1Q20 Earnings Release - PDF document

1Q20 EARNINGS RELEASE 3 1
1Q20 EARNINGS RELEASE 3 1Q20 Earnings Release 2 / 21 ri.caduinmobiliaria.com CADU REPORTS REVENUE FOR MXN 758 MILLION, NET INCOME OF MXN 86 MILLION AND EBITDA OF MXN 146 MILLION IN 1Q20 OPERATIONAL AND FINANCIAL HIGHLIGHTS During 1Q20, total revenue amounted to MXN 758 million, vs. MXN 949 million in 1Q19, decreasing 20.1% EBITDA decreased from MXN 231 million in 1Q19 to MXN 146 million in 1Q20, with a margin of 19.3% (-5.0 pp. YoY) 1Q20 Net Income was MXN 86 million, vs. MXN 177 million in 1Q19, with a margin of 11.3% (-7.4 pp. YoY) During 1Q20, the Company recorded a negative Free Cash Flow of MXN 213 million, compared to the negative MXN 94 million in 1Q19 1Q20 Average Sale Price was MXN 659 thousand, an increase of 13.4% when compared to the MXN 581 thousand reported in 1Q19 In 1Q20, no subsidized home sale was recorded, same case as 1Q19 In 1Q20, the first units from the “Mexico Tacuba” middle-income development, located in Mexico City, were titled, at an average sale price of ~MXN 2.7 million ACTIONS ADOPTED AMID COVID-19 Before the COVID-19 outbreak and seeking to preserve liquidity, CADU has implemented, in line with the regulation of the Mexican Banking and Securities Commission (CNBV), the following measures: i. Meetings were held with the holders of "CADU18" and "CADU19" local notes, resulting in the extension of “CADU18” principal payments, for the months of May to December 2020; ii. A waiver of the pre-established covenants of these instruments was approved; iii. An agreement was reached to avoid dividend payments in 2020 and 2021 (corresponding to years 2019 and 2020, respectively); and, iv. Principal and interest payment extensions were obtained from multiple institutions and a

dditional actions were undertaken t
dditional actions were undertaken to cut non-essential expenditures. Cancun, Quintana Roo, Mexico, June 16, 2020. – Corpovael, S.A.B. de C.V. (BMV: CADUA), a leading homebuilder in the development of affordable entry-level, middle-income and residential homes in Mexico, announced today its results for the first quarter 2020. The figures presented in this report are expressed in nominal Mexican pesos (MXN) are preliminary and non-audited, prepared in accordance with IFRS and current interpretations and may include minor differences due to rounding. 1Q20 Earnings Release 3 / 21 ri.caduinmobiliaria.com Since its staff is CADU’s most important asset, the Company will maintain all its workforce, providing full salaries to low-income associates. Additionally, as part of cautionary measures to properly resume productive activities, the Company has complied to all necessary protocols and counts on a certified staff (by the Mexican Social Security Institute) of 400 associates to fully engage with all due health standards In May 2020, the investors who acquired the land plot #186 in Playa del Carmen, (pursuing to participate in co-developing activities) notified the management their decision to suspend investments due to COVID-19, thus stopping the commitments of payments made to the Company for the months of June and December 2020 and requesting a partial cancellation of the operation. Consequently, and following the advice of the Company’s external auditors, CADU decided to partially reverse the revenue recognized from this transaction in 4Q19; keeping the sale in the proportion of the funds already settled (MXN 40 million) Although CADU has sufficient finished housing inventory in all segments to meet the expected demand over the economic

reactivation process, the Company's
reactivation process, the Company's strategy gears toward the affordable entry-level segment, as it expects that support from both housing institutes and development banks will be continuously provided to this segment 1Q20 Earnings Release 4 / 21 ri.caduinmobiliaria.com *Figures in Mexican pesos. Considering 342,022,974 shares outstanding in 1Q20 and 1Q19. KEY INDICATORS (MXN MILLION) Indicator 1Q19 1Q20 ∆% Homes Sold (Units) 1,595 1,070 (32.9%) Average Sale Price (thousands) 581 659 13.4% Home Sold Revenue 927 705 (23.9%) Commercial Land Plot Sales 2 52 �100.0% Construction Services 21 1 (95.3%) Total Revenue 949 758 (20.1%) Operating Income 196 116 (41.0%) EBITDA 231 146 (36.6%) EBITDA Margin (%) 24.3 19.3 (5.0 pp.) Net Income 177 86 (51.6%) Net Margin (%) 18.7 11.3 (7.4 pp.) FCFF (94) (213) �100.0% Interest Coverage 3.00x 2.51x (0.49x) Net Debt / LTM EBITDA 2.44x 3.56x 1.12x Leverage (Total Liabilities/Equity) 0.99x 1.09x 0.10x EPS* (MXN) 0.49 0.25 (49.1%) BALANCE SHEET INDICATORS (MXN million) FINANCIAL INDICATORS Indicator 1Q19 1Q20 Indicator 1Q19 LTM 1Q20 LTM Cash & Cash Equivalents 766 419 ROE (%) 18.8 9.4 Accounts Receivable 494 417 ROA (%) 9.5 4.5 Inventory 7,353 7,852 EBITDA (MXN million) 1,185 999 Other Assets 898 1,590 Net Income (MXN mill.) 900 461 Total Assets 9,512 10,278 EPS (MXN) 2.46 1.26 Bank Debt 3,036 2,972 Working Capital Cycle* 795 997 Local Notes 620 1,000 otal Debt 3,656 3,972 *Days Other Liabilities 1,069 1,383 Total Liabilities 4,726 5,355 Stockh

