Ser Educacional (SEER3) Q4 2024 earnings summary

Executive summary

• Achieved strong double-digit growth in adjusted EBITDA and net operating cash generation, with adjusted EBITDA up 18.3% to R$122.5 million and net operational cash generation rising 206.4% to R$50.1 million in 4Q24, enabling a 9% reduction in net debt and resumption of dividend payments after three years.

• Significant expansion in student base, especially in hybrid and health-related courses, with hybrid undergraduate intake up 16.7% and digital undergraduate intake up 9.2% year-over-year.

• Operational optimization since 2022 has driven margin expansion, improved cash flow, and reduced financial leverage for the eighth consecutive quarter.

• Adjusted net income more than doubled year-over-year in 4Q24 to R$36.3 million, with net margin up 3.2 p.p.

• Dividend distribution of R$19.6 million (BRL 0.15 per share) approved for May 2025, pending shareholder approval.

Financial highlights

• Net revenue increased 8.7% year-over-year to R$523.8 million in 4Q24; full-year revenue up 8.2%.

• Adjusted EBITDA margin expanded to 23.4% from 21.5% in 4Q23.

• Net operating cash generation increased by more than 200% compared to the same quarter last year.

• Net debt reduced by 9.3% to R$718.7 million; net debt/adjusted EBITDA improved to 1.64x.

• CAPEX increased year-over-year, with 4Q24 at R$27.4 million, focused on health labs, licenses, and campus upgrades.

Outlook and guidance

• Entering 2025 with a larger number of medical student places, expected to be a key driver of future results.

• Conservative expansion strategy focused on high-demand courses (health, law), accreditation of new medical courses, and participation in Mais Médicos.

• Continued focus on operational efficiency, cash generation, and further debt reduction, with plans for greater dividend distribution from 2026.

• New units opened in Bragança, Manaus, and Florianópolis in 1H25, aligned with focus on health and law courses.

• Strategic initiatives target academic quality improvement, higher margins, and leverage reduction.