Q1 2025 Vitru Brasil Empreendimentos Participações e Comércio SA Earnings Call
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Speaker Change: It replaces a hail Mitch that is a hit dawn and police Kissinger Cabo just.
Speaker Change: So really almost think that AGGY I'm all for quality much siggi.
Welcome. Welcome to the video conference for the disclosure of the first quarter 2025 results of Aveto Brasil.
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It is in this path that we are going to continue in the first quarter. Our adjusted net profit more than doubled totaling $19 4 million reais with a net margin of 16, 6% representing.
I highlight to those who need simultaneous translation that we have this tool available on the platform. To access it, just click the Interpretation button through the globe icon at the bottom of the screen and choose your preferred language, Portuguese or English.
An expansion of almost 10 percentage points when compared to the first quarter of 2024.
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Looking at the cash flow we delivered.
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For those listening to the videoconference in English, there is the option to mute the original audio in Portuguese by clicking on Mute Original Audio.
Free cash flow generation of $117 million.
Quarter in increments of 10% when compared to the first quarter of 2024.
We inform you that this videoconference is being recorded and will be available on the company's IR website, investor.vitro.com.br, where the complete material of our earnings release is available. It is also possible to download the presentation from the chat icon, including in English.
Speaker Change: And he'll also our premier acreage of those meetings.
The cashes are great northern stores, now with higher interest rates and the.
Michelle: Michelle with each of those will start about vytorin tissue the vintage of those ripple effect from Illinois, and Mississippi masked it assembled is receivables at June <unk>. The people of search percent vessels will premiere arbitrage of each block at a margin a beach ciba I change industries, they satrapy below 1%.
Strong generation of the quarter once again, we reduced our debt.
And in April we had the disclosure of the amazing 2023 and we're proud to say that in vitro had the highest evolution. Among the listed companies being the only left the company with more than 70% of its courses what scores between three and aside.
Speaker Change: During the company's presentation, all participants will have their microphones disabled. Then, we will start the question and answer session.
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Speaker Change: To ask questions, click on the Q&A icon at the bottom of your screen and type your question to enter the queue. When announced, a request to activate your microphone will appear on the screen. Then, you should activate your microphone to ask questions. We advise that questions be asked all at once.
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These highlights will be detail throughout the presentation and they demonstrate our focus and our discipline in the delivery of our strategic plan associated to the solidity of our businesses.
Vitro is repaired.
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Patient does it continue transforming the lives of our students I'm proud to say that we have the best professionals in the country.
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Moving forward to the next slide slide number five we observe our base of students at the end of the quarter. We overcame the mark of 900 students in the online education segment, our total base of students.
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Has about 1 million students five 7% of group and also in comparison to the first quarter of 'twenty 'twenty four and here. It is worth highlighting the vitro already reached a considerable level as a company.
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Aaron: Hey, guys sure Aaron also brings a gearless two moments, which is passengers rulers knives out this.
So the growth the current growth rates are in line with our estimates and much more than that considering the challenges in the current macro scenario the growth of our student base.
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Come proof that frequently students choosing to choose our brands when they are searching for the degree inequality degree that is why we continue growing and gaining market share and advancing them in our core business.
Aaron: In Brazil is fiber <unk>, just said, 10% of the sclerosis go north of Anchorage trace is seen.
Lastly over 97% of our student base is represented in the online modality.
This is highlighted said one little adds along with our present ourselves in the most of our lawsuit four we announced a discipline of brain drag of the loss of a blemish Scrappage associates that are solid they are those losses megawatts a V through Ellis Patrick bought out.
The biggest company of online education higher education in Brazil, we have the conviction.
This segment will continue being one of the main access avenues to quality education, and such a big continental country like towers.
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Moving on to the next slide slide number six we highlight on the left hand side the.
Number of students in the online graduation in 'twenty 'twenty four 'twenty five is it I'm sorry.
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[noise], we evolve in line with our extensive presence in all over the National territory.
We have two we reached 275 different hubs in different places of Brazil, and we assist students and over 1400 cities in Brazil, we are expanding more and more of our presence in different regions of the country.
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Aaron: Single Group lost X percentage of it is demand and a compote ourselves on premiere all three dealers moving schwab reacting.
Brands in vitro and yourselves and when he says anymore, we still see opportunities to open a few hubs in a few cities, but no. It was a more careful in perspective look our focus will be in having a strong or a stronger and more qualified network with a solid infrastructure.
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To assist all profiles of our students.
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According to what is being shown in the media. According related to the new regulatory framework that is about to be approved vitriol is going to be a lot of steps ahead of any competition regarding a structured education hub network with.
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Classrooms with academic processes and today, we have approximately 1200 hubs completely prepared with laboratories, which is something way above any other competitor and when we talk about.
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Semi prudential classes will have a very big competitive advantage as we have had in the last few years. When we look at the online education moving on on slide number seven on the right hand side, you can see the share of cost.
Aaron: Okay, Samantha age wise of those percentile of someone on Theodore <unk> stair step in advancing total they thought enough. So now confirm Jose those new states sensitive they simple paulus non percentage, Chris demand <unk> gone up by five <unk>.
Which is similar to the previous period on the right hand side, you can see the behavior of the average ticket in the beginning of the year, which is more stable in the in this period, we see a more competitive.
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Hence scenario in terms of price well, we continue reinforcing our ability to constantly adapt.
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Thoroughly adapt to the strategies.
Of the market always balancing the volume of.
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Students' retention and the ticket we had.
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I mean, an increase in the last two years or three 1% also demonstrating our strength as a quality player in digital education, We believe that the main pass for the success of the strategies of pricing.
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Paying attention to our products.
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With the retention of our good students of the quality of the students into our universities is an indicator of the health of our business in a guarantees stability throughout time.
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Gabriel: Now I would like to pass the floor to Gabriel he's going to continue the presentation.
Gabriel: Showing us the financial indicators of the true.
Speaker Change: Marina one Jeb Bush. Thank you very much hidden wanting everyone moving on to slide eight I would like to start by bringing a few details of the consolidated net worth of the company.
Aaron: Now total badge and semi precise cell St. Louis the enablement that Amazon fashion compared to achieve a more integrated.
Gabriel: The first quarter, we had a consolidated net worth.
Gabriel: $545 8 million Reais, a growth of the 0.2% when compared to 'twenty 'twenty four we grew in all the segments, which showed.
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Gabriel: That we have a strong portfolio of products.
Gabriel: Clearly driven by the online graduation, which is our core business.
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Gabriel: Continue growing in the online graduation delivery and growth of seven 7% when compared to the first quarter of 2024. This is a very important indicator because it shows that our consistency.
Gabriel: And our capacity to continue delivering a tragic trajectory of it.
Aaron: Naval doesn't stop there and hand off somewhat price it deliberate on the Saint Luke's is a few incredible launch Captisol you cheek challenges to Amazon Giga <unk> trace both 1% will have passed as a prostitute XIAFLEX. So the main demos through our Northstar fourth Pal is commonplace.
Gabriel: Revenue growth even in a moment like this that we are living in.
Gabriel: And where we have more pressure on the second one.
Gabriel: When you look at the girls and it was driven by our students either by a good retention in the first quarter or a good level of re enrollment of our students looking at the onsite Medicine segment. We grew 6.1% in this first quarter the numbers are.
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Gabriel: Medicines continue reflecting over competitive singularity is especially when it comes to the structure of the city of mining Guy.
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Gabriel: And also the unit test called on by both with an increase of average ticket lastly, we will see another important quarter for continuous education with our technical courses vocational courses and post graduation. They are also highlighted with a growth of 23, 8%.
Aaron: Similar theme what are most eligible psychological Gabrielle buyback ultimately Dodge inoperative and peso <unk> sales that we missed the premise.
Gabriel: This segment is an important growth Avenue of the company and we believe that this growth in the segments of continuous education will continue delivering.
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Aaron: Some of those like Georgia, where signage komisar presented tier ones that pattern should I say, if I look at the consolidated Accompanier isn't lost signals.
Gabriel: Good results. Further ahead, we will continue searching for opportunities to capture more value in this product looking at the three basic product and the long term they will make continuous education grow their participation in the total share of the company.
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Aaron: I mean, it doesn't mean squat and assembling told you Siggi match would you Marcia get Forza <unk> produced just taking that should I make for blending.
Gabriel: Looking at slide nine.
Gabriel: We have a detailing of our gross margin since last year with gross margin of the company reflects a maturing of the hybrid courses. So it had a certain pressure on the gross margin and more recently, we did a few reviews of internal processes of the company.
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Gabriel: Explaining this in numbers in the first quarter, we had a great gross margin when we talk about the percentage of the net margin net revenue.
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Gabriel: Compared to the first quarter of 'twenty 'twenty four.
Gabriel: Had a small reduction of 0.7 percentage points, but it is worth.
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Gabriel: Reminding you that we had a change in the contingency line starting from the fourth quarter of last year.
Speaker Change: The information contained in this presentation and any statements that may be made during the videoconference regarding business prospects, projections, and operational and financial goals of VitroBrasil constitute beliefs and assumptions of the company's management, as well as currently available information. Forward-looking statements are not performance guarantees. They involve risks, uncertainties, and assumptions, as they refer to future events and, therefore, depend on circumstances that may or may not occur. Investors should understand that general economic conditions, market conditions, and other operational factors can affect VitroBrasil's future performance and lead to results that differ materially from those expressed in such forward-looking statements.
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Speaker Change: Two 394.5 million Reais insulin in 'twenty five.
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Speaker Change: Associated to that with a few reductions of the team and with a few educational duration switches.
Speaker Change: Today, we have the presence of the Company's Executives. William Matos, CEO of Vitro, Gabriel Lobo, CFO of Vitro, and Maria Carolina, Head of IR and her team. I will now hand over to Mr. William Matos.
Speaker Change: Something on AR, and AR will not happen in the next two quarters.
