Good morning and thank you for holding. Welcome to Melnick's earnings call concerning the results of the third quarter of 2025. 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, and choose your preferred language, Portuguese or English. For those who will listen to this teleconference in English, there is an option available 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 website, ri.melnick.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 icon in both Portuguese and English.
During the company's presentation, all participants will have their microphones on mute, and following that, we will begin the question-and-answer session. To ask questions, click on the Raise Hand or question-and-answer 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 accept it to ask your question. We would like to clarify that any statements that might be made during this teleconference regarding Melnick'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 risks, 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 Melnick'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. Leandro Melnick, Chief Executive Officer, Mr. Juliano Melnick, Chief Financial Officer and Investor Relations Director, and Mr. Joelson Boeira, Administrative and Investor Relations Director. I will now give the floor to Mr. Juliano Melnick.
Good morning. I would like to thank you all for attending Melnick's earnings call concerning the third quarter of 2025. Let us begin with the highlights of the quarter in slide three. The box on the left-hand side of the slide displays the BRL 119 million in net launches in the quarter and the BRL 475 million in net launches accumulated in the year by Melnick.
Below, we can see the BRL 71 million net launches in the quarter and the BRL 243 million in net launches accumulated in the year by Melnick Partners, which is the company's vehicle that partners with other companies to participate in development projects. The box in the middle shows BRL 148 million in net sales in the quarter and BRL 602 million in net sales in the year excluding Melnick Partners. Another point to be highlighted is the 66% increase in the sales of inventory when we compare the first nine months of the year with the same period last year. The box on the right-hand side brings the gross margin ex-financing of 30.6% in the quarter, which consolidates the fourth consecutive quarter of growth and the net margin of 14.7% in the quarter. Lastly, we paid out BRL 50 million in dividends this quarter.
Moving on to slide 4, we break down the launches in the quarter. The chart shows the BRL 120 million of gross PSV launched in the quarter, BRL 119 million of which is net, comprising two launches in Porto Alegre: Go Home Design and the first phase of Open Major. In the bar chart in yellow below, we can see that besides the launches carried out by Melnick, we had BRL 71 million of net PSV, Melnick's share, carried out by Melnick Partners in partnership with Yuny. The project is Quaddra Lorena in São Paulo City. In this quarter and in the year, it amounts to BRL 243 million in net launches Melnick share launched by Melnick Partners. In slide number five, we have Go Home Design, the launch we had in the quarter.
It is a boutique project with only 141 compact units in Bela Vista neighborhood, the most prime location in the city. It is over 40% sold. We also have Open Major, a project that is part of Minha Casa, Minha Vida program and is located in Canoas City, where due to the success of the first phase launch there, we opened sales for the second phase after the closing of the quarter. Moving on to slide six, we shed some light on our Melnick Partners business unit. We currently operate in four states, Rio Grande do Sul, Santa Catarina, Paraná, and São Paulo, through nine partnering companies. On the right-hand side, we can see this quarter's launch, Quaddra Lorena, in partnership with Yuny. It consists of three high-end towers with complete infrastructure, such as tennis court in Jardins neighborhood.
Even though it is high-end for which launch SoS is traditionally slower, we have already surpassed the 30% mark of sales on this project. In slide seven, we will discuss the company's net sales. In the graph on the left-hand side, we can see that launch SoS in the quarter was 48%, whereas inventory SoS was 7%, which brings us to an average SoS of 10%. We had BRL 148 million in net sales split into BRL 90 million in inventory and BRL 58 million in sales of launches. Net sales in the year reached BRL 602 million, vis-à-vis BRL 601 million in the same period last year. That is virtually unchanged. Let me point out the 66% increase in inventory sales when we compare this year with the same period last year. The pie chart in the top right-hand corner will show the breakdown sales by business unit.
90% of sales are concentrated in the Incorporadora units. In the bar chart in the bottom right-hand corner of the slide, when we look at the projects to be delivered this year, we see that 94% of the units were already sold, giving us the last quarter of this year to sell the remaining 6%. In the next slide, in number eight, the graph on the left-hand side shows the company's deliveries, where by the end of the third quarter, the delivered PSV amounted to BRL 445 million. This leaves only one project in the Urbanismo unit to be delivered closer to the end of the year. On the right-hand side of this slide, we can see some information about our operating capacity.
We presently have 18 active construction sites, 12 of which are in the Incorporadora, five are in the Urbanizadora, and one is in the Open Minha Casa, Minha Vida unit. Together, they amount close to 4,300 units. In slide nine, we present our only delivery in the quarter, Arvo. It is a subdivision, a gated condominium in Santa Maria City, and is 68% sold, which is a departure from our track record of deliveries considering that in the last 10 quarters, our projects were delivered 94% sold on average. In slide 10, we break down the company's inventory by year of conclusion. In order to help you understand the company's finished inventory, the box on the left-hand side of the slide brings a donut chart displaying our inventory of launches prior to 2020, which we call pre-IPO.
