Afya Limited Announces First-Quarter 2025 Financial Results
Impressive Adjusted EBITDA Margin Expansion and Cash Generation
Full Year 2025 Guidance Reaffirmed
NOVA LIMA, Brazil–(BUSINESS WIRE)–Afya Limited (Nasdaq: AFYA; B3: A2FY34) (“Afya” or the “Company”), the leading medical education group and medical practice solutions provider in Brazil, reported today its financial and operating results for the three-month period ended March 31, 2025 (first quarter 2025). Financial results are expressed in Brazilian Reais and are presented in accordance with International Financial Reporting Standards (IFRS).
First Quarter 2025 Highlights
- 1Q25 Net Revenue increased 16.4% YoY to R$936.4 million. Net Revenue excluding acquisitions increased 10.9%, reaching R$891.5 million.
- 1Q25 Adjusted EBITDA increased 23.7% YoY reaching R$492.0 million, with an Adjusted EBITDA Margin of 52.5%. Adjusted EBITDA Margin increased 300 bps YoY. Adjusted EBITDA excluding acquisitions grew 15.8%, reaching R$460.6 million, with an Adjusted EBITDA Margin of 51.7%.
- 1Q25 Net Income increased 23.4% YoY, reaching R$257.0 million, and Adjusted Net Income increased 17.1% YoY, reaching R$293.9 million. Basic EPS growth was 23.3% in the same period.
- Operating Cash Conversion ratio of 96.8%, with a solid cash position of R$1,154.9 million.
- Over 317 thousand users in Afya’s ecosystem.
| Table 1: Financial Highlights | |||||
| For the three months period ended March 31, | |||||
| (in thousand of R$) |
2025 |
2025 Ex |
2024 |
% Chg |
% Chg Ex |
| (a) Net Revenue |
936,360 |
891,527 |
804,239 |
16.4% |
10.9% |
| (b) Adjusted EBITDA 2 |
491,971 |
460,603 |
397,853 |
23.7% |
15.8% |
| (c) = (b)/(a) Adjusted EBITDA Margin |
52.5% |
51.7% |
49.5% |
300 bps | 220 bps |
| Net income |
257,036 |
– |
208,299 |
23.4% |
– |
| Adjusted Net income |
293,897 |
– |
250,966 |
17.1% |
– |
| *For the three months period ended March 31, 2025, “2025 Ex Acquisitions” excludes: UNIDOM (January to March, 2025; Closing of UNIDOM was in July 2024). | |||||
| (2) See more information on “Non-GAAP Financial Measures” (Item 08). | |||||
Message from Management
It is with much satisfaction that Afya starts another year of great operational and financial performance. This quarterly result shows the high predictability of our business and successful execution of our strategy, that once again, combines strong growth, with higher profitability and cash generation – Afya’s three pillars business model. This quarter was marked by Gross margin expansion within our Undergraduate and Continuing Education segments, combined with solid cash generation, and robust EPS growth, showing our consistent business expansion.
Our Revenue Growth this quarter was supported by a successful intake process in all our medical school campuses, ensuring 100% occupancy in our integrated medical schools. Most notably, an example that highlights the effectiveness of our strategy was the acquisition of Unidom with a medical campus located in Salvador that had an occupancy rate below 60% prior to our acquisition. After only two intake processes the campus reached nearly 100% occupancy. This highlights the ongoing value of our ecosystem and the increasing recognition of our brand across the country.
We proudly present our highest Adjusted EBITDA Margin, ending the first quarter of 2025 with a record of 52.5%. This margin expansion reflects the strong performance of the Undergraduate segment, further enhanced by the continued ramp-up of the four Mais Médicos campuses launched in 3Q22, and most recently the Unidom acquisition. Our ongoing operational restructuring in the Continuing Education and Medical Practice Solutions segments contributed to improve cost management across selling, general, and administrative expenses in addition toenhancements to our shared services center, centralizing operations and increasing efficiency and operational synergies.
With the closing of the acquisition of Funic, we are excited to expand our undergraduate presence into the metropolitan area of Belo Horizonte, capital of Minas Gerais. This acquisition contributes 60 medical seats to Afya in Contagem, bringing our total approved medical seats to 3,653 in Brazil.
Furthermore, we are proud to highlight the excellent performance of our undergraduate medical schools in the most recent ENADE (Exame Nacional de Desempenho dos Estudantes – National Student Performance Exam), which reaffirms Afya’s commitment to academic excellence and the quality of medical education we provide across Brazil.
In April, we were proud to receive two significant recognitions. Moody’s Local Brazil upgraded our national scale credit rating from AA+.br to AAA.br with a stable outlook, reflecting our strong balance sheet, rewarded by cash generation, and financial discipline. They also highlighted our leadership in medical education and successful acquisition integration. We are also pleased to highlight that we successfully achieved all the IFC-defined targets for 2024, including the number of free medical consultations provided and the percentage of medical courses rated with the highest quality scores. This achievement will trigger a 15 bps step-down in our loan interest rate over the next 12 months, reinforcing and solidifying both our social impact and financial discipline. Additionally, we received our first ESG rating from MSCI, debuting with a solid BBB score. MSCI’s sector relative methodology underscores that Afya outperformed a significant portion of its peers, particularly in areas like data privacy and security, where our practices were stronger than many in the industry.