olders’ Equity 4,786 4,923
olders’ Equity 4,786 4,923 1Q20 Earnings Release 5 / 21 ri.caduinmobiliaria.com Message from the CEO Dear investors: 1Q20 results were marked by the harsh economic conditions currently affecting Mexico in its entirety, and the construction and housing sectors were no exceptions. Since the Mexican Banking and Securities Commission (CNBV) extended the filling deadline for 1Q20 results, CADU decided to use this extension to complement their presentation of information alongside the measures adopted by the Company to effectively tackle the COVID-19 contingency. Amongst the most relevant initiatives to ensure an adequate liquidity (paramount in these times, as a suitable cash balance is of utmost importance), are: i) the negotiating, with financial creditors and local note holders, of the terms of certain liabilities; ii) cease of dividend payments in 2020 and 2021; iii) the incorporation of new investors to fund projects; and, iv) the ongoing sale of non-strategic assets. The foregoing, coupled with the Company’s solvency, has allowed us to arrange significant extensions of principal and interest payments (in accordance with the guidelines adopted by the CNBV on the current environment), as well as achieve a waiver of the covenants of the “CADU18” and “CADU19” local notes. Furthermore, we seek to avoid non-essential expenses at the time being, seeking to optimize resources and avoid any form of breach to our commitments. In this regard, the cornerstone of these efforts gears toward the preservation of all our associates’ job positions, thus allowing our workforce to be completed and ready for the upcoming reactivation of the economy. These efforts will ensure sufficient resources to focus on productive tasks

to be carried out during the remainde
to be carried out during the remainder of year 2020 and year 2021. It is also relevant to note that even when home sales have slowed down from the inherent effects of the health contingency, marketing and sales operations are still ongoing. Regarding our quarterly results, consolidated revenue decreased 20.1% compared to the same period last year. It is worth mentioning that the year-over-year comparison base was high, coupled with the fact that we lost our 2 most significant weeks in terms of sales. On the other hand, in May 2020, investors who had acquired the land plot #186 in Playa del Carmen, (pursuing to participate in co-developing activities) notified the management their decision to suspend investments due to COVID-19, thus stopping the commitments of payments made to the Company for the months of June and December 2020 and requesting a partial cancellation of the operation. Consequently, and following the advice of the Company’s external auditors, CADU decided to partially reverse the revenue recognized from this transaction in 4Q19; keeping the sale in the proportion of the funds already settled (MXN 40 million). Although the economic slowdown persisted in 2Q20, we expect economic dynamism will recover with the highly possible overcoming of the health contingency towards 2H20; allowing our industry to normalize under new market conditions. As a result, we have decided to revise the Guidance issued on past February, as the pandemic caused by COVID-19 will affect our 2020 results, with an aftermath impact difficult to assess, as of this date. From our side, we are resuming the construction activities of our affordable entry-level developments in Cancun and Playa del Carmen, as well as those belonging to the middle-income, residential and residential plus s