Speaker Change: So we adjust.
Speaker Change: These costs in the common expenditures of the company, we hope to offset the impact of these decisions made in the first quarter.
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Speaker Change: Good morning everyone, it is always a pleasure to be gathered with the market for the presentation of the quarterly results. Joining me today are Gabriel Lobo, Cefou Davitrio, Maria Carolina, our Head of Investor Relations, and also our Investor Relations analyst, Luiz Felipe. Together, we will present the financial and operational results of the first quarter of 2025.
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Speaker Change: And a deferred manner throughout the year with a potential of gross margin in the future.
Speaker Change: Which is going to be way higher moving now to slide 10, we have the details of the lines of costs and expenses.
Speaker Change: With no maybe not as familiar to imagine, but it will not watching I imagine Bruce <unk>, it'll Egypt, regardless, I think Deutsche Bank watchable sounds comparable perimeter to even try to imagine, but they're just not represent the monies you had a hit song <unk> pulse based on flash.
Speaker Change: On the right hand side of the chart shows the costs and expenses.
Speaker Change: The company that reached 348 million rise in the first quarter and the growth of two 9% when compared to the first period same period of the previous year.
Speaker Change: Starting on slide number 4, I would like to begin by presenting the highlights of this first quarter. As you can see, the enrollment in the distance learning undergraduate program grew by 11.9%.
Speaker Change: Being able to get.
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Speaker Change: This.
What expansion reiterate what William said in his opening.
Speaker Change: That is related to the discipline for the search of efficiency to leverage our operational activities.
Speaker Change: in the first quarter compared to the previous year, making it clear that even in more competitive scenarios, our differentiators lead students to choose our brands, both Unicesumar and Unicef. In fact, I often say that growth in adverse times is the greatest proof of the solidity of our brand and the product we deliver. Many can grow in times of great abundance, but only the best continue to grow when the customer truly values every penny and understands that their investment really needs to bring a return. That is why this indicator says a lot about our delivery and our quality.
Speaker Change: Trying to grow our revenues rather than a constant expenses and.
Speaker Change: <unk> cost that Undergird, just taken on margin, but within about fab. So Pedro I think the traditional sense.
Speaker Change: I'm talking about the G&A aspect I would like to bring you a singularity of our business when compared to any competition feature or is one of them more kind of sized and light companies in this sector, which makes us incredible to adapt their much more agile when it comes to any kind of adaptation to the mone.
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Paul: Paul Thanks, you say that that adds and is permitted to mesh just totally Andrew Kushler companies I have neutral are have you thought yet values.
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Speaker Change: That means we are much more agile for any kind of movement internally and in the market with our list prices.
Speaker Change: On the right hand side of the slide we show that the general and administrative expenses line grew seven 5% when compared to the previous year, especially because of the benefits that we implemented on the second quarter of last year. This line is always stable.
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Speaker Change: Let's move on to Vitro's consolidated net revenue, which grew by 8.2% compared to the first quarter of 2024, driven by the solid performance of the distance learning undergraduate program, which advanced 7.7% in the same period. Additionally, as we will show later, the performance of our continuing education segment, an important growth avenue, once again stood out, recording an increase of almost 24% in the first quarter of 2025 compared to the first quarter of 2024. Meanwhile, Vitro's adjusted EBITDA reached 202.7 million this quarter, growing by an impressive 18.7% versus the first quarter of 2024, with the adjusted EBITDA margin reaching 37.1%, an increase of 3.3 percentage points over the margin of the first quarter of 2024. This margin expansion is associated with our commitment to constantly seek alternatives to maintain good levels of operational efficiency, while our products continue to evolve, delivering innovation along with high quality. In other words, margin for us is also a consequence of conscious management that understands the importance of continuing to build a culture of efficiency, and it is on this path that we will continue to follow.
Speaker Change: Which does not show any kind of concern for us moving on to be expenses with sales and marketing expenditures in the period grew 6% you're.
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Speaker Change: But year over year, and it's important to say that even in a more challenging competition environment, we were able to capture students and using sales and marketing.
Speaker Change: So that you're always larger base and you say the key was that balanced designees pushes it is now.
Speaker Change: Including a reduction of seven 7%.
James: Large D&O grass <unk>, hopefully that BG of course, its physical per year catching June necessary, but it doesn't quite do it to me joins you hash.
Of our expenses in the company, we aren't going to change we're going to continue with our adult patients without reducing in anyway, our capacity of capturing new students as we have seen throughout the quarter. We are also trying to search for optimization for our.
Speaker Change: Yes, the name Chris Doyle.
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Speaker Change: Delivering nominally a reduction of 23% when compared to last year, while the pluses and the percentage of the net.
Revenue there wasn't a reduction an increase of three point.
Speaker Change: Three percentage points of the company this performance reflects.
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Speaker Change: Our criteria for retention of students that was an important decision that we had in January last year with a healthier base than previous years and our focus here is deep in the improvement of internal processes, especially in the area of billing and.
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Speaker Change: In the quarter as well, our adjusted net profit more than doubled, exceeding R$ 90 million.
Speaker Change: Acting.
Actually we have seen in previous presentations, we hope that throughout the year and we will have important gains in BC LNG, but maybe not in the levels that we presented in this quarter between 1.1 or two percentage points of reduction throughout 2025.
Speaker Change: The net margin of 16.6% represents an expansion of almost 10 percentage points.
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EBITDA bridge in the first quarter, we reached almost 100.
Speaker Change: in relation to the margin of the first quarter of 2024. Looking at the rate flow, we delivered a free cash flow from operations after CAPEX of R$ 117 million in the quarter, an increase of 10% compared to the first quarter of 2024.
Speaker Change: 202.
Speaker Change: 3 million rise.
Speaker Change: The adjusted EBITDA margin reached 37, 1% in the period of growth of three percentage points when compared to the previous year, which is the result of everything that we commented in the last slides you evolution of the net.
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Aaron: Caixa is our great guide at this moment of higher interest rates and with the strong generation of the quarter, once again we reduced our free indebtedness. And in the month of April , the 2023 Enad was released, and we are proud to say that Vitro has the greatest evolution among listed companies, being the only listed company with more than 70% of courses with grades between 3 and 5.
Speaker Change: Revenue combined with the reduction of costs and expenses and P. C. L. Z contributing also for this operational leverage moving on to slide 12, we can see the adjusted net profit of the company in the first quarter reached 94 or more than doubled and Brent Lang.
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Speaker Change: Year with a healthy margin of nine six percentage points, which also represents an ex pension of 156.1 person.
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Aaron: These highlights will be detailed throughout the presentation and demonstrate our focus and discipline in delivering our strategic plan, associated with the solidity of our business. Vitrio is prepared to face the current business environment, which requires a lot of experience, adaptability, and undoubtedly, consistency. In this regard, before proceeding, I would like to thank our internal team who contribute daily to ensure that education continues to transform the lives of our students. I am proud to say that we have the best professionals in Brazil.
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Speaker Change: This performance was expected we have been talking to you about the strategic movements and which were the impacts expected for these movements. It is worth reminding we did a re profiling of two lines of the company last year.
Speaker Change: All substantial profoundly email oriented processes and banish.
Speaker Change: We issued the fourth and the fifth debentures, who did a change in the interest accrual model starting from the third quarter and also the process of reorganization of the company, which is something that we have talked to you about that will bring gains for the company and the future financial.
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Aaron: Moving on to the next slide, slide number 5, we observe our student base at the end of the quarter. We surpassed the mark of 900 thousand students in the distance learning undergraduate program, 7% above compared to the other quarter. Our total student base now totals almost 1 million students, a 5.7% growth compared to the first quarter of 2024. And here...
Speaker Change: Results speaking of each one of these lines.
Speaker Change: The result was negative 76 million Boe with a reduction of 13, 2% when we compare to the reports of the first quarter 'twenty 'twenty four this reflects.
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Speaker Change: Mainly the reduction of the bank spread.
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Speaker Change: Even in this scenario with higher interest debt.
Aaron: It is worth emphasizing that Vitro has already reached a considerable level as a company. Therefore, the current growth rates are in line with our estimates and more than that, considering the challenges, the current macro scenario, the growth of our base confirms that students frequently choose one of our brands in search of quality higher education. That's why we continue to grow, gaining market share and advancing in the core of our business. Finally, more than 97% of our student base is represented in the distance learning modality. Therefore, as the largest distance higher education company in Brazil, we are convinced that this segment will continue to be one of the main paths to access quality education in such a large, continental country as ours.
Speaker Change: Could apply some pressure in our financial results and looking at.
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Speaker Change: We started recognizing this project that is now in the organizations face the project tough reorganization of our society of our of our company that will also allow us to you to use from friends or on the tax shield of the financial.
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Speaker Change: Any operational effect, because basically we carry out the activities in the subsidiaries. This project is already on track and is going to be concluded so our third quarter with value capture and immediate effects.
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Speaker Change: The results and on the cash.
Speaker Change: Now on to slide 13 on the right hand side of the slide we can see our cash our left hand side, we can see or our cash flow. We have to have a deeper look at our cash flow with higher interest rates.
Aaron: Moving on to the next slide, slide number 6, we highlight, on the left side, the enrollment in the EAD undergraduate program in the first quarter of '25, with a growth of almost 12% compared to the previous year. Our enrollment evolves in line with our extensive presence throughout the national territory, reaching 2,675 centers, a 9% growth compared to the same period last year, and already serving students in more than 1,400 cities across Brazil. Every day we are expanding our presence in different regions of Brazil, advancing in more densely populated areas and identifying opportunities for both Vitro brands. Without a doubt!
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Speaker Change: Cash conversion post Capex was.
Speaker Change: 86%.
Speaker Change: Which is higher than what we delivered in the first quarter of 2024 and this reflects an improvement in our.
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Speaker Change: Working capital and the evolution that we had on the accounts receivable which has been.
Speaker Change: I've said it by a better quality of students we have.
