PDG Realty : 3Q18 Release

São Paulo, November 14th, 2018: PDG Realty S.A. (PDGR3) - Under Court-supervised Reorganization - announces today its results for the third quarter of 2018. Founded in 2003, PDG develops projects for different segments and publics, operating in the development, construction and sale of residential and commercial units, as well as land plots.

Highlights:

Gross sales increased 122% in 3Q18 over 3Q17, from R$37 million to R$82 million. YTD gross sales grew 25%, from R$181 million in 9M17 to R$266 in 9M18. (page 8)

Net sales also recorded a significant improvement, reaching R$35 million in 3Q18, in comparison to the negative sale recorded in 3Q17. In 9M18 net sales reached R$78 million, also compared to a negative sale registered in 9M17. (page 8)

In 3Q18 the Operating Net Revenues increased 462% over 3Q17, reaching R$85.5 million. In 9M18, the revenues amounted R$320.9 million, an increase of 10% over the same period last year. (page 21)

In this quarter the number of units transferred was 31% higher than 3Q17. In the Q-o-Q comparison the PSV increased 13%. (page 15)

Conference Call

Wednesday, November 21st, 2018

•  Portuguese

•  English (Simultaneous translation)

11:00 a.m. (Brasília) 08:00 a.m. (NY)

08:00 a.m. (NY)

11:00 a.m. (Brasília)

Tel.: [phone]

([phone]

Replay: ([phone] | Code: 7529736#

Tel.: [phone] [phone]

Replay: (11) 3193-1012 | Code: 0206125#

Investor Relations:

([phone]www.pdg.com.br/[e-mail]

3Q18 and 9M18 Earnings Results

Highlights:

For another consecutive quarter, the G&A expenses registered a significant fall of 24%. In 9M18, the reduction in G&A reached 44% over 9M17. (page 17)

The net loss was R$190 million down, representing a reduction of 64% in 3Q18, from

R$299.2 million in 3Q17 to R$108.9 million in 3Q18. In the y-o-y net loss decreased by R$398 million, representing a reduction of 36%. (page 21)

Between June and September, occurred the payment of the 4 of the 6 installments to the creditors foreseen in the Plan, amounting R$65 million. (page 4)

Recent Events:

In October the payment of the fifth installment, as foreseen in the Recovery Plan, was made to the creditors, amounting to R$15.7 million.

In November we are paying the last installment to the creditors. With this settled, and considering that the next maturities foreseen will only occur in 15 (fifteen) years, we expect to the coming periods a material reduction in the cash flow's pressure. In addition, since the beginning of the implementation of its Recovery Plan, PDG has successfully fulfilled all the obligations assumed with its creditors.

TABLE OF CONTENTS

Message from ManagementOperating and Financial IndicatorsOperating Performance - Launches

4 7 8

Operating Performance - Sales

8

Operating Performance - Cancellations and ResaleOperating Performance - Sales Speed (VSO)Operating Performance - InventoryOperating Performance - LandbankOperating Performance - Historical DataOperating Performance - Occupancy PermitsOperating Performance - Occupancy Permit ScheduleOperating Performance - Title IndividualizationsOperating Performance - Mortgage TransfersFinancial Performance

9 10 11 13 13 14 14 15 15 16

Income Statement and Balance Sheet

21

Initial Message

Throughout the year, PDG has taken important steps towards its Recovery Plan. The most important step was the payment of five of the six installments that were foreseen in the Plan, totaling more than R$81 million. Over November we are paying the last installment. In addition, as mentioned in the second quarter, we concluded on June 15th the capital increase related to the debt conversion into equity, in the total amount of R$74.2 million.

In total, considering the payment of the installments and the capital increase, the Company has already settled more than R$155 million in debts that are subjected to the Recovery Plan.

Thereby, we are very pleased to announce that the Company has, up to now, fully complied with all the terms established in its Recovery Plan, demonstrating it's commitment and effort to honor the obligations assumed with its labor and unsecured creditors and suppliers.

From now on, considering that the next maturities foreseen in the Recovery Plan will only occur in 15 years, we expect to the coming periods a material reduction in the cash flow's pressure.

In addition to the implementation phase and in compliance with the first payments established in the Plan, we continue to focus on a thorough assessment of the Company's processes, controls and structures, aiming to increase efficiency and reduce costs. This review will allow us to give due priority to the needs of the Plan, and also will support the creation of the grounds to the beginning of the resumption of PDG's activities.

During the third quarter we already observed a significant improvement in many of the Company's operating indicators, a fact that already reflects the improvement efforts implemented by the management in charge.

We have also started our short and mid-term Strategic Planning so that the Company can gradually launch new projects, as foreseen in the Plan.

Regarding the unfinished projects, we continue searching for alternatives that can make them feasible. Thus, we continue to negotiate with our main creditors and seek other interested parties so that we can fulfill the commitment assumed with our clients and, in addition, add value to the Company's assets.

Operating Results

In the 3Q18, gross sales totaled R$82 million, 122% higher than in 3Q17. In 9M18, gross sales amounted R$226 million, compared to gross sales of R$181 million in 9M17, a 25% increase. The improvement in sales compared to last year reflects the change in the Company's sales strategy, where we resumed the sales of the encumbered units throughout the year, as well as commercial campaigns in the press and digital media.

During 3Q18, cancellations came to R$47 million, 38% lower than the amount registered in 3Q17. In 9M18, cancellations reached R$148 million, 55% lower than 9M17. We continue to maintain the strategy to prioritize cancellations of units with better market liquidity and unencumbered, to accelerate the Company's cash generation.

With the improvement in gross sales recorded in the quarter and YTD, net sales came to R$35 million in 3Q18 and R$78 million in 9M18. It was this improvement in sales that helped us fulfill the payments established in the Recovery Plan, compensating and financing the lack of cash in clusters of some banks. Concerning the sales in 3Q17 and 9M17, net sales were negative by R$39 million and R$149 million, respectively.

In the comparison between 3Q18 and 3Q17, G&A expenses were reduced by 24%. As for 9M18 versus 9M17, the total reduction was 44%, reflecting the constant readjustments in the Company's structure and the increase in operational efficiency. Between the end of September 2017 and September 2018, there was a 41% reduction in headcount. Thus the Company ended the third quarter with 225 employees.