egments located in Cancun. Moreover, t
egments located in Cancun. Moreover, this year we have initiated the titling phase of our “Mexico-Tacuba” middle-income development, that will strongly contribute to 2020 revenue; and, we are about to start new affordable entry-level developments, in Tulum, Queretaro and Jalisco, as we continue to strive in the development of projects with a positive outlook; seeking to accelerate our recovery. Pedro Vaca Elguero, Chairman and CEO 1Q20 Earnings Release 6 / 21 ri.caduinmobiliaria.com Consolidated Revenue went down from MXN 949 million in 1Q19 to MXN 758 million, representing a 20.1% decrease, mainly due to a 23.9% (MXN 222 million) fall in home sales. 93.0% of consolidated revenue stemmed from home sales (MXN 705 million) while the remaining 7% was derived from commercial land plots and construction services (MXN 53 million). 97.6%0.2%2.2%1Q19Homes SoldCommercial Land Plot SalesConstruction Services93.0%6.9%0.1%1Q20Home SalesCommercial Land Plot SalesConstruction ServicesOPERATING RESULTS Total Revenue (MXN million) 1Q19 1Q20 ∆$ ∆% Homes Sold 927 705 (222) (23.9%) Commercial Land Plot Sales 2 52 50 �100.0% Construction Services 21 1 (20) (95.3%) Total 949 758 (191) (20.1%) CONSOLIDATED REVENUE 20.1% MXN 949 million MXN 758 million 1Q20 Earnings Release 7 / 21 ri.caduinmobiliaria.com NOTE: UH refers to Used Homes. The drop in affordable entry-level home sold revenue in Cancun and Playa del Carmen vs. 1Q19 (MXN 47 million and MXN 34 million, respectiv

ely) is explained by the operations s
ely) is explained by the operations shutdown of March’s last 2 weeks (the most significant for quarter sales), due to COVID-19 spread. The MXN 72 million fall in Guadalajara (UH) vs. 1Q19, followed the inventory depletion of this type of housing during year 2019. In 1Q20, middle-income home sold revenue in the Valley of Mexico went up by MXN 124 million vs. that of the same quarter 2019, driven by the start of the titling process of our Mexico Tacuba Development in Mexico City. Finally, the MXN 149 million revenue variation in our development Allure in Cancun derived from a high base of comparison represented by 1Q19 (which incorporated the recording of revenue from homes sold in 4Q18, as contracts were pending of titling before the public registrar of the State of Quintana Roo). Therefore, 1Q20 Total Home Sold Revenue decreased 23.9% when compared to that of the same quarter 2019. Homes Sold Revenue (MXN million) 1Q19 1Q20 ∆$ ∆% Affordable Entry-Level Homes Cancun 171 124 (47) (27.4%) Playa del Carmen 304 270 (34) (11.1%) Guadalajara (UH) 75 3 (72) (95.4%) Mexico Valley (UH) 7 2 (6) (77.6%) Aguascalientes (UH) 2 - (2) (100.0%) Ciudad Juarez / Other (UH) 65 29 (36) (55.3%) Total Affordable Entry-Level 625 428 (196) (31.4%) Middle-Income Homes Cancun 55 54 (1) (1.8%) Mexico Valley 48 172 124 �100.0% Total Middle-Income Homes 103 226 123 �100.0% Residential Homes Cancun 199 51 (149) (74.6%) Total Residential Homes 199 51 (149) (74.6%) TOTAL 927 70

5 (222) (23.9%) Homes Sold
5 (222) (23.9%) Homes Sold Revenue 1Q20 Earnings Release 8 / 21 ri.caduinmobiliaria.com 581 659 1Q191Q20Average Sale Price (MXN thousands) The revenue mix by housing segment was as follows: NOTE: Affordable entry-level homes are those in a price range under MXN 500 thousand, middle-income homes are those within an MXN 500 thousand to MXN 2.5 million range, and residential homes are those exceeding the MXN 2.5 million mark. Within the residential segment, those homes with prices above the MXN 8 million are classified as “luxury homes”, such as Allure’s. In 1Q19, approximately 39% of homes sold revenue was originated from the middle-income residential segment (+6 pp. YoY), while the remaining 61% came from the affordable entry-level segment. Homes and Subsidies (Units) CADU TOTAL 1Q19 1Q20 ∆ ∆% With Subsidy - - - - Without Subsidy 1,595 1,070 (525) (32.9%) Total 1,595 1,070 (525) (32.9%) As in 1Q19, no subsidized homes were titled this quarter (following the significant reduction for this housing program). 67%33%1Q19Affordable Entry-LevelMiddle-Income ResidentialMXN 927 million61%39%1Q20Affordable Entry-LevelMiddle-Income ResidentialMXN 705 million100.0%100.0%1Q191Q20Homes sold with and without subsidy (%)With SubsidyWithout Subsidy23.9% Homes Sold with Subsidies Average Sale Price 13.4% 1Q20 Earnings Release 9 / 21 ri.caduinmobiliaria.com The Average Sale Price rose from MXN 581 thousand in 1Q19 to MXN 659 thousand in 1Q20, representing a 13.4% growth (+6.6% YoY in the average sale price of the affordable entry-level segment, +26.0% YoY in middle-income and +90.8% YoY in residential, driven by the sale of a number of top priced departments at A