Looking ahead, Afya remains committed to its mission: to provide an integrated ecosystem of education and medical practice solutions throughout the entire medical journey. We continuously strive to support healthcare professionals’ development, ongoing learning, and productivity. We are proud of our achievements and excited about what lies ahead.
1. Key Events in the Quarter
- On March 12, 2025, the Company’s Board of Directors approved the first dividend distribution in the amount of R$129,784, representing 20% of the Company’s consolidated net income for the year ended December 31, 2024 and a dividend per share of R$1.348923, paid in U.S. dollars on April 4, 2025, to the shareholders on record as of the close of business on March 26, 2025 at the exchange rate (PTAX) published by the Brazilian Central Bank on March 13, 2025.
- On December 27, 2024, Law 15,079/2024 was enacted, establishing the implementation of the OECD’s Pillar Two global minimum tax in Brazil, effective as of January 1, 2025. Law 15,079/2024 aligns the Brazilian tax legislation to the OECD’s Global Anti-Base Erosion (GloBE) rules by introducing a minimum effective taxation of 15% through an additional Social Contribution on Net Profit (“CSLL”). This regulation applies to multinational groups within the scope of the OECD’s GloBE rules, specifically those whose ultimate parent entity reported annual consolidated revenues of at least €750 million in at least two of the four fiscal years immediately preceding the year under review. The rules are designed to ensure that the additional CSLL qualifies as a Qualified Domestic Minimum Top-up Tax (QDMTT) under the OECD Inclusive Framework, subjecting Brazilian entities to a minimum tax rate of 15%. On March 28, 2025, the Company filed a writ of mandamus with the Brazilian Federal Court challenging the enforceability of the newly enacted additional CSLL. The legal proceeding is grounded on constitutional and statutory arguments, and is waiting for court decision to prevent the collection of the additional CSLL, which is scheduled to be required in 2026 with respect to the 2025 fiscal year. The additional income tax expense as a result of Law 15,079/2024 for the three-month period ended March 31, 2025 was R$23,212.
2. Subsequent Event
- On May 7, 2025, Afya Participações announced the closing of its acquisition of 100% of the total share capital of Faculdade Masterclass Ltda. (“FUNIC”), located in Contagem, a city in the metropolitan area of Belo Horizonte, the capital of the State of Minas Gerais.
The acquisition contributes 60 medical school seats to Afya. FUNIC is pre-operational, with leased real estate prepared for a medical school operation, which is expected to start in the second semester of 2025.
The aggregate purchase price is R$ 100 million, net of the estimated Net Debt deducted from the down payment. The price and payment conditions were: (i) R$ 60 million, net of the estimated Net Debt, paid in cash on May 07, 2025; and (ii) R$ 40 million will be paid in three annual installments adjusted by CDI.
Additionally, the acquisition includes a contingent consideration for up to 60 additional medical school seats. If approved by MEC within 36 months from the closing date, it will result in an additional payment of R$1,000 per approved seat.
Afya expects an EV/EBITDA of 3.3x at full maturity and post synergies in 2030 with expected Net Revenues of R$ 52.4 million, of which 100% will come from Medicine.
3. 2025 Guidance
The Company is reaffirming its guidance for 2025, which considers the successful acceptance of new students for the first semester of 2025. The guidance for 2025 is defined in the following table:
| Guidance for 2025 | ||
| Net Revenue 1 | R$ 3,670 mn ≤ ∆ ≤ R$ 3,770 mn | |
| Adjusted EBITDA | R$ 1,620 mn ≤ ∆ ≤ R$ 1,720 mn | |
| CAPEX | R$ 250 mn ≤ ∆ ≤ R$ 290 mn | |
| (1) Excludes any acquisition that may be concluded after the issuance of the guidance, notably excluding Funic. | ||
4. 1Q25 Overview
Segment Information
The Company has three reportable segments as follows:
Undergraduate, which provides educational services through undergraduate courses related to medical school, undergraduate health science and other ex-health undergraduate programs;
Continuing education, which provides medical education (including residency preparation programs, specialization test preparation and other medical capabilities), specialization and graduate courses in medicine, delivered through digital and in-person content; and
Medical Practice Solutions, which provides clinical decision, clinical management and doctor-patient relationships for physicians and provide access, demand and efficiency for the healthcare players.
