Yduqs Participações (YDUQ3) Q3 2025 earnings summary

Executive summary

• Achieved strong Q3/3Q25 operational and financial performance, with robust cash generation, margin growth, and reduced leverage, driven by all segments including medicine, Ibmec, semi-on-campus, on-campus, and distance learning.

• Student intake grew 14% year-over-year, with semi-on-campus intake up nearly 50% and surpassing 100,000 students.

• Premium segment (Idomed and Ibmec) delivered double-digit growth, now representing 31% of net operating revenue and 43% of EBITDA.

• Margin improvement supported by lower bad debt, better revenue quality, and efficient policies.

• Company is well-prepared for regulatory changes, leveraging on-campus presence and semi-on-campus growth.

Financial highlights

• Net revenue grew 4–5% year-over-year, reaching up to R$1,368M in 3Q25, with premium brands now representing 31% of NOR and 43% of EBITDA.

• Adjusted EBITDA rose up to 9% year-over-year, reaching R$521M, with margin improvement of 1 p.p.

• Earnings per share increased 23% compared to Q3 2024, supported by a successful buyback program.

• Free cash flow to equity (FCFE) for the last twelve months reached R$610M, with an 18% yield, above guidance.

• Leverage (Net Debt/Adj. EBITDA ex-IFRS 16) improved to 1.52x.

Outlook and guidance

• Confident in meeting 2025 FCFE guidance of R$500–600M, with 9M25 already reaching R$559M.

• Guidance for earnings per share and cash flow remains strong, with 93% of annual guidance achieved in the first nine months.

• Expectation of stable or improved cash generation in 2026, with most non-recurring restructuring costs already recognized in Q3 2025.

• Positive outlook for Q4 and 2026, with further margin expansion, lower bad debt, and strong intake anticipated.

• New regulatory framework expected to benefit the company due to its focus on teaching quality and on-campus learning.