By Brazil Stock Guide – MRV Engenharia e Participações SA, Brazil’s largest low-income residential developer, reported a rebound in first-quarter results, with adjusted net income at R$133 million and stronger cash generation as the company advanced asset sales in the US and benefited from improved operations in Brazil. The company trades on B3 under the ticker MRVE3.
The Belo Horizonte-based builder said in its 1Q26 earnings release that net operating revenue rose 18% from a year earlier, while gross margin increased 1.4 percentage points. MRV said first-quarter seasonality weighed on transfers, sales recognition and revenue, as a high concentration of March sales left a backlog of units to be transferred into the second quarter.
MRV&Co generated R$392 million in cash in the quarter, including R$117 million from its Brazilian real estate development arm and US$69 million from Resia, its US operation. The company said cash generation was driven by Resia asset sales under its deleveraging plan and by the performance of the Brazilian development business.
In Brazil, MRV’s real estate development division reported net revenue of R$2.56 billion in 1Q26, up 17.6% from a year earlier. Gross profit reached R$793 million, while EBITDA rose to R$476 million. Adjusted profit attributable to shareholders climbed to R$133 million from R$18 million a year earlier.
Operational indicators also improved. Net pre-sales in the MRV real estate development unit totaled R$2.47 billion, up 13.9% from 1Q25. Launches reached R$2.92 billion in potential sales value, while production stood at 9,747 units. In April, the company said built units rose 9.7% from the monthly average of 1Q26, and transfers increased 28.7%, indicating a stronger start to the second quarter.
Management said Brazil’s Minha Casa Minha Vida housing program is in “the best moment in its history,” citing rule changes that improved families’ purchasing power during the quarter. The company also said inflation risks tied to the war between the US and Iran led it to adopt more conservative assumptions in construction budgets, which prevented further gross-margin expansion in 1Q26.
MRV said reported gross margin should resume quarter-by-quarter expansion from 2Q26 after the budget revision was incorporated. The company said its strategy rests on lower land costs, optimized products, more efficient execution and price increases above inflation.
Resia remained central to MRV’s deleveraging plan. The US unit sold the Tributary development in Georgia for US$73.3 million and the Marine Creek and Tucker land plots for US$18.3 million. Total asset sales in 1Q26 reached US$91.5 million, equivalent to R$480 million. MRV said Resia has sold US$241 million of an approximately US$800 million asset-sale pipeline.
The company’s Brazil net debt-to-annualized EBITDA ratio declined to 1.30 times in 1Q26 from 1.71 times a year earlier and 3.46 times in 1Q24. MRV also reported an S&P Global Ratings brA+ rating and said it remained within its debt and receivables covenants.
Other units showed mixed performance. Urba, MRV’s land-development subsidiary, was affected by seasonality and higher cancellations in the quarter, though the company said the impact should reverse as early as the next quarter. Luggo, MRV’s multifamily Brazil operation, had three completed developments nearing stabilization and available for future sale, with no new projects to be started unless previously sold.
Leave a Reply