CM Hospitalar (VVEO3) investor relations material

Executive summary

• Focus shifted from rapid growth to operational turnaround, emphasizing working capital, cash generation, and operational excellence in 2025.

• Achieved margin expansion and operational improvements despite a 3.8% year-over-year revenue decline in 3Q25, reflecting disciplined contract renegotiations and a focus on profitability over volume.

• Sequential net revenue growth in 3Q25, driven by contract renegotiations and a focus on profitability.

• Net income significantly boosted by the reversal of DIFAL tax provisions following favorable legal outcomes.

• Cash generation and working capital management improved, with a shorter cash cycle and enhanced receivables collection.

Financial highlights

• Gross margin expanded by 1.4 percentage points year-over-year to 14.7% in 3Q25, marking the fourth consecutive improvement.

• Adjusted EBITDA grew 13.1% to R$172.9 million in 3Q25, with margin up from 5.2% to 6.1%.

• Free cash flow in 3Q25 was R$166.9 million, up 28.8% year-over-year, and 9M25 free cash flow reached R$291.6 million.

• Net debt reduced to R$2,809.1 million, with leverage at 4.17x, the lowest since 4Q24.

• Net profit was R$226.9 million in 3Q25, reversing a net loss in 3Q24; adjusted net profit was R$42.4 million.

Outlook and guidance

• Expectation of continued improvement in cash generation and operational indicators into Q4 2025 and 2026.

• Further gross margin improvements anticipated through pricing initiatives and product mix optimization.

• Management remains focused on further expense reductions, working capital optimization, and deleveraging.

• Plans to gradually recover growth in hospitals and clinics, maintaining commercial discipline and profitability.

• Further improvements in inventory financing and freight optimization targeted by 1H26.