Yduqs Participações (YDUQ3) Q4 2024 earnings summary

Executive summary

• Achieved strong growth in adjusted EBITDA (BRL 1.8 billion, +6% YoY), net income (BRL 480 million, +40% YoY), and EPS (BRL 1.73), with robust operating cash flow of BRL 1.3 billion and free cash flow to equity of BRL 362 million.

• Completed BRL 300 million share buyback, canceling 35 million shares, and proposed BRL 150 million in dividends for 2025, maintaining a consistent payout since IPO.

• Strategic acquisitions of Newton Paiva and Edufor added over 10,000 students and 474 new medicine seats, expanding the premium segment at minimal CapEx.

• Maintained strong ESG profile, recognized with AA MSCI rating, ISS Prime status, and multiple awards.

• Auditor issued an unqualified opinion on 2024 financials, confirming compliance with Brazilian GAAP and IFRS.

Financial highlights

• Net revenue grew 4% YoY to BRL 5.36 billion, led by premium segments (IBMEC and IDOMED) whose share of total revenue increased by 3 percentage points.

• Adjusted EBITDA margin improved to 33.9% (+0.6 p.p. YoY), and net income for the year was BRL 480 million, up from BRL 342 million.

• Free cash flow to equity reached BRL 362 million, up BRL 295 million from 2023.

• CapEx was BRL 468 million (8.7% of net revenue), below guidance and moving toward a medium-term target of less than 8%.

• Bad debt as a percentage of net revenue declined to 12.3% in 4Q24, reflecting improved collections.

Outlook and guidance

• Confident in strong cash generation for 2025, with no debt maturities until 2026 and a positive working capital profile.

• Expect continued growth in semi-on-campus, medicine, and IBMEC segments, maintaining a lean cost structure and high cash conversion.

• CapEx as a percentage of revenue expected to stabilize between 7% and 8% from 2025.

• Intake for 2025.1 up 2% over the same period in 2024, with semi-on-campus courses expanding by 95%.

• Proposed BRL 150 million in dividends for 2025, continuing a consistent payout since IPO.