Good afternoon, ladies and gentlemen. Thank you for waiting. Welcome to the conference call for earnings for Q2 2022 for Plano&Plano. We inform that this event is being recorded, and all the participants will be in the listen-only mode during the company's presentation. Next, we will begin the Q and A session when further instructions will be supplied. If you need any assistance during the conference, please request the help of an operator dialing asterisk zero. This event is also being transmitted simultaneously via the internet via webcast. You can access at ri.planoeplano.com.br/en clicking on the banner Webcast. The slides are available for download. The information is available in Brazilian reais and BR GAAP and IFRS. Otherwise, we will indicate.
Before beginning, we would like to mention that any forward-looking statements made in today's conference concerning the business perspectives of Plano&Plano projections and operational goals and financial goals are based on assumptions and beliefs of the company, as well as on information currently available. Forward-looking statements are not guarantees of performance. They involve risks and uncertainties. They refer to future events and depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors may also affect the future results of Plano&Plano and can lead to results that may differ materially from those expressed in these comments. Today, we have the presence of Mr. Rodrigo Luna and João Hopp, respectively, Chairman, Vice President, and Investor Relations of Plano&Plano.
Now, I would like to pass to Mr. Rodrigo Luna, Director, Vice President, who will begin the presentation. Sir, you have the floor.
Thank you very much. Good afternoon. Once again, thank you for participating in our conference call concerning Q2 2022. Please, let's begin on slide number five. Plano&Plano has the strategic objective to make progress consistently in order to have a sustainable and long-term growth. Our numbers, even in challenging periods like these in the last few years, have shown that we have followed these objectives. With this north and looking at the dynamics of the market, we evolved, improving our management in many fronts, making the company more resilient and capable of really looking and taking advantage of opportunities.
In the last 18 months, we're marked by a challenging scenario, and we have worked in an in-depth way in many fronts to mitigate the pressure on construction costs and to deliver financial results in line with what we have done in the last few years. Among the other actions to overcome this scenario, we reviewed the specifications of the projects, looking for alternatives in construction methods and aiming at having productivity gains. We defined new guidelines for marketing expenses and sales expenses, and we tried to pass on the cost inflation to the prices. We would like to also mention the turnaround in the trends of REF at the end of the second semester that was 33%, representing an increase of 1.1% when compared with the end of Q1 2022.
This turnaround is a result of hard work being done to reduce construction costs and pass on inflation to the cost of sales of the units in inventory and in the launches. Now, concerning sales, the company established a new historical net sales record reaching BRL 380 million, 5% above the same period in the previous year. We sold 1,950 units during Q2. Plano&Plano, until now, is maintaining its launch program for 2022. This plan was made at the end of last year. The launches resulted in BRL 394 million until June 2022, which is 11% Q2 of 2021. And year to date, there is a growth of 45% in relation to the same period in 2021. Another point that we would like to highlight was the dilution of commercial expenses and administrative expenses through gains of scale and increase in productivity.
As the company grows, we hope to obtain more gains in operational leverage. We continue to work with a model that is light in assets, asset light, and the purchase of plots of land continue to be made with barter or exchange. The ROI of the company in the last 12 months was 34%, a return rate that is really high in the sector considering the results of companies in the stock market. The company will also increase the participation of products for middle class above low income class units in its portfolio. In 2022, 10% of the units launched, most of them now in the second semester, should be outside the low income housing. We're planning the launches for 2023. We should launch 20% of the portfolio for low middle class above low income class.
The management continues to trust that we will expand the operations of the company in a profitable way and with controlled risks. Now I'd like to pass the floor to Mr. João Hopp, our Financial Director, our CFO, who will talk about the operational and financial highlights. João, you have the floor.
Thank you. Good afternoon. Welcome to our conference call of Plano&Plano. Please, let's go on to slide number seven. Net sales 100% Plano&Plano in the Q2 resulted in BRL 380 million, 5.2% higher than the BRL 361 million that we had in Q2 2021, and 2.1% higher than the BRL 372 million in Q1 2022. This result establishes a new quarterly sales record for Plano&Plano.
