Homex Delivers Solid Q-1 2011 Revenue Growth of 14.1 Percent in Line With 2011 Guidance

CULIACAN, Mexico, May 2, 2011 /PRNewswire/ -- Desarrolladora Homex, S.A.B. de C.V. ("Homex" or "the Company") [NYSE: HXM, BMV: HOMEX] today announced Consolidated Financial Results for the First Quarter ended on March 31, 2011(1).

Financial Highlights

• Total revenue in the first quarter of 2011 increased 14.1 percent to Ps. 4.1 billion (US$344 million) from Ps.3.6 billion (US$301 million) for the same period in 2010.

• Gross margin for the quarter was 28.5 percent compared to 21.8 percent for the first quarter of 2010. 1Q11 gross margin, without considering the application of MFRS D-6 "Capitalization of Comprehensive Financing Cost" in a pro-forma basis increased 53 bps to 33.3 percent compared to 32.8 percent during the same period of last year, mainly as a result of higher average prices in the affordable-entry level segment and by efficiencies generated from a higher percentage of homes built with the use of the Company's aluminum moulds.

• Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) during the quarter was Ps.830.5 million (US$70 million), a 3.4 percent increase from the Ps.803.5 million (US$67 million) reported in the first quarter of 2010.  Adjusted EBITDA margin was 20.3 percent, a decrease of  208 basis points from 22.4 percent for the first quarter of 2010, due to higher SG&A expenses related to the the Company's investment in its Brazilian operations

(a) Adjusted EBITDA is not a financial measure computed under Mexican Financial Reporting Standards (MFRS). Adjusted EBITDA as derived from MFRS financial information net income, is excluding (i) depreciation and amortization; (ii) net comprehensive financing costs (“CFC”) (comprised of net interest expense (income), foreign exchange gain or loss, valuation effects of derivative instruments and monetary position gain or loss), including CFC, capitalized to land balances, that is subsequently charged to cost of sales; and (iii) income tax expense and employee statutory profit-sharing expense. See “Adjusted EBITDA” for reconciliation of net income to Adjusted EBITDA for the first quarter of 2011 and 2010.

(b) US$ values estimated using an exchange rate of Ps.11.9219 per US$1.00 as of March 31, 2011.  Common share/ADR ratio: 6:1

Commenting on Homex' performance in the quarter, Gerardo de Nicolas, Chief Executive Officer, said:

"We are pleased with our results for the first quarter, as our top line revenue growth of 14.1 percent clearly demonstrates the success of our business model.  We aim to continue to maintain our leadership in the Mexican homebuilding industry, with a strong concentration of our energies and resources in this, our home market.  Importantly, our affordable entry-level housing segment in México grew by 16.4 percent, year over year, which reflects the effectiveness of our strategy to adapt our product offering and mix to market conditions and to serve unattended markets, while at the same time, maintaining geographic diversification in the country.

"It is also important to note that during the quarter we have done much to solve our construction delays and streamline our collection process in Brazil, where we have registered initial revenues from our projects in the country.  Despite a change in Administration, we continue to experience a government most favorably disposed towards the housing market in Brazil, which gives us confidence in our business strategy there.

"We continue to be strategically focused on improving our profitability and working capital management, and while the latter is still a challenging issue, we believe we have made good progress, despite an increasing move towards vertical housing in Mexico, which inherently elongates the collection process.  During the quarter, we continued with the restructuring of our corporate offices, reducing administrative overhead in our Mexico, Tourism and International divisions and improving service efficiencies to our branches.

"As the year begins, we are demonstrating our capacity to deliver on our stated revenue guidance for 2011 of 13 to 16 percent growth.  We feel good about that.  We are confident that we are well-positioned to maintain our progress in each of our four Homex divisions throughout the year and to take full advantage of market conditions, as they unfold."

Detailed Financial Reports

The Company produces a detailed earnings report that provides information regarding Operating and Financial results. This detailed information is considered part of this earnings announcement and is available in full with this earnings release via the Company's website at http://www.homex.com.mx/ri/index.htm through email distribution or the Company's filings with the SEC and the CNBV.

(1) Unless otherwise noted, all monetary figures are presented in thousands of Mexican pesos and in accordance with Mexican Financial Reporting Standards (MFRS). First Quarter 2011 and 2010 figures are presented without recognizing the effects of inflation per the application of MFRS B-10 "Effects of inflation." The symbols "Ps." and "$" refer to Mexican pesos and "US$" refers to U.S. dollars. U.S. dollar figures in this release are presented only for the convenience of the reader, using an exchange rate of Ps. 11.9219 per US$1.00. First quarter 2011 and 2010 financial information is unaudited and subject to adjustments.

Comparison expressed in basis points are provided for the convenience of the reader. Basis points figures may not sum due to rounding.

INVESTOR  CONTACTS
[email protected]

Vania Fueyo
Head of Investor Relations
+5266-7758-5838
[email protected]

SOURCE Desarrolladora Homex, S.A.B. de C.V.