It consists mostly of commercial property that accounts for 86% of the inventory in this group and amounts to BRL 137 million. In the bar chart in the same box, we can see that we currently have BRL 1.176 billion in inventory, disregarding the inventory launched prior to 2020. Out of this amount, only about 8% or BRL 101 million corresponded to finished inventory. Out of the remaining inventory, only BRL 3 million refers to projects that will be finished this year. In the graph in the top right-hand corner of the slide, we break down the composition of our finished inventory worth BRL 238 million. Only 16% of it is in Urbanizadora. BRL 100 million corresponds to residential inventory, 9% of which is already leased.
The oldest and least liquid inventory, the commercial units consisting of office space stores and hotels, amounts to BRL 122 million, and BRL 47 million of it is already leased or are hotel units. Let me call your attention to the 12% decrease in the finished inventory, which is concentrated in our oldest inventory, the commercial units. At the bottom of the slide, we can see the duration of the inventory currently at 19 months.
In the next slide, number 11, we will discuss our land bank. You can see in the box on the left-hand side that we presently have BRL 4.4 billion of total PSV, BRL 2.9 billion of which is Melnick's share. It consists of 28 lots or phases, BRL 900 million of this PSV has already been approved. In the box on the right-hand side, we show you the composition of our land bank by business unit. In slide 12, where we present the company's financial indicators, we can see in the graph in the top left-hand corner that the quarter's net revenue was BRL 244 million. The graph on the right-hand side shows the quarter's gross profit, BRL 61 million, and a gross margin ex financing for production of 30.6%.
As already mentioned in the highlights, this is the fourth consecutive quarter when we see an increase in gross margin. At the bottom, we present our net income of BRL 25 million in the quarter and the net margin before minority's interest of 14.7%. It is worth noting the increase in net revenue, profits, and margins accumulated in the year in comparison with last year when we had the flooding event in Porto Alegre. This is proof of the city's market recovery. Now in slide 13, we demonstrate the company's capital structure.
In the table on the left-hand side, we can see that we ended the quarter with a net debt of BRL 149.4 million, which translates into a gross debt of BRL 515 million, mostly for financing the ongoing construction work, and a total cash position of BRL 366 million. Presently, shareholders equity is BRL 1.097 billion, and our capital structure corresponds to a net debt-to-equity ratio of 13.6%. The box in the bottom shows our consolidated cash position of BRL 366 million. Our net cash position ex SFH financing is BRL 264 million. In the quarter, the company had an operating cash burn of BRL 60 million and BRL 53.8 million in the year. The cash burn in the quarter happened mostly due to new projects involving the purchase of land by Melnick Partners. Lastly, we point out the payout of BRL 50 million in dividends in the quarter.
In slide 14, we present our track record of dividend payouts. From our partnership with Even in 2008 until our IPO in 2020, we had an average payout of 90%. It is worth noting that the total dividends paid out since the IPO amounts to over BRL 493 million, which corresponds to approximately 63% of the company's market cap. Thank you all for your attention. I will now give the floor to Leandro Melnick, company's Chief Executive Officer, for his final remarks, and then we will open for the question-and-answer.
Good morning. In the third quarter of this year, we had a higher concentration of inventory sales. We had a huge evolution in the volume of inventory sales this quarter when compared with the same period of last year. Concerning launches, the volume was lower than in the previous year, and we will have some significant launches in the fourth quarter, for whose pre-sales happened in the third quarter. It was a quarter that saw another increase in margins, demonstrating a trend of consistent increase in gross margin. We kept the company's financial discipline while holding on to our systematic dividend payout.
This was a quarter when our Open operation through the Minha Casa, Minha Vida program showed once again good commercial performance, and also Melnick Partners, which is the company's division that participates in real estate developments outside of Rio Grande do Sul, has been showing important growth in our figures. We are now regarding the fourth quarter, as I have already pointed out, as an important one because of some of the launches that were concentrated in this quarter due to our commercial strategy.
We are now going to take some questions. We will now begin our question-and-answer session. Remember that to ask your questions, you must click on the raise hand or question-and-answer 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 accept it to ask your question. Our first question is from Gustavo Fabris, sell-side analyst from BTG Pactual. You may now proceed.
Good morning, everyone. Thank you for the space. I have two questions. If you could share some of your perspective on gross margins, both for the fourth quarter next year. I would like to understand the direction in which you are moving, and if you have some negative or positive news regarding gross margin regarding construction. So that would be the first question. The second question concerns the land purchase. What is your appetite for continued buying land in this current scenario? This first half year were two pieces of land. If you will continue doing this, what kind of product you are aiming at, the location. That would be my second question.
