BRMALLS (Bovespa: BRML3) Announces EBITDA Of R$61.9 Million in the 3Q08, an Increase Of 45.7% Over the 3Q07, With an EBITDA Margin of 74.9%

Gross revenues totaled R$88.5 million in the 3Q08, an increase of 38.4% over the 3Q07, and R$239.2 million year-to-date, 69.8% over on the first nine months of 2007;

Consolidated NOI totaled R$73.5 million in the 3Q08, 52.0% higher than in the 3Q07, and R$194.9 million in the 9M08, an increase of 87.8% year-on-year. The NOI margin also increased from 84.4% in the 3Q07 to 89.8% in the 3Q08, and from 84.5% in the 9M07 to 88.9% in the 9M08;

Also in the 3Q08, same-property NOI increased 28.0% year-on-year. This substantial increase was primarily fueled by growth in the acquired malls, up by 39.5% over the 2Q08. In the 9M08 same-property NOI climbed 24.6% year-on-year;

Adjusted EBITDA stood at R$61.9 million in the 3Q08, 45.7% up over the 3Q07 and the adjusted EBITDA margin also improved substantially, widening from 71.7% to 74.9%. Year-to-date adjusted EBITDA totaled R$163.4 million, up by 76.9% over the 9M07, while the adjusted EBITDA margin increased from 70.2% to 73.8%;

AFFO (Adjusted Funds from Operations) totaled R$37.4 million in the 3Q08, an increase of 180.8% over the 3Q07, and R$81.9 million in the 9M08, a growth of 41.6% over the 9M07;

We ended the quarter with a cash position of R$756.6 million, down by R$154.8 million from June 30, 2008. These funds were used in the acquisitions concluded during the 3Q08 and in the already announced expansions, renovations and greenfield projects;

The Company’s gross debt totaled R$ 1.361 billion while net debt stood at R$ 604.4 million. Only R$ 68 million and R$ 145 million of the total debt amount is due over the next 12 and 24 months, respectively. The average amortization term is 14 years;
Only 25.0% of gross debt is exposed to the non-cash impact of the exchange variation. We do not undertake speculative operations with currency derivatives and we have protected our interest payment cash flow for the next 4.25 years. As a result, the R$ 59.2 million non-cash impact of the exchange variation is an accountable effect and should not have any impact on the Company’s cash flow;

We ended the 3Q08 with an accounting loss of R$49.9 million versus a net loss of R$13.1 million in the 3Q07. The negative result was due to the non-cash impact of the exchange rate variation on the principal of our perpetual bond;

Our current cash position covers all our expansions and greenfield capex. We continue to work on the approval of our projects and as the projects are approved, we will review its associated economics based on the macroeconomic scenario. Construction work will only begin after revision is done and returns are achieved.

We reduced the total fiscal costs (including sales taxes) to 8.5% of gross revenues, versus 15.0% in the 2Q08, giving a tax burden of 13.1% in the first nine months.

Despite the current financial crisis, we achieved the best operating results in our history. Shopping mall sales recorded growth of 12.7% in SSS and rent revenues increased 12.4% in SSR over the 3Q07. In year-to-date terms, these indicators increased by 11.1% and 10.0% year-on-year, respectively. We continued to achieve record occupancy rates (96.6%) and the lowest level of overdue payments of up to 30 days (3.8%).

Our sales team negotiated 278 contracts including expansion and greenfield project contracts in this quarter and 919 contracts year-to-date. In terms of GLA, 33,9 thousand m(2) were negotiated in the 3Q08 and 114,1 thousand m(2) year-to-date. Our leasing spread has remained above 13% for renewals and close to 15% for new contracts in 9M08.