Speaker Change: More and more engage students and also an improvement of the negotiation and collect and strategies of the company.
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Speaker Change: We had a great improvement between 'twenty 'twenty, four and 'twenty 'twenty five and all of a sudden this border boy.
Aaron: We, as a company, still see opportunities to open centers in some areas, but with a much more careful, prospective approach. Our focus will be on having an increasingly strong, more qualified network with solid infrastructure to cater to all profiles of our students. It is worth highlighting here that, in light of what has been reported in the media regarding the new regulatory framework that is about to be released, Vitreux will undoubtedly be many steps ahead of any competitor in terms of the strength of a structured center network, with laboratories, classrooms, and academic processes. Today, we have approximately 1,200 centers fully equipped with laboratories, which is far above any competitor. And when we think about authority in blended learning, without a doubt, we will have a very large competitive advantage, as we have always had in recent years when we look at distance learning.
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Speaker Change: The capex of the first quarter totaled $18 7 million rise, it's below last year, but basically it is explained by a.
Speaker Change: Simply think I've also said that she might be potentially to Hilton Amazon simply Scott, Matt just on maybe I understand each year, which is that extra French and a bunch of them at this stage.
Speaker Change: Occasional dislocation of the investments carried out by the company. We don't want to say that this is going to be perpetuated farther ahead, it's much more a dislocation between quarters, we're being more diligent in the allocation of capital of the company right now what our expectation is that the investments will return.
Speaker Change: And with that she or do they just feel there's kind of state of the company that you should all look at Jewish singles sample now Nordstrom throughout your whole GW.
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Speaker Change: To the historical level in the next quarters.
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Speaker Change: As William said, we have great infrastructure of our hubs, where we want to be something different than semi presents show classes.
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Speaker Change: Moving on to slide 14.
Speaker Change: We bring here.
Speaker Change: On a fundamental indicator, which is the company leverage.
Speaker Change: Index did.
Aaron: Following on slide number 7 on the left, we observe that the share of courses in enrollment remains similar to previous periods. In the graph on the right, it is possible to see that the behavior of the average ticket at the beginning of the year is more stable. At this moment, we see a more intense competitive scenario in terms of pricing, but we continue to reinforce this ability to constantly and meticulously adapt our strategies in relation to practice, always balancing the challenge between enrollment volume and ticket. Additionally, we had a CAGR of 3.1% over the last few years, with adjustments close to inflation, also demonstrating our strength as a quality player in digital education. We believe that the main reason for the success of our pricing strategies lies in the attention to our products, all aligned with the retention of our good students. The quality of the students entering our base is a fundamental indicator of the health of our business and ensures sustainability over time. Therefore, I would now like to hand over to Gabriel, who will provide his input in the presentation, bringing the financial indicators of Vitro for this quarter.
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Speaker Change: And.
Speaker Change: We closed the period is 2.4 times a reduction of half ton 0.5 times when compared to the first quarter of 2024. So in a year, we have reduced our lives.
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Speaker Change: And in December 'twenty, 'twenty, four or we have a three time reduction we having the spending trajectory driven by better generation of cash and they result in a reduction of the company's debt and as a result of the growing ecosystem.
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Speaker Change: Currently it is important to mention that 19% of our gross debt is in long term, which reflects the consistent work of liability management that we made in the last few quarters and the strong cash generation as I said has contributed.
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Speaker Change: So we can continue in this trajectory of reducing the leverage.
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Speaker Change: This is certainly one of our main strategic goals for 2025, one of our commitments is to preserve this ascending trajectory of that that's not that I'm Lee we will have place and room for new avenues for value generation organically or inorganically.
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Speaker Change: And all this route for a macro scenario that will bring us the and initiative for this trajectory, Brazil has a very high interest rate, but the true.
Aaron: Thank you, William, and good morning to everyone.
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Aaron: Moving on to slide 8, I would like to start by bringing some details of the company's consolidated net revenue and our segments. We delivered a consolidated net revenue of 545.8 million reais in the first quarter, an increase of 8.2% compared to the first quarter of 2024. We grew in all segments, which shows the strength of having a portfolio of extremely complementary product segments, clearly driven by distance learning (AD) graduation, which is our core business segment. We continue to grow in distance learning graduation, delivering a growth of 7.7% this quarter compared to the first quarter of 2024. This indicator is very important because it shows our consistency, a word that William used quite a bit earlier, and our ability to continue delivering a revenue growth trajectory, even in a time of greater competition like the one we are experiencing, where there is naturally more pressure on pricing. As William mentioned in the opening slides, the growth was largely driven by the student base, whether due to good enrollment during this first quarter or the good level of veteran re-enrollments we also had.
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Speaker Change: Close I would like to highlight another important milestone that we had thought this quarter and the beginning of the second quarter actually but I think it's something new and I should let you know.
Speaker Change: As much as they need the Bush wanted we should be doing as you hash or usage of our digital EBITDA.
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Speaker Change: That was brought by the reading, our financial solidity and our leadership position our differential competition differential when we think about the hybrid and online education I now close the financial results of the true and I pass the floor back to Williams.
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Williams: Thank you Gabrielle.
Williams: And finally on slide 15, I have to mention the important evolution of V true Indian Magic 23, which was disclosed in April.
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Speaker Change: Looking at the other segments, in the medicine and in-person segments, we grew by 6.1% and 5.8% respectively in this quarter. The numbers for medicine, here, giving a little more depth, continue to reflect our competitive advantages, especially regarding our structure in the city of Maringá and also the maturation of the Forumbá unit, both here with an increase in average ticket. Finally, we saw another important quarter in continuing education, consisting of technical courses, professional courses, and also postgraduate courses, which also stood out year over year, as William mentioned, with a growth of 23.8%.
Williams: The trajectory of our brands.
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Williams: Among the list of companies today, we are the groups, but the biggest evolution in this indicator.
Williams: With score three the concept just considered satisfactory by the Ministry of Education and then this has to be true is the company with the biggest evolution in this indicator being the only one listed was 70% of the courses with score from three to five and if we deepened this hour.
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Williams: Look at the four and five score as the proportion of courses by V true is 22%.
Speaker Change: I thought I should note that antibody XOMA pressures than we do at St. Louis The Amp Lithia Vandal mask and cyanide.
Speaker Change: This segment is an important avenue for the company's growth, and we believe that the growth of the continuing segment will continue to deliver double-digit growth looking forward. We will still continue to seek opportunities to capture even more value in this product, looking at the three base products, which in the long term, without a doubt, will ensure that the continuing segment increases its share of the company's total revenue. Looking at slide 9, the next slide, here we provide a breakdown of our gross margin. Since last year, the company's adjusted gross margin already reflects a maturation of free courses, so we had some pressure on the gross margin, and more recently we also made some revisions to the company's internal processes, explaining this in numbers. In this first quarter, we delivered an excellent gross margin, when we talk about the percentage of net revenue, delivering 72.4%. Compared to the first quarter of 2024, the adjusted gross margin showed a slight reduction of 0.7 percentage points, but it is worth remembering that we made a change in the allocation of the contingency line, here allocating, from the fourth quarter of last year, the fourth quarter of last year, by the nature of the allocation. And then, if we looked here on a comparable basis, we would basically have a FLEC gross margin versus the year 2024, which is, without a doubt, a great message, considering that we had a gross margin last year above 73%. Still, looking at our adjusted gross profit, we expanded by R$ 6.5 million, totaling R$ 395 million in the period. It is also worth mentioning a non-recurring event here, but extremely important to be detailed in this first quarter, which affected the company's cost line. Nitro revisited and updated the academic model of the Unicef brand, with the basic objective of meeting, in advance, the expected regulatory requirements for the sector. And with this, we already incurred costs related to this reorganization, with some team decisions, with this change in educational future, which is, without a doubt, a one-off and will not be repeated in the coming quarters, we make the adjustment of the total value of the decisions in the company's non-recurring expenses line. From a cash perspective, I think it's important to anticipate here, we expect to offset the impact of these decisions executed throughout this first quarter in a deferred manner throughout the year, with a potential improvement in gross margin in the future, when we look at our income statement in the coming quarters.
Williams: So 10 percentage points above the second player listed.
Speaker Change: But a little as an hour cumulus catalyzed gather especially utilization St. Louis you lose my already been asked yet.
Williams: Yeah.
Williams: This is of course, a reflection of the performance of our brands and don't he says Iraq as the brand with the best average and nowadays score among all of the brands.
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Williams: That are are they belong to the companies listed and then the same since we also make it clear here then.
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Williams: Increase in improvement in their concept the academic model of Luna Sylvia was revisit it and our expectation is of a more expressive improvement in the future of measurements of this sector.
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Williams: Yeah.
Williams: These results.
Williams: Validate and reinforce our commitment to the academic quality and the excellence in higher education with that we finish our presentation and we move on to the Q&A session.
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Williams: Oh.
Williams: Now we will start the Q&A session.
Williams: Now I would like to remind you that to ask questions you should click on the Q&A I 10 at the bottom of your screen and typing. Your question to join the queue. When you are announced a plan to activate your microphone will appear on the screen and you must then activate your microphone to ask questions. We kindly ask you.
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Williams: To ask all your questions all at once.
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Speaker Change: Let's go to your first question, it's fine La Paz Macdonald from Morgan Stanley.
Speaker Change: Cause little will activate your microphone. So you can ask your question Luca if you can move on please.
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Lillian Gabriel: Good morning, Lillian Gabriel.
Speaker Change: Cut all thank you very much for the space, we have two questions.
Lillian Gabriel: The first is.
Speaker Change: Could you give us more detail on the review of the academic model and what you're thinking about for the changes in the tutoring model.
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Speaker Change: And the other question is how much room do you still have to continue expanding your hub network.
Speaker Change: Can you still expand.
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Lucas: Hello Lucas thank.
