What were the key takeaways from Afya’s earnings call?

What guidance did Afya's management provide for the next earnings period?

What were the key takeaways from Afya's earnings call?

What does Afya do and what are its main business segments?

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Did Afya beat or miss consensus estimates last quarter?

What factors drove the changes in Afya's revenue and profit?

What is the revenue and EPS growth rate for Afya year over year?

- **Revenue & Profit Growth**: 13% YoY revenue, 19% YoY EBITDA, 20% YoY net income, driven by medical education expansion. 
- **Strategic Moves**: Acquired FUNIC, repurchased SoftBank shares, and extended debt duration. 
- **Tax Impact**: 2026 effective tax rate expected to rise to 15% due to Pillar Two. 
- **Segment Strengths**: Continuing Ed B2B up 65%, Medical Practice B2P up 11%, ecosystem users reach 304,000. 
- **ESG Leadership**: Delivered 700,000 free consultations, recognized as Brazil's top ESG education company.

**【CEO Summary Section】**
- **Revenue Growth**: 13% year-over-year (YoY) for the 9-month period, driven by medical education expansion and acquisitions (e.g., FUNIC). Adjusted EBITDA rose 19% to BRL 1.292 billion, with a margin of 46.4% (up 200bps YoY). 
- **Operational Highlights**: 25,000+ medical students (6% YoY growth), 3,753 approved medical seats (2% YoY), and 304,000 active ecosystem users. Continuing Education revenue grew 11% YoY, with B2B revenue up 65%. 
- **ESG Initiatives**: Delivered 700,000 free healthcare consultations, exceeding UN SDG targets. Launched Instituto Afya for chronic disease research. 

**【CFO Financial Commentary】**
- **Financial Performance**: Q3 2025 revenue BRL 929 million (+10% YoY), adjusted EBITDA BRL 399 million (+15% YoY). 9-month net income BRL 593 million (+20% YoY), EPS BRL 6.40 (+20% YoY). 
- **Segment Breakdown**: 
  - **Undergraduate**: 14% revenue growth, 86% from medical students. 
  - **Continuing Ed**: 11% revenue growth, B2B up 65%. 
  - **Medical Practice**: 9% revenue growth, B2P up 11%. 
- **Liquidity**: Cash flow from operations BRL 1.292 billion (101.5% cash conversion). Net debt BRL 1.342 billion (0.8x 2025 EBITDA guidance). 

**【Q&A Highlights】**
- **Tax Strategy**: 2025 effective tax rate 9.7% (vs. 5.1% 2024), due to Pillar Two tax provisioning. 2026 rate expected to converge to 15%. 
- **Capital Allocation**: Prioritize M&A (e.g., medical assets), buybacks, and dividends. Repurchased SoftBank shares, extended debt duration to 3.2 years. 
- **Segment Trends**: 
  - **Medical Practice**: Margins up 7pts QoQ due to cost efficiency. iClinic AI adoption accelerating. 
  - **Continuing Ed**: Residency Journey students down 36% due to product bundling, but revenue stable. 
  - **FUNIC Integration**: 60 seats in 1st year, margins to improve as classes mature (2-3 years).

Afya Limited (AFYA) Q3 2025 Earnings Call Transcript

- **Revenue & Profit Growth**: Q2 revenue +14% YoY, H1 EBITDA +20% YoY to BRL 893M. Net income up 70% YoY to BRL 434M. 
- **Efficiency Record**: All-time high EBITDA margin 48.1%, driven by shared services and maturing campuses. 
- **Share Buyback**: 4M shares authorized to enhance EPS, balanced with liquidity. 
- **Tax Management**: 9% effective rate vs. 15% target, deferred assets mitigating 2025 impact. Legal challenges ongoing. 
- **Medical Market**: 14% student growth, no discounts, net ticket +3.3% vs. inflation. 
- **ENAMED Opportunity**: Minimal CapEx needed, leveraging existing assets for growth. 


**【CEO Summary Section】**
- **Revenue Growth**: Q2 2025 revenue reached BRL 919 million, up 14% YoY, with H1 2025 revenue at BRL 1,856 million (15% YoY growth). Adjusted EBITDA for H1 was BRL 893 million, up 20% YoY, with a margin of 48.1% (220 bps expansion). 
- **Operational Efficiency**: Gross margin expansion driven by Undergrad and Continuing Ed segments, UNIDOM integration, and 4 Mais Medicos campus ramp-up. EBITDA margin hit all-time high since 2019. 
- **Share Repurchase Program**: Authorized up to 4 million Class A shares (≈4% of outstanding shares) by Dec 31, 2026, reflecting capital allocation discipline. 
- **Student Growth**: Undergrad medical students reached 26,000 (14% YoY), Continuing Ed revenue up 8%, and Medical Practice Solutions up 9%. Ecosystem active users hit 302,000. 

