Afya Limited Q4 FY2025 earnings call

• Achieved seventh consecutive year of meeting or exceeding guidance since second half of 2018. - Revenue for 12-month period grew 12% y-o-y to BRL 3.697 billion, adjusted EBITDA grew over 50% y-o-y to BRL 1.680 billion, adjusted EBITDA margin 45.4%. - Maintained leadership in medical education with 3,755 approved medical seats, underground medical students over 25,000 (5% growth y-o-y). - Concluded acquisition of 60 medical seats in Afya Contagem, secured authorization of 102 additional medical seats. - Delivered gross margin record of 64.5% at corporate level, EPS record of BRL 8.32. - Announced cash dividend of BRL 307.4 million, equivalent to BRL 3.45 per share, payable on April 6, 2026. - Strategic focus on strengthening Afya's position across entire physician life cycle, investing in technology, data, growth capabilities, broadening physician audience, scaling B2B health care industry offerings.

Undergrad segment: Revenue for 12-month period was BRL 2,789 million (up 13% y-o-y), number of medical students grew 5% to over 25,000, medical school net average ticket (excluding acquisitions) increased 3% to BRL 9,060, gross margin 63.9%. Continuing education segment: Revenue grew 11% y-o-y to BRL 284 million, B2B revenue growth 48%, gross margin expanded 363 basis points, over 10,000 graduate journey students. Medical practice solutions segment: Revenue grew 6% y-o-y to BRL 171 million, reached 196,000 payers, physicians made over 16.9 million prescriptions. Ecosystem: Reached 301,000 active users.

• Revenue expected to range between BRL 3.950 billion and BRL 4.100 billion in 2026. - Adjusted EBITDA anticipated to be between BRL 1.700 billion and BRL 1.800 billion in 2026, excluding acquisitions concluded after guidance issuance. - CapEx for 2026 expected to be between BRL 340 million and BRL 380 million, 8.6% - 9.3% of revenue. - No material impact from ENAMED on 2026 guidance expected as medical school intake occurs in first half of year.

Q: Could you please give some tangible examples of improvements planning for continuing education and medical practice solutions, and outlook for B2B revenues in medical practice solutions?

A: Virgilio said investments are about integrating products/services for physicians, creating a platform with membership concept and unified experience, improving product enhancement and technology. For B2B, it's about leveraging the platform to serve contracts better.

Q: Update on ENAMED and ProFMed discussions, potential impacts on schools and preparation for new schools?

A: Virgilio said no impact on 2026 intake as most seats filled, running 12 simulations for mock tests, new ENAMED expected in September. ProFMed under discussion in Senate.

Q: Explanation on operational expenses increase and CapEx, and EBITDA margin decrease in 2026?

A: Luis said CapEx increase in 2025 due to investments in Continuing Education and SPM segments starting in fourth quarter. OpEx had seasonality. EBITDA margin decrease partly due to investment programs in Continuing Education and SPM and mix effect.

Q: Comment on capital allocation priorities for next 3-5 years?

A: Luis said inorganic movements focus on medicine schools with at least 200 seats and 20% nominal unleveraged IRR. Mix of share buyback and dividends for shareholders, using free cash flow. Virgilio added on cash flow generation and allocation to buyback, dividends, and funding future opportunities.

Q: Detail on revenue growth breakdown by segment in guidance?

A: Luis said Undergrad will be single digits mixing ticket effect and small volume growth. SPM and Continuing Education will be double digits, but no segment-specific EBITDA breakdown provided.