Q2 2024 Smartfit Escola de Ginastica e Danca SA Earnings Call (English, Portuguese) Transcript
Key Points
- Smartfit Escola DE Ginastica E Danca SA (BSP:SMFT3) added a record 270 units in the last 12 months, reinforcing its leadership in Latin America.
- The company reported a 30% increase in net revenue compared to the same quarter in the previous year, reaching BRL1.358 billion.
- Membership grew by 17% year-on-year, reaching 4.6 million members in Q2 2024.
- The company achieved a record quarterly EBITDA of BRL437 million, a 29% growth compared to Q2 2023.
- Smartfit Escola DE Ginastica E Danca SA (BSP:SMFT3) maintains a strong cash position with high predictability of bottom line and strong generation of operating cash, totaling BRL1.5 billion in the last 12 months.
- Despite the increase in investments, the company faces a slight pressure on average ticket prices due to the opening of new units.
- The cash gross margin was slightly lower by 0.3 percentage points compared to Q2 2023 due to increased costs in ramping up units and higher expenses with new unit openings.
- SG&A expenses increased by 30% compared to Q2 2023, reflecting the strong expansion in the network of units.
- The company’s financial leverage increased to 1.4 times EBITDA in the last 12 months, with net debt reaching BRL2.1 billion.
- There is a concern about the potential cannibalization effects and the availability of real estate, which could limit the pace of annual openings.
Good morning, everyone, and welcome to Smartfit webcast to announce the results of the second quarter of 2024. For those who do not know me, I am [Mateo] to Investor Relations Manager. Before starting, an important message for those who are listening to the conference in English. Good morning, everyone, and welcome to Smartfit's conference call to discuss the results of the second quarter of 2024.
This call will be translated into English. To access the English mode, click on the interpretation button in the icon at the bottom of the screen and choose your preferred language. There is also an option to mute the original audio in Portuguese by clicking on mute original audio.
Today with us, we have Mr. Edgard Corona, CEO; Andre Pezeta, CFO; Diogo Corona, COO; Jose Luiz Rizzardo, IRO and M&A Director and Treasury; Alexandre Gregianin, CTO; and Juana Melo, Legal Officer.
Participants will be connected in listen-only mode during the company's presentation. Then we are going to start our questions-and-answer session when further instructions will be provided. As a reminder, the
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