Guidance On Track
Robust EPS Expansion
Afya Limited (Nasdaq: AFYA) (“Afya” or the “Company”),
the leading medical education group and digital health services
provider in Brazil, reported today financial and operating results
for the three and nine-month period ended September 30, 2022 (third
quarter 2022). Financial results are expressed in Brazilian Reais
and are presented in accordance with International Financial
Reporting Standards (IFRS).
Third Quarter 2022 Highlights
- 3Q22 Adjusted Net Revenue increased 25.2% YoY to R$580.2
million. Adjusted Net Revenue excluding acquisitions grew 17.1%,
reaching R$542.4 million.
- 3Q22 Adjusted EBITDA increased 19.5% YoY, reaching R$228.7
million, with an Adjusted EBITDA Margin of 39.4%. Adjusted EBITDA
excluding acquisitions grew 10.2%, reaching R$211.0 million, with
an Adjusted EBITDA Margin of 38.9%.
- 3Q22 Adjusted Net Income increased 2.7% YoY, reaching R$120.1
million, with an EPS growth of 47.4% in the same period.
Nine Months 2022 Highlights
- 9M22 Adjusted Net Revenue increased 38.2% YoY to R$1,724.0
million. Adjusted Net Revenue excluding acquisitions grew 15.6%,
reaching R$1,441.5 million.
- 9M22 Adjusted EBITDA increased 28.6% YoY reaching R$719.7
million, with an Adjusted EBITDA Margin of 41.7%. Adjusted EBITDA
excluding acquisitions grew 5.3%, reaching R$589.2 million, with an
Adjusted EBITDA Margin of 40.9%.
- 9M22 Adjusted Net Income increased 18.8% YoY, reaching R$406.4
million, with an EPS growth of 77.5% in the same period.
- Cash conversion of 104.6%, with a solid cash position of
R$715.6 million.
- ~286 thousand monthly active physicians and medical students
using Afya’s Digital Services, an increase of 15.7% over the same
period of last year.
Table 1: Financial Highlights For the three months
period ended September 30, For the nine months period ended
September 30, (in thousand of R$)
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
(a) Net Revenue
580,575
542,810
454,387
27.8%
19.5%
1,745,055
1,462,585
1,221,112
42.9%
19.8%
(b) Adjusted Net Revenue (1)
580,198
542,433
463,278
25.2%
17.1%
1,723,993
1,441,523
1,247,321
38.2%
15.6%
(c) Adjusted EBITDA (2)
228,730
210,968
191,400
19.5%
10.2%
719,717
589,167
559,709
28.6%
5.3%
(e) = (c)/(b) Adjusted EBITDA Margin
39.4%
38.9%
41.3%
-190 bps -240 bps
41.7%
40.9%
44.9%
-320 bps -400 bps *For the three months period ended September 30,
2022, "2022 Ex Acquisitions" excludes: UNIGRANRIO (only July, 2022;
Closing of UNIGRANRIO was in August, 2021), RX PRO, Garanhuns, Além
da Medicina, Cardiopapers, and Glic (all from July to September,
2022; Closing of RX PRO, Garanhuns, Além da Medicina, Cardiopapers,
and Glic were after October, 2021). *For the nine months period
ended September 30, 2022, "2022 Ex Acquisitions" excludes: iClinic
(only January, 2022; Closing of iClinic was in January, 2021),
Medicinae (from January to March, 2022; Closing of Medicinae was in
March, 2021), Cliquefarma (from January to April, 2022; Closing of
Cliquefarma was in April, 2021), Medical Harbour (from January to
April, 2022; Closing of Medical Harbour was in April, 2021), Shosp
(from January to May, 2022; Closing of Shosp was in May, 2021),
UNIFIPMoc and FIP Guanambi (from January to May, 2022; Closing of
UNIFIPMoc and FIP Guanambi was in June, 2021), UNIGRANRIO (from
January to July, 2022; Closing of UNIGRANRIO was in August, 2021),
RX PRO, Garanhuns, Além da Medicina, Cardiopapers, and Glic (all
from January to September, 2022; Closing of RX PRO, Garanhuns, Além
da Medicina, Cardiopapers, and Glic were after October, 2021). (1)
Includes mandatory discounts in tuition fees granted by state
decrees and individual/collective legal proceedings and public
civil proceedings due to COVID 19 on site classes restriction, and
excludes any recovery of these discounts that were invoiced based
on the Supreme Court decision. (2) See more information on
"Non-GAAP Financial Measures" (Item 08).
1. Message from Management
As we approach the end of the year, we can gladly see Afya
delivering strong results again. This quarter was marked by
significant increases in net revenue in our three segments,
positive EBITDA, cash generation and EPS growth, and a consistent
business expansion. All these factors combined enable us to
reassure our 2022 guidance, reinforcing our business strategy
execution.
Back in the third quarter of 2021, we were hoping to see the
pandemic lose its strength. Now, in 2022, we can finally see our
students, employees, and partners extracting the best from our
ecosystem again. After the opening of six new Continuing Education
campuses – a segment that was impacted during COVID-19 times -, we
can see, for the third time this year, an incredible recovery
compared to last year, with strong intake processes, new campuses
and courses maturation, and our practical classes boosting
again.
On the Undergrad side of the education segment, we can also see
important movements. First, the successful opening of four Mais
Médicos campuses – Abaetetuba, Bragança, Itacoatiara, and
Manacapuru -, along with UniSL Ji-Parana campus, all of them
combined totaling 228 new medical seats to our portfolio this
quarter, allowing us to reach an impressive number of 2,709 medical
operating seats, strengthening our consolidation as the medical
undergrad leader in Brazil. Second, to further boost this
leadership, on October 13rd, we announced the entering into a share
purchase agreement for our largest acquisition so far, UNIT Alagoas
and FITS Jaboatão dos Guararapes, adding 340 more medical seats to
our base. With the conclusion of this acquisition, will increase
our 2,759 approved seats to 3,099. And third, the completeness of
Unigranrio’s integration process also in October, one year after
its acquisition, proving our commitment to extracting synergies
within the operation. All this effort means one thing: our medical
education business remains, and will continue to be, the
cornerstone of our business in the short and middle terms,
delivering highly predicted growth combined with strong
profitability and cash generation.
On our Digital Services segment, we are proud to see another
quarter of strong inorganic and organic growth. Afya’s Digital
Health Services is being able to help physicians’ during their
medical journey and now, with our 6 pillars complete after the
acquisition of Glic, we will further explore the development of our
ecosystem, which is being built with multiple offerings, unlocking
new interactions and revenue streams that go beyond the physicians,
achieving pharma players, hospitals, labs and drugstores chains,
scratching the surface of a total addressable market of R$28.4
billion. Since the beginning of the year, we have been disclosing
our B2P and B2B figures, breaking down our Digital Service’s net
revenue within these two for a better perspective.