Hello, Gustavo. Good morning. Thank you for your questions. Let me talk about gross margin. It has been improving in these last quarters, and we believe some stability concerning what we have been doing, what we did last quarter. It is going to fluctuate a little above, a little below, but we see a stable condition here. We do not see anything different in relation to cost of construction. Our costs are under control. Of course, we have some difficulty regarding labor in the segments, but concerning the material costs, we are under control. Regarding your second question, the land bank.
We have been doing some land purchase in the second quarter. We bought some land in São Paulo city together with our partner companies through Melnick Partners, which is our vehicle for partnerships. We go beyond Rio Grande do Sul. This is land that is aimed at the high-end, which is a segment that is very resilient in the Paulista market. Also here in Porto Alegre, we have been working through swaps, which traditionally is how we operate. But we also have been purchasing land in cash. Here we go from high-end and sometimes even middle class, middle income.
The interest rate in the country makes it more difficult for this segment, but we are more concentrated in the highest end. In the Open line, which is lower income, Minha Casa, Minha Vida program. We have been increasing our participation and normally we work there. That is what I had to say.
Thank you.
Our next question is from Elvis Credendio, sell-side analyst from Itaú BBA. You may proceed.
Good morning, everyone. I have two questions. The first one concerning Open Minha Casa, Minha Vida. You made some changes that were approved in the program. It is still strong. I would like to understand how you see your Open division in the middle of all these changes. If you have more space to increase operation, what is the land bank like for this kind of operation? The second question is about partnership. You commented your launch is around BRL 240 million. I would like to understand if you have some expectation of the size of these partnerships for next year. What kind of challenges you see for next year.
Hello, Elvis. Good morning. Thank you for your questions. Let us begin with Open. Open has been developing. It is a project that we started a few years ago to gain some experience in this lower income segment, taking advantage of our strong presence in the south of Brazil regarding purchasing lands, our sales performance. We have been gaining experience working with a low volume. Exactly so we can have this learning curve in this segment. Now, after a few years doing these operations, the company is more mature to grow this.
In a moment, the market is very good for this segment of lower income Minha Casa, Minha Vida program. So Open, sales center with their own headquarters. It is an area dedicated in the company. It is an area dedicated to Open. We have a dedicated team to this segment. We are going to see in this last quarter, more launches from Open, which is a very resilient segment. It depends on federal help.
It will also count with us on state help. We are very happy with this segment and the tendency is, yes, to grow, and a little bit more in this quarter and, a growth of share among our four business units for next year. Talking about the partnerships. This is a little more difficult. It is more difficult to talk about size for this one because the destination of the business is not up to us, it is on our partners. The partners bring us the business and offer us this new opportunity. If these offers fit our margins, our deals, then we launch. And the trend is that this is going to also gain some space as we do these operations more often, as we measure the performance in the different regions. We see it grow, it will gain traction.
We cannot give you a guidance in relation to this. We will depend on, it is going to be on a business basis. As the business is coming to us, we are going to deal with them.
Thank you, Juliano.
Our next question is a written question. Comes from Reginaldo Anderson. Good morning. I would like to know regarding the payout of dividends in this year of 2025.
Hello, Reginaldo. Good morning. Thank you for your question. The company has always been working with a policy of doing this dividend payout. We look at this on a quarterly basis, and we have been taking care of our cash position considering the current market situation and also the opportunities that come up. I would say that as Melnick Partners gains volume, we are going to find new possibilities for new businesses to use this capital. Whenever we see we have a surplus, we are going to pay out the dividend.
Our trend is to always go after the payout dividend, but we need to see what this last quarter will show us in terms of opportunities. We can see this match between the best opportunities for the company. But it is important that we do not change our mind of this, and our mind is towards whenever possible to pay out the dividends. Melnick has a great track record of a company making good cash and paying out these dividends. That is very interesting and doing this in a constant way. But Melnick Partners brings us new opportunities for using this capital for land purchase in São Paulo, for example. We are going to balance more how much we are going to pay out, how much we are going to use this cash to buy land.
But this is our mind. Whenever possible, whatever is more important for the company, we are going to do this payout.
Our next question comes from Francisco de Paula. It is a written question. No question here. Just to congratulate you on your results. This is a very significant mark of 100% of net profit. Next question, Ivo Da Silva.
Good morning. I would like to know about your finished inventory that is already leased. Does the company intend to increase this percentage? Regarding net margin, what are the company's plans to increase this net margin? What would be the ideal net margin for the company?
Good morning. Thank you for your question. As a percentage of lease, the lease is basically concentrated on launches prior to 2020, which is into our IPO. We also have a lot of inventory concentrated in the older inventory, which is our commercial inventory. The hotels, office spaces.
