Q2 2024 Afya Ltd Earnings Call
I know, it's Brasil conference call I'm here today with us, we should evolve and our CFO resumed emblem.
Speaker Change: During today's presentation are as active we will make forward looking statements.
Speaker Change: Looking statements can be related to future events future financial operating performance, knowing unknown risks uncertainties and other factors that may cause <unk> actual results to differ materially from those contemplated by these forward looking statements.
Speaker Change: Forward looking statements in this presentation include but are not limited to the.
Speaker Change: Statements related to the business and financial performance.
Speaker Change: Spectation 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 <unk>.
Speaker Change: <unk> with the Securities and Exchange Commission.
Speaker Change: The forward looking statements in this presentation are based on information available to us as the date hereof.
Speaker Change: You 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.
Speaker Change: In addition management may reference non <unk> financial measures on this call.
Speaker Change: These measures are not intended to be considered in isolation or as a substitute of the results prepared in accordance with firefighters.
Fred Visitation: As Fred Visitation has reconciled as no ifr as financial measures to the most directly comparable ifr its financial measures.
Speaker Change: Now, let me turn the call over to MS usual I could feel who will begin with slide number three.
Speaker Change: Thank you, Matt and thanks to everyone for joining us today for our second quarter and first half.
Speaker Change: Conference call for 2024 results.
Speaker Change: This fact, we follow up performance highlights first.
Speaker Change: Net revenue increased almost 14%.
Speaker Change: $810 million.
Speaker Change: Adjusted EBITDA growth of 28%.
Speaker Change: 344, and adjusted EBITDA margin of 42, 5%.
Speaker Change: <unk> 490 bps over next year adjusted net income reached 210 meter.
Speaker Change: Mark and a 59% growth compared to the same period in 2023.
Speaker Change: While our adjusted EPS climbed to $2 29.
Speaker Change: It reflects a 62% increase over the previous year.
Speaker Change: We delivered robust cash flow from operating activities totaling $682 million or 21% year over year increase driven by the company's solid operational performance.
Speaker Change: <unk> cash conversion reached 94%.
Speaker Change: I'll discuss position of $723 million.
Speaker Change: At the close of the quarter.
Speaker Change: Moving to operations at the date of this water medical seats reaches.
Speaker Change: Three two towers on a proven seats. Additionally, our number of Mexico students has reached 22661, representing a 9% volume growth compared to the second quarter of the previous year.
Speaker Change: It's also important to mention that.
Speaker Change: Our recent acquisition of ammonia adult and the addition of ADC tills horizon for NIM in the third quarter of 2024, we have now reached a total of 3583 approved seats as of today.
Speaker Change: We also observed impressive results and Thats right for our continuing education business with the segment growing by over 12% year over <unk>.
Built in our net revenue of 127 million in the first six months period of 2024.
Speaker Change: Similarly, our medical pad solutions demonstrated significant progress with a revenue increase of 13% compared to first half of 2023, concluding the six month period with a net revenue of $77 million.
Speaker Change: Moving now to slide number four.
Speaker Change: We can now observed our new business districts has taken shape.
Speaker Change: Comprised of three segments undergrad programs, continuing education and medical grade solutions.
Speaker Change: I'd like to reiterate that notable change has occurred and continued education anchor.
Speaker Change: Entities, we've even as account, whereas our content and technology for medical application, we demerge Kopecks solution.
Speaker Change: Now accounted for in the continuing education segment.
Speaker Change: Tennessee The segment, formerly known as digital services was renamed to medical practice solutions.
Speaker Change: Beginning with the Undergrad segment, we observed significant progress throughout the quarter include.
Speaker Change: Including an increase of over five 4% and our net average tickets for medical of course organic growth and mall segments and expansion in gross margin and the acquisition of one you don't.
Speaker Change: Continued indication was market by an operational restructuring, resulting in growth and then the increase in <unk> students boosted by both Greg and Pat progress.
Speaker Change: This segment also benefited from a gross margin expansion due to operational restrictions efforts.