Speaker Change: Moving here to slide 10, we present the details of the cost and expense lines. On the left side of the chart, we show the consolidated value of the company's costs and expenses, which reached R$ 348 million this quarter, with a growth of only 2.9% compared to the same period last year. This slight expansion reiterates the fundamental point that William also brought up in our opening remarks, regarding discipline, in the pursuit of efficiency, naturally, through operational leverage, with the goal of always growing revenues more than our costs and expenses. Speaking a little about our SG&A, I would like to highlight a fundamental and differentiating aspect of our business, vis-à-vis here, any competitor, Vitrola is one of the leanest and lightest companies in the sector, which gives us an incredible ability to adapt, that is, we are much more agile when it comes to any type of adaptation to the market moment, and this in a scenario of not so favorable events, such as we have seen now, a slightly more competitive moment, we are naturally much more agile to make any movement at the internal level and at the market level from a private perspective.
Lucas: Thank you very much for your question I will start answering about the academic model.
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Lucas: I think you who know vitro deeply know that we always try to anticipate these needs.
Lucas: To continue improving any and every type of delivery that we have.
Lucas: Throughout time in our two brands.
I've got a comment that it was this is some of your peers, who does he have pastas and bring them to keep that as a tailwind to let's say that include kind of week when he Q&A not back you said you don't have that.
Lucas: And we have seen predicted changes like the regulatory framework that's accelerated.
Lucas: Misunderstanding.
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Speaker Change: Of needing to improve.
Speaker Change: And aligning the delivery that we always do to.
Speaker Change: To our students when he himself he as I said, when I mentioned and nowadays scores, we have been improving our results, but certainly we understood that we needed to.
Speaker Change: So does it Thomas Boise, Chile isn't just that isn't decision faith has told the human when he covers.
Speaker Change: Some of that must have been made a bad winter and Luke is not doing well the Morgan Stanley Hello cause it must have been at that while it's productive as opposed to how does that have slipped that winter Lucas budget, but I think people have worked.
Speaker Change: Have a difference our hiring model for our professors, we had a very acknowledged model and it continues with the tutors, but we see at the same time that the Ministry of education, often are not considering this tutor a pedagogical and then.
Joe: Hey, Joe.
Both of us prosecute.
Joe: Hey, just distinguish Bert Lucas a perimeter.
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Speaker Change: On the right side of the slide, we show that the general and administrative expenses line grew by 7.5% compared to the previous year, mainly due to the annualization of the benefits we implemented throughout the second quarter of last year. This line remains stable as a percentage of net revenue, which does not indicate any concern for us. Moving on to the sales and marketing expenses lines, expenses in the period grew by about 5% year over year. Here, however, I think it's important to mention that even in a more challenging competitive environment, we were able to capture efficiencies in the allocation of marketing expenses, delivering a reduction of 0.7 percentage points as a percentage of the company's total net revenue. We will continue strong and firm in our pursuit of creative solutions to operate wisely and with the best distribution of resources among media lines, without reducing our ability to attract new students in any way. As we saw throughout the quarter, but also seeking optimizations at the level of our CAC, especially when we talk about digital channels.
Joe: There's not a single dose of the models to.
Speaker Change: Gordon pedagogical agents in the process.
So trying to be a little bit more aligned to the needs of the senses and improving all our indicators. We did the change and today I can say that we have a hiring model.
Joe: Olympic Escalate Scarborough can we anticipate <unk> Bluetooth.
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Speaker Change: <unk> Ah Sieglinde somebody.
Speaker Change: With our professors that makes them more connected to our institution, we had a huge number of tutors that span a.
Speaker Change: Wanted to sponsor Sidney struggled back which are experts in Nepal.
Speaker Change: Is there still more with FICO, but definitely at a certain level of spend so little buffer.
Speaker Change: Awesome.
Speaker Change: Like connection to our company and we started hiring a lot of professors today with higher connections with our institution of 24 to 40 hours, which also gives us margin.
Bruce Demski: When you link this is Bruce.
Speaker Change: Got it.
Speaker Change: Allah Lucas regard, they've been up and Boonton vocal Mr. Capello mobile academic who nobody else complement from book.
Speaker Change: You have a smaller management and administration cost out well.
Speaker Change: Our ski, let's say stick Lansing portfolio manager vehicular side, the key north <unk>.
Speaker Change:
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Speaker Change: Bring us a safe condition and our financial results throughout this year.
Speaker Change: <unk> Mrs to digest.
Speaker Change: <unk> toward the full carrying that anger.
Speaker Change: Good morning, Luca just to complement I think William explained it very well, but I would like to add an important point.
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Speaker Change: Within the year, we considering the natural cost that we brought here of decisions we tend to see.
Speaker Change: He hasnt staying <unk> E <unk>.
Speaker Change: Finally, but not least, I wanted to highlight here a very important topic that we have been discussing for some quarters now. The PCLD was once again a highlight, delivering a nominal reduction of 23% compared to last year, and as a percentage of net revenue, a reduction of 3.3 percentage points, corresponding at the end of this quarter to 8.2% of the company's consolidated net revenue. This performance reflects the annualized capture of the better student activation criteria, an important decision we made in January of last year, resulting in a much healthier base than in previous periods, and also our consistent and deep focus on improving internal processes, especially in the credit and collection area. As we had already indicated in previous calls, we expect to have significant gains in the PCLD line throughout the year, but not at the levels presented this quarter. We should see something between a 1 and 2 percentage point reduction year over year throughout this year of 2021.
Speaker Change: But if he has this gone property marketed a lot broader.
Speaker Change: E file at all.
Speaker Change: A marginal cost.
Speaker Change: And some things you may entergy, Mississippi, <unk>, jamil or I E.
Speaker Change: And again, I'm, sorry, thinking about altering the structure and the savings that we'll have when we consider the next borders or 2026. This is recurring and our gross margin structural growth. Our gross margin and then we believe that when you sell the is going to have an opportunity I think.
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Speaker Change: It's important to make it clear for all of you who don't open he EBITDA margin or gross margin by brand, but when we look year administratively we see a gap between the two brands and this gap tends to be close with time.
Speaker Change: Zinc lead you fan H&R contract our soldiers in hospital facilities, and most seamless mobile <unk> toys <unk> into Villa El Mismo painful Administrated Luca so when windows visits don't consider their own group is at two <unk>.
Speaker Change: Coach the models of academic or I guess.
Speaker Change: This is something that we have studied why.
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Speaker Change: The regulatory changes were only a background for this acceleration and we had a very deep works very well executed by the academic team and we're very happy with the results.
Speaker Change: Including from the standpoint of risks, we don't see right now any risk of academic loss much on the contrary you would have seen an increase.
Speaker Change: Moving here to slide 11, we present the State's EBITDA bridge. In the quarter, the State's EBITDA reached almost around 203 million reais, an important growth of 18.7% compared to the first quarter of 2024. The State's EBITDA margin reached 37.1% in the period, reflecting a gain of 3.3 percentage points over the previous year, naturally resulting from everything we discussed in previous slides, basically the continuous evolution of net revenue, combined with balanced management of cost and expense lines, and naturally the PCLD also strongly contributing to this operational leverage.
Speaker Change: North <unk> modem went to ground.
Speaker Change: And there's a relationship between professor and students.
Speaker Change: Total is Katrina vehicles began those odd Easter.
Speaker Change: And we are aligning with the future perspectives. According to the legal framework the regulatory framework that will be launched.
Speaker Change: From a corner at <unk> more into profit. So it is always it only.
Speaker Change: Includes my orders do Beechcraft required into orders keep them being a woman that I bring my third time horizon, where people sitting in Oslo, Geez, just film and our.
Speaker Change: And on the expansion of our hub network Lou because obviously, when we looked at Brazil, and we see.
Speaker Change: 5500 municipalities.
Speaker Change: It can move measure that a long way. This soon debut staff necessary to save any let's say as a taboo Sanofi.
We.
Speaker Change: I think that we would like to take a brand. So all of the people who would like to have access to quality education, but there are a lot of small municipalities over 3000 municipalities have less than 20000 people fewer people fewer inhabitants and vitro is present in over.
Speaker Change: So component on the Guangzhou Lucas.
Speaker Change: Gosh do we noticed for coming today.
Speaker Change: Moving on to slide 12, we can see that the company's adjusted net profit for the period reached R$ 90.4 million, more than double the net profit obtained in the previous year, with an extremely healthy net margin of 16.6%, which also represents an expansion of almost 10 percentage points compared to the first quarter of 24.
Speaker Change: As shown on the banking book.
Speaker Change: Download one of his interest range out there of course, there are other question I'll put out to ensure execution of his designs et cetera.
Speaker Change: Yeah, I'm going to remind you at all.
Speaker Change: 95% of the municipalities.
Speaker Change: <unk> No question, Jason Gere manage update us a short order you to saving kitchen should idea Bill Saunders <unk> <unk> going to say.
Speaker Change: That have above 30000 people.
Speaker Change: The entrance in these small municipalities not happened as fast and we are looking at a restructuring or reorganization.
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Cohen: He stood out as I'm sure you're seeing it in check as you get to your <unk> capitalizing on the qui Tam opportunity Dodge actually potentially they shut cloud as sort of a safe from the hydrocodone.
Speaker Change: Of our hubs our improvement.
Speaker Change:
Speaker Change: Of our organization.
Cohen: <unk> imagine you did that name asking but I can imagine ended up with market.
Speaker Change: Models the model now that it's going to strengthen the semi presidential classes, we have been investing.
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Cohen: Everything just sufficient them with ample Kendra prosumer misers more dealers and <unk> been buying thoughts yamana allocation drive initial down to our best on standby secure way of guar.
Speaker Change: And we are acknowledged.
We have the best hubs and our focus.
Speaker Change: It is not in this accelerated opening up hubs.