As a reflection of our great results and actions that are being
shown to the market, we are also glad to announce that, for the
third time in a row, we’ve won the “Anuário Época Negócios 360º”
award as the best Company in the Education segment. We are very
proud of this achievement, as it is the recognition of the work and
passion of our more than nine thousand employees around a unique
vision: to transform health together with those who have medicine
as a vocation.
With another round of high and sustainable growth, our mission
remains solid as ever: to provide an ecosystem that integrates
education and digital solutions for the entire medical journey,
enhancing the development, updating, assertiveness, and
productivity of health professionals. We are very proud of our
business and of what we have achieved so far, as well as excited
about what we are planning for the future.
2. Subsequent Events in the Quarter:
- Afya announced on October 13th, 2022, that it has entered into
a share purchase agreement for the acquisition of 100% of the total
share capital of Sociedade Educacional e Cultural Sergipe DelRey
Ltda., that encompasses the operations of Centro Universitário
Tiradentes Alagoas ("UNIT Alagoas”) and Faculdade Tiradentes
Jaboatão dos Guararapes ("FITS Jaboatão dos Guararapes”). The
acquisition will contribute 340 medical school seats to Afya,
increasing Afya’s total medical school seats from 2,759 to 3,099.
The aggregate purchase price (enterprise value) is R$825.0 million
before the deduction of Net Debt that will be calculated at the
closing date, and it will be paid as follows: R$575 million in cash
on the transaction closing date and R$250 million in three annual
installments, respectively, of R$150 million, R$50 million, and
R$50 million, adjusted by the Brazilian interest rate (SELIC). We
expected an EV/EBITDA of 5.8x at maturity and post synergies
(2024). With the acquisition, Afya further consolidates its
presence in the Brazilian Northeast, entering a new state in the
region.
3. Full Year 2022 Guidance Reaffirmed
The Company is reaffirming its previously issued guidance for
FY22 including the successfully concluded acceptances of new
medical students for the second semester, ensuring 100% occupancy
in all of its medical schools.
The guidance for FY2022 is defined in the following table:
Guidance for 2022
Important
considerations
2022 Adjusted Net Revenue is expected to
be between R$2,280.0 million – R$2,360.0 million
Includes four Mais Médicos units start operating in 2H22;Includes
Ji-Parana acquisition start operating in the 2H22;Includes Além da
Medicina acquisition;Excludes any acquisition that may be concluded
after the issuance of the guidance, such as Cardiopapers and Glic.
2022 Adjusted EBITDA is expected to be
between R$935.0 million - R$1,015 million
4. 9M22 Overview
Operational Review
Afya is the only company offering educational and technological
solutions to support physicians across every stage of their medical
career, from undergraduate students in their medical school years
through medical residency preparatory courses, medical
specialization programs, and continuing medical education. The
Company also offers solutions to empower physicians in their daily
routine including supporting clinic decisions through mobile app
subscription, delivering practice management tools through a
Software as a Service (SaaS) model, and assisting physicians in
their relationship with their patients.
The Company reports results for three distinct business units.
The first, Undergrad – medical schools, other healthcare programs,
and ex-health degrees. Revenue is generated from the monthly
tuition fees the Company charges students enrolled in the
undergraduate programs. The second, Continuing Education –
specialization programs and graduate courses for physicians.
Revenue is also generated from the monthly tuition fees the Company
charges students enrolled in the specialization and graduate
courses. The third is Digital Services – digital services offered
by the Company at every stage of the medical career. This business
unit is divided into Business to Physician (which encompasses
Content & Technology for Medical Education, Clinical Decision
Software, Practice Management Tools & Electronic Medical
Records, Physician-Patient Relationship, Telemedicine, and Digital
Prescription) and Business to Business (which provides access and
demand for the healthcare players). Revenue is generated from
printed books and e-books, and is recognized at the point in time
when control is transferred to the customer, and subscription fees,
which are recognized as the services are transferred over time.
Key Revenue Drivers – Undergraduate Courses
Table 2: Key Revenue Drivers Nine months period ended
September 30,
2022
2021
% Chg
Undergrad Programs MEDICAL SCHOOL Approved Seats
2,759
2,611
5.7
%
Operating Seats
2,709
2,361
14.7
%
Total Students (end of period)
17,997
15,977
12.6
%
Average Total Students
17,692
13,983
26.5
%
Average Total Students (ex-Acquisitions)*
15,237
13,983
9.0
%
Tuition Fees (Total - R$MM)
1,522,393
1,081,135
40.8
%
Tuition Fees (ex- Acquisitions* - R$MM)
1,282,263
1,081,135
18.6
%
Medical School Gross Avg. Ticket (ex- Acquisitions* -
R$/month)
9,351
8,591
8.8
%
Medical School Net Avg. Ticket (ex- Acquisitions* -
R$/month)
7,765
7,109
9.2
%
UNDERGRADUATE HEALTH SCIENCE Total Students (end of period)
18,114
19,297
-6.1
%
Average Total Students
19,932
14,587
36.6
%
Average Total Students (ex-Acquisitions)*
14,401
14,587
-1.3
%
Tuition Fees (Total - R$MM)
254,613
163,270
55.9
%
Tuition Fees (ex- Acquisitions* - R$MM)
167,925
163,270
2.9
%
OTHER UNDERGRADUATE Total Students (end of period)
23,085
26,953
-14.4
%
Average Total Students
23,746
18,533
28.1
%
Average Total Students (ex-Acquisitions)*
14,190
18,533
-23.4
%
Tuition Fees (Total - R$MM)
201,116
161,063
24.9
%
Tuition Fees (ex- Acquisitions* - R$MM)
135,500
161,063
-15.9
%
TOTAL TUITION FEES Tuition Fees (Total - R$MM)
1,978,122
1,405,468
40.7
%
Tuition Fees (ex- Acquisitions* - R$MM)
1,585,688
1,405,468
12.8
%
*For the nine months period ended September 30, 2022, "2022 Ex
Acquisitions" excludes: UNIFIPMoc and FIP Guanambi (from January to
May, 2022; Closing of UNIFIPMoc and FIP Guanambi was in June,
2021), UNIGRANRIO (from January to July, 2022; Closing of
UNIGRANRIO was in August, 2021), and Garanhuns (from January to
September, 2022; Closing of Garanhuns was in November, 2021).