Because of the difficulty in the market, we create an operation called reversible leasing. Our idea is to lease these units first to keep the expenses of keeping this inventory. Second, this lease gives the tenants the opportunity of buying these opportunities in the future using the paid rent as part of the payment. So such strategy as a lease in the first moment, and in a second moment, sell these units. As we lease these units and then we sell them. Because of this, we can see that in the quarters where the sales performed well, the finished inventories performed well, are the ones, is exactly these conversions of leases into sale. While we have this kind of inventory that's not more so mature for sales, we are going to lease and sell. This is our strategy we call reversible lease.
In relation to net margin, we have been working here considering costs, reducing costs to increase margins. In our segments, for example, the Open Minha Casa, Minha Vida lower income segment is a more resilient segment. The company has been seeing some growth in this segment, and we think it will help us in the net margin. Also the partners that we have with São Paulo, which is harder and less pressed than Rio Grande do Sul. We are going to see some increase there. We do not have an ideal net margin because each place is different, each risk is different, and the margin is connected to the risk we are taking. But we have been pursuing this increase in net margins, and we are going to see it happen.
Our next question is written. It comes from Kevin Quinn.
Good morning. Congratulations on your excellent results. Regarding macroeconomic factors, what do you see in terms of this macroeconomic factor next year? How do you see the investment in new projects for coming years? What are the other projects you have for the other two states of the southern region?
Hello, Kevin. Good morning. Thank you for your questions. I think this macroeconomic scenario for the company is very robust. The company has a very robust cash position. We work without debts. In our years in the market, we are very well prepared for these companies. These companies that work in cycles in this country. We have to be prepared. We always look on a business-to-business basis. We do not give guidances for launches. We see this on a business-to-business basis. When the situation is more complicated macroeconomically, maybe we have to hold on a little bit, but sometimes we have great opportunities.
We are capitalized. Melnick is a company that is very well capitalized. We always measure the businesses considering the different risks these businesses offer so we can pursue a little bit better result depending on the deal. We are well-positioned in the high end, which is a more resilient segment to the increase, the high interest rates we have in Brazil now. Melnick is operating in São Paulo now through Melnick Partners. We are going to move on to other states in the south. We have a partnership in Curitiba. In the beginning of next year, we are going to deliver the first project in Curitiba, in Paraná. We have some areas in Santa Catarina state where we will start operating there.
Melnick Partners helps us to dilute risks because it decreases the concentration in one state, which is also a strategy that works well in the macroeconomic sense.
Thank you.
We have more relevance in the market, and it's very good in the south. In the company, we would have a bigger market share. This distribution among four business units, and one of it operates in more than one state, gives us a capacity to increase volume without exposing ourselves too much in one single segment. We're going to understand this on a business to business basis. We are going to have discipline and are going to launch anything that comes out.
We remind you that to ask questions, you must click on the question-and-answer or raise hand icons at the bottom of your screen and type in your name to join the queue.
Our next question comes from Tiago Diamante. It's a written question. In the IPO, Melnick raised more than BRL 600 million to use mainly in the purchase of land as the prospectus. After all this period, you have a robust land bank. Is the company happy with the current land bank or if you intend on continue buying land? If you're going to do this through swaps and with a low debt, if the company intends to use the cash to increase the dividend payout or if you're going to close capital.
Hello, Tiago. Good morning. Thank you for your question. Regarding our land bank, this is our main raw material. The company's always looked for good opportunities. It's important to have a land bank and also the launch that will consume this land bank. The company is always looking for good land.
We have a very strong operation in Rio Grande do Sul, especially through swaps. It helps us build a robust land bank using little cash. We are still purchasing or swapping, but it depends on the type of land, it depends on the region. We have been buying land that gives us a quick turnover. The location sometimes is so strong that it's very easy to get it approved, to have it at launch 12 months after the purchase. But we have some land for bigger areas to be developed. It takes more time to be approved. It's more uncertain, takes longer time in many phases.
This is land that we prefer to do through swap. Then we're going to be together with the owner of the land and developing this land together in the long term. The structure depends on the type of land. Through Melnick Partners, we have entered other markets, and there it's more common to purchase land with cash. We have land that have even already become launches, and we have some other that will be launched soon.
We have been sharing this between swapping or buying cash, depending on the land, the type. We have been paying dividends recurringly. Our idea is between continuing paying out dividends or doing a buyback. We have been opting for paying out dividends and every shareholder can decide to buy more stock. But this is a way we are working. But we do not think right now of doing a buyback or in closing capital.
The question-and-answer session is now closed. Melnick's earnings call concerning the results of the third quarter of 2025 is now concluded. The investor relations department is at your disposal to answer any further questions you may have. Thank you for attending this earnings call and wish you a good day.