brasil brokers reports 3q07 results1 3q07 earnings release brasil brokers reports 3q07 results rio...

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3Q07 Earnings Release

Brasil Brokers Reports 3Q07 Results

Rio de Janeiro, November 14th, 2007, Brasil Brokers Participações S.A. (Bovespa: BBRK3), a real estate brokerage and consulting firm consisting of 16 individual real estate brokerages, with a strong presence in Brazil’s major real estate markets, announces today its results for third quarter 2007 (3Q07).

The Company’s consolidated financial statements are prepared in accordance with generally accepted accounting principles in Brazil (BR GAAP), pursuant to Brazilian Corporate Law and CVM regulations.

3Q07 Highlights

On October 29, the Company held its Initial Public

Offering (IPO), raising R$304.0 million through the issue

of 320,018 common shares (code BBRK3).

Total of 4,862 Units Sold by subsidiaries, representing

Sale Orders of R$887.3 million, with 15.0% of this total

in the affordable segment, 19.3% in the lower-middle

segment, 33.3% in the middle-income segment, 17.6%

in the upper-middle segment, and 14.2% in the high-end

segment.

Total of 6,030 Units Launched by subsidiaries in the

3Q07, for Launched Potential Sales Value (PSV) of

R$1.05 billion in the 3Q07.

Sales Bank, from launches expected in November 2007

through December 2009, of R$28.6 billion, representing

162,121 units.

Financing and Operating Highlights

3Q07 9M07

PSV Launched (R$ thousand) 1,050,462.8 2,577,446.5

Number of Units Launched 6,030 12,461

Contracted Sales (R$ thousand) 887,344.9 2,240,917.1

Number of Units Sold 4,862 9,403

Number of Brokers 3,061 3,061

Conference Call 3Q07

Portuguese

November 21st, 2007

11:00 AM (Brasília Time)

08:00 AM (NY Time)

Tel.: +55 (11) 2188-0188

Code: Brasil Brokers

Replay: +55 (11) 2188-0188

English

November 21st, 2007

10:00 AM (NY Time)

01:00 PM (Brasilia Time)

Tel.: +1 (973) 935-8893

Code: 9462096

Replay: +1 (973) 341-3080

IR Contact

Álvaro Soares – CFO and IRO

Tel.: +55 (21) 3433-9550

e-mail: [email protected]

www.brbrokers.com.br

mailto:[email protected]

http://www.brbrokers.com.br/

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Subsequent Events

On October 29, 2007, common share in BrasilBrokers began trading on the São Paulo Stock Exchange (Bovespa) under the code BBRK3. On November 12, 2007, BrasilBrokers successfully concluded its primary and secondary distribution of shares, issuing 320,018 common shares in the primary offering with the distribution of 415,882 common shares, 319,982 shares in the secondary offering, and 95,900 shares via the over-allotment option.

The company raised R$288,011,958.74 net of commissions, which will be used mainly to acquire new operating companies. Funds are partially allocated in an exclusive fund managed by a first-tier financial institution, with the remainder managed directly by the Company’s treasury, with immediate liquidity and targeting return in line with the CDI overnight rate.

Below we show a breakdown of the company’s ownership before and after the offering.

Shares % Part. Shares % Part.

Controlling Shareholders 1,269,397 96.19% 853,515 52.05%

Board of Directors 5 0.00% 5 0.00%

Other (Free-float) - 0.00% 735,900 44.88%

Treasury 50,312 3.81% 50,312 3.07%

TOTAL 1,319,714 100.0% 1,639,732 100.0%

After OfferBefore Offer

History and Operations

BrasilBrokers was constituted on January 16, 2007 and initiated its operations on June 11, 2007. Over the past eight months the company has acquired controlling interests in 16 companies in the real estate brokerage sector (except for Niterói Administradora, in which it holds a 50% interest). Of these 16 companies, eight have operating histories, and eight are newly formed companies that received 100% of the operations and nearly 100% of the assets (including goodwill and brand equity) of companies formed at least three years ago that enjoy strong brand recognition in their respective markets.