Key Revenue Drivers – Continuing Education and Digital
Services
Table 3: Key Revenue Drivers Nine months period ended
September 30,
2022
2021
% Chg
Continuing Education Medical Specialization &
Others Total Students (end of period)
4,036
2,835
42.4
%
Average Total Students
3,686
3,273
12.6
%
Average Total Students (ex-Acquisitions)
3,686
3,273
12.6
%
Net Revenue from courses (Total - R$MM)
75,568
51,481
46.8
%
Net Revenue from courses (ex- Acquisitions¹)
75,568
51,481
46.8
%
Digital Services Content & Technology for Medical
Education Medcel Active Payers Prep Courses & CME - B2P
12,886
16,878
-23.7
%
Prep Courses & CME - B2B
5,704
4,097
39.2
%
Além da Medicina Active Payers
5,696
-
n.a.
Cardio Papers Active Payers
5,090
-
n.a.
Medical Harbour Active Payers
5,080
306
1560.1
%
Clinical Decision Software Whitebook Active Payers
133,926
117,826
13.7
%
Clinical Management Tools² iClinic Active Payers
22,596
15,984
41.4
%
Shosp Active Payers
2,348
2,093
12.2
%
Digital Services Total Active Payers (end of period)
193,326
157,184
23.0
%
Net Revenue from Services (Total - R$MM)
134,243
109,613
22.5
%
Net Revenue - B2P
117,256
103,596
13.2
%
Net Revenue - B2B
16,987
6,017
182.3
%
Net Revenue From Services (ex-Acquisitions¹)
111,050
109,613
1.3
%
(1) For the nine months period ended September 30, 2022, "2022 Ex
Acquisitions" excludes: iClinic (only January, 2022; Closing of
iClinic was in January, 2021), Medicinae (from January to March,
2022; Closing of Medicinae was in March, 2021), Cliquefarma (from
January to April, 2022; Closing of Cliquefarma was in April, 2021),
Medical Harbour (from January to April, 2022; Closing of Medical
Harbour was in April, 2021), Shosp (from January to May, 2022;
Closing of Shosp was in May, 2021), RX PRO, Além da Medicina,
Cardiopapers, and Glic (all from January to September, 2022;
Closing of RX PRO, Além da Medicina, Cardiopapers, and Glic were
after October, 2021). (2) Clinical management tools includes
Telemedicine and Digital Prescription features.
Key Operational Drivers – Digital Services
Monthly Active Users (MaU) represents the number of unique
individuals that consumed Digital Services content in each one of
our products in the last 30 days of a specific period.
Total monthly active users reached 286 thousand, 15.7% higher
over the same period in the last year.
Monthly Unique Active Users (MuaU) represents the number of
unique individuals, without overlap of users among products, in the
last 30 days of a specific period. Since this concept is being
implemented this year, the historical metrics of MuaU could not be
disclosed.
Table 4: Key Operational Drivers for Digital Services - Monthly
Active Users (MaU)
3Q22
3Q21
% Chg YoY
2Q22
% Chg QoQ
Content & Technology for Medical Education
21,811
20,015
9.0
%
20,739
5.2
%
Clinical Decision Software
239,640
194,082
23.5
%
221,862
8.0
%
Clinical Management Tools¹
23,036
32,909
-30.0
%
21,151
8.9
%
Physician-Patient Relationship
1,397
-
n.a.
1,101
26.9
%
Total Monthly Active Users (MaU) - Digital Services
285,884
247,006
15.7
%
264,853
7.9
%
1) Clinical management tools includes Telemedicine and Digital
Prescription features 2) Clinical management tools MAU excludes
other users other than payors, starting in 1Q22 3) Shosp, Medicinae
and Além da Medicina starting in 1Q22 4) Cardiopapers and Glic
starting in 2Q22
Table 5: Key Operational Drivers for Digital
Services - Monthly Unique Active Users (MuaU)
3Q22
Total Monthly Unique Active Users (MuaU) - Digital Services
263,587
1) Total Monthly Unique Active Users excludes non-integrated
companies: Medical Harbour, Medicinae, Shosp, Além da Medicina,
Cardiopapers and Glic
Seasonality
Undergrad’s and Continuing Education tuition revenues are
related to the intake process and monthly tuition fees charged to
students over the period thus the Company does not have significant
fluctuations during the semester. Digital Services is comprised
mostly by Medcel, Pebmed and iClinic revenues. While Pebmed and
iClinic do not have significant fluctuation regarding seasonality,
Medcel’s revenue is concentrated in the first and last quarter of
the year, as a result of the enrollments of Medcel’s clients
period. The majority of Medcel’s revenues are derived from printed
books and e-books, which are recognized at the point in time when
control is transferred to the customer. Consequently, the Digital
Services segment generally has higher revenues and results of
operations in the first and last quarters of the year compared to
the second and third quarters of the year.
Revenue
As disclosed in our 2Q22 earnings release, the Company has been
recovering amounts related to mandatory discounts in tuition fees
previously granted by individual and collective legal proceedings
and public civil proceedings related to COVID-19. For the nine
months period ended September 30, 2022, this amount represents
R$21.1 million, and, as Afya has excluded these mandatory discounts
from Adjusted Net Revenue in 2020 and 2021, this recovery is not
counted for Adjusted Net Revenue in 2022.
Adjusted Net Revenue for the third quarter of 2022 was R$580.2
million, an increase of 25.2% over the same period of the prior
year. Excluding acquisitions, Adjusted Net Revenue in the third
quarter increased 17.1% YoY to R$542.4 million, a strong increase,
mainly due to the maturation of medical seats and the beginning of
the 4 Mais Médicos operations during the third quarter, higher
tickets in Medicine courses, and the Continuing Education recovery,
which ended the third quarter with a 72.2% year over year increase
in net revenue, mainly due to the strong student base expansion
during 2022.
Once again, the Digital Services segment has also contributed to
the Adjusted Net Revenues growth this quarter, increasing 59.4%
year over year, and 30.4%, excluding acquisitions. This organic
growth is a combination of (a) a great start of the B2B
engagements, reaching 61 contracts – including pharma solutions and
RX PRO contracts -, with 40 different pharmaceutical industry
companies, and (b) the expansion of the active payers in the B2P,
mainly in Whitebook and iClinic.
For the nine-month period ended September 30, 2022, Adjusted Net
Revenue was R$1,724.0 million, an increase of 38.2% over the same
period of last year. Excluding acquisitions, Adjusted Net Revenue
in the nine-month period increased 15.6% YoY to R$1,441.5
million.
