2q12 disclosure and results

1

Earnings Release | Conference Call – 2Q12

August 7th 2012

2

Agenda

Ricardo Ribeiro

Vice President

Carlos Wollenweber

CFO | IR Officer

2Q12 Main Figures and

Operating Highlights

Financial Highlights

2Q12 2Q11 D %

Launched PSV% Direcional

BRL million 470 288 +63%

Contracted PSV% Direcional

BRL million 448 169 +165%

Sales Over Supply (VSO) % PSV 36,5% 18,5% +18 p.p.

Net Revenues BRL million 323 245 +32%

Adjusted Net Income¹ BRL million 49 41 +21%

Adjusted Net Margin¹ % 15,2% 16,6% -1,4 p.p.

Main Figures

3

1. Adjusted by non-cash expenses (Stock-Options Program).

1H12 1H11 D %

Units Launched 6,151 3,536 +74%

Delivered Units 2,726 1,581 +72%

Units Under Construction 39,972 27,389 +46%

% of Industrialization (# of units) 55% 32% +23 p.p.

Construction Sites 40 35 +14%

Average # of Units by Construction Sites 999 783 +28%

# of Cities 10 9 +11%

4

1H12 vs 1H11 Operating Figures

Focus on Industrialization

63% 60% 49% 44% 41% 35%

50%

2Q12

55%

9%

1Q12

44%

9%

4Q11

48%

8%

3Q11

7%

2Q11

32%

8%

1Q11

28%

9%

Units Under Construction by Construction Method

(% of Units)

1 Aluminum mold and concrete walls method

Industrial Construction¹Concrete BlocksConventional Structure (Concrete Pillars)

5

Minha Casa, Minha Vida Level 1

On the second quarter, Direcional signed an agreement with the State of Rondônia and Banco do Brazil for the construction of “Residencial Orgulho

do Madeira” project in Porto Velho with PSV of BRL 259.0 million.

# Units

Segment

Housing PSV

Infrastructure PSV

4,000

MCMV Level 1

BRL 219.5 million

BRL 39.5 million

Total PSV BRL 259.0 million

Location“Residencial Orgulho do Madeira”

Launch 2Q12

Porto Velho - RO

6

Operating Highlights

Launches

Sales

Delivered Units

Land Bank

Inventory

Operating HighlightsRicardo Ribeiro

Vice President

Total

(BRL'000)

% Direcional

(BRL'000)

1 Splendore April Manaus - AM 83,805 83,721 160 160 Upper-Midle

2 Silvestre 3rd phase April Rio de Janeiro - RJ 12,674 10,393 140 500 RET1%

3 Del Mar April Macaé - RJ 31,024 15,512 132 132 Medium

4 Grand Ville 2nd phase April São Bernardo - SP 56,749 43,980 264 528 Medium

5 Veredas Vistas do Horizonte May Belo Horizonte - MG 44,514 22,257 164 164 Medium

6 Monte Rey Hotel June Belo Horizonte - MG 44,196 35,357 200 671 Commercial

7 Orgulho do Madeira June Porto Velho - RO 258,988 258,988 4,000 4,000 MCMV Level 1

Total 2Q12 531,950 470,208 5,060 6,155

Total Units

(All Phases)Segment

# of Units

Launched2Q12 Projects Date City - State

PSV

7

Launches

Launched PSV

(BRL million)

Launched PSV – Track Record

(BRL million)

143

131

131

470

+228%

613+20%

+63%

1H12

354

259

1H11

643

511

2Q12

211

259

1Q122Q11

419

288

613783710

176

1,067

CAGR +69%

1H122011

1,447

2010200920082007

Development

MCMV Level 1

Project Acquisition

MG

Launches Breakdown

8

AM

17%

18% 14%30% 20% 13%

8%

1H12

42%

18%

13%

1H11

36%

35%

9%

2Q12

55%

2%17%

2Q11

41%

13%

Launches by Segment

(% PSV)

Launches by Region

(% PSV)