Speaker Change: Lastly, in our medical pad solutions segment, we ended the quarter with a 13% increase in exit fees driven by 11% growth in clinical decision and a 19% growth in clinical management. We have also seen a recovery in our <unk> net revenue for the same as some of the invoices.
Speaker Change: Were postponed during the first quarter of 2024 and now being accounted for.
Speaker Change: Moving now to slide number five.
Speaker Change: We are pleased to announce another day to access guidance following the recent acquisition of.
Speaker Change: The addition of 80 medical seats at the Union while ago was the first half results that have exceeded our initial expectation and also our robust intake process, which also again you should 100% of the coupon.
Speaker Change: Our <unk> include a new net revenue in a range between $3 billion 225 million Reais to.
Speaker Change: $3 billion 325 media hacks.
Speaker Change: And adjusted EBITDA range between $1 billion, 375 million Reais and $1 billion for $175 million.
Speaker Change: And our Capex range between 220 to 106 can be new highs for our capital expenditures.
Luis Blanco: Now I will be turning the call over to Luis Blanco asset CFO to provide more insight into the financial and operational metrics. Thank you.
Luis Blanco: Thank you Kris and good evening everyone.
Luis Blanco: Starting with slide number seven for a discussion of the key operational metrics by business unit, our number of medical students increased by 9% over the first half of 2023.
Luis Blanco: <unk>.
Speaker Change: 22 6000 students.
Richard: We have Richard <unk> thousand 203 appropriate medical seats due to the 40 seat increase one would be <unk> in January 2034.
Richard: The net average tickets for our medical school rose by five 4%, reaching 8920 to react.
Richard: In the first half of 2034.
Richard: Furthermore.
<unk> program net revenue saw an increase of more than 13%, reaching over 1414th meet every US 86 of which is related to medicine and 94% from now related courses.
Richard: All these airports highlight one key point for our medical educational thesis remains and will continue to be.
Richard: <unk> of our business in the short and medium term.
Speaker Change: Driving consistent growth alongside.
Speaker Change: Profitability and cash generation.
Speaker Change: We'll go next page I will present Oracle genome application of metrics.
Speaker Change: Strategically, we'll look into our continued application of considering three journeys.
Speaker Change: Starting from the left to the right with the residency Johnny.
Speaker Change: We observed a 33% increase.
Speaker Change: Good players.
Speaker Change: Rich.
Speaker Change: 13058 students.
Speaker Change: At the end of the period.
Speaker Change: Moving to the graduate journey.
Speaker Change: Achieve at 22% growth totally.
Speaker Change: <unk> thousand 100 students.
Speaker Change: Finally in our other courses and <unk> offerings, we saw an increase of eight 2% over the six month periods of the prior year.
Speaker Change: In summary, our efforts enable the continued reputation mass revenue to reach.
Speaker Change: 128 meter reacts in the first half of 2024 compared to 114 meet every ice in the first half of 2023, reflecting our growth.
Speaker Change: Over 1%.
Speaker Change: This growth includes a 15% increase from <unk> <unk>.
Speaker Change: And a 13% decrease from the <unk> offerings.
Speaker Change: Moving to slide number nine I'll discuss the medical practice solutions operational metrics.
Speaker Change: The first graph.
Speaker Change: You can see our total active players.
Speaker Change: Those generating revenues in the business to position segment.
Speaker Change: With a continuous growth trends, we reached 196000 paying users, reflecting 13% growth compared to last year's quarter.
Speaker Change: As shown in the second graph, our monthly active users counting stance over 253000 compared to 257000 in the first half of last year.
Speaker Change: Mainly due to the discontinuation of <unk> portal and the launch of the <unk> portal.
Speaker Change: Finally, our last breath displace the net revenue from our medical practice solutions, which grew by 13% compared to last year.
Speaker Change: 70 sounds me to react.
Speaker Change: Within this revenue 65 meter <unk> come from the B to B.