Key Revenue Drivers – Undergraduate Programs
| Table 2: Key Revenue Drivers | Three months period ended March 31, | ||
|
2025 |
2024 |
% Chg | |
| Undergraduate Programs | |||
| MEDICAL SCHOOL | |||
| Approved Seats |
3,593 |
3,203 |
12.2% |
| Operating Seats 1 |
3,543 |
3,153 |
12.4% |
| Total Students (end of period) |
25,879 |
22,609 |
14.5% |
| Average Total Students |
25,879 |
22,609 |
14.5% |
| Average Total Students (ex-Acquisitions)* |
24,263 |
22,609 |
7.3% |
| Net Revenue (Total – R$ ‘000) |
714,713 |
603,025 |
18.5% |
| Net Revenue (ex- Acquisitions* – R$ ‘000) |
672,589 |
603,025 |
11.5% |
| Medical School Net Avg. Ticket (ex- Acquisitions* – R$/month) |
9,240 |
8,891 |
3.9% |
| UNDERGRADUATE HEALTH SCIENCE |
|
||
| Total Students (end of period) |
26,134 |
24,881 |
5.0% |
| Average Total Students |
26,134 |
24,881 |
5.0% |
| Average Total Students (ex-Acquisitions)* |
25,348 |
24,881 |
1.9% |
| Net Revenue (Total – R$ ‘000) |
62,811 |
58,736 |
6.9% |
| Net Revenue (ex- Acquisitions* – R$ ‘000) |
61,730 |
58,736 |
5.1% |
| OTHER EX- HEALTH UNDERGRADUATE |
|
||
| Total Students (end of period) |
34,995 |
28,563 |
22.5% |
| Average Total Students |
34,995 |
28,563 |
22.5% |
| Average Total Students (ex-Acquisitions)* |
33,492 |
28,563 |
17.3% |
| Net Revenue (Total – R$ ‘000) |
49,848 |
42,758 |
16.6% |
| Net Revenue (ex- Acquisitions* – R$ ‘000) |
48,220 |
42,758 |
12.8% |
| Total Net Revenue |
|
||
| Net Revenue (Total – R$ ‘000) |
827,372 |
704,519 |
17.4% |
| Net Revenue (ex- Acquisitions* – R$ ‘000) |
782,539 |
704,519 |
11.1% |
| *For the three months period ended March 31, 2025, “2025 Ex Acquisitions” excludes: UNIDOM (January to March, 2025; Closing of UNIDOM was in July 2024). | |||
| (1) The difference between approved and operating seats refers to Cametá, a campus that is still pre-operational. | |||
Key Revenue Drivers – Continuing Education
| Table 3: Key Revenue Drivers | Three months period ended March 31, | ||
|
2025 |
2024 |
% Chg | |
| Continuing Education 1 | |||
| Total Students (end of period) | |||
| Residency Journey – Business to Physicians B2P |
12,203 |
14,693 |
-16.9% |
| Graduate Journey – Business to Physicians B2P |
8,542 |
7,366 |
16.0% |
| Other Courses – B2P and Business to Business Offerings |
26,164 |
26,983 |
-3.0% |
| Total Students (end of period) |
46,909 |
49,042 |
-4.3% |
| Net Revenue (R$ ‘000) |
|
||
| Business to Physicians – B2P |
65,444 |
60,538 |
8.1% |
| Business to Business – B2B |
5,660 |
4,877 |
16.0% |
| Total Net Revenue |
71,103 |
65,415 |
8.7% |
| (1) The figure above does not contemplate intercompany transactions | |||
Key Revenue – Medical Practice Solutions
| Table 4: Key Revenue Drivers | Three months period ended March 31, | ||
|
2025 |
2024 |
% Chg |
|
| Medical Practice Solutions 1 | |||
| Active Payers (end of period) | |||
| Clinical Decision |
163,071 |
159,183 |
2.4% |
| Clinical Management |
34,934 |
31,806 |
9.8% |
| Total Active Payers (end of period) |
198,005 |
190,989 |
3.7% |
| Monthly Active Users (MaU) |
|
||
| Total Monthly Active Users (MaU) – Digital Services |
244,518 |
262,717 |
-6.9% |
| Net Revenue (R$ ‘000)2 |
|
||
| Business to Physicians – B2P |
37,231 |
32,730 |
13.7% |
| Business to Business – B2B |
4,453 |
3,843 |
15.9% |
| Total Net Revenue |
41,684 |
36,573 |
14.0% |
| (1) The figure above does not contemplate intercompany transactions | |||
| (2) Net Revenue from ‘Shosp’, the clinical management software, was reclassified from B2B to B2P. | |||
Key Operational Drivers – Users Positively Impacted by Afya
The Users Positively Impacted by Afya represents the total number of medical students from the Undergraduate segment, students from the Continuing Education and users from Medical Practice Solutions. For the first quarter of 2025, Afya’s ecosystem reached 317,306 users.
| Table 5: Key Revenue Drivers | Three months period ended March 31, | ||
|
2025 |
2024 |
% Chg |
|
| Users Positively Impacted by Afya 1 | |||
| Undergraduate (Total Medical School Students – End of Period) |
25,879 |
22,609 |
14.5% |
| Continuing Education (Total Students – End of Period) |
46,909 |
49,042 |
-4.3% |
| Medical Practice Solutions (Monthly Active Users) |
244,518 |
262,717 |
-6.9% |
| Ecosystem Outreach |
317,306 |
334,368 |
-5.1% |
| (1) Ecosystem outreach does not contemplate intercompany figures. Note that there may be overlap in student numbers within the data. | |||
Seasonality of Operations
Undergraduate tuition revenues are related to the intake process, and monthly tuition fees charged to students and do not significantly fluctuate during each semester.
Continuing education revenues are mostly related to: (i) monthly intakes and tuition fees on medical education, which do not have a considerable concentration in any period; (ii) Residency journey product revenues, derived from e-books transferred at a point of time, which are concentrated at in the first and last quarter of the year due to the enrollments.
