MRV Engenharia e Participações (MRVE3) Q2 2025 earnings summary

Executive summary

• Industry environment is highly favorable, with federal, state, and local government support boosting customer purchasing power and improving housing program effectiveness.

• Operational KPIs and improvements in sales, production, and land acquisition are at historical bests, with ongoing enhancements and cost controls.

• Company is positioned as a leader in affordable housing, with a strong competitive edge and robust operational execution.

• Interim financial statements for the six months ended June 30, 2025, reviewed with no material modifications required by auditors, prepared in accordance with CPC 21 and IAS 34.

• Significant strategic actions included the sale of assets by subsidiary Resia and a major impairment loss related to assets reclassified as held for sale.

Financial highlights

• Net operating revenue for 1H25 was R$4.99 billion, up from R$4.19 billion in 1H24; 2Q25 revenue was R$2.71 billion, up from R$2.29 billion in 2Q24.

• Gross margin improved to 30.2%, up 0.6 p.p. from last quarter and 4.1 p.p. year-over-year.

• EBITDA at R$467 million, up 35% sequentially and 63% year-over-year.

• Adjusted net income was R$125 million, five times higher than Q1 2025 and 65% higher year-over-year.

• Consolidated net loss for 1H25 was R$1.20 billion, mainly due to a R$1 billion impairment from Resia asset sales.

Outlook and guidance

• Expectation of higher cash generation in H2 2025 as unit transfers outpace production.

• Guidance reaffirmed for cash generation and net income, with margin recovery and sales growth anticipated in H2.

• The Resia divestment and deleveraging plan is underway, targeting US$800 million in asset sales through 2026.

• Issued R$600 million in new debentures in August 2025 to strengthen liquidity and support ongoing operations.

• Launches in H2, especially Q3, expected to be strong with healthy margins.