As of September 30, 2007, of the 16 companies acquired, ten are fully operational with results already included in our financial statements: Primaz, Ágil (Gribel), Niterói Administradora, IPrice, Brito e Amoedo, Ética, Delforte, Pactual, Avance and Noblesse. The other six companies (Basimóvel, Américas, Abreu, Sardenberg, Tropical and Chão&Teto) were recently constituted and will launch operations in November 2007. The revenues and expenses of our subsidiaries involve real estate brokerage and consulting activities.

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Operational Areas

The map below shows the locations in which the Company has operations:

States where Brasil Brokers has

subsidiaries

Other states where Brasil Brokers

operates through its subsidiary

Primaz

Rio de Janeiro Metropolitan Area

Ética (MF Consultoria Imobiliária S.A)

With head offices in the city of Rio de Janeiro, Ética received 100% of the activities and nearly 100% of the

assets held by Ética Empresa Imobiliária Ltda., including its goodwill and brand equity, launching

operations in August 2007. With a focus on the resale segment, as of September 30, Ética had 134

employees and a large and highly qualified team composed of 705 brokers distributed in 17 branches

located in strategic districts of the Rio de Janeiro Metropolitan Area, including the Center, Tijuca, Méier,

Flamengo, Vila da Penha, Cachambi, Madureira, Copacabana, Barra da Tijuca, Taquara, Jardim Botânico,

Ipanema, Campo Grande, Grajaú, Engenho de Dentro and Freguesia.

Manaus

Natal

Salvador

Belém

Belo Horizonte

São Paulo Rio de Janeiro

Vitória

Recife

Curitiba

a Florianópolis

Porto Alegre

Goiânia

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Basimóvel (Basimóvel Consultoria Imobiliária S.A.)

With head offices in Rio de Janeiro, Basimóvel received 100% of the activities and nearly 100% of the

assets held by Basimóvel Marketing Imobiliário Ltda., including its goodwill and “Basimóvel” brand,

launching operations in October 2007. Basimóvel operates in the Rio de Janeiro Metropolitan Area and in

the following cities in Rio de Janeiro state: Mangaratiba, Angra dos Reis, Nova Iguaçu, Duque de Caxias,

São João de Meriti, Cabo Frio, Búzios, Volta Redonda and Resende. On September 30, Basimóvel had

29 employees and a team of 457 brokers.

As of November 1, Basimóvel had a sales bank of approximately R$2.10 billion, consisting of 12,705 Units,

which is expected to be fully launched by 2009.

Américas (BB Américas 2007 Consultoria Imobiliária S.A.)

With head offices in Rio de Janeiro, Américas received 100% of the activities and nearly 100% of the

assets held by RFC Américas 2005 Consultoria Imobiliária Ltda., including its goodwill and “Américas”

brand, launching operations in October 2007. Américas operates in the Rio de Janeiro Metropolitan

Area, and in the following cities of Rio de Janeiro state: Angra dos Reis, Nova Iguaçu, Duque de

Caxias, Cabo Frio and Búzios municipalities. As of September 30, it had 10 employees and a team of

93 brokers.

As of November 1, Américas had a sales bank of approximately R$312.6 million, consisting of 1,235 Units,


Niterói Administradora

With head offices in the city of Niterói city in Rio de Janeiro state, the company initiated its operations in

1999, providing brokerage services for development launches and mainly targeting the upper-middle and

middle-income residential segments.

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We believe Niterói Administradora is the absolute leader in the real estate brokerage market in Niterói,

which also operates in several other cities in Rio de Janeiro state, such as Niterói, São Gonçalo and

Maricá. Niterói Administradora has a strong brand in the markets where it operates and a solid

relationship with the main developers in the market. As of September 30, it had 40 employees and a

team of 151 brokers.

As of November 31, Niterói Administradora had a sales bank of approximately R$4.77 billion, consisting of

14,788 Units, with R$2.90 billion of this amount expected to be fully launched by 2009.

São Paulo Metropolitan Area

IPrice

With head offices in São Paulo, IPrice initiated its operations in 2005 as a real estate brokerage

targeting the upper-middle, middle and lower-middle segments, providing brokerage services for

both new development launches and resale, with operations in the cities of São Paulo, Campinas, São

Bernardo and Jundiaí. On September 30, Iprice had 53 employees and a large team of 296 brokers.