Medical Practice Solutions are comprised mainly of Afya Whitebook and Afya iClinic revenues, which do not have significant fluctuations regarding seasonality.
Net Revenue
Net Revenue for the first quarter of 2025 was R$936.4 million, an increase of 16.4% over the same period in the prior year. Excluding acquisitions, Net Revenue in the first quarter increased by 10.9% YoY to R$891.5 million.
The quarter revenue increase was mainly due to higher tickets in medicine courses, the maturation of medical school seats, the acquisition and the increase of occupancy in Unidom, and the advancement of Medical Practice Solutions and Continuing Education segments.
| Table 6: Revenue & Revenue Mix | ||||||
| (in thousands of R$) | For the three months period ended March 31, | |||||
|
2025 |
2025 Ex Acquisitions* |
2024 |
% Chg |
% Chg Ex Acquisitions |
||
| Net Revenue Mix | ||||||
| Undergraduate |
827,372 |
782,539 |
704,519 |
17.4% |
11.1% |
|
| Continuing Education |
71,103 |
71,103 |
65,415 |
8.7% |
8.7% |
|
| Medical Practice Solutions |
41,684 |
41,684 |
36,573 |
14.0% |
14.0% |
|
| Inter-segment transactions |
(3,799) |
(3,799) |
(2,268) |
67.5% |
67.5% |
|
| Total Reported Net Revenue |
936,360 |
891,527 |
804,239 |
16.4% |
10.9% |
|
| *For the three months period ended March 31, 2025, “2025 Ex Acquisitions” excludes: UNIDOM (January to March, 2025; Closing of UNIDOM was in July 2024). | ||||||
Adjusted EBITDA
Adjusted EBITDA for the first quarter of 2025 increased by 23.7% to R$492.0 million, up from R$397.9 million in the same period of the prior year, with the Adjusted EBITDA Margin rising by 300 basis points to 52.5%.
The increase in Adjusted EBITDA Margin was mainly driven by: (a) higher gross margin in the Undergraduate and Continuing Education segments; (b) the continued ramp-up of the four Mais Médicos campuses launched in 3Q22; (c) restructuring initiatives within Continuing Education and Medical Practice Solutions; and (d) improved cost efficiency in Selling, General, and Administrative expenses.
| Table 7: Reconciliation between Adjusted EBITDA and Net Income | |||
| (in thousands of R$) | For the three months period ended March 31, | ||
|
2025 |
2024 |
% Chg | |
| Net income |
257,036 |
208,299 |
23.4% |
| Net financial result |
94,994 |
74,366 |
27.7% |
| Income taxes expense |
24,782 |
10,865 |
128.1% |
| Depreciation and amortization |
91,755 |
79,269 |
15.8% |
| Interest received 1 |
14,532 |
12,415 |
17.1% |
| Income share associate |
(4,285) |
(4,172) |
2.7% |
| Share-based compensation |
6,963 |
8,629 |
-19.3% |
| Non-recurring expenses: |
6,194 |
8,181 |
-24.3% |
| – Integration of new companies 2 |
5,970 |
5,870 |
1.7% |
| – M&A advisory and due diligence 3 |
88 |
248 |
-64.5% |
| – Expansion projects 4 |
124 |
605 |
-79.5% |
| – Restructuring expenses 5 |
12 |
1,458 |
-99.2% |
| Adjusted EBITDA |
491,971 |
397,853 |
23.7% |
| Adjusted EBITDA Margin |
52.5% |
49.5% |
300 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. | |||
Adjusted Net Income
Net Income for the first quarter of 2025, totaled R$257.0 million, reflecting a 23.4% increase YoY. Adjusted Net Income reached R$293.9 million, up 17.1% from the same period in the prior year. This growth was primarily driven by improved operational performance that was partially offset by a higher tax rate compared to the previous year due to the provision of additional CSLL towards OECD’s Pillar Two global minimum tax effects.
Adjusted EPS reached R$3.20 per share for the first quarter ended March 31, 2025, an increase of 17.0% YoY, supported by higher Net Income and a disciplined capital allocation strategy.
| Table 8: Adjusted Net Income | |||
| (in thousands of R$) | For the three months period ended March 31, | ||
|
2025 |
2024 |
% Chg |
|
| Net income |
257,036 |
208,299 |
23.4% |
| Amortization of Intangible Assets 1 |
23,704 |
25,856 |
-8.3% |
| Share-based compensation |
6,963 |
8,630 |
-19.3% |
| Non-recurring expenses: |
6,194 |
8,181 |
-24.3% |
| – Integration of new companies 2 |
5,970 |
5,870 |
1.7% |
| – M&A advisory and due diligence 3 |
88 |
248 |
-64.5% |
| – Expansion projects 4 |
124 |
605 |
-79.5% |
| – Restructuring expenses 5 |
12 |
1,458 |
-99.2% |
| Adjusted Net Income |
293,897 |
250,966 |
17.1% |
| Basic earnings per share – in R$ 6 |
2.79 |
2.26 |
23.3% |
| Adjusted earnings per share – in R$ 7 |
3.20 |
2.73 |
17.0% |
| (1) Consists of amortization of intangible assets identified in 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) Basic earnings per share: Net Income/Weighted average number of outstanding shares. | |||
| (7) Adjusted earnings per share: Adjusted Net Income attributable to equity holders of the Parent/Weighted average number of outstanding shares. | |||
Cash and Debt Position
As of March 31, 2025, Cash and Cash Equivalents totaled R$1,154.9 million, an increase of 26.8% over December 31, 2024. Net Debt, excluding the effect of IFRS 16, reached R$1,524.1 million, compared to December 31, 2024, Afya reduced its Net Debt by R$290.8 million due to solid Cash Flow from Operating Activities.