**【CFO Financial Commentary】**
- **Financial Highlights**: Q2 net income BRL 177 million (+9% YoY), H1 net income BRL 434 million (+70% YoY). Basic EPS BRL 4.69 (17% YoY). 
- **Cash Flow**: Operating cash flow BRL 783 million (+15% YoY), cash conversion ratio 88.8%. Net debt reduced to BRL 1,621 million (down BRL 194 million YoY). 
- **Tax Impact**: Effective tax rate 9% (vs. 15% OECD Pillar Two target). Deferred tax assets recognized in Q1/Q2 offsetting short-term impact. 
- **Debt Structure**: Net debt/EBITDA ratio 0.97x, conservative leverage with low cost debt. 

**【Q&A Key Highlights】**
- **Profitability Drivers**: SG&A efficiency from shared services, Continuing Ed restructuring, and operational leverage from maturing campuses. 
- **Tax Rate Outlook**: Long-term 15% effective rate, but 2025 impact mitigated by deferred assets. Legal challenges to PROUNI tax treatment ongoing. 
- **Medical Competition**: 5% candidate ratio vs. 7% last year, no discounts applied. Net ticket growth 3.3% vs. inflation. 
- **M&A Strategy**: Focused on high-reputation, well-located institutions. Buyback program balances liquidity with EPS growth. 
- **ENAMED Impact**: Minimal CapEx needed, leveraging existing assets for B2C/B2B opportunities. Resident journey recovery expected in H2. 


Afya Limited (AFYA) Q2 2025 Earnings Call Transcript

- **Revenue Surge**: 16% YoY growth to BRL 936M, fueled by 4% ticket increase and 50% student base expansion.
- **Profit Margin Expansion**: EBITDA margin jumps to 52.5%, driven by undergrad gross margin and cost control.
- **Cash Strength**: BRL 470M operating cash flow and BRL 1.2B cash on hand.
- **ESG Recognition**: AAA.br credit rating and MSCI BBB ESG score highlight financial and sustainability discipline.
- **Tax Headwind**: OECD Pillar 2 adds BRL 23M in Q1 taxes, but legal challenges underway.
- **Medical Demand**: 7-8 candidates per seat in medical programs, underscoring brand strength.

**【CEO Summary Section】**
- **Revenue Growth**: Net revenue increased 16% YoY to BRL 936 million, driven by 4% YoY growth in medical school net average ticket (BRL 9,240) and 50% YoY increase in undergrad medical students to 26,000.
- **Profitability**: Adjusted EBITDA rose 24% YoY to BRL 492 million (52.5% margin), with gross margin expansion in undergrad and continuing education segments.
- **Cash Generation**: Operating cash flow of BRL 470 million (96.8% conversion rate) and cash position of BRL 1.2 billion.
- **Operational Expansion**: 653 approved medical seats post-Funic acquisition, 37,000 active ecosystem users, and 198,000 paying users in medical practice solutions.
- **ESG Milestones**: Moody's upgraded credit rating to AAA.br, MSCI ESG BBB rating, and IFC target achievement leading to 50bps interest rate reduction.

**【CFO Financial Commentary】**
- **Undergrad Segment**: 17% YoY revenue growth to BRL 827 million, 86% of which from medicine courses.
- **Continuing Education**: 9% YoY revenue growth to BRL 71 million (8% B2B growth, 16% graduate journey growth).
- **Medical Practice Solutions**: 14% YoY revenue growth to BRL 42 million (14% B2P, 16% B2B growth).
- **Financial Health**: Net income BRL 257 million (+23% YoY), EPS BRL 2.79 (+23% YoY), and net debt/EBITDA ratio of 0.9x.
- **Tax Impact**: OECD Pillar 2 provisions added BRL 23 million in Q1 tax expenses, with legal challenges ongoing.

**【Q&A Highlights】**
1. **EBITDA Margin Expansion**: Driven by undergrad gross margin (Unidom acquisition, 4 Mais Medicos campuses) and cost efficiencies in continuing education.
2. **Enrollment Challenges**: 7-8 candidates per seat in medical programs, healthy intake due to brand strength and 2023 renewal process.
3. **Medical Practice Users**: Monthly active users declined 6% YoY (245k vs 263k) due to PEBMED portal transition, but paying users grew 4% YoY.
4. **Tax & Debt**: SoftBank convertible debt redemption in May 2026; cash flow sufficient to cover obligations if exercised.
5. **B2B Seasonality**: Pharmaceutical contracts typically front-loaded in Q4, leading to Q1 lags but 30% YoY growth in 2024.

Afya Limited (AFYA)-8 May 25-2025 Q1 Earnings call transcript

- **Record Financial Performance**: 2024 net revenue up 14.9% to BRL 3.3 billion, EBITDA margin 44.1%, with 34% cash flow growth.
- **Student Growth & Expansion**: 24,000 medical students (+13%), Continuing Ed revenue up 8%, Medical Practice Solutions +15%.
- **Dividend Milestone**: 20% of 2024 net income distributed, marking shift to shareholder value sharing while maintaining M&A (200+ seats/year) and capex (BRL 250-290 million).
- **2025 Outlook**: Target BRL 3.67-3.77 billion revenue, driven by organic growth, new contracts, and Medical Practice Solutions expansion.
- **Sustainable Capital Allocation**: Low debt (1.25x EBITDA), disciplined M&A pipeline, and inflation+ tuition strategy ensure long-term growth.