Table 6: Revenue & Revenue Mix (in thousands of R$)
For the three months period ended September 30, For the
nine months period ended September 30,
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
Net Revenue Mix Undergrad
509,097
479,424
410,059
24.2%
16.9%
1,538,037
1,278,760
1,060,345
45.1%
20.6%
Adjusted Undergrad¹
508,720
479,047
418,950
21.4%
14.3%
1,516,975
1,257,698
1,086,554
39.6%
15.8%
Continuing Education
27,906
27,906
16,209
72.2%
72.2%
75,568
75,568
51,481
46.8%
46.8%
Digital Services
44,548
36,456
27,948
59.4%
30.4%
134,243
111,050
109,613
22.5%
1.3%
Inter-segment transactions
-976
-976
171
n.a.
-670.8%
-2,793
-2,793
- 327
754.1%
754.1%
Total Reported Net Revenue
580,575
542,810
454,387
27.8%
19.5%
1,745,055
1,462,585
1,221,112
42.9%
19.8%
Total Adjusted Net Revenue ¹
580,198
542,433
463,278
25.2%
17.1%
1,723,993
1,441,523
1,247,321
38.2%
15.6%
*For the three months period ended September 30, 2022, "2022 Ex
Acquisitions" excludes: UNIGRANRIO (only July, 2022; Closing of
UNIGRANRIO was in August, 2021), RX PRO, Garanhuns, Além da
Medicina, Cardiopapers, and Glic (all from July to September, 2022;
Closing of RX PRO, Garanhuns, Além da Medicina, Cardiopapers, and
Glic were after October, 2021). *For the nine months period ended
September 30, 2022, "2022 Ex Acquisitions" excludes: iClinic (only
January, 2022; Closing of iClinic was in January, 2021), Medicinae
(from January to March, 2022; Closing of Medicinae was in March,
2021), Cliquefarma (from January to April, 2022; Closing of
Cliquefarma was in April, 2021), Medical Harbour (from January to
April, 2022; Closing of Medical Harbour was in April, 2021), Shosp
(from January to May, 2022; Closing of Shosp was in May, 2021),
UNIFIPMoc and FIP Guanambi (from January to May, 2022; Closing of
UNIFIPMoc and FIP Guanambi was in June, 2021), UNIGRANRIO (from
January to July, 2022; Closing of UNIGRANRIO was in August, 2021),
RX PRO, Garanhuns, Além da Medicina, Cardiopapers, and Glic (all
from January to September, 2022; Closing of RX PRO, Garanhuns, Além
da Medicina, Cardiopapers, and Glic were after October, 2021). (1)
Includes mandatory discounts in tuition fees granted by state
decrees and individual/collective legal proceedings and public
civil proceedings due to COVID 19 on site classes restriction, and
excludes any recovery of these discounts that were invoiced based
on the Supreme Court decision. (2) See more information on
"Non-GAAP Financial Measures" (Item 08).
Adjusted EBITDA
Adjusted EBITDA for the three-month period ended September 30,
2022 increased 19.5% to R$228.7 million, up from R$191.4 million in
the same period of the prior year, while the Adjusted EBITDA Margin
decreased 190 basis points to 39.4%. For the nine-month period
ended September 30, 2022, Adjusted EBITDA was R$719.7 million, an
increase of 28.6% over the same period of the prior year, with an
Adjusted EBITDA Margin decrease of 320 basis points in the same
period. The Adjusted EBITDA Margin reduction is due to (a) the
Digital segment, mostly in the performance of Medcel in the
residency preparatory market, (b) the expansion of the Continuing
Education segment, which is still maturing the new campuses, and
(c) the increase in corporate expenses in the period.
Excluding acquisitions, Adjusted EBITDA for the three-month
period increased 10.2% YoY to R$211.0 million, while the Adjusted
EBITDA Margin decreased 240 basis points to 38.9%. For the
nine-month period, excluding acquisitions, Adjusted EBITDA
increased 5.3% YoY to R$589.2 million, while the Adjusted EBITDA
Margin decreased 400 basis points to 40.9%, mainly due to the same
reasons previously explained.
Table 7: Adjusted EBITDA (in thousands of R$)
For the
three months period ended September 30, For the nine months
period ended September 30,
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
2022
2022 Ex Acquisitions*
2021
% Chg
% Chg Ex Acquisitions
Adjusted EBITDA
228,730
210,968
191,400
19.5%
10.2%
719,717
589,167
559,709
28.6%
5.3%
% Margin
39.4%
38.9%
41.3%
-190 bps -240 bps
41.7%
40.9%
44.9%
-320 bps -400 bps *For the three months period ended September 30,
2022, "2022 Ex Acquisitions" excludes: UNIGRANRIO (only July, 2022;
Closing of UNIGRANRIO was in August, 2021), RX PRO, Garanhuns, Além
da Medicina, Cardiopapers, and Glic (all from July to September,
2022; Closing of RX PRO, Garanhuns, Além da Medicina, Cardiopapers,
and Glic were after October, 2021). *For the nine months period
ended September 30, 2022, "2022 Ex Acquisitions" excludes: iClinic
(only January, 2022; Closing of iClinic was in January, 2021),
Medicinae (from January to March, 2022; Closing of Medicinae was in
March, 2021), Cliquefarma (from January to April, 2022; Closing of
Cliquefarma was in April, 2021), Medical Harbour (from January to
April, 2022; Closing of Medical Harbour was in April, 2021), Shosp
(from January to May, 2022; Closing of Shosp was in May, 2021),
UNIFIPMoc and FIP Guanambi (from January to May, 2022; Closing of
UNIFIPMoc and FIP Guanambi was in June, 2021), UNIGRANRIO (from
January to July, 2022; Closing of UNIGRANRIO was in August, 2021),
RX PRO, Garanhuns, Além da Medicina, Cardiopapers, and Glic (all
from January to September, 2022; Closing of RX PRO, Garanhuns, Além
da Medicina, Cardiopapers, and Glic were after October, 2021).
Adjusted Net Income
Net Income for the third quarter of 2022 was R$80.4 million, an
increase of 38.7% over the same period of the prior year. For the
nine-month period ended September 30, 2022, Net Income increased
66.3%, from R$193.3 million to R$321.4 million, mainly due to: (a)
the increase in operational results, as previously described, (b)
the recovery of a portion of the prior granted discounts in tuition
fees related to COVID-19, (c) the reduction of financial expenses
related to the fx rate difference regarding the Softbank
transaction that affected 2Q21, and (d) the reduction on the
non-recurring M&A expenses.