28%

1H12

62%

10%

1H11

56%

34%

10%

2Q12

73%

27%

2Q11

66%

34%

NorthSoutheastMidwest

MCMV Level 1

Low-Income

Medium

Upper Middle

Commercial

RJ

3

5

1

6

2

SP

4

RO

7

Sales

Contracted Sales

(BRL million)

Sales Track Record

(BRL million)

133

89

89

+165% 448

+238%

580+69%

1H12

321

259

1H11

433

344

2Q12

189

259

1Q122Q11

258

169

Development

MCMV Level 1

Project Acquisition

580661

441

127

2010

1,037

200920082007

CAGR +76%

1H122011

1,230

9

17%

12%

10%

1H12

45%

21%

22%

7%5%

1H11

30%

49%

10%

2Q12

58%

15%

17%6% 4%

2Q11

24%

47%

MCMV Level 1

Low-Income

Medium

Upper-Middle

Commercial

Sales by Economic Segment

(% PSV)

Sales by Region

(% PSV)

20% 22%

1H12

73%

22%

5%

1H11

40%

38%

2Q12

80%

16%5%

2Q11

48%

32%

North

Southeast

Midwest

10

Sales Speed

2Q12

36.5%

21.2%

1Q12

16.1%16.1%

4Q11

31.8%

18.5%

3Q11

36.7%

16.0%

2Q11

18.5%18.5%

With MCMV Level 1 project

Without MCMV Level 1 project

Sales-Over-Supply Ratio (VSO)

(In total PSV - %)

2%

3Q11 95%90%

2%

2%

1%

4Q11 93%85% 6%

1%1Q12 61%10% 51%

2Q12 88%

2Q11 77%20% 20% 18% 16%

3 M 6 M 9 M 12 M 15 M

32%

18%

201116%

20106%

<2010

2Q12

28%

1Q12

Sales by Period of Launching - 2Q12

(% PSV – Ex MCMV Level 1)

Sales Speed

(% Units)

68% of the sales in the 2Q12 refer to sales of inventory

launched before 2Q12

18% of the sold PSV refers to units launched before 2010

Total

(BRL'000)

% Direcional

(BRL'000)1 Weekend Club Ponta Negra February Manaus - AM 90,960 72,768 427 Medium

2 Total Ville Manaus - Harmonia February Manaus - AM 50,050 50,000 512 Low-Income

3 Riviera Residencial Clube February Porto Velho - RO 31,800 25,440 82 Upper-Middle

4 Total Ville Bella Città - Salinas March Marituba - PA 61,875 61,869 598 Low-Income

Total 1Q12 234,685 210,077 1,619

5 Total Ville Marabá - 1st Phase April Marabá - PA 57,140 57,134 524 Low-Income

6 Garden Club - 2nd Phase June Porto Velho - RO 19,641 15,712 215 Low-Income

7 Setor Total Ville - 1st Phase June Santa Maria - DF 39,146 39,142 368 Low-Income

Total 2Q12 115,926 111,989 1,107

Total 1H12 350,612 322,066 2,726

# Units SegmentDelivered Projects - 1H12 Date City - StatePSV

11

Delivered Projects – 1H12

Delivered Projects

(2011 e 1H12)

2,726

322

+6%

1H12

1,887

2011

305

# Units PSV (Millions)

2 3

74 5 6

1

12

Land Bank

58.6% large scale projects (over 1,000 units)

74.5% are eligible for the MCMV Program

75.6% acquired by physical or financial Swap

Average cost of 9.2% over PSV

BRL 6.9 Billion

66,859 units

Land Bank by Segment

(% PSV)

Land Bank 2Q12 vs 1Q12

(BRL million in PSV)

211

111616,895

-39

2Q12LaunchesReview of

Assumptions

Acquired

Land Bank

1Q12

6,934

Land Bank by Region

(% PSV)

In the 2Q12 Direcional

acquired two plots of

land, with PSV of BRL

160.8 million

Type of Payment

(2Q12 – % PSV)