llure). The following table sho
llure). The following table shows the average sale prices by housing segment: Average Sale Price by Product (MXN thousand) Product 1Q19 1Q20 ∆$ ∆% Affordable Entry-Level 408 434 27 6.6% Middle-Income 2,187 2,756 569 26.0% Residential 13,286 25,350 12,064 90.8% Total 581 7 659 78 13.4% FINANCIAL PERFORMANCE Income Statement Revenue and Cost of Sales Breakdown (MXN million) Concept 1Q19 % 1Q20 % Home sold revenue 927 97.6% 705 93.0% Land plot sales revenue 2 0.2% 52 6.8% Construction services 21 2.2% 1 0.1% Total revenue 949 100.0% 758 100.0% Cost of homes sold 619 66.8% 475 67.4% Cost of land plots 1 77.2% 36 69.2% Cost of construction services 20 96.6% 1 91.6% Total Cost of Sales 641 67.5% 512 67.5% During 1Q20, Cost of Sales decreased 20.1% YoY, totaling MXN 512 million. The cost-to-revenue ratio was 67.5%, unchanged vs. 1Q19. 5815925815355235886593Q184Q181Q192Q193Q194Q191Q20Average Sale Price (MXN thousands)Cost of Sales 1Q20 Earnings Release 10 / 21 ri.caduinmobiliaria.com During 1Q20, gross income totaled MXN 246 million, MXN 62 million less than the MXN 308 million recorded for the same period in 2019, following a lower revenue recorded over the quarter. In 1Q20, Selling, General and Administrative expenses totaled MXN 130 million, an increase of 16.2% compared to the MXN 112 million in 1Q19. As a result of a lower revenue base, which limited the generation of better economies in fixed expenses, the SG&A-to-revenue ratio expanded from 11.8% in 1Q19 to 17.2% in 1Q20. EBITDA decreased from MXN 231 million in 1Q19 to MXN 146

million in 1Q20, down 36.6% YoY. In 1Q2
million in 1Q20, down 36.6% YoY. In 1Q20, EBITDA margin contracted by 5.0 pp. YoY, to 19.3%. 3082461Q191Q20Gross Income (MXN million)20.2%11.8%17.2%1Q191Q20SG&A / Revenue (%)2311461Q191Q20EBITDA (MXN million)36.6%EBITDA SG&A Gross Income 5.4 pp. 1Q20 Earnings Release 11 / 21 ri.caduinmobiliaria.com During 1Q20, Operating Income decreased 41.0% YoY, amounting to MXN 116 million, vs. MXN 196 million in 1Q19, mainly due to a lower revenue generation, which reduced operating economies for the period. 1Q20 Financial Expenses were MXN 16 million, MXN 9 million more in an annual basis. In 1Q20, Income Tax amounted to MXN 16 million, compared to MXN 15 million in 1Q19. 1Q20 Net Income reached MXN 86 million, vs. MXN 177 million in 1Q19 (-51.6% YoY). Net margin decreased from 18.7% in 1Q19 to 11.3% this quarter. 1961161Q191Q20Operating Income (MXN million)41.0%177861Q191Q20Net Income (MXN million)51.6%EBITDA Breakdown (MXN million) Concept 1Q19 1Q20 ∆$ ∆% EARNINGS AFTER TAXES IMPUESTOSIMIMPUESTOS 177 86 (91) (51.6%) (+) Current Income Tax 15 16 2 10.8% EARNINGS BEFORE TAXES (EBT) 192 102 (90) (46.8%) (+) Capitalized CFR 32 27 (4) (13.8%) (+) Non-Capitalized Interest 8 16 9 �100.0% (-) Interest Income 3 3 (1) (16.3%) (+) Depreciation & Amortization 3 3 0 9.2% EBITDA 231 146 (84) (36.6%) EBITDA Margin 24.3% 19.3% - (5.0 pp.) Net Income Income Tax Operating Income Financial Expenses 1Q20 Earnings Release 12 / 21 ri.caduinmobiliaria.com Net Income and EPS (MXN million) Concept 1Q19 1Q20 ∆$ ∆% Consolidated Ne