Cohen: Thoroughly software you can punch formula, but I must say, let us all ESPN as each phase W. Winter performed a superb start approaching academic and establish sensor faithful Guangzhou pad Thai Tang because if you're at the point of Vista Judishe for key additional shack and a small amount new niche would you be able to cut them because they are a competitor distinguishing mall.
Speaker Change: And just to close Lukas talking about your last question. The focus here is much much more on quality than on once a chi we have to rationalize the portfolio somehow we have to have well structured hubs well positions hubs.
Cohen: The quality of customer and that's the Hela cell professor Alan one Asia or them atrichia, adding onto calling basically Jewish with Jewish, Illinois microwave product just like <unk>.
Speaker Change: Understanding that infrastructure is going to be the big thing in the new regulatory framework and we think this is the education that Brazil needs to have we see a competitive advantage for vitro in this sense.
Cohen: So by so much.
Speaker Change: We have about 1200 hubs with a well established laboratories and classrooms and we continue in this agenda knowing that if there is an improvement should be done in that hub, we will do it. So the focus is much more on the excellence program on the greater qualification of our network so that does.
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Speaker Change: And move on positively.
Speaker Change: Mind, you that we still have the opportunity and the maturing of this.
Speaker Change: Hubs that are.
Vicky: So men audit <unk> interesting thing Jim <unk> E. <unk> to those municipals are seamless <unk> Hill May Chi I try them is backend was when as cheap as element that I might Miss Linda listed Dodge.
Speaker Change: Have understood.
Speaker Change: We have understood that the focus is more on the acceleration on the openings, but more on the qualification of this network. Further ahead. Thank you very much everyone for the answers.
Speaker Change: Let's move onto our next question is if I look at my kids and he's from at all.
Vicky: <unk> put in my history put us so my Hey, we're going to have our cylinders losses fall.
Speaker Change: Luca we're going to open your microphone. So you can ask your question.
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Speaker Change: Well.
Speaker Change: Yes.
Speaker Change: Good morning, everyone and thank you very much for the questions. You commented during the presentation that you have been you have seen a much more competitive market and that would but just the growth of the average ticket could you give us a little bit more detail in the sense. If it is a more competitive model in the us.
Vicky: The seamless zyla, but our thought is on both ample nausea subsequent seasons hotels made artist balls and Don Falk, we see he'll mentioned nowhere near suburb toward affiliate adequately for it before he faith in those which moslems allophony gives you pause.
Speaker Change: Pacific aspects or what specific courses.
Speaker Change: The second question is no.
Vicky: I guess just to complement on the site to make let's say South Dakota, so which what they want.
Speaker Change: It's related to the first one thinking about a more competitive market. Looking further ahead. How is the company's commercial strategy did you intend to increase our marketing cost to accelerate this growth and the such a competitive market that sets everyone. Thank you.
Vicky: That youll Farquhar, managing <unk> amazing quality Dodge magazines. Thank you Hudson undesirable Nishu is sports, while they're interesting depositor baseball just Fernandez main street garage and but on the Q in fresh to the tune of Ico Ghanaians Yahoo.
Vicky: Well I'll tell you as you start telling advocates yoga amenity requests, but as Europe.
Speaker Change: Well.
Speaker Change: Yeah.
Speaker Change: Well I'm going to start here and then got Bill can add.
Vicky: I think Suzanne shagbark montage compared to chew up Brazil, and missing children as you extinguish at a restaurant I mentioned <unk> Jackson laboratory salaries yellow base stability.
Speaker Change: I'm certain that the macroeconomic scenario the difficulties nowadays of this future students the student debt the at once to enrol in higher education.
Vicky: <unk>.
Speaker Change: Nestri also, the cash registers, it reflected a non-recurring effect, I have already briefly commented, but for those who handle cash, it hits all at once, which is the effect of the decisions, resulting from this new academic model of Unicel, as we have already mentioned on the slide.
Vicky: <unk> tagging, Paul Romano outage to put out there and I cannot process each of IOC led and Sos for quite a successful bank don't Farquhar Cam Winter management program or just a laser now quite discussing how the visual I wouldn't I'll say age.
Speaker Change: Or a little bit more difficult in this year of 2025. So we're very careful on the tradeoff between volume and ticket. This is a great challenge that all institutions have well when we look at this first quarter, we did not have any specific location or a great region.
Speaker Change: Brachia isn't a rush Orangey NUCYNTA deposit you then but other key is you still attainable Boston you dodged that no matter what I saw this exposure for ambassadors of the chosen which falls and then I'll add to what Adam St will sound silicone bradish nothing no matter, what they sound like don't Farquhar, yeah manner salvage and I'll state it as soon as all the stores in March Macquarie discussing traffic.
Speaker Change: The CAPEX of the first quarter totaled R$ 18.7 million, which is an amount lower than the previous year, but basically due to a temporary shift in the investments made by the company. I'm not suggesting that this saving is likely to be perpetuated going forward; it's more of a shift between quarters. We are being extremely diligent in the company's capital allocation at this moment, but our expectation is that investments will return in the coming quarters to Vito's historical level, given that we have planned the acquisition of new laboratories, something that William mentioned a lot in his speech. We want to position ourselves as a differential client also in the semi-presential, in line with our already mentioned strategy.
Speaker Change:
Speaker Change: Okay.
Speaker Change: Pleasure.
Speaker Change: Macroeconomic challenge of competition I think you already had access to the competitors in the last few reports where there.
Vicky: Gladys supercell, but he got it.
Vicky: What was the approximate bedroom that Apple will come after that.
Speaker Change: Core growth in smaller volumes unexpected, but be true, having any market intelligence and a very specific work in each one of the courses and hubs, we try to balance that not losing unimportant irrelevant volume for us even though we have the big.
Vicky: Well look at them as I read it that long, but give us a path of how does that is that they're going to.
Vicky: Look up by Jupiter. Thank you Praful.
Speaker Change: Good morning, Joe peso, but also for the wound to someone who is more so on the.
Speaker Change: Just coming tangential business does so Nikki Keith box on April.
Speaker Change: Moving here to slide 14, we show here, basically, a fundamental indicator, which is the company's leverage ratio and how this leverage profile of the company is, which continues, I think it's very important to comment, on a downward trajectory. Vitória ended the first quarter with a net debt of 2.2 billion reais. With this, the net debt to EBITDA ratio, adjusted, the Ex-FRF, closed the period at 2.4 times, making a reduction of half a turn, 0.5 times, compared to the first quarter of 24, that is, in one year we lowered it by almost 0.5 times and 0.2 times versus the last quarter, December 2024. So, we are on a downward trajectory, driven naturally here, both by an effect of better cash generation and reduction of the company's net debt, as well as by the effect of growing EBITDA. So, acting on both ends, both the denominator and the numerator. Currently, I think it's important to comment, 96% of our gross debt is in the long term.
Speaker Change: A bigger student database, but trying to understand what is the limit that we couldn't work on and are taken and I'm going to take this chance to answer both questions.
Speaker Change: Instead of Illinois, Mercado Bookmarks compete Chu with Oasis, that's pretty overbuilt. Christine did you you should get your magic letting down book might be dialing in essence, you need to see.
Speaker Change: Oh, macadamize quickly to be ever more process to Heath Coca courses with recruiting towards cleaner don't poke myself Tyler schemes.
Speaker Change: Of course.
Speaker Change: There's no intention and are increasing our costs and sale and an expenditure and marketing because we can balance.
Speaker Change: Let's say, we're not going to let the Colorado Supreme into it.
Speaker Change: <unk> syndrome Macadamize can pitch in.
It doesn't impact the interest income you guys thought that requires selling businesses.
Speaker Change: Not a growth like we had in the last few years, but much more focused on the student that is much more connected to the and their interest in our remaining and studying with us.
Speaker Change: I don't know Oprah painting, all mean.
Speaker Change: Oscar market, you've got into oscillate around broker cigarettes main tradeshow mechanical that's true.
Speaker Change: So we're going to put forward.
Gabriel: Very nice Lillian Thank you for the answers.
Speaker Change: Yeah.
Speaker Change: I don't know if it will push our key deposit nobody ever complement that.
Speaker Change: Hmm.
Gabriel: Let's go now to our next question is by mid L. O, Nevada of Bank of America Merrill over going to activate your audio from your question Middle or you can move forward.
Speaker Change: The St. Luke's Neoma, Yeah, I think Savi kusanagi macroeconomic who are skeptical that zuzhi. This eve to lot of Moonlight Gilkey, Bouska zancou stupid or L. A.
Speaker Change: These things. These two book might just go diagnose central those meeting soon.
Speaker Change: This consistent work of liability management that we have done over the last three years reflects, and the strong cash generation, as I mentioned, also contributes to us continuing on the path of reducing leverage, which is undoubtedly one of our major strategic objectives for the year 2025. One of our commitments is to preserve this downward trajectory of debt so that at an opportune moment, we have room to explore new avenues of value generation, whether they are organic or inorganic. We are also hoping for a macro scenario that brings interest rates down to this same trajectory. We are still seeing Brazil with very high interest rates, but Vitro is undoubtedly a player that, seeing a first market signal of falling interest rates, will undoubtedly be one of the biggest beneficiaries. The debt amortization schedule is at the bottom of the slide here, highlighting the very extended profile we have today, practically without short-term commitments. To conclude, I would like to highlight another important milestone we had over this quarter. In fact, it was now at the beginning of the second quarter, and I think it's important to bring this new news to the market's attention. Fitch assigned a national double A rating to the company, undoubtedly highlighting the major points brought by the rating: our financial solidity, the leadership position we hold, and our competitive differential when we think about digital and semi-presential education. With this excellent news, I conclude the presentation of Vitro's financial results and hand over to William so that we can continue with our presentation.
Speaker Change: Nevada, we cannot hear you very well so if you can start again please.
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Speaker Change: Three additional diverting look I always perceived format <unk> is used to seeing with Zephyr and poke my are macroeconomic or Dupont Cohen the.
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Can you hear me now Okay. You can we can hear you.
