Rede D'Or São Luiz (RDOR3) Q1 2025 earnings summary

Executive summary

• Gross revenue reached BRL 14.1 billion in Q1 2025, up 6.8% year-on-year, with consolidated EBITDA of BRL 2.3 billion, up 22.1%, and net income of BRL 1 billion, up 21.1% year-on-year.

• SulAmérica's integration contributed to consolidated results, with net revenues up 12.2% year-on-year to over BRL 8 billion and membership growing 8.5% to 5.4 million beneficiaries.

• Operational cash flow rose 85.1% year-on-year to BRL 3.2 billion.

• Continued expansion of operational beds, reaching 10,148 at quarter-end, up 291 from year-end and 409 year-on-year.

• Expansion included the inauguration of Barra D'Or and consolidation of São Luiz Campinas in Atlântica D'Or.

Financial highlights

• Adjusted EBITDA, including insurance technical reserves, reached BRL 2.6 billion with a 20% margin; SulAmérica's adjusted EBITDA was BRL 986 million, up 106.4% year-on-year.

• Gross revenue from hospital services was BRL 7.9 billion, up 6.8% year-on-year; oncology segment revenue was BRL 869 million, up 16.5% year-on-year.

• Net debt stood at BRL 17.3 billion, with net debt/EBITDA at 1.7x, or 1.1x including technical provisions.

• Administrative expenses held at 4.2% of revenue; hospital services G&A at 4.1% of gross revenue.

• Gross margin for hospitals, oncology, and others was 21.6%, down 2.4 pp year-on-year.

Outlook and guidance

• Ongoing organic expansion with 40 projects (4,036 beds) planned for delivery between 2025 and 2028.

• Expecting accelerated ramp-up of new assets, especially Atlântica D'Or, and continued organic project deliveries.

• Portfolio price adjustments and beneficiary growth expected to support continued revenue expansion.

• Anticipate stronger bed growth in Q2 2025 due to ramp-up of new units, with seasonality expected to differ from previous years.

• Maintaining financial discipline, with flexibility for new investments and share repurchases.