Adjusted Net Income for the third quarter of 2022 was R$120.1
million, an increase of 2.7% over the same period of the prior
year. Adjusted Net Income for the nine-month period of 2022 was
R$406.4 million, an increase of 18.8% year over year.
Our EPS reached R$3.39 per share for the nine-month period ended
September 30, 2022, an increase of 77.5% year over year, reflecting
the increase in our Net Income, and capital allocation discipline
executing our business combination and three buyback programs in a
row.
Table 8: Adjusted Net Income (in thousands of R$)
For the
three months period ended September 30, For the nine months
period ended September 30,
2022
2021
% Chg
2022
2021
% Chg Net income
80,410
57,989
38.7%
321,425
193,282
66.3%
Amortization of customer relationships and trademark (1)
18,952
18,031
5.1%
55,959
46,015
21.6%
Share-based compensation
8,833
8,847
-0.2%
20,414
33,949
-39.9%
Non-recurring expenses:
11,861
32,008
-62.9%
8,586
68,726
-87.5%
- Integration of new companies (2)
7,063
5,192
36.0%
17,015
12,728
33.7%
- M&A advisory and due diligence (3)
1,388
8,442
-83.6%
3,194
11,998
-73.4%
- Expansion projects (4)
1,079
3,069
-64.8%
2,358
6,459
-63.5%
- Restructuring expenses (5)
2,708
6,414
-57.8%
7,081
11,332
-37.5%
- Mandatory Discounts in Tuition Fees (6)
- 377
8,891
n.a.
- 21,062
8,891
n.a.
Adjusted Net Income
120,056
116,875
2.7%
406,384
341,972
18.8%
Basic earnings per share - in R$ (7)
0.84
0.57
47.4%
3.39
1.91
77.5%
Adjusted earnings per share - in R$ (8)
1.28
1.20
6.7%
4.33
3.50
23.7%
(1) Consists of amortization of customer relationships and
trademark recorded under business combinations. (2) Consists of
expenses related to the integration of newly acquired companies.
(3) Consists of expenses related to professional and consultant
fees in connection with due diligence services for our M&A
transactions. (4) Consists of expenses related to professional and
consultant fees in connection with the opening of new campuses. (5)
Consists of expenses related to the employee redundancies in
connection with the organizational restructuring of our acquired
companies. (6) Consists of mandatory discounts in tuition fees
granted by state decrees and individual/collective legal
proceedings and public civil proceedings due to COVID 19 on site
classes restriction, and excludes any recovery of these discounts
that were invoiced based on the Supreme Court decision. (7) Basic
earnings per share: Net Income/Weighted average number of
outstanding shares. (8) Adjusted earnings per share: Adjusted Net
Income attributable to equity holders of the Parent/Weighted
average number of outstanding shares.
Cash and Debt Position
Cash and cash equivalents on September 30, 2022, was R$715.6
million, a decrease of 31.1% over the same period in 2021.
For the nine-month period ended September 30, 2022, Afya
reported Adjusted Cash Flow from Operations of R$743.8 million, up
from R$557.2 million in the same period of the previous year, an
increase of 33.5% YoY, boosted by the solid operational
results.
Operating Cash Conversion Ratio was strong once again, achieving
104.6% for the nine-month period ended September 30, 2022, compared
to 113.5% in the same period of the previous year. This decrease
was mainly related to (a) an increase in the trade receivables,
partially caused by the recovery of the mandatory discounts in
tuition fees related to COVID-19 that were invoiced but not yet
received, and (b) the fact that last year’s cash performance was
positively impacted by the recover of the special payment
conditions related to the COVID-19 given to our students during
2020.
On September 30, 2022, net debt, excluding the effect of IFRS
16, totaled R$1,348.2 million, compared with net debt of R$1,108.6
million in the same period in 2021, mainly due to payments related
to (a) 6 business combinations and license acquisitions executed in
the last 12 months, totaling R$263.7 million; (b) shares repurchase
program of R$267.5 million, executed in the last 12 months, (c)
investments activities in properties, equipment and intangibles
(excluding license acquisitions and goodwill) totaling R$228.1
million in the last 12 months, and (d) net financial results from
the last 12 months, which totaled R$235.8 million, all partially
offset by the R$818.1 million cash generation from September 30,
2021 through September 30, 2022. The following table shows more
information regarding the cost of debt for the third quarter,
considering loans and financing, and accounts payable to selling
shareholders. It is important to mention that our capital structure
remains solid with a conservative leveraging position and a low
cost of debt.
Table 9: Gross Debt and Cost of Debt (in R$ MM)
For the
nine months period ended September 30, Cost of Debt
Gross Debt
Duration (Years)
per year
%CDI*
Loans and financing: Softbank
824
3.6
6.5%
55%
Loans and financing: Others
575
0.8
13.7%
114%
Accounts payable to selling shareholdersplus other financial
obligations
664
1.3
11.6%
97%
Total
2.063
2.2
10.0%
84.0%
*Based on the annualized Interbank Certificates of Deposit ("CDI")
rate for the period as a reference. 9M22: ~11.97% p.y.
Table 10:
Operating Cash Conversion Ratio Reconciliation For the nine
months period ended September 30, (in thousands of R$)
Considering the adoption of IFRS 16
2022
2021
% Chg
(a) Cash flow from operations
715,881
528,698
35.4%
(b) Income taxes paid
27,940
28,495
-1.9%
(c) = (a) + (b) Adjusted cash flow from operations
743,821
557,193
33.5%
(d) Adjusted EBITDA
719,717
559,709
28.6%
(e) Non-recurring expenses:
8,586
68,726
-87.5%
- Integration of new companies (1)
17,015
12,728
33.7%
- M&A advisory and due diligence (2)
3,194
11,998
-73.4%
- Expansion projects (3)
2,358
6,459
-63.5%
- Restructuring Expenses (4)
7,081
11,332
-37.5%
- Mandatory Discounts in Tuition Fees (5)
-21,062
26,209
n.a.
(f) = (d) - (e) Adjusted EBITDA ex- non-recurring expenses
711,131
490,983
44.8%
(g) = (c) / (f) Operating cash conversion ratio
104.6%
113.5%
-890 bps
(1) Consists of expenses related to the integration of newly
acquired companies. (2) Consists of expenses related to
professional and consultant fees in connection with due diligence
services for M&A transactions. (3) Consists of expenses related
to professional and consultant fees in connection with the opening
of new campuses. (4) Consists of expenses related to the employee
redundancies in connection with the organizational restructuring of
acquired companies. (5) Consists of mandatory discounts in tuition
fees granted by state decrees and individual/collective legal
proceedings and public civil proceedings due to COVID 19 on site
classes restriction, and excludes any recovery of these discounts
that were invoiced based on the Supreme Court decision.