As of November 31, A I. Price had a sales bank of approximately R$4.21 billion, consisting of 22,498 Units,

with R$3.72 billion of this amount expected to be fully launched by 2009.

Del Forte (Del Forte Empreendimentos Imobiliários S.A.)

With head offices in the city of São Paulo, Del Forte received 100% of the activities and nearly 100% of the

assets held by Del Forte Planejamento e Empreendimentos Imobiliários Ltda., including its goodwill and

brand equity, initiating operations in July 2007. Del Forte has a strong presence in the ABCD region of the

São Paulo Metropolitan Area and also operates in the cities of São Paulo, Guarulhos and Bertioga. On

September 30, it had 38 employees and a team of 311 brokers.

As of November 1, Del Forte had a sales bank of approximately R$2.16 billion, consisting of 11,619 Units,


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Avance

With head offices in the city of São Paulo, Avance initiated its activities in 2005, providing brokerage

services for launches in the upper-middle, middle and lower-middle residential segments. On September

30, Avance had 45 employees and a team of 151 brokers, operating in the São Paulo Metropolitan Area

and the cities of Campinas and Jundiaí.

As of November 1, Avance had a sales bank of approximately R$3.91 billion, consisting of 31,464 Units,

with R$3.44 billion of this amount expected to be fully launched by 2009.

Belo Horizonte Metropolitan Area

Gribel

With head offices in the city of Belo Horizonte, Gribel launched its activities in 2004, offering

brokerage services in the upper-middle, middle and lower-middle residential segments for both new

development launches and resale. On September 30, Gribel had 16 employees and a team of 84

brokers.

As of November 1, Gribel had a sales bank of approximately R$2.06 billion, consisting of 4,422 Units,


Pactual

With head offices in the city of Belo Horizonte, Minas Gerais state, Pactual launched activities in

1995, selling and renting properties in the upper-middle, middle and lower-middle segments, for

both new development launches and resale. On September 30, Pactual had 11 employees and a team

of 30 brokers.

As of November 1, Pactual had a sales bank of approximately R$737.6 million, consisting of 659 Units,

with R$673.6 million of this amount expected to be fully launched by 2009.

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Salvador Metropolitan Area

Brito & Amoedo

With head offices in the city of Salvador, Bahia state, Brito & Amoedo launched its brokerage

operations in 2004 for the upper-middle, middle and lower-middle segments, for both new

development launches and resale. The company has operations in the Salvador Metropolitan Area and

in the cities of Camaçari, Lauro de Freitas, Mata de São João and Itacaré. On September 30, Brito &

Amoedo had 10 employees and a team of 220 brokers.

As of November 1, Brito & Amoedo had a sales bank of approximately R$1.58 billion, consisting of 7,068

Units, which is expected to be fully launched by 2009.

Natal Metropolitan Area

Abreu (Abreu Brokers Serviços Imobiliários S.A.)

With head offices in the city of Natal, Rio Grande do Norte state, Abreu received 100% of the

operations and nearly 100% of the assets, including goodwill and brand equity, of Abreu Imóveis

Ltda, launching its operation in November 2007. Abreu operates as a brokerage in the segments of

residential, land and hotel development launches in the upper-middle, middle and lower-middle

residential segments, and is a leader in the real estate brokerage market in the Natal Metropolitan

Area. On September 30, Abreu had 70 employees and a team of 45 brokers.

As of November 1, Abreu had a sales bank of approximately R$7.08 billion, consisting of 33,655

Units, with R$4.46 billion of this amount expected to be fully launched by 2009.

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Porto Alegre Metropolitan Area

Noblesse

With head offices in the city of Porto Alegre, Rio Grande do Sul state, Noblesse launched operations in

August 2007 as a brokerage in both the new development launch and resale segments. Noblesse has a

strong brand in its market, and on September 30 had 46 employees and a team of 186 brokers, in

addition to a highly automated team of brokers and excellent IT platform.

As of October 31, Noblesse had a sales bank of approximately R$867.4 million, consisting of 4,491

Units, which are expected to be fully launched by 2009.

Belém Metropolitan Area

Chão e Teto (Chão e Teto Consultoria Imobiliária S.A.)