For the three-month period ended March 31, 2025, Afya generated R$470.2 million in Cash Flow from Operating Activities, up from R$429.1 million in the same period of the previous year, an increase of 9.6% YoY, boosted by operational results. The Operating Cash Conversion Ratio reached 96.8%.
| Table 9: Operating Cash Conversion Ratio Reconciliation | For the three months period ended March 31, | ||
| (in thousands of R$) | Considering the adoption of IFRS 16 | ||
|
2025 |
2024 |
% Chg |
|
| (a) Net cash flows from operating activities |
463,850 |
417,860 |
11.0% |
| (b) Income taxes paid |
6,386 |
11,194 |
-43.0% |
| (c) = (a) + (b) Cash flow from operating activities |
470,236 |
429,054 |
9.6% |
| (d) Adjusted EBITDA |
491,971 |
397,853 |
23.7% |
| (e) Non-recurring expenses: |
6,194 |
8,181 |
-24.3% |
| – Integration of new companies 1 |
5,970 |
5,870 |
1.7% |
| – M&A advisory and due diligence 2 |
88 |
248 |
-64.5% |
| – Expansion projects 3 |
124 |
605 |
-79.5% |
| – Restructuring Expenses 4 |
12 |
1,458 |
-99.2% |
| (f) = (d) – (e) Adjusted EBITDA ex- non-recurring expenses |
485,777 |
389,672 |
24.7% |
| (g) = (c) / (f) Operating cash conversion ratio |
96.8% |
110.1% |
-1330 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. | |||
The following table provides additional details on the cost of debt for the first quarter of 2025, considering loans and financing and accounts payable to selling shareholders. Afya’s capital structure remains solid, with a conservative leveraging position and a low cost of debt. Afya’s Net Debt (excluding the effect of IFRS16) divided by Adjusted EBITDA mid guidance for 2025 would be 0.9x.
| Table 10: Gross Debt and Average Cost of Debt | ||||||||
| (in millions of R$) | For the three months period ended March 31, | |||||||
| Cost of Debt | ||||||||
| Gross Debt | Duration (Years) | Per year | %CDI² | |||||
|
2025 |
2024 |
2025 |
2024 |
2025 |
2024 |
2025 |
2024 |
|
| Loans and financing: Softbank |
850 |
826 |
1.1 |
2.1 |
8.6% |
6.5% |
69% |
57% |
| Loans and financing: Debentures |
513 |
510 |
2.3 |
3.3 |
14.6% |
12.7% |
115% |
117% |
| Loans and financing: Others |
328 |
446 |
0.5 |
1.3 |
14.7% |
12.7% |
115% |
116% |
| Loans and financing: IFC |
522 |
– |
3.6 |
– |
14.0% |
– |
110% |
– |
| Accounts payable to selling shareholders |
466 |
405 |
3.6 |
0.9 |
12.7% |
10.8% |
100% |
100% |
| Total¹| Average |
2,679 |
2,189 |
2.2 |
2.1 |
12.2% |
9.8% |
97% |
91% |
| (1) Total amount refers only to the “Gross Debt” columns | ||||||||
| (2) Based on the annualized Interbank Certificates of Deposit (“CDI”) rate for the period as a reference: 1Q25: ~14,15% p.y. and for 1Q24: ~10.65% p.y. | ||||||||
| Table 11: Cash and Debt Position | |||||
| (in thousands of R$) | |||||
|
1Q25 |
FY2024 |
% Chg |
1Q24 |
% Chg |
|
| (+) Cash and Cash Equivalents |
1,154,888 |
911,015 |
26.8% |
611,077 |
89.0% |
| Cash and Bank Deposits |
3,508 |
6,078 |
-42.3% |
5,573 |
-37.1% |
| Cash Equivalents |
1,151,380 |
904,937 |
27.2% |
605,504 |
90.2% |
| (-) Loans and Financing |
2,212,674 |
2,195,161 |
0.8% |
1,783,094 |
24.1% |
| Current |
373,275 |
363,554 |
2.7% |
161,675 |
130.9% |
| Non-Current |
1,839,399 |
1,831,607 |
0.4% |
1,621,419 |
13.4% |
| (-) Accounts Payable to Selling Shareholders |
466,341 |
530,772 |
-12.1% |
405,410 |
15.0% |
| Current |
191,698 |
185,318 |
3.4% |
244,865 |
-21.7% |
| Non-Current |
274,643 |
345,454 |
-20.5% |
160,545 |
71.1% |
| (-) Other Short and Long Term Obligations |
– |
– |
n.a. |
– |
n.a. |
| (=) Net Debt (Cash) excluding IFRS 16 |
1,524,127 |
1,814,918 |
-16.0% |
1,577,427 |
-3.4% |
| (-) Lease Liabilities |
989,184 |
978,336 |
1.1% |
902,542 |
9.6% |
| Current |
47,762 |
45,580 |
4.8% |
40,030 |
19.3% |
| Non-Current |
941,422 |
932,756 |
0.9% |
862,512 |
9.1% |
| Net Debt (Cash) with IFRS 16 |
2,513,311 |
2,793,254 |
-10.0% |
2,479,969 |
1.3% |
CAPEX
Capital expenditures consist of the purchase of property and equipment and intangible assets, including expenditures mainly related to the expansion and maintenance of Afya’s campuses and headquarters, leasehold improvements, and the development of new solutions in the Medical Practice Solutions and content in the Continuing Education.