t Income 177 86 (91) (51.6%) C
t Income 177 86 (91) (51.6%) Controlling Interest 166 85 (82) (49.1%) Earnings Per Share* (MXN) 0.49 0.25 (0.24) (49.1%) *Figures in Mexican pesos. Considering 342,022,974 shares outstanding in 1Q20 and 1Q19. 1Q20 Earnings Per Share (EPS) was MXN 0.25, MXN 0.24 less than the MXN 0.49 in 1Q19. Financial Position The balance of cash and cash equivalents at the end of 1Q20 was MXN 419 million, MXN 72 million and MXN 347 million lower than 4Q19 and 1Q19, respectively, due, among other factors, to the payment of “CADU15”, which was fully settled last December. It is important to mention that seeking to preserve the Company's liquidity, our local note holders approved an extension of the “CADU18” principal payments between May and December 2020, as well as a waiver of the covenants of these instruments. Furthermore, the Company obtained an extension of the principal and interest payments with a number of financial institutions (in line with the guidelines adopted by the CNBV on the current environment), and no dividend payments will be made during 2020 and 2021. CADU's cash funds are mainly invested in high credit quality short-term debt instruments. Accounts Receivable Breakdown (MXN million) Concept 1Q19 1Q20 ∆$ ∆% Homes Sold Receivables 350 223 (127) (36.3%) Land Plot Receivables 144 193 50 34.4% Total A/R 494 417 (78) (15.7%) A/R (days) 1Q19 1Q20 ∆ days ∆% Homes Sold Receivables 29 21 (8) (27.3%) Land Plot Receivables 115 290 175 �100.0% Total A/R 37 36 (1) (0.2%) At the end of 1Q20, Accounts Receivable totaled MXN 417 million (36-day turnover), vs. MXN 494 million in the same period 2019 (37-day turnover).

766602376491419Mar-19Jun-19Sep-1
766602376491419Mar-19Jun-19Sep-19Dec-19Mar-20Cash & Cash Equivalents (MXN million)Cash & Cash Equivalents Accounts Receivable (A/R) 1Q20 Earnings Release 13 / 21 ri.caduinmobiliaria.com Working Capital Cycle (WCC) increased 202 days in an annual basis, reaching 997 days, following the increase of 216 days in inventory, since the delay in the purchase decision of clients in previous periods intensified, given the sanitary contingency. On the other hand, inventory turnover decreased 1 day in its annual comparison, while supplier and prepayments turnover increased 12 and 1 days YoY, respectively. Inventory Breakdown (MXN million) Concept 1Q19 1Q20 ∆% Land Bank 2,102 2,211 5.2% Work in Progress and Completed Homes 5,026 5,085 1.2% Capitalized Interests 225 556 �100.0% Total 7,353 7,852 6.8% As of March 31, 2020, inventory amounted to MXN 7,852 million, increasing 6.8% YoY (+MXN 499 million), partly due to the beginning of a development located in Tulum. Inventory was comprised of MXN 2,211 million in land bank, recorded at acquisition cost (+MXN 109 million YoY), work in progress & completed homes for MXN 5,085 million (+MXN 59 million YoY) and capitalized interest for MXN 556 million (+MXN 331 million YoY). Capitalized Interest in Inventory (MXN million) Concept 1Q19 1Q20 Interest Paid 100 104 Financial Expenses (8) (16) Capitalized Interest 92 88 Opening Balance 165 495 Total Capitalized Interest 257 583 Capitalized Interest in Cost of Sales (32) (27) Balance of Capitalized Interest in Inventory 225 556 In 1Q20

, interest paid amounted to MXN 104 mil
, interest paid amounted to MXN 104 million, of which MXN 27 million are reflected in the cost of sales, MXN 16 million as interest expense and the remaining MXN 61 million recognized in inventory. 377982911795259584011932361,0144112997Receivables (days)Inventory (days)Suppliers (days)Prepayments (days)WCCWorking Capital Cycle (days)1Q194Q191Q20Working Capital Cycle (WCC) Inventory 1Q20 Earnings Release 14 / 21 ri.caduinmobiliaria.com Gross Debt increased 8.6%, from MXN 3,656 million as of March 31, 2019 to MXN 3,972 million at the end of 1Q20. Bank Loans (MXN million) Concept 1Q19 1Q20 ∆$ ∆% Bridge Loans 2,059 2,152 93 4.5% Land Bank 14 68 54 �100.0% Working Capital 963 751 (212) (22.0%) Financial Leases 0.8 0.5 (0.3) (34.4%) Total 3,036 2,972 (65) (2.1%) At the end of 1Q20, bank debt amounted to MXN 2,972 million, a decrease of 2.1% or MXN 65 million compared to the MXN 3,036 million in the same period 2019, as increases in bridge loans for home construction (+MXN 93 million) and in loans for land reserve acquisition (+MXN 54 million) were offset by a decrease of 22.0% YoY or MXN 212 million in loans for working capital. It is worth noting that, at the end of 1Q20, the Company counts on revolving credit lines to face the challenges arising from the COVID-19 pandemic. Debt Securities – Local Notes (MXN million) Concept 1Q19 1Q20 ∆$ ∆% CADU 15 120 - (120) (100.0%) CADU 18 500 500 - - CADU 19 - 500 500 - Total 620 1,000 380 61.3% Gross Debt* 3,656 3,972 315 8.6% *100% of the Company’s debt is denominated in Mexican pesos as of