Speaker Change: 12 million Reais was from <unk>.
Reverting the decrease in net revenue in the first quarter as briefly postpone <unk> invoices were now accounted for.
Speaker Change: The next slides, we also presents archaea ecosystem.
Speaker Change: We are proud to present, the second continue backed debt, Austria has made on the health care community in Brazil.
Speaker Change: At the end of the second quarter of 2030 for our ecosystem.
Speaker Change: Over 320000 users who are actively engaged with our service and products.
Speaker Change: Moving forward to page 11, I want to discuss our financial overview for the second quarter of 2034.
Speaker Change: Starting with the next slides with great satisfaction I am pleased to present, another robust quarterly results Raphael.
Raphael: Net revenue for the second quarter of 2024 reached 810 million <unk>, reflecting a 13, 7% increase over the same quarter of the prior year.
Raphael: For the six months Europe net revenue was 1614, neither reacts and.
Raphael: An increase of 13, 5% over the same period of last year.
Raphael: This growth is mainly drive by.
Raphael: Five 4% increase in average tickets for our medical courses.
Raphael: Maturation of medical seats.
Raphael: The addition of 40 seats.
Speaker Change: The Gwen and the compass.
Raphael: Strong performance in continuing education of intake.
Speaker Change: And effective execution in magical breakfast solutions.
Speaker Change: In the second quarter of 2024, adjusted EBITDA increased over 28% to 344 meter reacts with.
Speaker Change: Adjusted EBITDA margins of 42, 5%.
Speaker Change: Marking an increase of.
Speaker Change: 490 basis points compared to the second quarter of 2023.
Speaker Change: For the six month period, adjusted EBITDA was 742 meter reacts.
Speaker Change: An increase of 24% over the same period of the prior year.
Speaker Change: And adjusted EBITDA margins of 45, 9% an increase of 380 basis points for the same period.
Speaker Change: The adjusted EBITDA margin expansion is mainly due to.
Speaker Change: Gross margin extinctions within undergrad and casino locations completions off <unk> and SCM is about the only integration process in November 2023.
Speaker Change: The ramp up of the <unk> medical scalpel that started operating operations into third quarter of 2032.
Speaker Change: Operation restructuring efforts in our continuing education and medical practice solutions segments.
Hence.
Speaker Change: More efficient in selling general and administrative expenses.
Speaker Change: Moving to the next slide the year cash flows from operating activities grew 21% totaling 683 million reais.
Speaker Change: Driving by our robust operational.
Speaker Change: Thomas.
Speaker Change: The operating cash.
Speaker Change: <unk> ratio was 94% in the first half of 2034.
Speaker Change: Adjusted net income for the second quarter of 2024.
Speaker Change: <unk> to 210 meter <unk>.
Speaker Change: An increase of almost 60% over the same period of 2023.
Speaker Change: For the six month periods ended June 2034, we also saw an increase in adjusted net income rich.
Speaker Change: <unk> 461 meter <unk>.
Speaker Change: Presenting an increase of nearly <unk>.
Speaker Change: 65% year over year, mainly due to the enhancement of operational results the reduction in financial expenses due to the decrease in net debt and lower interest rates.
Speaker Change: And lower effective tax rates.
Speaker Change: Austria increases, it's tax efficient by incorporating entities and increasing distribution from subsidiaries.
Speaker Change: Adjusted EPS, we achieve it.
Speaker Change: <unk> <unk> cents for the quarter a remarkable 60.
Speaker Change: 62% increase compare to the prior year.
Speaker Change: And <unk>.
Speaker Change: <unk> and <unk> per share in the first six months spirit a growth of 57%.
Speaker Change: On the next slide we can see a table with the breakdown of our graft apps and our total cost of that considering our index the Softbank bank transactions the Panthers.
Speaker Change: Payables through selling shareholders and other financial obligations.
Speaker Change: We are proud to announce that.
Speaker Change: Answered.
Speaker Change: Our loan agreements with international finance corporations to finance our expansion program through acquisition.