ES1%

AM13%

MG39%

RO5%

SP6%

PA13%

DF20%

RJ1%

GO2%

Swap

95.3% Cash4.7%

Commercial4%

Upper-Midle

7%

Medium35%

Low-Income

54%

Total % Direcional

Under Construction 742,809 647,327 90.2% 3,109 90.5%

Finished Units 88,548 70,360 9.8% 326 9.5%

Total 831,356 717,687 100.0% 3,435 100.0%

InventoryPSV in Inventory (BRL'000)

% Units in Inventory %

13

Inventory

Only 9.8 % of the inventory are finished units

91.2% of the units under construction have already been sold

2Q12

18.4%

1Q127.0%

2011

36.3%

201017.5%

<201010.9%

Finished Units

9.8%

14%Midwest

Southwest 24%

North 62%

Inventory by Region

( % PSV)

Inventory by Aging

(% PSV)

14


Cash Burn


Capital Structure

Deferred Results

DIRR3 Stock Analysis

Financial HighlightsCarlos Wollenweber

CFO | IR Officer

1S12 2011 D %

R$ Million (a) (b) (a/b)Gross Debt 626.2 473.2 32.4%

Cash 342.3 351.1 -2.5%

Net Debt 283.9 122.0 132.6%

Equity 1,331.4 1,232.5 8.0%

Net Debt/Equity 21.3% 9.9% -11.4 p.p.

Receivables ( 1 + 2 ) 1,347.4 1,156.4 16.5%

Development (1) 1,214.6 1,044.3 16.3%

Receivable from Finished Units 376.9 241.6 56.0%

Receivable from Units Under Construction 877.5 835.4 5.0%

(-) Present Value of Account Receivables (IFRS) -39.8 -32.8 21.5%

Services (2) 132.8 112.1 18.4%

15

1H12 Cash Performance

Cash Burn

(1H12 - BRL million)

Cash Burn Net

of "Repasses"

-14.9

Account

Receivables

Variation from

Finished Units

135.3

Cash Burn

Ajusted by

Dividends

120.4

Dividends

41.5

Net Debt

Variation

161.9

Cash

Generation+21%

100.1

2Q121Q12

82.9

Financing Transfer (“Repasses”)

(BRL million)

D Net Debt

BRL 162 million

D Receivable

from Finished

Units

BRL 135 million

16


651

479

323327

245

+32.2%+36.0%

1H121H112Q121Q122Q11

CAGR +80%

1H12

651

2011

1,072

2010

782

2009

378

2008

263

2007

102

Net Revenue

(BRL million)

Net Revenue – Track Record

(BRL million)

2115

+78.4% +75.6%

1H12

201

30%

1H11

114

23%

2Q12

31%

1Q12

98

29%

103

4Q11

82

27%

3Q11

72

24%

2Q11

58

23%

1Q11

57

24%

4Q10

48

18%

3Q10

33

15%

2Q10

12%

1Q10

10%

Revenue from Services – Track Record

(BRL million)

MCMV Level 1

98.5% Brokerage Fee

1.1%

Management Fee

0.4%

Breakdown of Revenue from Services

(in 2Q12 - %)

Service Revenue% of Gross Revenue

2Q12 1Q12 1H12 2011

Adjusted Gross Margim from Developments¹ 35% 33% 34% 33%

Share (%) 69% 71% 70% 76%

Gross Margin from Sevices 22% 24% 23% 25%

Share (%) 31% 29% 30% 24%

17

130

15

30.3%

2Q12

99

87

12

30.6%

1Q12

+35.7%

88

11

30.2%

2Q11

73

64

9

29.8%

+0.2%198 +36.4%

1H12

175

23

30.4%

1H11

145

99

Interest Capitalised in costsAdjusted¹ Gross Margin Gross Profit


Adjusted¹ Gross Profit

(BRL million)

1. Gross Margin Ex-SFH: excluding interest expenses;

18


Adjusted¹ G&A

(BRL million)

Sales Expenses

(BRL million)

2324

16

23

1716

7.3%

4Q11

5.4%

3Q11

7.8%

2Q11

7.1%

1Q11

6.9%

2Q12

7.0%

1Q12

1099

67

5

2Q12

3.0%

1Q12

2.6%

4Q11

3.1%

3Q11

2.0%

2Q11

3.1%

1Q11

2.1%

Sales Expenses% Net RevenueAdjusted¹ G&A% Net Revenue

142106

717148

+33.6%

+46.5%

1H12

21.8%

1H11

22.1%

2Q12

21.9%

1Q12

21.6%

2Q11

19.7%

Adjusted¹ EBITDAAdjusted¹ EBITDA Margin

Adjusted¹ EBITDA

(BRL million)