Table
11: Cash and Debt Position (in thousands of R$)
3Q22
FY2021 % Chg
3Q21
% Chg (+) Cash and Cash Equivalents
715,644
748,562
-4.4%
1,038,934
-31.1%
Cash and Bank Deposits
27,161
88,487
-69.3%
75,635
-64.1%
Cash Equivalents
688,483
660,075
4.3%
963,299
-28.5%
(-) Loans and Financing
1,399,724
1,374,876
1.8%
1,377,810
1.6%
Current
259,638
128,720
101.7%
14,780
1656.7%
Non-Current
1,140,086
1,246,156
-8.5%
1,363,030
-16.4%
(-) Accounts Payable to Selling Shareholders
598,367
679,826
-12.0%
696,521
-14.1%
Current
241,560
239,849
0.7%
247,819
-2.5%
Non-Current
356,807
439,977
-18.9%
448,702
-20.5%
(-) Other Short and Long Term Obligations
65,748
72,726
-9.6%
73,212
-10.2%
(=) Net Debt (Cash) excluding IFRS 16
1,348,195
1,378,866
-2.2%
1,108,609
21.6%
(-) Lease Liabilities
782,224
714,085
9.5%
675,895
15.7%
Current
28,685
24,955
14.9%
24,169
18.7%
Non-Current
753,539
689,130
9.3%
651,726
15.6%
Net Debt (Cash) with IFRS 16
2,130,419
2,092,951
1.8%
1,784,504
19.4%
CAPEX
Capital expenditures is consisting of the purchase of property
and equipment and intangible assets, including expenditures mainly
related to the expansion and maintenance of our campuses and
headquarters including leasehold improvements, and the development
of new solutions in the digital segment, among others.
For the nine-month period ending September 30, 2022, CAPEX went
from R$140.7 million to R$238.4 million, an increase of 69.4% over
the same period of the prior year, due to higher expenditures
related to intangible assets, mainly explained by the R$24.4
million earn-out related to the 28 additional seats of Centro
Universitário São Lucas, in Ji-Parana, approved in March, 2022, and
R$39.1 million remeasurement of Unigranrio's business combination
goodwill.
Table 12: CAPEX (in thousands of R$)
For the nine months
period ended September 30,
2022
2021
% Chg
CAPEX
238,369
140,725
69.4%
Property and equipment
116,641
97,435
19.7%
Intanglibe assets
121,728
43,290
181.2%
- Licenses
24,408
-
n.a.
- Goodwill
39,100
-
n.a.
- Others
58,220
43,290
34.5%
ESG Metrics
ESG commitment is an important part of Afya’s strategy and
permeates the Company’s core values. Afya has been advancing year
after year on its core pillars and, since 2021, ESG metrics have
been disclosed in the Company’s quarterly financial results.
In August 2021, Afya assumed a voluntary commitment to have at
least 50% women in its management positions by 2030. In addition,
Afya announced that it was certificated by Women on Board, an
independent initiative whose purpose is to acknowledge, value and
promote corporate environments in which women are part of the board
of directors. The company voluntarily committed to continuing to
have at least two women as board members.
On January 2022, Afya announced that it is one of 418 companies
across 45 countries and regions to join the 2022 Bloomberg
Gender-Equality Index (GEI), a modified market
capitalization-weighted index that aims to track the performance of
public companies committed to transparency in gender-data
reporting. This reference index measures gender equality across
five pillars: female leadership & talent pipeline, equal pay
& gender pay parity, inclusive culture, anti-sexual harassment
policies, and pro-women brand. Afya was included on this year’s
index for scoring above a global threshold established by Bloomberg
to reflect disclosure and the achievement or adoption of
best-in-class statistics and policies.
The 2021 Sustainability Report can be found at:
https://ir.afya.com.br/ >> Corporate Governance >>
Sustainability.
Table 12: ESG Metrics¹³⁴
3Q22
3Q21
2021
2020
2019
#
GRI Governance and Employee Management
1
405-1
Number of employees
9,039
8,177
8,079
6,100
3,369
2
405-1
Percentage of female employees
57%
55%
55%
55%
57%
3
405-1
Percentage of female members in the board of directors
27%
18%
18%
18%
22%
4
102-24
Percentage of independent member in the board of directors
36%
36%
36%
36%
22%
Environmental
4
302-1
Total energy consumption (kWh)
4,355,340
3,172,655
12,176,966
8,035,845
5,928,450
4.1
302-1
Consumption per campus
98,985
99,145
385,573
321,434
395,230
5
302-1
% supplied by distribution companies
71.6%
89.8%
91.3%
83.4%
96.2%
6
302-1
% supplied by other sources²
28.4%
10.2%
8.7%
16.6%
3.8%
Social
8
413-1
Number of free clinical consultations offered by Afya
128,686
144,832
341,286
427,184
270,000
9
Number of physicians graduated in Afya's campuses
17,176
12,359
16,772
12,691
8,306
10
201-4
Number of students with financing and scholarship programs (FIES
and PROUNI)
10,329
7,940
7,881
4,999
2,808
11
% students with scholarships over total undergraduate students
17.4%
13.0%
12.9%
13.7%
11.7%
12
413-1
Hospital, clinics and city halls partnerships
481
432
447
432
60
(1) Some factors can influence in the adequate proportionality
analysis of data over the years, such as: climate changes, COVID-19
pandemic effects, seasonalities, number of employees, number of
students, number of active units, among others. (2) "Other sources"
refers to: (a) Derived from renewable sources, such as solar panels
installed in the units; and (b) Derived from the search for
alternative energy options in the market. (3) Starting in 2Q22,
previously disclosed environmental data were updated to consider:
(a) GHG Protocol guidelines improvements, and (b) additional
data-collection criteria refinements. (4) Starting in 2Q22,
previously disclosed social data were updated to consider: (a) the
number of graduated physicians considering all units after its
closing, and (b) partnerships related only to medical schools.
5. Conference Call and Webcast Information
When:
November 21, 2022 at 5:00 p.m. ET.