March 31, 2020. At the end of 1
March 31, 2020. At the end of 1Q20, Debt Securities balance increased 61.3% YoY, totaling MXN 1,000 million, due to the MXN 500 million issuance of "CADU19" local notes conducted in 2Q19, which was partially offset by the full amortization of "CADU15" local notes last quarter. As of March 31, 2020, CADU's credit rating granted by HR Ratings and Verum was "HR A-" and "A-/M", respectively. As for the Company's local notes, Verum and HR Ratings rated “CADU18” and “CADU19” at "A-/M" and "HR A-", respectively. Leverage and Interest Coverage (Times) Concept 1Q19 1Q20 Net Debt to EBITDA 2.44 3.56 Total Liabilities / Equity 0.99 1.09 EBITDA / Interest Paid 3.00 2.51 Aiming to preserve the Company's liquidity, at the light of the health contingency, meetings were held with holders of "CADU18" and "CADU19" local notes, resulting in the extension of "CADU18" principal payments for May to December 2020. Additionally, a waiver of the pre-established covenants of these instruments was approved for 2020 and 2021. Debt 1Q20 Earnings Release 15 / 21 ri.caduinmobiliaria.com The impact on Company's financial ratios was reflected from 1Q20 onwards, as gross debt increased following the drawdown of credit lines, which have contributed to Company's liquidity, as revenue and EBITDA generation have been affected. At the end of 1Q20, Net Debt / EBITDA ratio stood at 3.56x, compared to 2.44x in the same period last year. As of March 31, 2020, the Interest Coverage Ratio (EBITDA / Interest Paid) was 2.51x, vs. 3.00x at the end of 1Q19. The weighted average cost of debt, at the end of 1Q20, was 9.98% (TIIE + 2.64 pp. / without commissions). 100% of debt is contracted at a floating rate. Prior to the waiver of not to do obligations, establ

ished in the “CADU18” and “CADU19â
ished in the “CADU18” and “CADU19” local notes, the covenants established the following: That the Company’s Total Liabilities / Shareholders’ Equity ratio does not exceed the 3.0 times mark (waiver approved) o As of March 31, 2020, Total Liabilities /Shareholders’ Equity ratio was 1.09x That the Company’s Net Debt / LTM EBITDA ratio will not be greater than 3.0 times (waiver approved) o As of March 31, 2020, Net Debt / LTM EBITDA ratio was 3.56x That the Company’s Interest Coverage ratio (LTM EBITDA divided by interest paid over the last twelve months) will not be less than 2.5 times (waiver approved) o As of March 31, 2020, Interest Coverage ratio stood at 2.51x Debt Maturity Profile as of March 31st, 2020 (MXN million) Concept Current year Up to 1 year Up to 2 years Up to 3 years Up to 4 years Up to 5 years Total Bank Loans 732 395 808 969 68 - 2,972 CADU 18 14 43 171 271 - - 500 CADU 19 - - - 36 429 36 500 Total 746 437 980 1,276 497 36 3,972 % Total 18.8% 11.0% 24.7% 32.1% 12.5% 0.9% 100.0% Regarding the maturity profile, only 18.8% of total debt matures in the next 9 months, 11.0% in 1Q21, 24.7% under 2 years, 32.1% in 3 years, 12.5% within 4 years and the remaining 0.9% in 5 years. At the end of 1Q20, the Company did not have any debt in foreign currency. 4,7864,923Stockholders' Equity (MXN million)Mar-19Mar-202.8%Stockholders’ Equity 1Q20 Earnings Release 16 / 21 ri.caduinmobiliaria.com (103)(161)(94)4130197(213)3Q184Q181Q192Q193Q194Q191Q20Free Cash Flow (MXN million)As of March 31, 2020, the Stockholders' Equity was MXN 4,923 million, an annual increase of 2.8%. It is relevant to underscore that, as of the end of 1Q20, Stockholders' equity embra