10491495441

+21.2%

+13.5%

-9.8%

1H12

15.9%

1H11

19.1%

2Q12

15.2%

1Q12

16.6%

2Q11

16.6%

Adjusted¹ Net Income

(BRL million)

Adjusted¹ Net IncomeAdjusted¹ Net Margin

1. Adjusted by non-cash expenses (Stock-Options Program).

2Q12 1Q12 2Q11 D % D %

(BRL million) (a) (b) (c) (a/b) (a/c)

Debt 626.2 556.6 408.6 12.5% 53.3%

SFH 516.9 492.8 341.3 4.9% 51.4%

Securitization 25.6 30.1 37.2 -14.9% -31.2%

Receivables Assigned 49.3 - - n/a n/a

FINAME and others 13.8 13.7 9.1 1.0% 51.3%

Working Capital 20.5 20.0 21.0 2.5% -2.0%

Cash 342.3 364.1 381.8 -6.0% -10.3%

Net debt 283.9 192.5 26.9 47.5% 956.9%

Net debt / Equity 21.3% 14.8% 2.3% 6 p.p. 19 p.p.

19

Capital Structure

Working Capital

3.3%

FINAME and Others

2.2%

Receivables Assigned

7.9%

Securitization

4.1%

SFH 82.5%

Debt Breakdown Total Debt - SFH

(BRL million)

Cash

-233.0

Net Cash ex-FH

342.3

SFH

516.9

Gross Debt

626.2

2Q12 1Q12 2Q11 D % D %

(BRL million) (a) (b) (c) (a/b) (a/c)

Consolidated Deferred results (1+2) 551.4 552.7 413.5 -0.2% 33.4%

Deferred results - Margin 37.2% 38.5% 38.2% -1.4 p.p. -1.2 p.p.

Deferred results - Development (1) 300.5 342.6 314.0 -12.3% -3.8%

Margin 40.7% 42.0% 43.2% -1.3 p.p. -2.5 p.p.

Deferred results - MCMV Level 1 projects (2) 250.9 210.0 101.0 19.5% 148.5%

Margin 33.7% 33.9% 28.5% -0.3 p.p. 5.1 p.p.

20

Deferred Results

Schedule of Deferred Results

(%)

2015

0.7%

2014

4.2%

2013

60.2%

2012

34.9%

Deferred Results

(BRL million)

+33.4%

-0.2%

2Q12

551

301

251

1Q12

553

343

210

2Q11

413

312

101

MCMV Level 1 projects

Development

D irecio nal IB OV IM OB

Last 10.50 58,345 838

Quarter -5.2% -15.7% -13.8%

Half Year 5.2% -4.2% 2.7%

In 2012 -2.1% -8.0% -7.3%

12 Months 1.1% -0.3% -0.4%

21

Shares Performance Since IPO

22

Disclosure

This presentation contains certain forward-looking statements concerning the business prospects,

projections of operating and financial results and growth potential of the Company, which are based on

management’s current expectations and estimates of the future performance of the Company. Although the

Company believes such forward-looking statements are based on reasonable assumptions, it can give no

assurance that its expectations will be achieved. Expectations and estimates that are based on the future

prospects of the Company are highly dependent upon market behavior, Brazil’s political and economic

situation, existing and future regulations of the industry and international markets and, therefore, are

subject to changes outside the Company’s and management’s control. The Company undertakes no

obligation to update any information contained herein or to revise any forward-looking statement as a result

of new information, future events or other information.

23

Contacts

Carlos WollenweberCFO | IR Officer

Paulo SousaIR Analyst

Cristiano FariaIR Analyst

www.direcional.com.b/ri

[email protected]

(55 31) 3214-6200

(55 31) 3214-6450

2q12 disclosure and results

Investor Relations