**【CEO Summary Section】**
- **Revenue Growth**: Net revenue increased by 14.9% to BRL 3,304.3 billion, with adjusted EBITDA up 25% to BRL 1,455.6 billion (44.1% margin). Cash flow from operations rose 34% to BRL 1,453.2 billion.
- **Student Expansion**: Undergrad medical students reached 24,000 (+13%), with Continuing Education net revenue up 8% to BRL 255.4 million. Medical Practice Solutions grew 15% to BRL 161.8 million.
- **Dividend Announcement**: First dividend payout of 20% of 2024 net income, payable April 2025, signaling shareholder value sharing while maintaining growth investments.
- **2025 Guidance**: Net revenue target BRL 3.67-3.77 billion, EBITDA BRL 1.62-1.72 billion, driven by organic growth, M&A (200+ seats/year), and Medical Practice Solutions expansion.

**【CFO Financial Commentary】**
- **Financial Health**: 2024 net income BRL 648.9 million (+6%), EPS BRL 0.071 (+62.9%). 2024 cash conversion rate 102%, with net debt/EBITDA ratio 1.25x, reflecting strong cash generation and disciplined capital management.
- **Segment Performance**: Undergrad net average ticket BRL 8,849 (+4.6%), Continuing Education B2B revenue up 10%, Medical Practice Solutions B2B contracts grew 30%.
- **Debt Structure**: Gross debt BRL 1.815 billion, with low-cost debt (IFRS 16-adjusted) and no material refinancing needs, supporting long-term growth.

**【Q&A Key Takeaways】**
- **Dividend Sustainability**: Dividends reflect one-time payout of 2024 profits, with no formal policy; future payments will balance growth investments (M&A, capex) with shareholder returns.
- **M&A Pipeline**: 2025 target to acquire 200+ seats, focusing on high-quality, low-cost assets (e.g., Contagem/FUNIC deal). New approved seats (e.g., Mais Médicos III) may drive additional capex.
- **Tuition Strategy**: Committed to passing at least inflation, with 5% ticket increase in 2024. Strong brand demand allows selective pricing, though smaller M&A deals may limit premium pricing opportunities.


Afya Limited (AFYA)-13 Mar 25-2024 Q4 Earnings call transcript

Afya Limited (AFYA)-13 Nov 24-2024 Q3 Earnings call transcript

Afya Limited (AFYA)-14 Aug 24-2024 Q2 Earnings call transcript

- **Record Financials**: 2023 revenue up 24% to R$2.874B, EBITDA up 21% to R$1.166B, cash flow up 24% to R$1.89B. 
- **Student Growth**: 21,000+ med students (+19%), 4,976 continuing ed students (+60%). 
- **Digital Expansion**: 268K active users, B2B revenue +64% YoY. 
- **2024 Outlook**: Revenue R$3.25-3.50B, EBITDA R$1.3-1.4B, 20%+ EBITDA margin expansion. 
- **Strategic Moves**: Active M&A pipeline, 64% B2B growth, 6:1 candidate/seat ratio in 2024 intake.

**【CEO Summary Section】**
- **Revenue and Profit Growth**: Adjusted net revenue reached R$2.874 billion (+24% YoY), EBITDA was R$1.166 billion (+21% YoY), and cash flow from operations was R$1.89 billion (+24% YoY). 
- **Student Expansion**: 21,000+ undergrad medical students (+19% YoY) and 4,976 continuing education students (+60% YoY). Digital health ecosystem has 268,000 active users (34% of Brazil's medical students/doctors). 
- **2024 Guidance**: Net revenue R$3.25-3.50 billion, EBITDA R$1.3-1.4 billion. CapEx guidance R$220-260 million. 
- **ESG Milestones**: 100% renewable energy for education operations, 58% female workforce, 45% women in leadership roles. 

**【CFO Financial Commentary】**
- **Q4 2023 Results**: Adjusted net revenue R$730 million (+23% YoY), EBITDA R$289 million (+19% YoY), EPS R$6.37 (+12% YoY). 
- **Segment Performance**: 
  - **Undergrad**: 12% seat growth to 3,203, 8% ticket price increase to R$8,548. 
  - **Continuing Ed**: 35% revenue growth, 60% student growth. 
  - **Digital Services**: R$229 million revenue (+21% YoY), B2B revenue +64% YoY. 
- **Financial Health**: 97% cash conversion ratio, R$591 million net income (+11% YoY). 

**【Q&A Highlights】**
- **Competitive Environment**: 6 candidates per seat in 2024 intake (vs. 4 pre-pandemic), 5.8% ticket price increase. 
- **M&A Pipeline**: Actively evaluating targets with >60% med school revenue, targeting 20%+ IRR. 
- **Digital Growth**: B2B revenue +64% YoY, new pharma contracts driving expansion. 
- **Mais Médicos**: 23 campus bids allowed (down from 36), expect proposals by July 2024. 
- **Margins**: 2024 EBITDA margin expansion driven by undergrad (UNIMA/FCMJ integration), continuing ed (operational leverage), and digital (B2B scale).

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