Speaker Change: Could have sent home and if aluminum buchman awed as previously might have read through them to my intelligence to Jamaica Blue microphone.
Speaker Change: Thank you good morning, William and Gabriel.
Speaker Change: Still in restructuring Gabriel mentioned in the previous question then you don't see a risk of academic loss with the change of the model well you know that the tutor has always had an important role in the development of the students show when you talk about this point specifically, how you have mitigated.
Speaker Change: Two specific guidance Cardinal discourses at Bolivar simply boosted daily price no Purdue ballroom at Gameboard guarantee you Hayley Lewis put on all mezzanine loans up Amazon MLR Bozzi journal wounds milestone B blizzcon anything they can always slip meat cheese, <unk> palladia trouble alcohol and also cheap.
Speaker Change: The engagement of the students are without the tutor and along the same lines on regulation could you talk to us a little bit what are the expectations have changed and also the timing of the disclosure, especially after the fourth postpone postponing postponement in the.
Speaker Change: Geo will pick up groceries, everyone is born there as Louis St over the name alone the one they will maintain so.
Speaker Change: Joe manpower more Sue <unk> Mark this cookie is actually cost saggy can EBITDA now, Chris Samantha collateral noncore monthly faith in those which Muslims My winter My spouse toddler, you didn't want to <unk> zinc lie blueprint. There is some is would you put them on etsy is too dark windows.
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Speaker Change: <unk>. Thank you very much for your question.
Speaker Change: Manila first we have an invitation for you to know her better Gotta go model ammonia cells, even in this new structure, but it's important the same at all of that in no and no point we.
Speaker Change: Sudhakar William Liang.
Speaker Change: We lost the role of the tutor well, we changed as the way that the tutor works much more present with the students and also with a bigger time of availability.
Speaker Change: That means that no surprise from our bedroom and then meet Alan Veda. The Bank also make me at Allen It ends up at a pad well, it's pretty clear suppose I had is that is what they're going to.
Speaker Change: Yeah, I love budget, but I think it possible.
Speaker Change: Thank you, Gabriel. And finally, on slide number 15, I couldn't fail to mention the important progress of Vitro in the Enad 2023, which was released in April . The trajectory of our Vitro brands stands out among the listed companies. Today, we are the group with the greatest progress in this plan. Starting from a score of 3, the concept is considered satisfactory by the MEC, and in this regard, Vitro is the company with the greatest improvement in the indicator, being the only one listed with 72% of courses scoring between 3 and 5. And if we delve deeper into scores 4 and 5, the proportion of Vitro courses is 22%. This is 10 percentage points above the second listed player. These percentages are undoubtedly reflections of the performance of our brands, and Unicesumar is the brand with the best average Enad among all brands owned by listed companies. In the same vein, we also make it clear here that Unicelv has been showing significant improvement in its ratings. Remembering that recently, Unicelv's academic model was revisited, and our expectation is for even more significant improvement in future measurements of the indicator. These results consolidate and reinforce our commitment to academic quality and excellence in higher education. And with that, we conclude our presentation and move on to the Q&A session.
Speaker Change: And with a nomenclature that is much more connected to what we believe that will come in the next regulatory framework for.
Speaker Change: Yeah.
Okay.
Speaker Change: Yeah.
Speaker Change: <unk> for the eventual climate shock instrument that drove him.
Speaker Change: For a while the Ministry of Education has been explicit saying, that's a tutor will not have a role as a pet or plagiarism and we who have such a long experience with this professional we know that they are unimportant professional so we did a few adjustments and we have this cost.
Speaker Change: Which was the.
Speaker Change: Need to change and also we had a very strong hiring.
Speaker Change: Okay.
Speaker Change: Oh, you're going to have the cycles hanging because amortization is stabilization at Allergan ship reticent.
Speaker Change: Efforts within the new model and then the new nomenclature showed that much on the contrary, we could understand that the facilitator teacher, which is one of the nomenclature is that we're using now it's going to be much more present during the tutoring of the class, but also in the pre and post glass, which.
Speaker Change: The Santa Fe.
Speaker Change: Buendia reading a video and then I'll turn on a history lesson.
Speaker Change: Correct, Nathan unethical to deal with and I can say something here could you paid academia.
Speaker Change: On mobile the mobile <unk>, 2% to a different platform, we can potentially and it got me to double in the ninth synthetic momentum for cordless phone for <unk>.
Speaker Change: Just where are we saw that our students would demand the tutor a lot and that wasn't a concern. When we also have another brands. When he says the mine, but also showed better indicators.
Speaker Change: Well move assisting each guy does he squeeze the telephone line doesn't mean $2 1 million upon Cassandra attributable towards yes.
Speaker Change: MS Molina nihil, if someone had gloss Celsius is plentiful ample quite suddenly stick situation does it pains me to do timing.
Speaker Change: Better market indicators and we are trying to find the best strategies that are used in the two brands.
Speaker Change: So a nice differential please ADC quieted you have maintenance thousands that put the castle.
Speaker Change: And no regulation.
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Speaker Change: We have an expectation here.
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Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: It is a short term.
Speaker Change: Oh wait now we had an event in brasilia and the perspective and our understanding is that.
Speaker Change: This new instrument will be launched this new framework will be launched in the next 15 days as we all know there's a big change, which is the creation of semi prudential classes and ask Abdel sat in one of his speeches. This is very high.
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Speaker Change: Now, we will begin the Q&A session.
Speaker Change: Positive for them.
Speaker Change: Remember that, to ask questions, you must click on the Q&A icon at the bottom of the screen and write your question to enter the queue. When announced, a request to activate your microphone will appear on the screen, and then you should activate your microphone to ask questions. We kindly ask that questions be asked all at once.
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Speaker Change: True because we have been the biggest player of digital education, and we've always invested a lot in hybrid courses in hubs with infrastructure with laboratories and certainly.
Speaker Change: With this new regulatory framework, which was going to be established as the biggest glare of semi position of education in Brazil.
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Speaker Change: Let's go to our first question. It's from Lucas Nagano, from Morgan Stanley . Lucas, we will enable the audio so you can ask your question. Lucas, please go ahead.
Speaker Change: With over.
Speaker Change: 1200 hubs with hubs in the area of engineering with hubs with.
Speaker Change: Let's courses in the area of health and I'm sure that after the regulatory framework in the next quarter, we're going to bring you. Some of these figures I think it is going to be important for the whole market to get to know them and acknowledge that'd be true is the best and most prepared institution.
Joe: Good morning, William, Gabriel, Carol, Luiz. Thank you for the steps here. We have two questions. The first is...
Speaker Change: One of those moments like Willis announce things as lumbar gwadar aided by some <unk> two momentum authority of Dol miles north Platte in the bonds and call get obligations sheet via June also alone would be Jim Owens, yes, halfway on Northrop bustle Ilene, but under cash interest they Omar watermark account suezmax simply more.
Joe: so you can give a little more color to this course on academic model review and what you are thinking about changing in the doctoral model. And I missed a part too, but I think Gabriel mentioned the possibility of improving the gross margin, but how does this relate to, possibly, the ratio of faculty to student? That's the first one. The second is about...
Speaker Change: To assist this new regulatory framework in this new modality that is being created in Brazil, especially in over a thousand municipalities, where we are present.
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Speaker Change: Yeah.
Speaker Change: Okay, perfect very clear thank you very much William.
Speaker Change: How many opportunities do you see for continuing to expand the hub?
Speaker Change: Okay.
Speaker Change: Now, let's move on to our next question is by Marcio Ozark cold by Bradesco from Bradesco BBB I, we're going to open your microphone. So you can ask your question Marshall. Please continue.
Speaker Change: there should now be an acceleration effect due to last year's suspension.
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Speaker Change: Osnapra, Spongy, Alendesis, 2018, I think. Thank you.
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Speaker Change: Good morning, everyone.
Shneur: Device cloud Walsh.
Speaker Change: Hello, Lucas. Thanks for the question. I'll start here with the academic model. Gabriel will add a bit. I think those of you who know Vitry deeply know that we always strive to anticipate these needs to continue improving every delivery we make over time in our two brands. And we have seen changes anticipated with the regulatory framework itself that accelerated...
Speaker Change: Just a question for my part are still on the topic of the adjustments of the academic staff.
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Shneur: One thing to bear in Grandeur example language.
Speaker Change: I would like a few other clarifications about what has been done.
Shneur: EMEA SA bosses solution by E uppers mixed shift or even Austin things you may have.
Speaker Change: <unk> was that this was carried out and viognier selvey brands. So you have fired dismissed tutors and you hire professors so was that the change.
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Speaker Change: Was there ever debt reduction in the number of on site classes that were offered.
Speaker Change: And.
Shneur: The same things as Jim was moving inclusive Z, but it goes a ball and peripheral toward a corner boarder board as you've seen over the Neoma Apple <unk> and via through Vices Fabless Sycamore Omar player Jim Caruso family prevent cell. This is Brazil from ISG.
Speaker Change: What is the reduction of the cost what is the reduction.
Speaker Change: this understanding of the need to improve and align the delivery that we always provide to our students. Uniacelvi, as I mentioned when I talked about Enad itself, we have already been improving the results, but without a doubt, we understood that we needed to create a different bond in hiring our teachers. We had a very well-recognized model that still remains with tutors, but at the same time, we see the Ministry of Education often not considering this tutor as an important pedagogical agent in the process. And then, seeking to be more aligned with the needs of the census itself, improving all indicators, we made this change and today I can say that we have a hiring process with teachers who have an even greater bond with our institution. We moved from a large number of tutors who had small, hourly contracts to hiring many teachers today with larger contracts of 24, 40 hours, which also somehow opens up a certain margin, because you have a lower management cost that will help us throughout this year to even seek some savings in this financial result.
Speaker Change: Consider the cost of the professor is cheaper than the cost of the tutor that is why you have the savings that's my question.
Hello Marshall.
