Good afternoon, everyone, and thank you for waiting. Welcome to BR Properties second quarter of 2022 results conference call. With us here today we have Martin Jaco, CEO, and André Bergstein, CFO and IR officer. This event is being recorded and all participants will be in a listen only mode during the company's presentation. After BR Properties remarks, there will be a question and answer session. At the time, further restrictions will be given. Should any participant need assistance during this call, please press star zero to reach the operator. This event is also being broadcast live via webcast and may be accessed through BR Properties website at http://www.brpr.com.br/ir, where the presentation is also available. Participants may view these slides in order they wish. The replay will be available shortly after the event is concluded. Now I will turn the conference over to Martin Jaco. Please go ahead. Thank you and good afternoon to everyone, and thanks for your presence and your interest in the earnings release of the second quarter 2022 of BR Properties. In terms of the dynamic of this call, I'll make a brief introduction with the main highlights and followed by André with the detailing of the results of the second quarter 2022, and we'll leave enough time for the Q&A session. Let me start with introduction and main highlights. Let me stress that I would like to separate the introduction in two different parts. One part much more related to the day-to-day operational of the company and the second part related to the sale of assets, which is really a unique event that we have and has a lot of effects in the company. Going to the first part, only focus on the operational results of the second quarter 2022. The company continued its recovery, according to plan and according to what we had informed previously in the previous call to the market. Since we were seeing a recovery in our occupancy as the same thing that we did during the pandemic period that our properties continued to be leased and occupied. We had a net income of around BRL 98 million, which represents a 25% increase compared to the same quarter of 2021. This is due to the lease activity that we have in the previous quarter, that its effect was only perceived now in the second quarter, and that's what we have said. I mean, there's been a lot of activity. Those who follow us for a longer time have been a lot of activity that we announced in terms of lease, and now those leases are having the effect in the quarter's results. 25% increase, which is a fantastic number, and therefore we have an EBITDA with a 22% increase in the same period, equaling BRL 67 million. Operation of the company did very good. The part that really was worrying us, and we announced that, was the financial cost that the company had due to its finance. Remember the last year we started saying that we will address this issue probably with the sale of assets, and that's exactly what we did. I'm gonna talk about it on the second part and André's gonna detail it. The financial expenses, in fact, it all took almost away all the results that we have in EBITDA margins. FFO margins became something close to BRL 4 million, BRL 3.7 million. Although higher than what was the expectations of the market as a whole, of course, the financial cost made a huge toll in the company. From the vacancy point of view, we had a marginal reduction in the same quarter, thus proving not only the quality of the assets, the quality of the portfolio, but the operational capacity that the company have of continually using continuous operation throughout in very uncertain times. This is just related specific to the operational results. Now the second part, I'm gonna turn to the sale of assets. Just to recall, we did the sale of 12 assets at a total of BRL 5.9 billion. That was concluded in July 2022, therefore after the second quarter of this year. It's a very important event that we wanted to address in this quarter, not to leave in the third quarter, which will be, in our opinion, too much ahead. The transaction was concluded entirely. It is considered the largest transaction of direct sale of assets in Brazil. It shows the high capacity of the company of carrying out the great operations. As we did throughout the 15 years of existence of the company, sales, acquisitions and sales, acquisitions and sales is something that's really in our DNA, and we did it constantly. 7% of all the resources were received, and with those 70% received, we did the following. Number one, we attacked the financing issue. Almost the gross debt that was close to BRL 3 billion was almost entirely paid. Only remaining BRL 240 million to be paid in the beginning of September. Therefore, a completely unleveraged company today, so we don't have the bad effect of the high interest rates financing in our company anymore. The second point that we addressed with these resources, and we announced it to the market, and we did, was the return of capital to our shareholders. On July 28, we did a general assembly that approved the capital reduction of the company, and there will be a distribution equivalent to BRL 2.42 per share, around September 30, which will become available those resources to our shareholders. After all this transaction and all this movement, the remaining portfolio, the remaining company comprises BRL 2.3 billion in assets, all Triple- A assets, office and logistics space with a vacancy below 3%. That is to say only prime properties, completely unleveraged company with high levels of occupancy, more than 97%. Therefore, we expect with this portfolio coming with very important and aggressive operational results. It's good to bear in mind that's a common question that we have usually regarding, okay, what about your SG&A costs after this transaction. Well, we just like to remember that the higher cost that we have in the SG&A was vacancy cost. We sold with this transaction 100,000 m ² of vacant office. Therefore, the reduction of SG&A, it's already perceived and will be perceived in the next quarter following the sale of the assets. This is the first part about the operational. The second part about the sale of assets. The only thing that I just want to add is about the ESG program. We've been acting on ESG front since the inception, since the creation of the company. We're about to release, to communicate in a better format to the market. We're gonna present our first formal report to the market. It's still on August, so some days ahead, we will all receive, and we'll be more than pleased to discuss that with you ahead of us. This is the first introduction, main highlights, and I'd like to pass the word now to André to make the detailing of the results. André, thank you. Hello. Thank you very much, Martin. Well, good morning. Good afternoon, everyone, and thank you for being here with us. I will split the highlights in two parts. First, talking about operational performance before the sale transaction, and secondly, about the impacts of the transaction itself. In the second quarter, the net revenue was BRL 98 million, up 25% versus the same quarter of last year. First half of the year, revenue was BRL 181 million, 13% up, 2021, as Martin mentioned. I think it's worth mentioning that 20,000 m² in new lease agreement signed between the end of 2021 and beginning of this year, as well as the corresponding revenues from Galpão Centauri, 