For the three-months period ending March 31, 2025, CAPEX was R$56.2 million, representing 6.0% of Afya’s Net Revenue.
| Table 12: CAPEX | |||
| (in thousands of R$) | For the three months period ended March 31, | ||
|
2025 |
2024 |
% Chg |
|
| CAPEX |
56,212 |
92,901 |
-39.5% |
| Property and equipment |
38,477 |
22,955 |
67.6% |
| Intangible assets |
17,735 |
69,946 |
-74.6% |
| – Licenses1 |
– |
49,600 |
n.a. |
| – Others |
17,735 |
20,346 |
-12.8% |
| (1) One-off effect of R$ 49.6 million regarding the Earnout of FIP Guanambi, due to the expansion of 40 seats as disclosed to the market in January 2024. | |||
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 three key metrics, Governance and Employee Management, Environmental and Social.
The 2023 Sustainability Report can be found at: https://ir.afya.com.br/annual-report/
| Table 13: ESG Metrics 1, 2 & 3 |
1Q25 |
1Q24 |
2024 |
2023 |
||
| # | GRI | Governance and Employee Management | ||||
|
1 |
405-1 |
Number of employees |
9,810 |
9,914 |
9,717 |
9,680 |
|
2 |
405-1 |
Percentage of female employees |
59% |
58% |
59% |
58% |
|
3 |
405-1 |
Percentage of female employees in the board of directors |
30% |
36% |
30% |
36% |
|
4 |
102-24 |
Percentage of independent member in the board of directors |
40% |
36% |
40% |
36% |
| Environmental | ||||||
|
5 |
Total renewable energy generated by own photovoltaic plants (MWh) |
1,447.552 |
1,794.215 |
6,329.796 |
4,510.637 |
|
|
6 |
302-1 |
Total energy consumed (MWh) |
6,330.837 |
5,831.206 |
24,260.662 |
24,036.608 |
|
7 |
302-1 |
% of renewable energy consumed from own generation |
19.5% |
26.8% |
23.2% |
16.0% |
|
8 |
302-1 |
% of energy consumed from the power grid |
37.6% |
30.8% |
34.8% |
60.3% |
|
9 |
302-1 |
% of energy consumed from the free market |
42.9% |
42.3% |
42.0% |
23.7% |
| Social | ||||||
|
10 |
413-1 |
Number of free clinical consultations offered by Afya |
212,549 |
147,757 |
846,264 |
586,611 |
|
11 |
Number of physicians graduated in Afya’s campuses |
23,032 |
20,220 |
22,867 |
20,197 |
|
|
12 |
201-4 |
Number of students with financing and scholarship programs (FIES and PROUNI) |
12,825 |
10,815 |
12,342 |
10,584 |
|
13 |
% students with scholarships over total undergraduate students |
14.7% |
14.2% |
16.0% |
16.0% |
|
|
14 |
413-1 |
Hospital, clinics and city halls partnerships |
524 |
518 |
614 |
649 |
| (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) 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. | ||||||
| (3) The number of students with financing and scholarship programs (FIES and PROUNI) in 2023 excludes students from the Unima and FCM Jaboatão acquisition, and for 3Q24 onwards, also excludes those from the UNIDOM acquisition. | ||||||
5. Conference Call and Webcast Information
|
When: |
May 8, 2025 at 5:00 p.m. EDT. |
|
|
Who: |
Mr. Virgilio Gibbon, Chief Executive Officer Mr. Luis André Blanco, Chief Financial Officer |
|
|
Webcast: |
OR
Dial-in:
Brazil: +55 11 4632 2236 or +55 11 4632 2237 or +55 11 4680 6788 or +55 11 4700 9668 or +55 21 3958 7888
United States: +1 346 248 7799 or +1 360 209 5623 or +1 386 347 5053 or +1 507 473 4847 or +1 564 217 2000 or +1 646 931 3860 or +1 669 444 9171 or +1 669 900 6833 or +1 689 278 1000 or +1 719 359 4580 or +1 929 205 6099 or +1 253 205 0468 or +1 253 215 8782 or +1 301 715 8592 or +1 305 224 1968 or +1 309 205 3325 or +1 312 626 6799
Webinar ID: 995 2743 1135
Other Numbers: https://afya.zoom.us/u/advMyerzrb
6. About Afya Limited (Nasdaq: AFYA; B3: A2FY34)
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 medical practice solutions 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, including risks and uncertainties related to statements about our competition; our ability to attract, upsell and retain students; our capacity to increase tuition prices; our ability to anticipate and meet the evolving needs of students and teachers; our capacity to source and successfully integrate acquisitions; as well as general market, political, economic, and business conditions. Additionally, these statements include 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. These statements are not guarantees of future performance and undue reliance should not be placed on them.
