impact. The reduction of the Selic interest rates benefits our profit. This is not something from this month that is originated by a certain in the past and it is being benefited now. Selic has a cost, an entire cost of capital in the entire portfolio. The challenges will have lower rates in the future. That is a trend for real estate credit lines.
However, we have the benefit of Selic being reduced, and that has a positive impact on the profit. I believe that credit lines will continue to be a good business. The average term was 330 months of financing. That is a long period for buyers. There has been a pressure to reduce interest rates on the tables, on the closing of transactions. I believe that the scenario for CrediPronto looking forward is a positive one, undoubtedly.
Thank you. It is very clear.
Next question is from Alex Ferraz, Itaú BBA.
Good morning, Marcos, Francisco, and Bea. Thank you for the presentation. I have two questions. First, could you give us some color about the behavior of the operation in these last three months? We are ending the second quarter. I believe that transactions has been most impacted since the brokerage houses have been locked down, but we had a positive feedback from companies from stabilizing sales in May, especially June. How was your operations behavior in the last three months, mainly May and June? We have noticed also that some players are already testing the market for July. Do you see any pipeline of new launches for the next quarter or the second half of the year, or are you discussing projects for the end of the year? Thank you.
Good morning. This is Marcos Lopes speaking. The month of April was highly impacted by the pandemic. A new reality was imposed by the closing of the sales stands and also by the brokerage houses in São Paulo. We had to adapt in the state to this new reality. Sales did not stop completely, but there was a major impact. In May, after a certain adaptation, people got adapted to this new reality much better than in April. May was better than April.
We see that people are adapting to these new times. In terms of the challenges of working that way, we were forced to anticipate some actions that were scheduled to happen in the future, such as to improve communication with our real estate agents. That was quite healthy because that advances the way we plan to operate, and that was quite a healthy decision. We see some movements in terms of other market players trying to test the market with some initiatives for July and August. We start to see some launches being scheduled for that period. Slowly, things are going back to the normal reality and interest rates are very low.
There is a scenario of real estate financing having even lower rates added to these solid results from CrediPronto, which shows the strength of the real estate market with a very good reaction from the side of the demand. We see a good prospect for the second half of the year that somehow offsets the reduction of the salaries and wages earned by people. Because now we have interest rates that allow 3 million more families to apply for credit facilities, which is very beneficial to our industry.
Thank you very much, Marcos, for your answer.
I remind you that to ask a question, please press star one. This ends the Q and A session. I will now turn the floor over to the CEO of the company, Marcos Lopes, for his final considerations.
Thank you very much, everyone, for attending this conference call to talk about the earnings of the first quarter of 2020. It shows that the company was prepared. We have this philosophy of always being ready for unexpected events because they do happen. We had wonderful growth prospects, and we were caught by this pandemic, but we had very high cash and bank levels. We had the help of our teams and the producers, the sales team. They keep united, and we maintain a market share and ready for the market to start growing after the pandemic. Thank you very much.
The conference call for LPS Brasil has now ended. We thank you all for attending, and have a good afternoon.