Q2 2026 Cruzeiro do Sul Educacional SA Earnings Call Transcript
Key Points
- Net revenue grew 8.2% year-over-year to BRL780 million, with net income up 61% to BRL101 million.
- Re-enrollment KPI reached a record 91% for the first half, with dropout rates down 7.6%.
- Healthcare programs now represent 55% of on-campus students and 73% of segment revenue, driving a 10.6% revenue increase.
- Adjusted EBITDA margin expanded 2 percentage points to 29.9% in Q2, with gross margin up 0.8 percentage points.
- Leverage remains low at 0.8x net debt/EBITDA, despite paying BRL177 million in dividends over the last 12 months.
- Digital segment average ticket rose 12.8%, with hybrid program share increasing from 12% to 19%.
- Free cash flow improved significantly to BRL74 million in Q2, up from BRL9.2 million in the prior year.
- Medicine program at Universidade de Itaúna achieved the highest score in EnaMed, enhancing brand reputation.
- Consolidated student intake fell 30% due to new regulatory framework and program discontinuations.
- Digital segment student base declined 7.3% year-over-year, partially offsetting ticket growth.
- First-half adjusted EBITDA margin contracted 2.6 percentage points due to higher bad debt provisions and technology costs.
- Average collection period worsened to 40 days from 35 days, reflecting a revised receivables discount strategy.
- The FAPI earn-out payment of approximately BRL185 million will increase net debt starting in Q3 2026.
- Macroeconomic uncertainty and upcoming elections create a challenging intake environment for the second half.
- Higher costs for hybrid programs (on-campus components, labs) are expected to pressure margins.
- Bad debt provision was negatively impacted by a BRL12.2 million account reclassification in Q2.
Good afternoon, everyone, and thank you for standing by. Welcome to Cruzeiro do Sua de Casional's earnings call to discuss the results for the second quarter of 2026. (Operator Instructions)
And will be made available on the company's investor relations website, ri.crozeirodosertogacional.com.br, where all the materials related to our earnings release are already available. The presentation can also be downloaded through the chat icon, including the English version. (Operator Instructions)
Please note that the information contained in this presentation, as well as any statements that may be made during this video conference regarding Cruzeiro do Educacional business outlook, projections and operating and financial targets, reflect the beliefs and assumptions of the company's management, as well as information currently available.
Forward-looking statements are not guarantee of performance. As they involve risks, uncertainties, and assumptions as they relate to future events and therefore depend on circumstances that may or may not occur. Investors should understand that general
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