The Company assumes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances occurring after its publication, nor to incorporate 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 of these risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from those 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 they are made. Further information on these and other factors that could affect the Company’s financial results is included in 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 annual report on Form 20-F. These documents are available in 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 IFRS accounting standards as issued by the International Accounting Standards Board—IASB, Afya presents Adjusted EBITDA, Operating Cash Conversion Ratio, Adjusted Net Income and Adjusted EPS, 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 income share associate, plus/minus non-recurring expenses/income. Operating Cash Conversion Ratio is calculated as the Cash flow from Operating Activities plus income taxes paid, minus/plus non-recurring expenses/income divided by Adjusted EBITDA. The calculation of Adjusted Net Income is the Net Income plus amortization of customer relationships and trademark, plus share-based compensation, plus/minus non-recurring expenses/income. The calculation of Adjusted EPS is the Adjusted Net Income minus the non-controlling interests divided by the Weighted average number of outstanding shares.
The non-GAAP supplemental financial measures are provided with the intend to help investors in assessing the overall performance of Afya’s business regarding its core operations, cash generation and profitability. The non-GAAP financial measures described in this release are not substitutes for the IFRS measures. In addition, the calculations of Adjusted EBITDA, Operating Cash Conversion Ratio, Adjusted Net Income and Adjusted EPS are not standardized financial measures and may differ 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: [email protected]
10. Financial Tables
|
Unaudited interim condensed consolidated statements of financial position As of March 31, 2025 and December 31, 2024 (In thousands of Brazilian reais) |
|||
|
March 31, 2025 |
December 31, 2024 |
||
|
Assets |
(unaudited) |
|
|
|
Current assets |
|
||
|
Cash and cash equivalents |
1,154,888 |
911,015 |
|
|
Trade receivables |
636,906 |
595,898 |
|
|
Recoverable taxes |
32,118 |
25,726 |
|
|
Other assets |
57,304 |
|
57,145 |
|
Total current assets |
1,881,216 |
|
1,589,784 |
|
|
|
||
|
Non-current assets |
|
|
|
|
Trade receivables |
34,014 |
|
35,948 |
|
Deferred tax assets |
7,146 |
|
– |
|
Other assets |
116,371 |
115,875 |
|
|
Investment in associate |
53,129 |
54,442 |
|
|
Property and equipment |
670,162 |
658,482 |
|
|
Right-of-use assets |
845,698 |
842,219 |
|
|
Intangible assets |
5,504,138 |
5,532,789 |
|
|
Total non-current assets |
7,230,658 |
7,239,755 |
|
|
Total assets |
9,111,874 |
8,829,539 |
|
|
|
|
||
|
Liabilities |
|
|
|
|
Current liabilities |
|
|
|
|
Trade payables |
129,973 |
128,080 |
|
|
Loans and financing |
373,275 |
363,554 |
|
|
Lease liabilities |
47,762 |
45,580 |
|
|
Accounts payable to selling shareholders |
191,698 |
185,318 |
|
|
Advances from customers |
161,262 |
161,048 |
|
|
Dividends payable |
130,798 |
|
– |
|
Labor and social obligations |
237,850 |
208,076 |
|
|
Taxes payable |
35,695 |
33,456 |
|
|
Income taxes payable |
9,517 |
4,247 |
|
|
Other liabilities |
5,137 |
10,836 |
|
|
Total current liabilities |
1,322,967 |
1,140,195 |
|
|
|
|
||
|
Non-current liabilities |
|
|
|
|
Loans and financing |
1,839,399 |
1,831,607 |
|
|
Lease liabilities |
941,422 |
932,756 |
|
|
Accounts payable to selling shareholders |
274,643 |
345,454 |
|
|
Taxes payable |
134,355 |
112,681 |
|
|
Provision for legal proceedings |
115,599 |
113,521 |
|
|
Other liabilities |
42,074 |
42,742 |
|
|
Total non-current liabilities |
3,347,492 |
3,378,761 |
|
|
Total liabilities |
4,670,459 |
4,518,956 |
|
|
|
|
||
|
Equity |
|
|
|
|
Share capital |
17 |
17 |
|
|
Additional paid-in capital |
2,343,939 |
2,344,521 |
|
|
Treasury shares |
(271,751) |
|
(273,955) |
|
Share-based compensation reserve |
194,460 |
187,497 |
|
|
Retained earnings |
2,134,090 |
2,011,875 |
|
|
Equity attributable to equity holders of the parent |
4,400,755 |
4,269,955 |
|
|
Non-controlling interests |
40,660 |
