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Gafisa Reports Unaudited Full Year 2011 Preliminary Results

Should be noted that based on accounting provisions, the Company did not account for the respective deferred income tax assets of R$ 251.8 million related to tax loss carryforwards and R$106.3 million related to timing differences.

The revenue reversal totaled R$1.2 billion, as shown in the table above. However, we expect to rebook: (1) 60% of the revenue reversal with resale of returned units; and (2) 34% will be recognized in accordance with PoC of the related projects (79% launched< 2008). Only 6% of the total is unrecoverable.

ACCOUNTS RECEIVABLE VS COSTS TO BE INCURRED

The level of accounts receivable is significantly greater than our costs still to be incurred and supports our expected increase in operating cash flow going forward. We highlight our accounts receivable of R$9.5 billion versus costs still to be incurred including sold and unsold units of R$3.7 billion.

         
(R$ mn)       Total
Accounts receivable       9,499
Costs still to be incurred including sold and unsold       3,716

RESULTS AND BACKLOG MARGIN

Additionally, an indication of future results is our backlog and backlog margin. The backlog margin for the group is 34.5% and excluding Tenda that margin would be 38.2%.

                         
(R$ mn)       Gafisa   Tenda   Alphaville   Gafisa Group   Gafisa Group ex- Tenda
Back log of Results       2.530   1.316   670   4.516   3.200
Costs to be incurred (units sold) (1.664) (978) (315) (2.957) (1.979)
Results to be Recognized 866 338 355 1.559 1.221
Backlog Margin       34,2%   25,7%   53,0%   34,5%   38,2%
 

OUTLOOK

With the introduction of a new strategy and organizational structure, Gafisa is already making progress toward achieving its 2012 guidance.

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