With head offices in the city of Belem, Pará state, Chão e Teto received 100% of the operations and

nearly 100% of the assets of Chão & Teto Empreendimentos Ltda., launching operations in November

2007. The company has operations in brokerage services related to appraisal, rental, administration,

acquisition, sale and legalization of properties, whether for residential, commercial, leisure, rural or

investment purposes. On September 30, Chão e Teto had 39 employees and a team of 80 brokers.

As of November 1, Chão & Teto had a sales bank of approximately R$943.8 million, consisting of 7,061

Units, which is expected to be fully launched by 2009.

Vitória Metropolitan Area

Paulo Sardenberg (Paulo Sardenberg Consultoria Imobiliária S.A.)

With head offices in the city of Vitória, Espírito Santo state, the company received 100% of the

operations and nearly 100% of the assets of Paulo Sardenberg Imóveis Ltda., launching operations in

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October 2007. With operations in the development launch, resale and rental administration segments, on

September 30, Paulo Sardenberg had 23 employees and a team of 40 brokers.

As of November 1, Paulo Sardenberg had a sales bank of approximately R$586.2 million, consisting of

4,158 Units, with R$526.2 million of this amount expected to be fully launched by 2009.

Goiânia Metropolitan Area

Tropical (Tropical Corretora e Consultoria Imobiliária S.A.)

With head offices in the city of Goiânia, Goiás state, the company received 100% of the operations

and nearly 100% of the assets of Tropical Consultoria em Administração de Imóveis Ltda, launching its

operations in October 2007. The company has brokerage operations in the segments of new

development launch, resale, land development, rental, and administration of residential and

commercial developments. On September 30, Tropical had 82 employees and a team of 212 brokers.

As of November 1, Tropical had a sales bank of approximately R$4.36 billion, consisting of 45,330

Units, with R$2.82 billion of this amount expected to be fully launched by 2009.

Operations in Brazil’s Major Metropolitan Areas

Primaz

With head offices in the city of Belo Horizonte, Minas Gerais state, though with operations in most

regions of Brazil, Primaz launched activities in 2006, operating in the structuring, purchase and sale of

interests in real estate complexes, targeting the corporate and real estate investment markets. Primaz

also has excellent access to the pension fund industry, mall administrators, major developers and

property holding companies, with a portfolio of more than 100 clients with high investment capacity and

excellent access to resources.

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Operating Performance

Sales by State

Sales Orders totaled R$887.3 million in the third quarter. Of this

total, 46.5% were in São Paulo state, 20.7% in Rio de Janeiro,

16.0% in Bahia, 13.4% in Minas Gerais, and 3.4% in Rio Grande

do Sul.

Sales by Income Segment

Of the total of R$887.3 million in Sales Orders, 15.0% were

from properties in the affordable segment (up to

R$100,000.00), 19.8% in the lower-middle segment (from

R$100,000.01 to R$150,000.00), 33.3% in the middle-income

segment (from R$150,000.01 to R$350,000.00), 17.6% in the

upper-middle segment (from 350,000.01 to R$600,000.00),

and 14.2% in the high-end segment (over R$600,000.00).

Sales by Market Segment

Of the R$887.3 in sales orders, 91.7% was from residential

properties, 7.0% from commercial properties, 1.1% from lot

developments and 0.3% from hotel units.

RJ21%

SP47%

MG13%

BA16%

RS3%

Contracted Sales - by State

Residential 92%

Commercial7%

Lots1%

Hotels0%

Contracted Sales - by Income Segment

Economic15%

Mid-Low20%

Middle33%

Mid-High18%

High14%

Contracted Sales - by Market Segment

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Sales Bank

The table below shows the PSV to be launched and the number of units for each of our subsidiaries:

until

2009Total

ÉTICA

IMOBILIÁRIA(1) Aug/07 Rio de Janeiro Resales N/A N/A N/A

BASIMÓVEL Oct/07 Rio de Janeiro New Launches and Resales R$2,103 R$2,103 12,705

AMÉRICAS Oct/07 Rio de Janeiro New Launches R$312 R$312 1,235

NITERÓI

ADMINISTRADORAMay/99 Niterói New Launches and Resales R$2,902 R$4,774 14,788

GRIBEL Jun/04 Belo Horizonte New Launches and Resales R$2,057 R$2,057 4,422

PACTUAL Jun/95 Belo Horizonte New Launches and Resales R$674 R$738 659

BRITO & AMOEDO Aug/04 Salvador New Launches and Resales R$1,580 R$1,580 7,068

I. PRICE Aug/05 São Paulo New Launches and Resales R$3,724 R$4,211 22,498

DEL FORTE Jul/07 São Paulo New Lauches R$2,165 R$2,165 11,619

AVANCE Oct/05 São Paulo New Lauches R$3,443 R$3,909 31,464

NOBLESSE Aug/07 Porto Alegre New Launches and Resales R$867 R$867 4,491

PAULO SARDENBERG Oct/07 VitóriaNew Launches, Resales and Lease

ManagementR$526 R$586 4,158

CHÃO & TETO Nov/07 BelémNew Launches, Resales and Lease

ManagementR$944 R$944 7,061

TROPICAL Oct/07 Goiânia New Launches and Resales R$2,816 R$4,364 45,330

ABREU Nov/07 Natal New Launches and Resales R$4,457 R$7,084 33,655

PRIMAZ (2) Jun/06 Brasil Commercial Properties N/A N/A N/A

(2) P rimaz has no current value to be launched, since its revenue is derived from the structuring ans sale of ownership in real estate investments.

Total

Number of

Units

Beginning of

Activities

TOTAL R$35,694R$28,570 201,153

Our SubsidiariesMetropolitan Areas

of:Segment

PSV Launches

(in millons of reais)

(1) Ética Imobiliária does not present total value of sales to be launched and real estate units because it specializes in resales.

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Our Sales Bank remains diversified in distribution by state, by property value, and by market

segment.

Sales Bank – by State

RJ19%

SP31%

MG10%

ES2%

RS3%

BA6%

RN16%

PA3%

GO10%

Sales Bank (up to 2009) - by State

Sales Bank – by Income Segment

Economic9%

Mid-Low 20%

Middle42%

Mid-High19%

High10%

Sales Bank (up to 2009 - only residential units) -

by income segment

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Sales Bank – by Market Segment

Residential94%

Commercial2%

Lots2%

Hotels2%

Sales Bank (up to 2009) - by market segment

Financial Performance

Because it is in its pre-operational phase, BrasilBrokers did not account results and therefore did not

report an income statement for the quarter. The founding shareholders of the subsidiaries of

BrasilBrokers have the right to usufruct of retained earnings, to be distributed in the form of

dividends (registered in the Balance Sheet in the account line Related Parties – Short Term), in

accordance with the share exchange contracts signed between the parties. This right includes the

income to be generated up to the settlement date of the public offering (10/31/2007).

For purpose of better understanding the operations of our companies, we present below the

financial performance of the subsidiaries of BrasilBrokers obtained through a non revised proforma

combined Income Statement of their operations – attachment III

Service Revenue

The combined Gross Service Revenue from the subsidiaries of BrasilBrokers, consisting of the

brokerage commissions paid by buyers, amounted to R$25.3 million in the quarter, equivalent to

2.9% of the R$887.3 million sold in the period. This revenue is recognized when the sale order is

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signed, and the average payment term for the commission is 30 days. After deduction of taxes, net

revenue in the quarter was R$23.3 million.

Costs of Services

The combined Cost of Services of the subsidiaries of BrasilBrokers was R$1.9 million, representing

8.3% of net revenue in the period. These costs include rent and utilities of stores, costs with

researching buyer’s application information, and other costs directly related to the brokerage

operations.

Operating Expenses

The combined operating expenses of the subsidiaries of BrasilBrokers totaled R$4.8 million in the

quarter, representing 20.6% of net revenue in the period. The composition of these expenses is

shown below:

Operating Expenses (R$ mm)

3Q07 9M07

Admnistrative Expenses (3,367.2) (7,145.5)

Managment Fees (459.3) (732.2)

Depreciation and Amortization (93.7) (324.3)

Financial Expenses (281.1) (521.7)

Financial Income 50.3 121.1

Other Operating Income/Expenses (656.4) (876.7)

TOTAL (4,807) (9,479)

Administrative expenses consist of expenses with the maintenance of facilities and operating

activities, such as salaries of administrative personnel, rent and utilities (for administrative area),

legal and court fees, office supplies and other supplies.