Speaker Change: The financing is IFC birth system abated linked at low end basic social targets in deprecation will sector.
Speaker Change: According to the financial terms I guess seat.
Speaker Change: Loan up to 500 media reacts.
Speaker Change: Which shall be repeats in seven equal semi INO.
Speaker Change: <unk> is tardy in April 2027.
Speaker Change: The interest rate is the Brazilian CDI rate plus one 2%.
Speaker Change: And maybe reduce it by.
Speaker Change: 15, Bips east sustainability Kpis are cheap.
Speaker Change: Now moving to my last two slides I will discuss our cash and net debt positions also giving more insight into our cost opex.
Speaker Change: In second quarter 2030 for a net that's reached its 1459 meter reacts when compared to December 2023.
Speaker Change: After reduced its net debt by 356 meter reacts.
Speaker Change: Even considering the deep one of the earn out.
Speaker Change: 49 million reacts.
Speaker Change: We're able to reduce our net aspirated down from one six times in 2023 to one five times in the second quarter of 'twenty four.
Speaker Change: Coding only don't bedroom business combination.
Speaker Change: As shown we also reduced on that that's over 150 million more compared to the same period of the prior year.
Speaker Change: This concludes our prepared remarks.
Speaker Change: We are very proud of our achievements and strong performance across all of ours.
Speaker Change: Our commitment to enhancing the medical journey through the year.
Speaker Change: Unified educational system and digital solutions remain steadfast.
Speaker Change: This approach supports the growth continuous learning accuracy and further <unk> of health care professional.
Speaker Change: Looking ahead, we are excited about the promising opportunities that's a way for us.
Speaker Change: I will now open the conference for Q&A sessions. Thank you.
Speaker Change: Yeah.
Speaker Change: So in answering questions. Please raise your hand.
Speaker Change: Question comes from me Taylor from Bank of America, whereby you mean downtown.
Does it mean your skills reason in Atlanta I have two questions here. The first one in terms of cost of that.
Speaker Change: What should we think about it that are considering the recent IFC mission and that the maturity of some of your <unk>.
Speaker Change: After that it's a cheaper silver, but what are we thinking about the cost of that.
Speaker Change: Near future in <unk>.
Speaker Change: Second on the <unk> on.
Speaker Change: On the triggers to reach the top of the guidance on margins I imagine that the risk here of late is more on the medical practice solutions. So could you tell us a bit of a how is the margin dynamic in this business.
Speaker Change: Especially for the for the second semester.
Speaker Change: Miami and L. A with speaking talking about the expected cost of dance.
Speaker Change: I would say that.
Speaker Change: We're going to presents our cost of debt below CDI.
Speaker Change: At least until we have the.
Speaker Change: The Softbank transactions with us that is due to 2036, so until Theyre you or you can expect that our cost of debt will be below the Brazilian 100% CDI.
Speaker Change: <unk>.
Speaker Change: Regarding your second question the guidance how to reach the top client excellent.
Amy: Amy the range its commitment used to reach the range that we're releasing right now but based on our three segments here. So <unk> was above the initial expectations for all the three segments here. So we are performing better.
Amy: Regard the medical solutions segment.
Amy: Since last year, the second half of last year. When we did all the restructuring process between consumer method location and also the digital service to all digital services segment.
We have had a lot of synergies here and on digital solutions that now it's all in medical practice solution. We are delivering a positive EBITDA, we are growing close to 20 years.
Amy: Our growth rates for 2000.
Amy: 74 expected and also deposit.
Amy: EBITDA around planet remember that we were close to zero last year. So.
Amy: We're quite positive improvement.
Amy: All our products that we're offering under the medical product solutions, but also bus by Undergrad segment and also continued on that application will get both of them are also better than expectation also better than last year.
Amy: As you can see on our first half results view, yes, if I may add in Manila are the main reasons the main triggers.
Speaker Change: You kept the margin.
