Cogna Educação (COGN3) Q1 2025 earnings summary

Executive summary

• Net revenue grew 5.8% year-over-year to BRL 1.628 billion, driven by Kroton's strong performance and efficiency gains.

• Recurring EBITDA increased 12.2% to BRL 556 million, with margin up 2.0 percentage points to 34.2%.

• Net profit reached BRL 95.1 million, reversing prior year losses and marking over 1,000% year-over-year growth.

• Free cash generation surged to BRL 150 million, a 16x increase from the first quarter of 2024.

• Leverage improved to 1.28x Net Debt/EBITDA, the lowest since 4Q18.

Financial highlights

• Adjusted net profit for the quarter was BRL 155 million, up 206% year-over-year, with a margin of 9.5%.

• Operating cash generation after CapEx rose 19% to BRL 250 million.

• Net debt reduced by BRL 463 million (14%) year-over-year, reaching BRL 2.814 billion.

• Recurring EBITDA margin improved to 34.2% from 32.2% year-over-year.

• Capex increased 28.7% to BRL 128.9 million, mainly for infrastructure and technology.

Outlook and guidance

• Positive outlook for 2025 with expectations of continued net profit, dividend distributions, and revenue growth, especially in Kroton and Vasta.

• Ongoing focus on operational and financial efficiency, leveraging AI, process improvements, and digital transformation.

• Management expects Saber to resume growth in 2H25 with the High School Program cycle.