63,000 m², were accounted in the second quarter results, explaining most part of this significant increase. The remaining part was explained by inflation. In the second quarter, the average rent per square meter per month of the same commercial property portfolio was nominally up 9.8% in the last 12 months, and the average rental growth by 1.1% versus the first quarter of this year. This comparison includes all tenant movements in the properties, tenants that were coming in, tenants that were leaving. Considering only inflation adjustments, it was pretty in line with IPCA and IGPM. Another interesting point to note is that today we have around 53% of agreements with IPCA and 47% with IGPM. Looking behind us before the pandemic, we had 90% of IGPM and only 10% IPCA. What I feel is that it's totally for sure it's a trend that we will have each time more IPCA than IGPM, which personally I think it's correct for the real estate market. In the Q2, G&A expenses excluding vacancy expenses, stock options plan and taxes amounted BRL 16.7 million, 19% up versus the same period of last year. This increase is explained by the effect of inflation on the company's general expenses, mainly, because of the impact of the salary readjustment, the dissídio, as we say in Portuguese, okay, on the payroll of 11%, starting in May 2022. Last year, this readjustment, the collective wage agreement, occurred only in the second half of the year, which generates some kind of distortion when we compare the two periods. The Adjusted EBITDA of this quarter, excluding non-cash results, totaled BRL 67 million, up 22% versus the second quarter. The margin achieved 69% in the quarter. Year to date, adjusted EBITDA was BRL 121 million, 5% more than the first six months of 2021. In the second quarter also, we had adjusted net financial expenses of BRL 63 million, a nominal increase of around BRL 35 million when compared to the same period of the previous year. Year-t o- date, this expense reached around BRL 120 million, BRL 72 million more than this first half of last year. This result, as you know, is explained mainly by the increase in the Selic interest rate. The increase comparing, I mean, last year at the same moment with this year, came from 2%- 13.25%, now 13.27%. A very, very huge increase. The FFO with the quarter totaled BRL 3.7 million, 86% down when compared to the second quarter of 2021, okay. I think it's interesting to say that last quarter, the first quarter of the year, it was a negative of BRL 1.4 million. It came to a positive side, the BRL 3.7 million that I mentioned, mainly because we are able to manage EBITDA in order, revenues and EBITDA in order to have an increase, which is higher than the increase of the financial expenses, which was around 15%. As we mentioned, 24% quarter-to-quarter compared to the first quarter increase in EBITDA and 15% increase in financial expenses. It was a good increase comparing to last quarter. On April 7, the amount of BRL 7.6 million was credited to shareholders as dividends based on 2021 results. We also approved on the AGM of April the distribution of dividends in the amount of BRL 41 million additional amount, okay, equivalent to BRL 0.089 per share. This amount is being paid in three installments, the first one already done in June. The other two are going to be paid in September and December. Since last year, we have been working on the ESG practice and report, okay. That we could put in a report to the shareholders, to all stakeholders, what we have been doing in terms of social governance and environmental practice. It has been a very good work and with a lot of stakeholders taking part of that, answering questions, giving opinions, okay. We have buy side, sell side, we have the management, we have all the employees, we have suppliers. A very good work that has been developed. Finally, now in August, we're going to deliver to the market our first report. We are very anxious with that. I hope you like it. Talking about the sale transaction. On July 21, one day after the conclusion, the closing of the transaction, we were able to pay almost BRL 1.2 billion of debt, referring to the outstanding balance of the debts that were that used to have the properties as collateral, okay. Until today in August, so far, we were able to amortize another BRL 1.5 billion. From July 21st to August 12, we were able to pay BRL 2.7 billion of total debt. We only have another BRL 240 million of debt that are still due. You know, the cost of this specific debt is 101% of Selic. Somehow it has a positive carrying, and we're going to be paying this last debt until September. In terms of the results, you know, we had a net loss on the quarter of almost BRL 1.5 billion. I think it's easier to explain to you splitting in three big lines. The first one is the gain or loss on appraisal of investment properties. As you know, we sold the properties with a 14% discount over the book value of those properties. In nominal terms, this means almost BRL 1 billion. Apart from that, we had around BRL 121 million of straight-line rent that the write-off of that, and also the provision of the minimum guarantee rent that we closed with Brookfield regarding Ventura and Parque da Cidade of around BRL 108 million. Those lines explain the BRL 1.25 billion of loss in the appraisal of investment properties. We had also the write-off in the intangible assets of around BRL 550 million, and the reversal of the deferred taxes because of the adjustment in the fair value of the properties of around a positive amount of BRL 426 million. Those were the three main lines that took our results to BRL 1.4 billion-BRL 1.5 billion, all of them that came and were booked because of the transaction. Well, I think those are the main highlights of this quarter. A very important one with the transaction, okay? All the effects of the transaction. We had a lot of work to be able to reflect all of these in this quarter. Although we had, you know, the transaction being closed by July 20th, and we are presenting financial statements of June 13th. All the understanding was that we had to show to the market and affect the balance sheet with all the movements related to the transaction, so in order to be clear for all the investors. Thanks very much for your presence. We're now going to go to the Q&A. Again, thanks very much and we are here pleased to answer your questions. The floor is now open for questions. If you have a question, please press Star One on your touchtone phone at this time or any time. If at any point your question has been answered, you may remove yourself from the questioning queue by pressing Star Two. Questions will be taken in order they are received. We do ask that when you pose your question that you pick up your headset to provide optimal sound quality. Please hold while we pull for questions. As a reminder, if you have a question, please press Star One. This concludes today's question and answer session. I would like to invite Mr. Martin Jaco to proceed with his closing remarks. Please go ahead. Thanks everyone for your presence and interest. As usual, any doubt or clarification need arises, we'll be at your entire disposal. Thank you very much. Have a nice weekend, everyone. That just concludes BR Properties conference call for today. Thank you very much for your participation, and have a nice day.
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