Speaker Change: And to achieve what we're delivering the guidance, let's say outside of what's in the guidance is mostly the ones that we already have so that visitors Saturday restructuring between the medical practice solutions and consumer education also the integration of unique that comes with a better margin for the whole year and therefore.
Speaker Change: Medical units at the open in the second semester of two demonstration that are now delivering better margins.
Speaker Change: Thank you that's super clear.
Kevin: Thanks, Kevin.
Speaker Change: Our next question comes from communicate macadamia friendly town.
Speaker Change: Okay.
marathon: Can you can you hear me guys marathon, okay. Thank you.
Speaker Change: Thank you for taking my questions a couple of questions from our side. So the first one is the release mentioned that one of the reasons for the upward revision in guidance was the performance in the first semester. So can you. Please comment on which of the segments delivered the results that were above expectations and latch. This revision in the guidance and then the second one is we saw.
Exploration in the revenue growth for the medical practice solutions segment can you. Please provide some more color on.
Speaker Change: We took the products' latches stronger performers that's it from my.
Speaker Change: Sorry.
Speaker Change: Please.
Hi, Luca I'll take the questions.
Luca: One regarding the better performance in the first.
Luca: Semester basically.
Luca: Come from.
Luca: Better.
Speaker Change: Results that we got from the integrations of Ah when EMA and.
Shove off down to our our structure and remember that we have therapies as combinations in the beginning of 2000 and an infinite suites, but the integrated it and in November 2023, So we're now capturing.
Speaker Change: The whole senior she is.
Speaker Change: We have with these operational all the one it's better performance margins that we were doing.
Speaker Change: Owned <unk> Medical's two operations that we've launched through 2032.
Speaker Change: We have.
Speaker Change: <unk> delivered Barra SG&A.
Speaker Change: With all of the zero budgets.
Speaker Change: Projects that we have implemented.
Speaker Change: On Oscar So all of that said we.
Got this performance.
Speaker Change: At our end.
Speaker Change: That's performance with the when you Don why positions and we are.
Speaker Change: The additional seats that we've gotten from with EMA made us comfortable too.
Speaker Change: Updates our guidance for this one that we just released.
Speaker Change: So we're very careful about that.
Speaker Change: We will deliver the guidance as a.
Speaker Change: Until Q until today, we have delivered all the guidance that we've provided.
Speaker Change: Regarding the second question regarding the best the acceleration of that in terms of net revenues.
Speaker Change: <unk>.
Speaker Change: You bet Brett.
The solutions business.
Speaker Change: So solutions.
Speaker Change: We have these accelerated mostly.
Speaker Change: The <unk> science.
Speaker Change: The solutions remember that in the first name answers with nations that are we.
Speaker Change: We have.
Speaker Change: Part of the revenue recognitions.
Speaker Change: Dropping from the first to the second quarter, we finalized this.
Speaker Change: Service provider for the pharmaceutical induce reserve and then we could recognize revenue during the second quarter and these b to B.
Speaker Change: Revenues, that's come up during the second bar made.
Speaker Change: During the semester the revenues grew.
Speaker Change: More than 20% and accelerating the revenue for the segment.
Speaker Change: And regarding the product.
Speaker Change: That means that at the first selling individually is marketing campaign for the pharmacy.
Speaker Change: That's frankly you guys. Thank you very much Luca I think just one point I think it's important to mention also the new guidance considered the all the rhythm that we saw from the new intake from the second half Windows. We had another strong intake with a lot of candidates proceeds.
Speaker Change: Close to what we had last year, so it's a very healthy.
Speaker Change: Cycle, So gave us.
Speaker Change: Again, the right often asked and predictability to our board and update our guidance for 2024.
Speaker Change: Perfect. Thank you.
Speaker Change: Thank you and welcome.
Speaker Change: The next question comes from Alonso Lastest from St.
Alonso Lastest: And then in alcohol.
Alonso Lastest: Hey, guys. Thank you.