The company launched in Q2 five new projects totaling a sales volume of BRL 394 million, including exchange, representing 11.4% in relation to BRL 354 million launched in Q2 last year. The participation of the company in launches in the quarter was 91%. Next slide. On June 30, 2022, the VSO of the last 12 months was 40.7%. When comparing with the previous quarter, there was a drop of half a percent in VSO in relation to the 41.2% on March 31, 2022, due to the high VGV of BRL 209 million launched in June and a period with lower sales. In comparison with December 31, 2021, there was an improvement in VSO with an increase of 1.5%. Slide 11, where we will continue to talk about financial highlights.
Net revenue of the company, BRL 339 million in Q2 2022, 7.4% higher than BRL 316 million in Q1 2022, and 2% higher to the BRL 333 million obtained in Q2 2021. The revenue has continued solid following the evolution of the projects and the sale of the units in inventory, obeying the norms of recognizing revenue using the methodology of percentage of completion. Slide 12. Adjusted gross profit of capitalized interest in the quarter reached BRL 97.5 million , and adjusted gross margin was 28.7% in Q2, with a drop of 0.9%. The main factor of pressure on the margin and the increase was due to the increase in prices of raw materials, which the whole market is suffering with. The company is going through a gradual process to pass on the inflation to its prices.
With the rapid acceleration of INCC, it is impossible to pass on the whole inflation to the prices. We have to wait until the ideal time with acceleration in sales to increase prices. In this quarter, the REF margin had a growth of 1% here. In this period of pressure from inflation, the company is really recurring to many actions to improve its margins. One of the actions is to pass on inflation, increasing prices of units under construction. We also update our actions. The recognition of the results with these new sales will have more effect as the as the construction progresses. We see that the actions are having an effect. Another measure is the detailed follow-up of the projects with the engineering team, optimizing expenses and renegotiating contracts. Next slide.
Even with a growth of 5.2% in the sales between Q2 2021 and Q2 2022, commercial expenses, sales expenses had a drop of 14.5%. Administrative expenses had a drop of 17.3% from Q2 2021 to Q2 2022, showing a better efficiency in operations. The growth of sales and administrative expenses in Q2 2022 compared to Q2 2021 was lower than the growth of net revenue. The sales expenses went from 14% of net revenue in Q2 2021 to 11.8% in Q2 2022 from one year to another, while management expenses, administrative expenses went from 7.7% of total revenue in 2021 to 6.2% in Q2 2022. Total operational expenses had a drop of 12.2% in comparison between Q2 2021 and Q2 2022. When considering year to date, operational expenses had a drop of 0.3% of the revenue between 2021 and 2022.
The first semester 2022 commercial expenses, sales expenses had a drop of 7.9%, while net sales had an increase of 7.9%, which represents a greater efficiency in the client acquisition. Administrative expenses had an increase of 2.4% in the first semester of 2022, lower than the inflation in the last 12 months, which had a growth of 11.9%. We are obtaining a dilution of expenses due to our scale and also with gains in productivity. The net profit reached BRL 19.3 million in Q2 2022, 9.9% above the same period last year. The drop in relation to Q1 of 2022 is due to the impact of inflation on costs of the gross margin. The company is gradually passing on inflation of raw materials to the price of the units.
The company had an adjusted EBITDA of capitalized interest of BRL 39.5 million in Q2 2022, which represents a margin of 11.6%.
The EBITDA margin of this quarter also suffered an impact due to the pressure of construction costs, but was partially mitigated by better operational expenses. On June 30, 2022, the gross debt represented BRL 463 million. Considering equivalent cash of BRL 293 million, the net debt was BRL 169 million at the end of the quarter. The company continues to really work to have net debts on equity below 20% in the next quarters. Excluding the effect of payment of dividends and repurchase of shares, the company's operation had a cash consumption of BRL 307,000 in Q2 2022. The cash variation comes due to the amount invested in real estate as a consequence of a good performance of our production and the increase in VGV in the last periods. We would like to conclude, and we are available for clarifications in the Q and A session. Thank you.
