Afya Limited (NASDAQ:AFYA) Q2 2024 Earnings Conference Call August 14, 2024 5:00 PM ET

Corporate Participants

Renata Couto - Investor Relations
Virgilio Gibbon - Chief Executive Officer
Luis Andre Blanco - Chief Financial Officer

Conference Call Participants

Mirela Oliveira – Bank of America
Lucca Marquezini - Itau
Leandro Bastos - Citi
Marcelo Santos - JPMorgan
Mauricio Cepeda - Morgan Stanley

Renata Couto

Thank you for joining us for Afya's Conference Call. I'm here today with Afya's CEO, Virgilio Gibbon, and our CFO, Luis Andre Blanco.

During today's presentation, our executives will make forward-looking statements. Forward-looking statements can be related to future events, future financial or operating performance, known and unknown risks, uncertainties, and other factors that may cause Afya's actual results to differ materially from those contemplated by these forward-looking statements.

Forward-looking statements in this presentation include, but are not limited to, statements related to the business and financial performance, expectations and guidance for future periods, or expectations regarding the company's strategic product initiatives and its related benefits. These risks include those more fully described in our filings with the Securities and Exchange Commission.

The forward-looking statements in this presentation are based on the information available to us as the date hereof. We should not rely on them as predictions of future events, and we disclaim any obligation to update any forward-looking statements, except as required by law. In addition, management may reference non-IFRS financial measures on this call.

These measures are not intended to be considered in isolation or as a substitute of the results prepared in accordance with IFRS. This presentation has reconciled these non-IFRS financial measures to the most directly comparable IFRS financial measures.

Now, let me turn the call over to Virgilio Gibbon, the CEO, who will begin with slide number three.

Virgilio Gibbon

Thank you, Renata, and thanks to everyone for joining us today for our second quarter and first half conference call for 2024 results.

Let's start with our performance highlights. First, net revenue increased almost 14%, reached R$810 million, followed by an adjusted EBITDA growth of 28% year-over-year, reaching R$344 million, with an adjusted EBITDA margin of 42.5%, an impressive 490 bps over last year. Adjusted net income reached R$210 million, marking a 59% growth compared to the same period in 2023. Meanwhile, our adjusted EPS climbed to R$2.29, reflect a 62% increase over the previous year. We delivered robust cash flow from operating activities, totaling R$610 million, a 21% year-over-year increase, driven by the company's solid operational performance. Operating cash conversion reached 94%, with a robust cash position of R$723 million at the close of the quarter.