Who:
Mr. Virgilio Gibbon, Chief Executive
Officer
Mr. Luis André Blanco, Chief Financial
Officer
Webcast: https://afya.zoom.us/j/92548247907
OR
Dial-in: Brazil: +55 11 4700 9668 or +55 21 3958 7888 or
+55 11 4632 2236 or +55 11 4632 2237 or +55 11 4680 6788
United States: +1 646 931 3860 or +1 929 205 6099 or +1 301 715
8592 or +1 309 205 3325 or +1 312 626 6799 or +1 669 444 9171 or +1
669 900 6833 or +1 719 359 4580 or +1 253 215 8782 or +1 346 248
7799 or +1 386 347 5053 or +1 564 217 2000
Webinar ID: 925 4824 7907
Other Numbers: https://afya.zoom.us/u/abwfMV1H7z
6. About Afya Limited (Nasdaq: AFYA)
Afya is a leading medical education group in Brazil based on the
number of medical school seats, delivering an end-to-end
physician-centric ecosystem that serves and empowers students and
physicians to transform their ambitions into rewarding lifelong
experiences from the moment they join us as medical students
through their medical residency preparation, graduation program,
continuing medical education activities and offering digital
products to help doctors enhance their healthcare services through
their whole career. For more information, please visit
www.afya.com.br.
7. Forward – Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, which statements involve substantial risks and uncertainties.
All statements other than statements of historical fact could be
deemed forward looking, and include risks and uncertainties related
to statements about our competition; our ability to attract, upsell
and retain students; our ability to increase tuition prices and
prep course fees; our ability to anticipate and meet the evolving
needs of students and professors; our ability to source and
successfully integrate acquisitions; general market, political,
economic, and business conditions; and our financial targets such
as revenue, share count and IFRS and non-IFRS financial measures
including gross margin, operating margin, net income (loss) per
diluted share, and free cash flow. Forward-looking statements by
their nature address matters that are, to different degrees,
uncertain, such as statements about the potential impacts of the
COVID-19 pandemic on our business operations, financial results and
financial position and the Brazilian economy.
The Company undertakes no obligation to update any
forward-looking statements made in this press release to reflect
events or circumstances after the date of this press release or to
reflect new information or the occurrence of unanticipated events,
except as required by law. The achievement or success of the
matters covered by such forward-looking statements involves known
and unknown risks, uncertainties and assumptions. If any such risks
or uncertainties materialize or if any of the assumptions prove
incorrect, our results could differ materially from the results
expressed or implied by the forward-looking statements we make.
Readers should not rely upon forward-looking statements as
predictions of future events. Forward-looking statements represent
management’s beliefs and assumptions only as of the date such
statements are made. Further information on these and other factors
that could affect the Company’s financial results are included in
the filings made with the United States Securities and Exchange
Commission (SEC) from time to time, including the section titled
“Risk Factors” in the most recent Rule 434(b) prospectus. These
documents are available on the SEC Filings section of the investor
relations section of our website at: https://ir.afya.com.br/.
8. Non-GAAP Financial Measures
To supplement the Company's consolidated financial statements,
which are prepared and presented in accordance with International
Financial Reporting Standards as issued by the International
Accounting Standards Board—IASB, Afya uses Adjusted EBITDA and
Operating Cash Conversion Ratio information, which are non-GAAP
financial measures, for the convenience of investors. A non-GAAP
financial measure is generally defined as one that intends to
measure financial performance but excludes or includes amounts that
would not be equally adjusted in the most comparable GAAP
measure.
Afya calculates Adjusted EBITDA as net income plus/minus net
financial result plus income taxes expense plus depreciation and
amortization plus interest received on late payments of monthly
tuition fees, plus share-based compensation plus/minus share of
income of associate plus/minus non-recurring expenses. The
calculation of Adjusted Net Income is net income plus amortization
of customer relationships and trademark, plus share-based
compensation. We calculate Operating Cash Conversion Ratio as the
cash flow from operations, adjusted with income taxes paid divided
by Adjusted EBITDA plus/minus non-recurring expenses.
Management presents Adjusted EBITDA, because it believes these
measures provide investors with a supplemental measure of financial
performance of the core operations that facilitates
period-to-period comparisons on a consistent basis. Afya also
presents Operating Cash Conversion Ratio because it believes this
measure provides investors with a measure of how efficiently the
Company converts EBITDA into cash. The non-GAAP financial measures
described in this prospectus are not a substitute for the IFRS
measures of earnings. Additionally, calculations of Adjusted EBITDA
and Operating Cash Conversion Ratio may be different from the
calculations used by other companies, including competitors in the
education services industry, and therefore, Afya’s measures may not
be comparable to those of other companies.
9. Investor Relations Contact
E-mail: ir@afya.com.br
10. Financial Tables
Unaudited interim condensed
consolidated statements of financial position
As of September 30, 2022, and December
31, 2021
(In thousands of Brazilian
reais)
September 30, 2022
December 31, 2021
Assets
(unaudited)
Current assets
Cash and cash equivalents
715,644
748,562
Trade receivables
405,450
378,351
Inventories
12,488
11,827
Recoverable taxes
42,510
25,579
Other assets
37,874
42,533
Total current assets
1,213,966
1,206,852
Non-current assets
Trade receivables
34,218
27,442
Other assets
198,700
180,306
Investment in associate
55,900
48,477
Property and equipment
503,626
419,808
Right-of-use assets
712,068
663,686
Intangible assets
4,042,545
3,900,835
Total non-current assets
5,547,057
5,240,554
Total assets
6,761,023
6,447,406
Liabilities
Current liabilities
Trade payables
62,905
59,098
Loans and financing
259,638
128,720
Lease liabilities
28,685
24,955
Accounts payable to selling
shareholders
241,560
239,849
Notes payable
17,333
14,478
Advances from customers
108,588
114,585
Labor and social obligations
202,040
131,294
Taxes payable
24,170
26,715
Income taxes payable
27,353
11,649