We would like to begin the Q and A session. To ask a question, please dial asterisk one. To remove the question from the list, dial asterisk two. Our first question comes from Juan Castaño, XP Investments.
Good afternoon. Good presentation. I would like to understand how you see the CVA. In the release, you say you had some difficulty to pass on inflation to the price. I believe that my second question about leverage, you repurchased shares. How do you see the current leverage, and what is your strategy to reduce it to 20%, as you just said?
Hello, Juan. Good afternoon. Rodrigo Luna. I will answer the first question about low-income units. Yes, the changes are welcome. We are making changes. There is a reduction of interest rates for certain wage brackets, especially in group two families that are no longer in these brackets due to higher prices.
We have worked hard to pass on these costs, and also we have other measures that have been approved. For example, exemptions 35 years, and including future deposits of buyers to use this as income. These two are not in effect yet. When they are part of day-to-day of the program, they will obviously help a lot in terms of affordability of Brazilian buyers, but it makes a difference. It brings a search for us to really include more buyers, very far from what happened two and a half, three years ago before this period with inflation. But it is a constant movement, and we have worked with the government during all these 12 last years, 14 years of the government program, which began in 2008.
It is a nonstop operation where we in the sector, we talk to The Federal Savings Bank and to the government, to the Ministry of Regional Development in the Secretariat of Housing , the needs that consumers have to be able to buy their house. João will answer the second part.
Thank you. We took out a loan of BRL 50 million. We had paid an operation, a corporate debt of BRL 30 million. It was a substitution. Basically, we have contracts, loans from The Federal Savings Bank . Concerning leverage, our intention is to be below 20%, reminding you that at the end of 2020, end of 2019, our leverage was 0.85x. Now we are 0.45x, 0.445x, and we have a policy this year to pay minimum dividends due to the market. And reminding you, since 2017, we have been growing 40% a year in launches, and we aim at projects with profitability.
As they become mature, we have cash generation, and we can decrease leverage. We have projects in progress, and as we grow, as the projects progress, we receive money from The Federal Savings Bank . We are buying plots of land in exchange for units. 96% of the value of the plot of land is through barter or exchange, not cash. The projects will generate cash, and we will lower the leverage. We wanted to go down to 0.2x. Probably this will happen next year in 2023.
Thank you.
Our next question comes from Pedro Lobato, Bradesco BBI.
Good afternoon. First, we'd like to know, do you believe competition will become stronger with these changes? Have you seen more competition from smaller companies? In terms of launches and plots of land, the purchase of land. The second question, have you identified projects that are not feasible? Do you hold on to the plot of land, or do you sell the land?
Hi, Pedro, it's João. The current scenario, we feel that the medium and small companies are suffering more. In launches in São Paulo, where we are, our sales this year have 22% market share and the launch is 29%. We continue making our launches, and we see competitors making less launches, less projects. The larger companies this year will win market share. Concerning purchase of land, Luna will answer.
Hi, Pedro. Concerning plots of land, reinforcing what João said, we see that competition in the acquisition of land is concentrated in the large companies. We have seen less competition from small and medium-sized companies in buying plots of land. This brings to light the following, those companies that are less capitalized, they need more liquidity and create situations in order to pay the plots of land they bought. Less competition in the purchase of plots of land. Concerning feasibility, we continue with our assumptions to only launch projects when we can obtain our historical margins. We only launch projects that the market will accept with our parameters. We want to deliver the margins that we used to deliver historically.
Very clear. Thank you.
Our next question comes from Elvis Credendio, BTG Pactual.
Good afternoon, Luna, João. First, in terms of the low-income housing program, you talked about affordability. How do you believe affordability will increase on the part of buyers' buying power? Based on this, I'd like to know what strategy will you have? Will you give priority to better margins and prices or increase sales? In terms of growth, would it be the case of accelerating launches from now on? Second question, cost of construction. How do you see the price of raw materials?
