Gafisa S.A.

Gafisa reported gross inventory sales of R$970 million in 2023, up 21% year over year, and net revenue of R$1.1 billion despite no product launches during the year. The company said SG&A totaled R$153 million, down 12% year over year, and debt was down 12% year over year; it also said total receivables were R$1.3 billion at year-end. Management said the company ended 2023 with an adjusted net profit of R$48 million in the fourth quarter, though the full-year result reflected high interest rates, cost inflation, asset sales, and delayed launches. For 2024, Gafisa said it will deliver 8 projects, with average unit sales of 90% across them, which it believes supports receivables and cash generation.

Sheyla Resende framed 2023 as a challenging market year marked by high interest rates and weak growth, but said Gafisa stayed disciplined by reducing expenses, cutting non-strategic projects, and completing planned works. She emphasized that the company kept focus on reducing medium and mid-high income inventory and strengthening its high-end positioning, while using the year to absorb benefits from the strategic master plan review. Her tone was cautious but constructive, with confidence that the portfolio reset and lower cost base should support 2024.

Luis Fernando Ortiz focused on execution and efficiency: inventory sales were up 21% year over year even without launches, while SG&A fell to R$153 million, down 12% year over year. He said inventory was reduced 42% year over year, with the mix now 91% high-income and 9% mid-income, and noted that six projects were delivered in 2023 totaling PSV of R$559 million in 238 units, with 95% sold at year-end. He also highlighted a 12% year-over-year debt reduction, said 95% of debt relates to projects in progress and on schedule, and pointed to the São Paulo master plan changes as a meaningful uplift to land-bank value, including more than 50% PSV increases in some assets.

Analysts asked about the impact of older inventory vintages, cash generation in 2024, the decision not to launch in 2023, and ESG efforts. Management replied that inventory sales were strong even without launches, citing a 21% year-over-year increase and 59% SoS in residential in São Paulo, and said 2024 inventory turnover should remain similar with a more favorable macro backdrop. On cash generation, Sheyla said the company has 8 projects to deliver in 2024 and average unit sales of 90%, which provides good predictability for receivables. On ESG, management highlighted ISE B3, CDP Clima, Great Place to Work, and Época 360 governance recognition as evidence of ongoing commitment.