Other liabilities
4,532
15,163
Total current liabilities
976,804
766,506
Non-current liabilities
Loans and financing
1,140,086
1,246,156
Lease liabilities
753,539
689,130
Accounts payable to selling
shareholders
356,807
439,977
Notes payable
48,415
58,248
Taxes payable
93,445
96,598
Provision for legal proceedings
205,151
148,287
Other liabilities
12,962
2,486
Total non-current liabilities
2,610,405
2,680,882
Total liabilities
3,587,209
3,447,388
Equity
Share capital
17
17
Additional paid-in capital
2,375,344
2,375,344
Share-based compensation reserve
114,515
94,101
Treasury stock
(304,947)
(152,630)
Retained earnings
938,192
631,317
Equity attributable to equity holders
of the parent
3,123,121
2,948,149
Non-controlling interests
50,693
51,869
Total equity
3,173,814
3,000,018
Total liabilities and equity
6,761,023
6,447,406
Unaudited interim condensed
consolidated statements of income and comprehensive income
For the three and nine-month periods
ended September 30, 2022 and 2021
(In thousands of Brazilian reais,
except earnings per share)
Three-month period
ended
Nine-month period
ended
September 30, 2022
September 30, 2021
September 30, 2022
September 30, 2021
(unaudited)
(unaudited)
(unaudited)
(unaudited)
Net revenue
580,575
454,387
1,745,055
1,221,112
Cost of services
(216,691)
(180,042)
(622,663)
(450,993)
Gross profit
363,884
274,345
1,122,392
770,119
General and administrative expenses
(210,692)
(178,811)
(596,621)
(444,399)
Other (expenses) income, net
(7,173)
(135)
(8,739)
1,163
Operating income
146,019
95,399
517,032
326,883
Finance income
29,202
29,161
76,618
45,144
Finance expenses
(91,933)
(64,558)
(256,873)
(168,825)
Finance result
(62,731)
(35,397)
(180,255)
(123,681)
Share of income of associate
3,819
3,004
10,260
8,626
Income before income taxes
87,107
63,006
347,037
211,828
Income taxes expenses
(6,697)
(5,017)
(25,612)
(18,546)
Net income
80,410
57,989
321,425
193,282
Other comprehensive income
-
-
-
-
Total comprehensive income
80,410
57,989
321,425
193,282
Income attributable to
Equity holders of the parent
75,760
53,030
306,875
178,357
Non-controlling interests
4,650
4,959
14,550
14,925
80,410
57,989
321,425
193,282
Basic earnings per share
Per common share
0.84
0.57
3.39
1.91
Diluted earnings per share
Per common share
0.84
0.56
3.38
1.89
Unaudited interim condensed
consolidated statements of cash flows
For the nine-month periods ended
September 30, 2022 and 2021
(In thousands of Brazilian
reais)
September 30, 2022
September 30, 2021
Operating activities
(unaudited)
(unaudited)
Income before income taxes
347,037
211,828
Adjustments to reconcile income before
income taxes
Depreciation and amortization
151,706
112,204
Write-off of property and equipment
683
1,936
Write-off of intangible assets
6
1,049
Allowance for doubtful accounts
29,441
34,005
Share-based compensation expense
20,414
33,949
Net foreign exchange differences
293
18,376
Accrued interest
147,839
66,851
Accrued lease interest
63,458
47,738
Share of income of associate
(10,260)
(8,626)
Provision for legal proceedings
8,531
9,286
Changes in assets and
liabilities
Trade receivables
(60,167)
(18,593)
Inventories
(661)
(1,232)
Recoverable taxes
(16,931)
(8,228)
Other assets
5,858
(11,264)
Trade payables
1,398
3,461
Taxes payables
10,709
(1,247)
Advances from customers
(16,075)
9,419
Labor and social obligations
70,608
54,005
Other liabilities
(10,066)
2,276
743,821
557,193
Income taxes paid
(27,940)
(28,495)
Net cash flows from operating
activities
715,881
528,698
Investing activities
Acquisition of property and equipment
(116,641)
(97,435)
Acquisition of intangibles assets
(70,423)
(43,290)
Dividends received
2,837
5,770
Acquisition of subsidiaries, net of cash
acquired
(242,752)
(925,279)
Restricted cash
-
8,103
Net cash flows used in investing
activities
(426,979)
(1,052,131)
Financing activities
Payments of loans and financing
(68,975)
(130,446)
Issuance of loans and financing
-
809,539
Payments of lease liabilities
(84,509)
(61,909)
Treasury shares
(152,317)
(98,541)
Proceeds from exercise of stock
options
-
32,721
Dividends paid to non-controlling
interests
(15,726)
(15,663)
Net cash flows from (used in) financing
activities
(321,527)
535,701
Net foreign exchange
differences
(293)
(18,376)
Net increase in cash and cash
equivalents
(32,918)
(6,108)
Cash and cash equivalents at the beginning
of the period
748,562
1,045,042
Cash and cash equivalents at the end of
the period
715,644
1,038,934
Reconciliation between Net Income and Adjusted EBITDA
Reconciliation between Adjusted EBITDA and Net Income
(in thousands of R$)
For the three months period ended September
30, For the nine months period ended September 30,
2022
2021
% Chg
2022
2021
% Chg
Net income
80,410
57,989
38.7%
321,425
193,282
66.3%
Net financial result
62,731
35,397
77.2%
180,255
123,681
45.7%
Income taxes expense
6,697
5,017
33.5%
25,612
18,546
38.1%
Depreciation and amortization
52,617
45,289
16.2%
151,706
112,204
35.2%
Interest received (1)
9,400
9,857
-4.6%
21,979
17,947
22.5%
Income share associate
(3,819)
(3,004)
27.1%
(10,260)
(8,626)
18.9%
Share-based compensation
8,833
8,847
-0.2%
20,414
33,949
-39.9%
Non-recurring expenses:
11,861
32,008
-62.9%
8,586
68,726
-87.5%
- Integration of new companies (2)
7,063
5,192
36.0%
17,015
12,728
33.7%
- M&A advisory and due diligence (3)
1,388
8,442
-83.6%
3,194
11,998
-73.4%
- Expansion projects (4)
1,079
3,069
-64.8%
2,358
6,459
-63.5%
- Restructuring expenses (5)
2,708
6,414
-57.8%
7,081
11,332
-37.5%
- Mandatory Discounts in Tuition Fees (6)
(377)
8,891
n.a.
(21,062)
26,209
n.a.
Adjusted EBITDA
228,730
191,400
19.5%
719,717
559,709
28.6%
Adjusted EBITDA Margin
39.4%
41.3%
-190 bps
41.7%
44.9%
-320 bps
(1) Represents the interest received on late payments of monthly
tuition fees. (2) Consists of expenses related to the integration
of newly acquired companies. (3) Consists of expenses related to
professional and consultant fees in connection with due diligence
services for our M&A transactions. (4) Consists of expenses
related to professional and consultant fees in connection with the
opening of new campuses. (5) Consists of expenses related to the
employee redundancies in connection with the organizational
restructuring of our acquired companies. (6) Consists of mandatory
discounts in tuition fees granted by state decrees and
individual/collective legal proceedings and public civil
proceedings due to COVID 19 on site classes restriction, and
excludes any recovery of these discounts that were invoiced based
on the Supreme Court decision.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221121005859/en/
Investor Relations Contact: Afya Limited ir@afya.com.br
Media Contact: Cíntia Moraes Marin cintia.marin@afya.com.br
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