Hi, Elvis, João. The changes in the low-income government housing program, it depends on the income range. In the income range close to the ones we have, BRL 4,000 , we can charge BRL 10,000 extra, and our intention is to increase the sale price, yes, in July. Our commercial area brought numbers that begin to show an increase in price. We want to increase the price to increase the margin. Concerning VSO, always balancing with VSO. Balance, we analyze project by project. We discuss this on a weekly basis, the results, to calibrate VSO versus margin.
But if we have to give priority, we have given priority to margin recovery. We have been able to increase prices by BRL 10,000. We have a plan that we prepared at the end of last year, so our pipeline is ready. We should not change the pipeline due to changes. We are maintaining the sustainable growth for the time being. I will pass the floor to Rodrigo for construction costs.
Thank you for the question. I do not have much else to say about this. What we feel is that prices are stabilizing. We are suffering a little still with cement. This helps a lot to have more foreseeability. In Plano&Plano, we have a basket of prices, and we compare this with the INCC index every month with every negotiation. Our cost today is below that of the INCC, so we are recovering price.
This price recovery has two components. First is productivity increase. We have made projects in a faster way with more efficient processes, producing the same quality in less time. On the other hand, obviously, a lot of work. We work hard talking to suppliers to lower prices, increase productivity, and our philosophy is loyalty and partnership. This helps a lot in difficult times. But in a nutshell, the worst is not over. What we feel now is that things are balanced in the short term. We do not know what will happen in the next three months. We never know. But comparing with the past, we are in a better situation. Plano&Plano has 40 projects within cost and on time. I can guarantee that we will have a good performance in operations.
Thank you, Rodrigo. Thank you, João.
The next question comes from webcast. Victor Junior, Portal Small Caps: After the increase in the margin, do you believe that gross margin will grow in Q3? How many launches do you have for Q3? Thank you.
The REF margin is an important indicator. Margin is affected by the evolution of construction costs. This is adjusted on a monthly basis. It depends also on price increases for raw materials in the next 45 days, so we cannot guarantee. But our expectation is that this turnaround in the REF margin will be a positive turnaround for gross adjusted margin too. This is our expectation, and we are working with the same plan we had at the beginning of the year. The second question, launches. As we said, we do not give an official guidance, but we are trying to deliver this year a growth in launches in relation to last year of a double-digit growth. We want to close the year with a growth above BRL 1.4 billion that we launched last year.
Thank you. Our next question also comes from webcast. Gustavo: My question has to do with the changes in the low-income government housing program. Do you have any forecast of when you will have benefits from the changes approved for group two of the program? Will you increase the prices of units sold?
Gustavo, thank you. At the end of July, the sales team began to use the new price lists. The impact is immediate, trying to recover price. Reminding you that we work in group two this year. We will launch 37% of VGV in group two, 53% in group three, 10% outside the low-income government housing program. So in group two and three, we are being able to charge BRL 10,000 more per unit. Now the idea is to increase prices, yes.
Thank you. The next question from webcast, Andre Santana: Have you seen a drop in construction costs?
Thank you, Andre. Yes, we've seen a drop in construction costs. Our strategy in curve A in our projects, we're trying to use parametric formulas for costs to really take advantage of this price drop. We know the weight of each item, each price. We have felt a drop in prices, but we're a little more certain for the short term. Thank you.
Thank you. Reminding you to ask questions, please dial asterisk one. You can also send your question in writing via webcast. Since there are no more questions, I'd like to pass the floor to Mr. Rodrigo Luna for his final comments.
Good afternoon. Thank you for participating in our conference call for Plano&Plano for Q2 2022. We continue reinforcing our attention in sustainable growth and long-term growth. A lot of attention to the market and consistency of our plan. We are sure that the most difficult times are behind us, and we are in line looking for recovery of margins and robust growth to deliver the margins that we delivered a few years ago. Thank you. Good afternoon.