Auna (AUNA) Q1 2026 Earnings Transcript

Auna reported 10% FX-neutral revenue growth to PEN 1.2 billion, with gains across Peru, Mexico, and Colombia, while free cash flow rose 2.6x to PEN 152 million and cash increased 22% to PEN 409 million. Adjusted EBITDA fell 5% FX-neutral due to Peru revenue adjustments and payroll inflation in Mexico and Colombia, but management reaffirmed full-year revenue and EBITDA guidance and expects second-half acceleration. Mexico EBITDA improved 19% quarter over quarter, Colombia revenue grew 13%, and leverage remained elevated at 3.7x versus a 3x medium-term target.

Analysis

The market is still underestimating how much of this quarter’s noise is actually a portfolio reconfiguration story, not an operating deterioration. The key second-order effect is that Auna is trading short-term margin volatility for a much better cash conversion profile: risk-sharing mix, tighter billing cycles, and supplier financing should keep reducing working-capital intensity even if headline EBITDA stays lumpy for a few quarters. That matters because a lower cash conversion cycle is the cleanest path to de-levering from a near-term FX-distorted leverage print without needing heroic margin expansion.

Mexico is the most important re-rate candidate. The business is moving toward a higher-complexity mix that will likely look worse at the margin before it looks better in absolute dollars, but the inflection should come from volume scaling in a relatively fixed-cost base plus better contract economics from re-tiering and payer renegotiations. The hidden upside is that once oncology and radiotherapy utilization pass threshold density, incremental margin can expand faster than investors expect because equipment, physician coverage, and admin overhead are already in place.

Peru is the main source of recurring skepticism, but the issue looks more like process friction than structural value leakage. Shorter billing cycles and delayed rebates imply the company is tightening revenue recognition discipline, which creates near-term noise but should reduce future surprises; the real risk is a persistently stricter payer environment that could keep suppressing recognized revenue growth into H2. Colombia is the quiet stabilizer: higher risk-sharing should compress near-term margin slightly, but it improves collections and reduces political beta, making it more valuable in a downside regime than the market likely credits.

The contrarian read is that the stock may be cheapest when headline EBITDA is weakest. If H2 delivers even modest margin recovery in Mexico and fewer Peru adjustments, the operating leverage into free cash flow could be disproportionately large versus consensus, especially with a medium-term 3x leverage target and an explicit lack of buyback urgency.

Key Decisions for Investors

• Go long AUNA for a 3-6 month catalyst window into H2 guidance delivery; use weakness on any Peru-related headline risk to build the position, targeting a rerating if cash flow continues outpacing EBITDA.
• Pair trade: long AUNA / short a Latin American hospital operator with less working-capital flexibility, expressing the view that Auna’s cash conversion and risk-sharing mix are structurally superior over the next 2-4 quarters.
• If available, buy AUNA calls or call spreads with 4-6 month tenor; the setup is asymmetric because the stock can re-rate quickly once Mexico margin recovery and Peru normalization become visible in sequential prints.
• Avoid chasing the name on a single quarter of EBITDA noise; the better entry is after the market digests guidance conservatism and before H2 sequential acceleration becomes consensus.
• For lower-risk expression, wait for confirmation that Peru adjustments fade and Mexico margins inflect in the next 1-2 quarters before sizing a full long; otherwise keep exposure tactical rather than strategic.