Afya Limited (AFYA) Q3 Earnings call transcript Nov 13, 2024

Afya, a leading player in Brazil's education and healthcare sector, recently held a conference call to discuss its third quarter and nine-month results for 2024. The call, led by CEO Virgilio Deloy Gibbon and CFO Luis Andre Blanco, highlighted Afya's robust performance and strategic acquisitions.

Financial Performance

Afya reported a net revenue growth of over 16% year-over-year, reaching BRL 841 million. This was accompanied by a 25% increase in adjusted EBITDA to BRL 348 million and a 29% growth in adjusted net income to BRL 165 million. These impressive figures reflect Afya's strategic focus on capital allocation and operational efficiency.

Acquisitions and Expansion

One of the key highlights of the call was Afya's acquisition of Unidom, which brought 300 additional medical seats and strengthened its footprint in Salvador. This strategic move has significantly boosted Afya's student base, with a 37% increase in medical students. The company also reported approvals of 80 seats in UNIMA and the reconsideration of additional 10 medical seats in UNIGRANRIO.

Medical Practice Solutions

Afya's Medical Practice Solutions segment showed strong growth, with a 15% increase in net revenue year-over-year. This growth is attributed to a strong ramp-up in B2B and B2P engagements, reflecting Afya's growing attractiveness to clients. The company reported a significant increase in active payers, driven by a 13% growth in clinical decision and a 14% growth in clinical management.

Operational Efficiency and Restructuring

Afya highlighted its operational efficiency gains, particularly in the Continuing Education segment. The company's restructuring efforts have led to a 10% increase in net revenues, with a focus on operational leverage in each business unit. This strategic move is expected to further boost Afya's margins in the coming quarters.

Future Outlook

Looking ahead, Afya remains optimistic about its growth prospects. The company plans to maintain its focus on strategic acquisitions, with a target of 200 seats per year. Additionally, Afya is preparing for the rollout of Mais Medicos, which is expected to further expand its footprint in the Brazilian education and healthcare market.

Conclusion

Afya's strong financial performance and strategic acquisitions underscore its position as a leading player in Brazil's education and healthcare sector. With a focus on operational efficiency and strategic growth, Afya is well-positioned to capitalize on the opportunities in the Brazilian market and deliver value to its stakeholders.