Speaker Change: I would like to also invites you to meet with US. So that we can show you our new model, it's important to make clear in this reorganization that there was no reduction of delivery for our students in terms of studying hours and the model that when you sell he has which is different than.
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Speaker Change: He says I'm, a which is a model of the monthly entries and monthly disciplines, one meeting a week.
Speaker Change: It all it all remains as it is but what changes Maurice here the big change that we.
Shneur: But I think this normally go out the audit, yes, a novel modality Dodge starts and look at out in Lhasa, Brazil Principal Mainsheet aim is Jim you want to see if this oh engineered systems Provenge.
Speaker Change: See farther ahead as Alberto said.
Speaker Change: That makes us safe, which is not the main focus but our main focus was the improvement of the quality indicators of doing it yourself. The brand is that we had a big number of tutors spread out throughout the country.
Shneur: It's quite a big on Dominion.
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Speaker Change: And many of our academic models also post endemic became a flex model, where we have the tutoring, which was the online assistance and.
Shneur: Yes, it was I've been at that large, but it gives us a pause ahead of that as what theyre going to mass.
Shneur: NASA budget, but as they get profitable.
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Speaker Change: And we did change towards a bigger number.
Shneur: Now it can poke mice kletterschuh maintain a lot of things that I mentioned, you'll kick every phase two and so they prefer to know Mark when you sell me Matt.
Speaker Change: Professors, we hired professors with a workload wherever they have a bigger connection and presence in the institution we love this.
Don Mckenna: Precision doses, Jimmy Choo, Don Mckenna.
Speaker Change: This figure that was above 3000, and we continue with five 1500 professors with more hours.
Speaker Change: Just to add, good morning, Lucas, I think Elião explained it very well, but just adding an important point, within the year we have to see, considering the natural cost we brought here of terminations, etc., we have to see a marginal gain, thinking about the cost we had to terminate, to change this structure and the savings we will have thinking about the next quarters. For the year 26, this is recurring in our gross margin, structural, and then yes, we believe that UniaSelvie ends up bringing here, there is an opportunity, I think it is important to make this clear to you, to the market as a whole, we do not disclose EBITDA margin, nor gross margin, nor EBITDA margin by brand, but when we look here, managerially, in our day-to-day, we had a gap between the two brands, this gap tends to be closed over time, as we bring the academic organization models closer together. So, this is something we have been studying for a long time, I think the regulatory aspect was just a backdrop for an acceleration, and I think we did a very thorough job, super well executed by the academic team, we are quite satisfied with the result. So, even from a risk perspective here, we do not see at this moment any risk of academic loss, on the contrary, we have seen an increase in the qualification of this teacher-student relationship, and already, obviously, here, aligning with future perspectives by the new regulatory framework that tends to come out in the next few weeks.
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Speaker Change: And Theres a change because many times this tutor was hired regionally.
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Don Mckenna: Yeah.
Speaker Change: And they have different costs according to different union.
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Don Mckenna: Perfect sure.
Speaker Change: So there are other gains that we achieved with managements costs behind all of this.
Don Mckenna: <unk> Q2, due to poor produce cable system second.
Don Mckenna: Second EMEA.
Speaker Change: So my first has to do with this pretty Ghana.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: For example training that is very important.
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Speaker Change: We continue with a big part of these professors hired.
Speaker Change: That was not a full change.
Speaker Change: Today on yourself. It continues with over 3000 professors and its staff to take care of this academic model, which is a great singularity.
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Speaker Change: Now with the.
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Speaker Change: Especially in the courses that will have.
Speaker Change: Face to face.
Speaker Change: Classes that says the know how that when yourself and when he says Lamar has gathered it's rob.
Speaker Change: Sorry to say that you can do for you for placebo response, Foy Melodia Booze <unk> do qualify to the American ourselves agnostic. It was alumina went to ground just two daughters. This biological is brand new.
Speaker Change: I'm today than they just collaborate a base of our institutions is focused on our processes.
Speaker Change: Well.
Speaker Change: Okay. Thank you.
Speaker Change: He went to those losses mobile Lusaka band, because then being postponed EMEA. This tornado modelo flags when your chance of tutorial Kenworth engine Menthol line.
Speaker Change: Okay.
Speaker Change: Our next question is by some roll off is from BTG Pactual, some well I would like to.
Cohen: Regarding the issue of centers, Luca, we see that, obviously, when we look at our Brazil and see a Brazil with 5,500 municipalities, sometimes we understand and would like to bring our brands to all those who would like to have access to quality education. But there are many small municipalities, more than 3,000 municipalities, that have fewer than 20,000 inhabitants. And we have understood that today, Vitro is already present in more than 95% of municipalities with more than 20,000 to 30,000 inhabitants. Indeed, the entry into these small municipalities will no longer have the same speed. And we are looking much more at a restructuring, a reorganization of our centers, an improvement in infrastructure, especially now with the new model that will establish the semi-presential model, this model where Vitro is already a pioneer, we have already invested in laboratories for a long time, we are already recognized for having the best centers. So, the focus itself is really not on this accelerated opening as we have done in recent years regarding the number of centers.
Speaker Change: <unk> seen one will dose approved no moodle, yeah, Mike.
Speaker Change: Turn on your microphone. So you can ask your question.
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William Gabriele: Good morning, William Gabriele Good morning, everyone I have two questions.
Speaker Change: The first one is an update regarding the optimization of the tax revenue.
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William Gabriele:
William Gabriele: I would like you to please give us an update.
William Gabriele: About Uh huh.
William Gabriele: Collapse of the structures. The two companies that are below the whole day.
William Gabriele: So as we can.
William Gabriele: Take chance if all the benefits of pruning and you mentioned during your presentation that the inspection of Capex will return to the previous levels could you just comment.
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William Gabriele: The investment plan for the budget this year.
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So if you can open up the figures that would be great.
Speaker Change: One more part to this is broker sorties contract by Booth D&O 14, one with US our food now was it our net sales we continue to work on my eyes at today's new profit. So it isn't dollar swap buys. The contrast that back with that there's some mobile academic Nokia when drilling just for yourself <unk>.
William Gabriele: Yeah.
William Gabriele: The first question about the income tax the main instrument.
William Gabriele: Yeah.
William Gabriele: This is stuff that.
William Gabriele: But we need to pay attention to is that the focus is not only income tax we have today a structure that is.
Speaker Change: I bought a comorbidity semi present itself at two <unk>, but off the surface into the world of professor in the agenda of the films that taught us that I've watched daily volume week Demised myeloid leukemia said on his phone service and informational sclerosis casino operators and salad Rgs, So knowhow keep them Tony ourselves bonuses of my answer to you.
William Gabriele: Organizationally not the most efficient way.
William Gabriele: We carry 100% of our debts and a structure that basically is cash with very very small revenue in the subsidiaries aren't the biggest volume of operations and our tax cost.
Vicky: That's it, to complement and also to close, Lucas, your last question, I think the focus here is less on quantity and more on quality. We need to rationalize this portfolio to some extent, we need to have well-positioned, well-structured centers, remembering that infrastructure will be the main target of the new regulatory framework, and we are very aligned that this is the path that education in Brazil needs to take. We already see a competitive advantage for Vito in this regard, we currently have approximately 1,200 centers already with well-established laboratories and classrooms, and we continue with this agenda, knowing that there is room for a better-structured center in that area, we will accelerate its qualification. So the focus here is much more on a program of excellence, on the increasing qualification of our network, so that this business moves in a positive direction. Remembering that we still have an opportunity in the maturation of these centers that were opened in recent years, these centers have not yet matured 100%, on the contrary, we still have potential maturation, so the focus here is perhaps less on accelerating openings and more on the qualification of this network going forward.
William Gabriele: So we are now in a reorganization of our company.
Speaker Change: Our loan will dampen don't get refreshes that he or she buys the jackalope would've bought as I ended on authorization at this point is therefore god knows us for facilities.
William Gabriele: This process is very advance our expectation is to conclude throughout the third quarter so that.
William Gabriele: From the incorporation movement, which is theoretically what should happen is from the partnership in company's data points, we're going to incorporate.
Speaker Change: Oh can everybody Ghana.
Speaker Change: I'll now, surpassing our Piedmont and some well I'll just flip it to hit back plus some while it was our belief that a large part of because I suppose I had is that is what they're going to.
William Gabriele:
William Gabriele: Some of the I as in the whole thing and then we're going to be able to enjoy the tax shield and the pro in the advanced stages. There are many elements that make neutral.
Speaker Change: Somewhere else budget, but I think a possible.
Speaker Change: But you were doing with everybody else when you have told us.
Speaker Change: Some of those people does it given us a lot of our premier myeloma, so quite a lot. So our chorizo switching poster Hampden are assessed with asking about how much of it is a phone call have also co market.
Reduced significantly the payments you can see in our cash in the first quarter that we still say substantially higher income tax than any other institution. This has to do with our structure.
Speaker Change: Comcast, but I do know collapses I'm, just sort of to what is our need is loosening, but in this country a bunch of the holding up at a proper rate.
William Gabriele: Reminding you that this throw money volume is not a 100%.
Speaker Change: And then if you Sue India don't add to the <unk>.
Speaker Change: S equity mirror, yes, it grew into Cisco menthol and I put it in that present, the sone that key aspect that you would your Capex hotel partner might as Don said, you always is that just put that thing soco menthol plunging fisherman two budgets. This journal parish anxious as pedestrian I'm doing limited I won't break out.
William Gabriele: Yeah.
Vicky: Is that clear, folks? Thank you.
William Gabriele: Yeah.
William Gabriele: This payment is.
Vicky: Let's move on to our next question. It's from Luca Marquezine, from Itaú. Luca, we will enable the audio so you can ask your question. Luca, please go ahead.
William Gabriele: Going to be reduced as a result of this.
William Gabriele: Company reorganization, we are going to navigate in the Capex.