Alonso Lastest: Two questions more related to regulation and first one I mean, we had kind of set the approval decision actually by the Supreme Court for the for the injunctions and so far have you seen or have you seen some approval. So just wanted to have your perspective on whether you're seeing any changes in competition, given those approvals and how many ejection youre seeing might be.
Speaker Change: <unk> may be approved given the the market knowledge that you have and then there'll be the first part and then the second also related is whether the recent approvals have been changing your strategy in terms of the regions from resonated with St.
Alonso Lastest: Auction.
Mike: And Mike.
Michael Caine: Michael Caine interchanges. The timeline also that you expect from a medical streets.
Jason: Given those kind of outstanding Jason.
Speaker Change: Sort of a you know my site.
Speaker Change: Jamie on the Russell the first part was the intake cycle all the owners relief. So we didn't receive any changing we had a very positive and healthy cycle I think we are.
Speaker Change: Sure.
Speaker Change: Differentiate a lot our operation in all cities that we have.
Speaker Change: Our campuses are the undergrad segment.
Speaker Change: Thank the approval.
Speaker Change: The great majority of them very aligned with the expectation after the definition from the Supreme Court.
Speaker Change: So it's everything running as expected.
Speaker Change: Still have.
Speaker Change: Some approvals.
Speaker Change: Approvals to come also.
Speaker Change: The increase of number of CFO.
Speaker Change: The normal.
A process that we add in the past still see some approvals coming from the Ministry of education, not only based on the decision by the Supreme Court. So has there been running as expected. It is very difficult to measure all will be the impact.
Speaker Change: And the speed of them could depend on the capacity.
Speaker Change: Of.
Speaker Change: The Miss application to approve and also finalize our team that they have.
Speaker Change: But based on the idea on the entire mise magical III program is something around nine to 10000 additional seats.
Speaker Change: Uh huh.
Including all the expansion for this new capacity, we've at least what the Bay.
Speaker Change: Based on the idea coming for the administrative locations. So it's too early in the process to get more in the order that they are more than that okay.
Speaker Change: Yeah and regarding the regions a correction.
Speaker Change: We're not going to compete for and the ones that are already I'm, sorry, we are not going to compete on regions that we haven't Gibson.
Speaker Change: Mhm grit and just going to say if I may another one in terms of and the M&A pipeline. This has been changing with the injunction I don't know of any company Thats, one and I have mentioned we might become targets.
Speaker Change: Did your pipeline change with debt or you see more opportunities or not.
Speaker Change: Really.
Speaker Change: I will take that around ROE as a matter of fact, we have these new institutions been approvals so our pipeline.
Speaker Change: Possible top of the funnel Hasbro wrong okay.
Speaker Change: So we are we have more targets to talk.
Speaker Change: Great confidence that we can.
Speaker Change: Is it keep the written off to.
Speaker Change: 200 seats of <unk> and remember that.
Speaker Change: With units.
Speaker Change: Accusations and so when you don't wear hats off the guidance that we provide that's six 2022, so we still see with very good eyes to do the M&A with the right pricing right.
Speaker Change: Right now we have more more more targets on the streets to talk to and of course, we are going to keep that discipline.
Speaker Change: <unk>.
The rationale is that make sense for us.
Speaker Change: At the right price.
Speaker Change: Great. Thank you.
Speaker Change: I guess a reminder, if you want to ask a question just please raise your hand. The next question comes from my former firm confirm Jason Martin.
Jason Martin: Hi, good evening behavioral Blanca cannot but thanks for taking my questions I have two and one clarification.
Jason Martin: The first question is could you. Please comment on the competitive environment on the Prep course business I think that was something that in the past you were having some difficulty just wanted to know how it evolves.
Jason Martin: The second question is wanted to understand a bit why.
<unk> revenues and continued education contracting and what are the trends there.
Speaker Change: Clarification is something Thats pursued or said in one of the answers did.
Speaker Change: Did you mention that the margin for the medical practice business is 20%.
Speaker Change: Or I understand I didn't understand if you mentioned it was 20 as well as well as the growth or Youre, just comment referring to the growth and the margin is positive just want to understand better.
