Gafisa Group Reports Results for 1Q13

  Gafisa Group Reports Results for 1Q13

Business Wire

SÃO PAULO -- May 13, 2013

Gafisa S.A. (Bovespa: GFSA3; NYSE: GFA), Brazil’s leading diversified national
homebuilder, has reported financial results for the first quarter ended March
31, 2013.

First quarter financial results can be found on the Company’s website
(www.gafisa.com.br/ir) and with the Brazilian Comissao de Valores Mobiliarios
(CVM).

  *Launches totaled R$308 million in 1Q13, a 34% year-over-year decrease, and
    were broadly in keeping with the proportion of full-year launches
    historically occurring in the first quarter
  *The Tenda brand was relaunched under its new business model and accounted
    for 37% of launches
  *Pre-sales totaled R$218 million and gross sales reached R$700 million in
    1Q13
  *Inventory at market value declined R$119 million to R$3.5 billion on a
    sequential basis
  *Gafisa Group delivered 9 projects/phases encompassing 1,300 units during
    the first quarter, a 79% decrease compared to 1Q12
  *Revenue, recognized by the “PoC” method, decreased 20% year-over-year to
    R$669 million in 1Q13
  *Adjusted EBITDA was R$68 million in 1Q13, compared to R$100 million in
    1Q12
  *Operational cash flow was positive at R$122 million in 1Q13, resulting in
    cash burn of R$89 million

Duilio Calciolari, Chief Executive Officer, said: “Market conditions were
stable in the first quarter and results are in keeping with seasonally lower
activity. The high volume of deliveries in the second half of 2012 resulted in
increased first quarter sales cancellations, however we are making steady
progress on the resale of these units to qualified customers. Inventory sales
represented 65% of total sales as we continue to focus on inventory reduction
initiatives. Cash generation was impacted by lower launch volumes and
expenditures linked to land bank acquisition.”

“Our focus in 2013 is on profitable growth in order to capture the full
potential of the Gafisa Group’s new operating structure. Accordingly, the
relaunch of the Tenda brand under a new business model is proceeding in line
with plan. Two projects were launched in São Paulo and Salvador in the first
quarter, with sales contingent upon the transfer of mortgages to financial
institutions. The brand’s relaunch forms part of the Company’s reinvestment
strategy that will expand medium and long-term profitability. Results continue
to be impacted by the resolution of Gafisa segment legacy projects launched in
non-core markets and the majority of the remaining Tenda projects.”

Operating and Financial Highlights – (R$000, unless otherwise specified)
                                                              
               1Q13         4Q12          QoQ(%)    1Q12          YoY(%)
Launches        307,553      1,489,760     -79%      463,740       -34%
(%Gafisa)
Launches         391,690       1,780,811      -78%       568,046        -31%
(100%)
Launches,
units            1,617         5,120          -68%       1,283          26%
(%Gafisa)
Launches,        2,003         6,695          -70%       1,667          20%
units (100%)
Contracted
sales            218,281       905,241        -76%       408,237        -47%
(%Gafisa)
Contracted       255,929       1,202,068      -79%       507,213        -50%
sales (100%)
Contracted
sales, units     831           3,097          -73%       502            66%
(% Gafisa)
Contracted
sales, units     1,076         4,203          -74%       900            20%
(100%)
Contracted
sales from       76,276        760,410        -90%       222,944        -66%
Launches
(%co)
Sales
Velocity         5.9%          20.0%          -71%       10.4%          -44%
(VSO) %
Completed
Projects         172,590       1,327,531      -87%       1,106,806      -84%
(%Gafisa)
Completed
Projects,        1,300         9,378          -86%       6,165          -79%
units
(%Gafisa)
                                                              
Consolidated
Land bank        0             18,668,669     -100%      16,759,355     -100%
(R$)
Potential        0             87,742         -100%      83,124         -100%
Units
Number of
Projects /      0            123           -100%     59            -100%
Phases
                                                              
Net revenues     668,591       815,071        -18%       831,684        -20%
Gross profit     158,276       221,360        -28%       176,672        -10%
Gross margin     23.7%         27.2%          -349       21.2%          243
                                              bps                       bps
Adjusted
Gross Margin     28.8%         30.67%         -6%        25.4%          13%
¹
Adjusted         67,886        32,842         107%       100,335        -32%
EBITDA ²
Adjusted                                                                -191
EBITDA margin    10%           4.0%           612 bps    12%            bps
²
Adjusted Net
(loss) profit    -40,583       - 78,742       -48%       -18,187        123%
²
Adjusted Net     -6.1%         -9.7%          359 bps    -2.2%          -388
margin ²                                                                bps
Net (loss)       -55,473       - 98,875       -44%       -31,515        76%
profit
EPS (loss)       -0.1285       -22.9%         1000       -0.0729        -556
(R$)                                          bps                       bps
Number of
shares ('000     431,630       432,630        0%         432,099        0%
final)
                                                              
Revenues to      3,309,913     3,676,320      -10%       3,562,048      -7%
be recognized
Results to be    1,289,503     1,449,745      -11%       1,261,061      2%
recognized ³
REF margin ³     38.96%        39.4%          -48 bps    35.40%         356
                                                                        bps
                                                              
Net debt and
investor         2,485,372     2,396,388      4%         3,088,885      -20%
obligations
Cash and cash    1,443,644     1,567,755      -8%        847,121        70%
equivalent
Equity           2,489,357     2,544,504      -2%        2,623,135      -5%
Equity +
Minority         2,644,543     2,694,888      -2%        2,716,976      -3%
shareholders
Total assets     8,530,374     8,714,662      -2%        8,768,668      -3%
(Net debt +
Obligations)    94%          89%           506 bps   114%          -1971
/ (Equity +                                                             bps
Minorities)
Note: Unaudited Financial Operational data
1) Adjusted for capitalized interest
2) EBITDA Earnings before interest, tax, depreciation and amortization. EBITDA
Adjusted for expenses on stock option plans (non-cash), capitalized interest
and minority shareholders
3) Results to be recognized net of PIS/Cofins - 3.65%; excludes the AVP method
introduced by Law nº 11,638
4) Note: During 2Q12, Tenda land bank was readjusted to focus on core regions,
3Q12 all remaining non-strategic land bank were excluded
Nm = not meaningful

About Gafisa

Gafisa is a leading diversified national homebuilder serving all demographic
segments of the Brazilian market. Established over 57 years ago, we have
completed and sold more than 1,000 developments and built more than 12 million
square meters of housing only under Gafisa’s brand, more than any other
residential development company in Brazil. Recognized as one of the foremost
professionally managed homebuilders, "Gafisa" is also one of the most
respected and best-known brands in the real estate market, recognized among
potential homebuyers, borrowers, lenders, landowners, competitors, and
investors for its quality, consistency, and professionalism. Our pre-eminent
brands include Tenda, serving the affordable/entry level housing segment, and
Gafisa and Alphaville, which offer a variety of residential options to the mid
to higher-income segments. Gafisa S.A. is traded on the Novo Mercado of the
BM&FBOVESPA (BOVESPA:GFSA3) and on the New York Stock Exchange (NYSE:GFA).

Contact:

Investor Relations:
Gafisa S.A.
Luciana Doria Wilson
Phone: +55 11 3025-9297 / 9242 / 9305
Fax: +55 11 3025-9348
ri@gafisa.com.br
www.gafisa.com.br/ir
or
Media Relations:
Máquina da Notícia Comunicação Integrada
Fernando Kadaoka
Phone: +55 11 3147-7498
Fax: +55 11 3147-7900
fernando.kadaoka@maquina.inf.br