And just a well regarded bullish virulent there's room, along with big IQ Premier to Eduardo NASA additional agent pushing handle.
William Gabriele: Around 140, <unk> hundred and 50 million rise.
Speaker Change: Good morning, everyone. Thank you for our questions, we have two from our side. You mentioned during the presentation that you have gone through a... you are observing a slightly more competitive market, perhaps this even slowed down the growth of the average ticket. If you could provide a bit more detail in this regard, whether it is a more competitive market in a specific area or for specific courses, if you could give a bit more detail, I think it would help us. The second question is actually linked to this first one, thinking about a more competitive market, looking ahead, how does the company's commercial strategy look? Do you expect or intend to increase marketing expenses to try to accelerate this growth in the face of a competitive market? That's it from our side. Please.
William Gabriele: That was a percentage of the.
Speaker Change: I sure Tracy Paolo and romantic crushing potentials Dakota at Falcon, Assam ancient pushing on but then my question on Kids simply Scott also said that it <unk>.
William Gabriele: Our revenue that will be in the same order of.
William Gabriele: It was the same level soon.
William Gabriele: And we had an expectation of investments there was a little bit higher due to.
Speaker Change: Interesting erosion maestro to the CAD, one <unk> or the in restaurant, all Illinois Amas exchange.
Speaker Change: The same store so there's I'll say, there's much throughput Ikea <unk> safe <unk> Chicago faster at all but as you well know me. There's also look there are signs youll book would've been about either Don as you start working on process of Keno Hill.
William Gabriele: Internal projects and as we see.
William Gabriele: C a scenario with bigger income right.
William Gabriele: Rates and a more intensive competition.
William Gabriele: Yes.
William Gabriele: We have looked now are into it we would have looked in our internal operations with this commitment to us.
Speaker Change: Todd is process it at the Astro bear a massage massage picked up <unk> eylea alone that they set up their master plan.
William Gabriele: Reducing our Capex, that's an important line for us too.
Speaker Change: She is the most amount of <unk> 90, <unk> in casual things Yaacov just at the point of view so.
Speaker Change: What I'm going to bring up here, and then Gabriel will complement, without a doubt, we know that the macroeconomic scenario, the difficulties today of this future student, the one who seeks to pursue higher education, and we have seen a bit more difficulty in this year of 2025. So, we are very careful about this trade-off between volume and ticket. I think it's a big challenge that every institution has, but when we look at this first track, we didn't have any specific location or a large region. Yes, there is a slightly bigger challenge, macroeconomic, of competition, I think you have already had access to the competitors themselves in the latest reports, where they grew in volumes a little less than expected, but Vitrio, having market intelligence, a very specific performance in each of the courses and centers, we always seek to balance this, not losing a volume that is important and relevant to us, even though we already have the largest student base, but also seeking to understand what is this limit that we could work with our ticket. And I will take the opportunity and already answer both, without a doubt, there is no intention to increase our cost in expenses, in marketing, since we can balance growth, of course, not as it was done in recent years, but much more based on a student who comes much more linked, with a real interest in staying and studying with us.
William Gabriele: To remain 100 at around 140 to 150 million Reais.
Speaker Change: Sure Todd.
Speaker Change: Yeah, and tranquil for albumin, SSH and navigate through holding Apache the UGG plus our outlook for the year total nature.
William Gabriele: We have been very diligent in the approval of these projects and we will continue pursuing this target. Thank you very much. Thank.
Speaker Change: Tax shields at auction does that salt someday adopt agency showered lives with I thought you think <unk> filing.
William Gabriele: Thank you good morning.
Okay.
Speaker Change: If you drew a posture of Januvia, Jimmy which pharmacy Achiever will pack on the emphasis you reiterate the bonus cassia. This permitted disposition of biomarin pushing down to some small cell <unk> Zhao to locate where cattle registries salary you stay here for an ostrich through Twitter so set that at <unk>.
Speaker Change: The Q&A session is wrapped up and now we would like to pass the floor.
Speaker Change: To the final considerations of the company.
Speaker Change: Once again, thank you very much for your participation.
Speaker Change: Pharma commit yourself or is that now and then but other key and most of all the major problem in Illinois. She is simple sample the patch and anthology and sustainable quicker, but that on a Basel IV is a internally as you can see <unk> patches that they set up their <unk>, if I've got the amp to Jay and he'll make jakaya fruit Odessa simply has also said that they are going to kill it.
Speaker Change: We continue in your availability and we reiterate.
Speaker Change: Our commitment to continue doing what we believe in delivering an education quality education, a sustainable company and then making the difference in this Brazil. Thank you very much and have a good day.
Speaker Change: Let's see when the house on Capex, you should have another guy sounded from Capex that you went to a party looking for one beside a mark was any sense quite answer sensing platform utilize your cash our installed based central data center.
Speaker Change: Yeah.
Speaker Change: These video conference of results of Q1 2025 of vitro, Brazil is wrapped up the department of relations with investors is that your availability to answer any questions or concerns. Thank you very much to the participants and have a great day.
Speaker Change: Thanks, Jessica nanometer margins, you get ideas and shut that chinas.
Speaker Change: Oh, Julia, but I was thinking of a boom in eastern Europe financials on a passage of my shaped achievers English amounts that <unk> Apple <unk> brush apples in San Jose you Bellfounder Logi surprise, yeah, I've animal Shanghai to Jim mileage, Sasha Jewish Nigeria, although not at the point you said you paid some bulk my shouldn't they also.
Speaker Change: I think she shops as a loss or as fast as all demonstrate our the answer you hit the road is Amish demanded attention on cheating a formal Beaumont Farquhar jettison Kashered, one mustn't credentialing premiere sledge function monitor as you thought it does all of them are causing you a capex money boorstein check here.
Speaker Change: Subicói, William. Thank you.
Speaker Change: I just bought a company a subject you banked on farmers yet out there of another guy held in liquidity since quite a sensitive question.
Speaker Change: Let's move on to our next question. It's from Mirella Oliveira, from Bank of America. Mirella, we will enable the audio so you can ask your question.
Speaker Change: Can you start saying, but he didn't answer Gil Alan process ongoing as you stand with limitation will then answer so bear <unk> I cannot prove us on its fresh ACH you didn't you buy coachella as they say you know this is it.
Speaker Change: Irela, you may proceed, please.
Speaker Change: Alright.
Speaker Change: But again with a bunch of you.
That's it from Japan does he his sponsors this thing to happen yeah glad I always said, you're only supposed that up I'll have a better schools at Edison Tonight The company.
Speaker Change: Mirella, it's a little low, if you could maybe start over, we can't hear you.
Speaker Change: Muslim business <unk> quite small soldier toward those.
Speaker Change: What's the normal is that supposed to so you hate that Amazon also compromise and you've got to laugh as Andrew Ikea leukemic cells that rigid thumbs entering the Andrew Cuomo signed through my customer quality batch when line three is a sustained positive.
Speaker Change: Good morning, everyone. Can you see me now? If you want to write to us, Mirella, we... Ah, now yes. Now it worked. Perfect, perfect. Thank you. Good morning, William, Gabriel. Still on the topic of restructuring, Gabriel mentioned in the previous question that you don't see a risk of academic loss with the change in the model. We know here that the tutor has always played a very important role in student engagement. So, if you could comment a bit on this specific point, how have you mitigated the risks regarding student engagement at the end without this figure of the tutor? And the second question, I think along the same lines, regarding regulation, if you could talk a bit about what the expectations for changes are and especially the timing of the announcement, especially after this fourth postponement in the publication deadline.
Speaker Change: The Fund's Enbridge finance on this Brazil criticism, because I'd, rather go into Z bonds yet.
Speaker Change: How did you called city center his <unk> pretty message it doesn't even think that vitro Brazil. Thanks your habits.
Speaker Change: I mean did you Hello safely. This stability is that suppose if somebody has gone there as they must do if he does he kissed funds want to break out those by two points at Campbell Union.
Speaker Change: Nope.
Shneur: That's it from our side. Thank you.
Shneur: Perfect, super clear. Thank you, William.
Shneur: from our next question. It is from Márcio Azako, Bradesco BBI. Márcio, we will enable the audio so that you can ask your question. Márcio, please go ahead.
Shneur: Good morning, everyone. Just a question from my side, still on this topic about the adjustment in the Academic Body that you made. I would like a bit more clarification on exactly what was done. Was this done under the Unicelvi brand, where you dismissed tutors who were under CLT contracts, and you hired professors? Was this the change, and there was no reduction in the in-person meetings that were offered?
Don Mckenna: So, how does the cost go down? The cost of a teacher is cheaper than that of a doctor, is that why you have this saving?
Don Mckenna: These are the questions. Thank you.
Don Mckenna: Hello more
Speaker Change: Ok, Brianna.
Speaker Change: Our next question is from Samuel Alves, from BTG Pactual. Samuel, we will enable the audio so you can ask your question. Samuel, please go ahead.
Speaker Change: Good morning, William, Gabriel, good morning everyone. We have two questions from our side. The first is more of an update regarding income tax optimization. If you could provide an update on how the collapse of the structures of the two companies under the holding is expected to take advantage of the full benefit of ProUni. That's the first one. The second, you mentioned in the presentation that the expectation for capex is returning to previous levels. If you could just comment on this year's investment plan and budget for us, if you could provide a number. Okay. Thank you.
Speaker Change: Thank you, good morning.
Speaker Change: The Q&A session is now closed. And now, we would like to give the floor to the company's closing remarks.
Speaker Change: Once again, we thank everyone for their participation.
Speaker Change: We remain at your disposal and reiterate our commitment to continue doing what we believe in and delivering, as always, quality education, a sustainable company, and making a difference in this Brazil that needs it so much. Thank you all and good morning.
Speaker Change: The first quarter 2025 earnings conference call of VitroBrasil has ended. The Investor Relations Department is available to answer any further questions and inquiries. Thank you very much to the participants and have a good day.