Net Income

The combined net income of the subsidiaries of BrasilBrokers in the third quarter was R$13.9 million,

for net margin of 59.5%.

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Adjusted EBITDA(1)

The combined adjusted EBITDA of the subsidiaries of BrasilBrokers in the third quarter was R$16.8

million, representing adjusted EBITDA margin of 71.4%.

Reconciliation (R$ mm) 3Q07 9M07

Net Profit 13,857 29,934

IR and CS (2,704) (5,957)

Non Operating Results 14 130

Net Financial Results (231) (401)

Depreciation and Amortization (94) (324)

Adjusted EBITDA 16,871 36,486

Adjusted EBITDA Margin 71.4% 71.1%

Net Margin 59.5% 59.0%

(1) Adjusted EBITDA consists of income before net financial result, income tax and social contribution tax, depreciation and amortization and non-

operating income. Adjusted EBITDA is not a measure in accordance with generally accepted accounting principles in Brazil (BR GAAP), does not

represent cash flow for the periods presented, and should not be considered a substitute for net income as an indicator of operating performance, or as

a substitute for cash flow as an indicator of liquidity. Adjusted EBITDA does not have a standardized meaning and our definition of Adjusted EBITDA may

not be comparable to that used by other companies.

Income Tax and Social Contribution Tax

The combined Income Tax and Social Contribution Tax on the net income of the subsidiaries of

BrasilBrokers was R$2.7 million in the quarter, equivalent to 11.6% of net revenue in the period.

Indebtedness

At the close of the third quarter, the company’s total debt was R$ 9.6 million. Of this amount, the

debits of subsidiaries related to loans with financial institutions totaled R$0.2 million, and R$7.2

million refers to the provisioning for dividends for payment to the founding partners due to their

usufruct of the income generated up to the settlement date of the public offering.

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Attachments

I – Controlling e Consolidated Balance Sheet

II – Controlling e Consolidated Cash Flow

III – Proforma non revised Combined Income Statement

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Anexo I – Controlling e Consolidated Balance Sheet

09/30/07 (in thousand of reais)Controlling Company Consolidated

A S S E T S

Current Assets: Cash, Cash Equivalents 76 2,315 Accounts Receivable from Clients - 10,866 Accounts Receivable - Other - 30 Tax to Recover - 119 Other Current Assets - 268

Total Current Assets: 76 13,598

Noncurrent Assets:

Long Term Assets Accounts Receivable of the Clients - - Related Parties - 388 Other - 5

- 393

Permanent Assets Investments 182 - Goodwill Investments 5 5 Property and Equipment - 4,623 Deferred 230 600

418 5,228

Total Noncurrent Assets: 418 5,620

Total Assets 493 19,219

30/09/07 (in thousand of reais)Controlling Company Consolidated

L I A B I L I T I E S

Current Liabilities: Loans and Financings - 145 Suppliers - 582 Wages and Burden Payable 19 1,592 Taxes and Contributions payable - 4,564 Advances from Clients - 144 Related Parties 210 2,197 Deferred - 7,220 Other - 417

Total Current Liabilities: 229 16,860

Noncurrent Liabilities: Long-term Liabilities Loans and Financings - 56 Related Parties Provision for contingencies - 1,757 Taxes to Recover - 221 Deferred - - Other - 51

Total Noncurrent Liabilities: 2,084

Minority Interest - 10

Shareholders´ Equity: Subscribed Capital 216 216 Unpaid Capital - - Capital Reserve 47 47 Legal Reserve - - Accumulated Gains / Losses - -

Total Shareholders´ Equity 264 264

Total Liabilities 493 19,219

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Anexo II – Controlling e Consolidated Cash Flow

Cash Flow

Controlling Company Consolidated

From Activities

Changes in the Assets and Liabilities

Accounts Receivable from clients (short term) - (5,901,440)

Accounts Receivable - Other - 30,000

Taxes to Recover - 28,352

Other Current Assets - (182,789)

Accounts Receivable from clients (long term) - 132,661

Related Parties (short term) - 2,580,396

Other Noncurrent Assets - (4,908)