Speaker Change: If you really said that thank you.
Thanks, Oliver I'll take the first one regarding the competitive environment for the prep course.
Speaker Change: The competitive environment in the second quarter.
Speaker Change: It's not relevant.
Speaker Change: At this moment, because the second and the third quarters.
Speaker Change: For these markets.
Speaker Change: <unk> is not.
Speaker Change: Seasonal because the the sales are concentrated on the first thing to enter.
Speaker Change: A quarter of the year, so did not impact us.
Speaker Change: And the second in the second quarter and will not be a topic for the fourth quarter.
Speaker Change: For the third quarter, sorry, this will be back on the table when the sales come back is the fourth quarter. When we had when the allowance the Atlanta 25 collections that we stopped say sales outfits during the fourth quarter.
Speaker Change: So until until that.
Speaker Change: To do this new cycle.
And now we're going to we're going to change.
Speaker Change: On that if I may add on this point I need to remember that the product is not only makes it right when you're talking about the rising styrene, they're talking about Matt sound now and to make it so.
Speaker Change: Offering today, Michael is not only the prep costs as we had in the past right.
Speaker Change: Dimitri It gives a lot of furniture Maxwell product that's very important.
Speaker Change: All of the sort of credit losses embedded thats not only the product initially was being delivered by itself so even considering.
Speaker Change: Mid sales for additional color on it but as we reviewed the <unk>.
Greek: Greek loan the product who we.
Speaker Change: He has strong enrollment growth coming on the prior quarter Arena here as you can see on our table three commentary more than 30% of students are more than the Thanksgiving last year. So it's a.
Speaker Change: A good sign on our breath.
Speaker Change: Prep course segment, so not only mid <unk> myself I think your second question the year about the <unk> Zone Casino Mexico location. This is not core this was something that was leverage during the pandemic that we will license fee our products here to help all the institute.
Speaker Change: Sure. This is will be more than flat, we are not a guy.
Speaker Change: Guiding any role for this type of article on this type of segment continuum edification, but that is something that we are not.
Speaker Change: Shutting down the offer but we continue to cooperate wildfire so around 30 to 40.
Speaker Change: Institution that continue to use our products and the education.
Speaker Change: The education sector about the clarification.
Ahmed: So we are expecting to grow around 20, this year Ahmed Kopeck solutions and also.
Ahmed: The contribution margin.
Ahmed: Not only the gross.
Ahmed: Margin improvement, but we are seeing.
Ahmed: The result, after the older the restructuring process that we run to.
Ahmed: In the second half of last year.
Ahmed: Delivery of positive EBITDA around 10 to 15.
Ahmed: And we are aiming to reach close to 20%, but thats our contribution margin do we are not done.
Ahmed: Disclaimer.
Ahmed: Releasing that on our reports by segment just up to contribution margin.
Speaker Change #100: Perfect. Thank you very much.
Speaker Change #101: Contribution would be gross gross margin okay. Thank you very much.
Speaker Change #102: The next question.
Speaker Change #102: <unk> <unk> from Morgan Stanley.
Speaker Change #104: Hi, Vasu to Blanca here now to thank you for the opportunity.
Vasu: We have two questions. The first one about when you Don.
Speaker Change #106: What do you expect in terms of consolidated margins. After after the integration, which are the sources of synergy there, which are which is the timeframe of the integration.
Speaker Change #106: So a.
Speaker Change #107: A little bit on the impact of when you don't.
Speaker Change #108: A second one about the medical practice solutions, we understood from the release that there was a simplification there.
Speaker Change #108: Which helped the margins. So the question would be if you are narrowing down the services you offer there.
Speaker Change #108: If you choose to chose concentrating some few digital services.
Speaker Change #108: Basically if there is a.
Speaker Change #108: Different strategy or a different positioning there. Thank you.
Hi, Hi, Fitbit I'll take this one regarding Winnie dong.