ces an adjustment in retained earni
ces an adjustment in retained earnings related to 4Q19 net income for MXN 334 million, of which MXN 220 million stemmed from the cancelation of the transaction of Land Plot #186, while the remaining MXN 114 million derived from deferred tax provisions. At the end of 1Q20, the capital structure was comprised of 52.1% liabilities and 47.9% equity, while as of March 31, 2019, it was comprised of 49.7% liabilities and 50.3% equity. At the end of 1Q20, the leverage ratio (Total Liabilities / Stockholders’ Equity) was 1.09x, vs. 0.99x at the end of 1Q19. The balance of stockholders' equity, as of March 31, 2020, was MXN 136 million higher than that recorded in 1Q19. In 1Q20, Return on Equity (ROE) was 9.4%. Cash Flow Cash Flow (MXN million) Concept 1Q19 1Q20 ∆% Earnings before taxes (EBT) 192 102 (46.8%) Investment activities 0 1 �(100.0%) Financing activities 32 27 (13.8%) Cash flow before taxes 223 130 (41.8%) Cash flow from operating activities (320) (346) 8.0% Net cash flow from operating activities (97) (216) �100.0% Net cash flow from investment activities 3 3 (16.3%) Net cash flow from financing activities 186 141 (23.9%) Δ Cash and cash activities 92 (72) �(100.0%) Cash and equivalents – beginning of period 674 491 (25.9%) Cash and equivalents – end of period 766 419 (45.3%) Free Cash Flow to Firm (94) (213) �100.0% Cash Variations 1Q20 Earnings Release 17 / 21 ri.caduinmobiliaria.com Free Cash Flow in 1Q20 was negative MXN 213 million, compared to the negative MXN 94 million in 1Q19, mainly due to a lower generation from homes sold revenue in March, as the last two weeks of this month’s sal

es were lost due to COVID-19.
es were lost due to COVID-19. ************************** Recent Developments In May 2020, the investors who had acquired the land plot #186 in Playa del Carmen, (pursuing to participate in co-developing activities) notified the management their decision to suspend investments due to COVID-19, thus stopping the commitments of payments made to the Company for the months of June and December 2020, and requesting a partial cancellation of the operation. Consequently, and following the advice of the Company’s external auditors, CADU decided to partially reverse the revenue recognized from this transaction in 4Q19; keeping the sale in the proportion of the funds already settled (MXN 40 million). On May 14, 2020, CADU held a meeting with the "CADU18" and "CADU19" local notes’ holders, approved, among other things: i) an extension to the principal payments of "CADU18", for the months of May to December 2020 (will be paid on February 21, 2023, as of the maturity date); and, ii) the waiver of “CADU18” and “CADU19” covenants. For additional information, please refer to the following link: Holders’ Meeting. At the end of May, principal and interest payments have been extended with a number of financial institutions (in line with the guidelines established by the Mexican Banking and Securities Commission on the prevailing environment). Analyst Coverage Given that Corpovael, S.A.B. de C.V. ("CADU") has issued securities under the regulations of the Mexican Exchange Internal Bylaws, it informs that the financial institutions that provide analyst coverage over CADU’s stock are: Actinver Casa de Bolsa, BBVA Bancomer, Punto CB, Apalache Analisis and Miranda GR. For more information, please visit http://ri.caduinmobiliaria.com. 2020 Guidance CADU has set the Guidance issued on last February under revision, as the pande

mic caused by COVID-19 will affect
mic caused by COVID-19 will affect its 2020 results; with an aftermath impact difficult to assess, as of this date. (94)(213)Accumulated Free Cash Flow as of March 31, 2020 (MXN million)Accumulated Mar-19Accumulated Mar-20 1Q20 Earnings Release 18 / 21 ri.caduinmobiliaria.com About CADU Corpovael, S.A.B. de C.V. “CADU” (BMV: CADUA) is a leading homebuilder in the development of affordable entry-level, middle-income, and residential homes in Mexico. CADU has more than a decade of experience in the housing sector where it has developed a successful business model by seeking sustained, high profitability. Its competitive advantage is based on an efficient and vertically integrated structure (developing activities of land acquisition, urbanization, building, and commercialization) in markets that have been identified as having a solid demand for housing. It primarily operates in Quintana Roo, Mexico Valley, and Jalisco. Forward-looking statements 1Q20 Conference Call Information presented by the Company may contain forward-looking statements about future events and/or financial results. The reader should understand that the results obtained may differ from the projections contained in this document, as past results in no way offer any guarantee of future performance. For this reason, the Company assumes no responsibility for any indirect factors or elements beyond its control that might occur inside Mexico or abroad and which might affect the outcome of these projections. 1Q20 Earnings Release 19 / 21 ri.caduinmobiliaria.com Corpovael, S.A.B de C.V. and Subsidiaries Consolidated Statement of Financial Position As of March 31st, 2020 and 2019 (Figures in MXN thousands) Mar-31 Mar-31 ∆% 2019 2020 Assets Current Assets:

Cash and cash equivalents $679,361
Cash and cash equivalents $679,361 $419,321 (38.3%) "CADU15" reserve fund 86,893 - (100.0%) Accounts receivable (Net) 494,414 416,752 (15.7%) Other accounts receivable (Net) 251,278 554,482 �100.0% Inventory 7,353,307 7,851,891 6.8% Other Current Assets Other 559,744 777,363 38.9% Non-current Assets: Property, plant and equipment (Net) 86,989 59,359 (31.8%) Other non-current assets - 198,491 - Otros activos no circulantes - - 6 Total Assets $9,511,986 $10,277,659 8.0% Liabilities and Stockholders’ Equity Current Liabilities Bank Loans 801,819 820,066 2.3% Debt securities 160,000 128,572 (19.6%) Income Tax payable - 67,324 - Accounts payable 266,748 229,839 (13.8%) Taxes payable 3,750 4,165 11.1% Other current liabilities 148,377 141,120 (4.9%) Non-current Liabilities Bank loans 2,234,644 2,151,893 (3.7%) Debt securities 460,000 871,428 89.4% Lease liability - 20,480 - Deferred taxes 650,397 920,123 41.5% Total Liabilities $4,725,735 $5,355,010 13.3% Stockholders’ Equity Capital stock 171,011 171,011 - Retained earnings 4,492,333 4,611,846 2.7% Controlling interest 4,663,344 4,782,857 2.6% Non-controlling interest 122,907 139,791 13.7% Total Stockholders’ Equity 4,786,251 4,922,648 2.8% Total Liabilities and Stock

holders’ Equity $9,511,986 $10
holders’ Equity $9,511,986 $10,277,659 8.0% Financial Statements 1Q20 Earnings Release 20 / 21 ri.caduinmobiliaria.com Corpovael, S.A.B de C.V. and Subsidiaries Statement of Consolidated Comprehensive Income (Figures in MXN thousands) 1Q19 As % of Revenue 1Q20 As % of Revenue ∆% Revenue: Homes Sold $926,853 97.6% $705,080 93.0% (23.9%) Land Plot Sales 1,655 0.2% 51,899 6.8% �100.0% Construction Services 20,693 2.2% 983 0.1% (95.3%) 949,201 100.0% 757,962 100.0% (20.1%) Costs and expenses: Cost of Sales (640,799) 67.5% (511,752) 67.5% (20.1%) Gross Income 308,402 32.5% 246,210 32.5% (20.2%) General Expenses (112,103) 11.8% (130,299) 17.2% 16.2% Operating Income 196,299 20.7% 115,911 15.3% (41.0%) Financial Income 3,331 2,787 (16.3%) Financial Expenses (7,608) (16,479) �100.0% (4,277) (13,693) �100.0% Earnings Before Taxes 192,022 20.2% 102,218 13.5% (46.8%) Income Taxes: Current (14,869) 1.6% (16,477) 2.2% 10.8% Net Comprehensive Consolidated Income $177,153 18.7% $85,741 11.3% (51.6%) Controlling Interest 166,429 84,647 (49.1%) Non-controlling Interest 10,724 1,094 (89.8%) Net Comprehensive Consolidated Income 177,153 18.7% 85,741 11.3% (51.6%) Net Income (Loss) per Share* 0.49 0.25 (49.1%) *Considering 342,022,974 shares outstanding in 1Q20 and 1Q19. 1Q20 Earnings Release 21 / 21 ri.caduinmobiliaria.com Corpovael, S.A.B de C.V. and Subsidiaries Statement of Consolidated Cash Flow

(Figures MXN thousands) 1Q1
(Figures MXN thousands) 1Q19 1Q20 Operating Activities Earnings before taxes 192,021 102,218 Items Related to Investment Activities Depreciation and Amortization 3,118 3,404 Interest Income (3,331) (2,787) Capitalized interest recognized in cost of sales 31,514 27,162 Cash Flow from Earnings Before Taxes 223,322 129,997 Cash Flow from or used in Operating Activities Decrease (increase) in accounts receivable (56,948) (120,020) Decrease (increase) in inventory (131,793) 90,135 Decrease (increase) in other accounts receivable and other current assets 79,601 (341,166) Increase (decrease) in accounts payable (51,787) 148,817 Increase (decrease) in other liabilities (159,507) (183,704) Income taxes paid or reimbursed - 59,846 Net Cash Flows from or used in Operating Activities (97,112) (216,095) Investment Activities - Investment in property, plant and equipment - - Interest received 3,331 2,787 Net Cash Flows from or used in Investment Activities 3,331 2,787 Financing Activities Bank loans 850,974 768,914 Debt certificates - - Amortization of bank loans (525,319) (523,423) Amortization of debt certificates (40,000) - Dividends paid - - Interests paid (100,000) (99,073) Other items - (5,223) Net Cash Flows from or used in Financing Activities 185,655 141,195 Increase (decrease) in Cash and Cash Equivalents 91,874 (72,113) Cash and Cash Equivalents at Beginning of the Period 674,380 491,434 Cash and Cash Equivalents at End of the Period 766,254 419,321 Note on Financial Statements: in addition to the contents of this report, for better analysis we recommend referring to the details noted on financial statements found at http://ri.caduinmobiliaria