40,628 |
|
|
Total equity |
4,441,415 |
4,310,583 |
|
|
Total liabilities and equity |
9,111,874 |
8,829,539 |
|
|
Unaudited interim condensed consolidated statements of income and comprehensive income For the three-month periods ended March 31, 2025 and 2024 (In thousands of Brazilian reais, except for earnings per share information) |
||
|
|
March 31, 2025 |
March 31, 2024 |
|
|
(unaudited) |
(unaudited) |
|
|
|
|
|
Revenue |
936,360 |
804,239 |
|
Cost of services |
(282,639) |
(269,504) |
|
Gross profit |
653,721 |
534,735 |
|
|
|
|
|
Selling, general and administrative expenses |
(281,500) |
(241,164) |
|
Other income (expenses), net |
306 |
(4,213) |
|
|
|
|
|
Operating income |
372,527 |
289,358 |
|
|
|
|
|
Finance income |
43,481 |
25,530 |
|
Finance expenses |
(138,475) |
(99,896) |
|
Net finance result |
(94,994) |
(74,366) |
|
|
|
|
|
Share of income of associate |
4,285 |
4,172 |
|
|
|
|
|
Income before income taxes |
281,818 |
219,164 |
|
|
|
|
|
Income taxes expenses |
(24,782) |
(10,865) |
|
|
|
|
|
Net income |
257,036 |
208,299 |
|
|
|
|
|
Other comprehensive income |
– |
– |
|
|
|
|
|
Total comprehensive income |
257,036 |
208,299 |
|
|
|
|
|
Income attributable to: |
|
|
|
Equity holders of the parent |
251,999 |
203,393 |
|
Non-controlling interests |
5,037 |
4,906 |
|
|
257,036 |
208,299 |
|
|
|
|
|
Basic earnings per common share |
2.79 |
2.26 |
|
Diluted earnings per common share |
2.76 |
2.22 |
|
Unaudited interim condensed consolidated statements of cash flows For the three-month periods ended March 31, 2025 and 2024 (In thousands of Brazilian reais) |
||
|
|
March 31, 2025 |
March 31, 2024 |
|
|
(unaudited) |
(unaudited) |
|
Operating activities |
|
|
|
Income before income taxes |
281,818 |
219,164 |
|
Adjustments to reconcile income before income taxes |
|
|
|
Depreciation and amortization expenses |
91,755 |
79,269 |
|
Write-off of property and equipment |
305 |
19 |
|
Allowance for expected credit losses |
16,558 |
15,264 |
|
Share-based compensation expense |
6,963 |
8,630 |
|
Net foreign exchange differences |
476 |
(190) |
|
Accrued interest |
76,939 |
51,745 |
|
Accrued interest on lease liabilities |
29,563 |
26,744 |
|
Share of income of associate |
(4,285) |
(4,172) |
|
Provision (reversal) for legal proceedings |
408 |
(1,851) |
|
|
|
|
|
Changes in assets and liabilities |
|
|
|
Trade receivables |
(55,632) |
(6,434) |
|
Recoverable taxes |
(6,392) |
(6,914) |
|
Other assets |
(6,131) |
1,458 |
|
Trade payables |
1,893 |
14,472 |
|
Taxes payable |
10,787 |
5,439 |
|
Advances from customers |
214 |
3,095 |
|
Labor and social obligations |
29,774 |
23,528 |
|
Other liabilities |
(4,777) |
(212) |
|
|
470,236 |
429,054 |
|
Income taxes paid |
(6,386) |
(11,194) |
|
Net cash flows from operating activities |
463,850 |
417,860 |
|
|
|
|
|
Investing activities |
|
|
|
Acquisition of property and equipment |
(38,477) |
(22,955) |
|
Acquisition of intangibles assets |
(17,735) |
(69,946) |
|
Dividends received |
5,598 |
3,900 |
|
Acquisition of subsidiaries, net of cash acquired |
(65,162) |
(147,262) |
|
Payments of interest from acquisition of subsidiaries and intangibles |
(14,536) |
(24,735) |
|
Net cash flows used in investing activities |
(130,312) |
(260,998) |
|
|
|
|
|
Financing activities |
|
|
|
Payments of principal of loans and financing |
(769) |
(10,762) |
|
Payments of interest of loans and financing |
(44,980) |
(48,806) |
|
Payments of principal of lease liabilities |
(11,904) |
(9,648) |
|
Payments of interest of lease liabilities |
(29,167) |
(26,903) |
|
Proceeds from exercise of stock options |
1,622 |
826 |
|
Dividends paid to non-controlling shareholders |
(3,991) |
(3,712) |
|
Net cash flows used in financing activities |
(89,189) |
(99,005) |
|
Net foreign exchange differences |
(476) |
190 |
|
Net increase in cash and cash equivalents |
243,873 |
58,047 |
|
Cash and cash equivalents at the beginning of the period |
911,015 |
553,030 |
|
Cash and cash equivalents at the end of the period |
1,154,888 |
611,077 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250508364394/en/
Investor Relations Contact:
Afya Limited
[email protected]
KEYWORDS: Latin America North America United States Brazil South America New York
INDUSTRY KEYWORDS: General Health Health University Training Education
MEDIA:
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