Speaker Change #109: Uh huh.
Speaker Change #109: Remember all of that as we close the deal in the first day of July.
Speaker Change #109: We will receive.
Speaker Change #109: Uh huh.
Speaker Change #109: Very.
Speaker Change #109: Good institutions that was.
Speaker Change #110: With a very lean is structure.
Speaker Change #111: We're very happy with the transactions we have.
Speaker Change #112: 45 days since the closing so we're still working on the integration plan, we don't have the integration dates.
Speaker Change #111: Yes.
Speaker Change #111: Fine, but we're very happy with.
Speaker Change #111: The solution itself the senior here will come.
Speaker Change #113: Uh huh.
Speaker Change #113: In the same line with all the transactions that we've made.
Speaker Change #113: As up to date. So they are concentrated in top line will run a half.
Speaker Change #114: The fulfillness.
Speaker Change #114: Capacity during these periods were going to have the.
Speaker Change #114: The stream.
Speaker Change #114: The scholarships and a sub kinds of discounts that were given to our family of brands or institutions, we're going to revisit the cost up to.
Speaker Change #114: To provide the service.
Speaker Change #115: Regarding the <unk> structure for the features we're going to implement our national Greek global over there and Theyre going to centralize all of the back office operations in our <unk>.
Speaker Change #115: Without increasing needs.
So these are the kind of synergies that were gone up we're gonna we've done.
Speaker Change #115: And we're going to achieve.
Speaker Change #115: In the next.
Couple of months so everything these.
Speaker Change #115: Corey.
Speaker Change #115: According to the planned depth.
Speaker Change #115: We've announced assets when we sign the.
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Speaker Change #115: The deal is.
May unless Nate so.
Speaker Change #115: When we did that we put the bets are off.
Speaker Change #115: We got them at ratios, we run a reach a navy if it to a beach the winter sufficiently mature with four puts too fast if the EBITDA. So this is our view and our best view floor. When it all for the same answer is incorporated in our RF.
Speaker Change #115: And so that the number is over there rigor.
Speaker Change #116: Regarding the restructuring of the diesel segment, the NDA application segments with mace.
Speaker Change #116: This is the very very beginning of there, but the year. So we started this a restructured who started this year with these receptor in places.
Speaker Change #117: One of the major part of the REIT structure is what to move.
Speaker Change #117: The old pillar, one offerings from the diesel to the Cochin relocations and these movements are each one of the segments. We started should not be.
Speaker Change #117: We started to not be.
Speaker Change #118: A stroke, they're there.
Speaker Change #119: Our product or product family the broader but we started to be organized at this segment as a whole so instead of having a product team for instance.
Speaker Change #119: Each one of the pillars, we stop it you'll have one.
Speaker Change #119: Our product team for all of the service that we have we started to have one.
Speaker Change #119: Our tech team for all the.
Speaker Change #119: <unk> breadth technical solutions for all of the solutions that we have so we are lean up our structure for the year and with that we gain a lot of the patients both in terms of cost and expenses. So we're very happy with that.
Speaker Change #119: And we've put that these movements are.
Speaker Change #119: Within the guidance and as we are delivering.
Speaker Change #119: Our banner there are results we operate all of these scenarios we have been when you do authorizations to update our guidance for the year.
Speaker Change #120: Okay. Good. Thank you. So so the point is that there was no redesigning the offerings.
Speaker Change #121: It's much more about.
Speaker Change #121: Internal structure for delivery.
Speaker Change #121: Yes.
Speaker Change #121: <unk>.
Speaker Change #122: Thank you.
Speaker Change #121: Alright.
Speaker Change #121: So as we do not have any more questions and like only two games.
Speaker Change #123: We're happy to give you guys an indication.
Speaker Change #123: Our active data to happen on October 29.
Speaker Change #123: We will be online and in British Homer and Theyre linked to San Martin details shortly.
Speaker Change #123: Thank you Laura all are being with us today, and we hope to see you next time.
Speaker Change #123: Have a good night.