Suppliers - 83,877

Wages and Burden Payable 19,217 1,148,657

Taxes and Contributions payable - 1,308,807

Advances from Clients - 5,220

Related Parties (short term) 210,178 1,389,689

Accounts Payable - Other - 128,868

Related Parties (long term) - (5,858)

Provision for Contigencies - 629,446

Taxes and Contribution quota - (8,868)

Other Noncurrent Liabilities - 50,945

Cash Flow from Activities 229,395 1,413,055

From Investments Activities

Investiments (47,438) (5,238)

Fixed Assets - (2,640,150)

Deferred Assets (229,395) (581,370)

Net Cash Used in Investment Activities (276,833) (3,226,758)

From Financing Activities With Third Parties

Loans and Financing (short term) - (82,522)

Loans and Financing (long term) - (14,494)

Net Cash Used in Financing Activies - (97,016)

From Financing Activities with Shareholders

Capital Increase 55,688 55,688

Capital Reserve – Goodwill in subscription shares 47,437 47,437

Net Cash Used in Financing Activies 103,125 103,125

Cash Increase (Decrease) 55,687 (1,807,594)

Cash

In the Beginning of the period 20,021 4,122,962

In the End of the period 75,708 2,315,368

Cash Increase (Decrease) 55,687 (1,807,594)

September

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Anexo III - Proforma non revised Combined Income Statement

Income Statement 3Q07 % 30/9/2007 %

Gross Service Revenues 25,346,041 108.8% 55,092,319 108.6%

Taxes (2,047,034) 8.8% (4,357,579) 8.6%

Net Revenue 23,299,007 100.0% 50,734,740 100.0%

Cost of services rendered (1,944,826) 8.3% (5,494,612) 10.8%

Gross Income 21,354,181 91.7% 45,240,128 89.2%

Operating Cost and Expenses (4,807,414) 20.6% (9,479,359) 18.7%

Managment Expenses (3,367,186) 14.5% (7,145,540) 14.1%

Managment Fees (459,300) 2.0% (732,187) 1.4%

Depreciation and Amortization (93,662) 0.4% (324,328) 0.6%

Financial Expenses (281,140) 1.2% (521,661) 1.0%

Financial Income 50,266 0.2% 121,066 0.2%

Other Operating Income/Expenses (656,392) 2.8% (876,709) 1.7%

Operating Income 16,546,767 71.0% 35,760,769 70.5%

Non Operating Revenues/Expenses 13,576 0.1% 129,972 0.3%

Income/Loss before Taxes 16,560,343 71.1% 35,890,741 70.7%

Social Contribution Allowance (745,073) 3.2% (1,609,404) 3.2%

Income Tax Allowance (1,958,630) 8.4% (4,347,791) 8.6%

Net Income/Loss of the Period 13,856,640 59.5% 29,933,546 59.0%

(1) The financial statements for 9/30/2007 and the 3Q07 present the combined results of the 5 companies acquired on July 2007 and

operating since January 2007 (IPrice, Ágil (Gribel), Primaz, Niterói Administradora e Brito and Amoedo) and the other 5 companies that

also launched their operations or were acquired in the quarter: Avance (acquired in August 2007 and operating since 1/1/2007), Pactual

(acquired in September 2007 and operating since 1/1/2007), Delforte (acquired in June 2007 and operating since 7/1/2007), Ética

(acquired in June 2007 and operating since 8/1/2007) and Noblesse (acquired in September 2007 and operating since August 2007).

(2) The other six companies owned by BrasilBrokers (Basimóvel, Américas, Abreu, Sardemberg, Tropical and Chão&Teto) started up

operation recently in October and November this year.

(3) The net income presented in the financial statements above belongs to the founding shareholders of the subsidiaries of BrasilBrokers,

which hold usufruct rights to the retained earnings, to be distributed in the form of dividends (registered in the Balance Sheet in the

account line Related Parties – Short Term), in accordance with the share exchange contracts signed between the parties. This right

includes the income to be generated up to the settlement date of the public offering (10/31/2007).

brasil brokers reports 3q07 results1 3q07 earnings release brasil brokers reports 3q07 results rio...

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