Vasta Platform Limited

Good afternoon and welcome. My name is Emma and I will be your conference operator today. At this time, I would like to welcome everyone to the VASTA second quarter 2022 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. Bruno Giardino, CFO, you may begin your conference.

Good evening, everyone, and thank you for joining me in this conference call to discuss Vasta Platform's second quarter 2022 results. With me on the call today, we have Mario Guil, Vasta CEO, and Guilherme Melaga, Vasta COO. During today's presentation, Our executives will make forward-looking statements. Forward-looking statements generally relate to future events or future financial or operating performance and involve known and unknown risks, uncertainties, and other factors that may cause or actual results to differ materially from those contemplated by these forward-looking statements. Forward-looking statements in this presentation include, but are not limited to, statements related to our business and financial performance, expectations for future periods, our expectations regarding our strategic product initiatives and their related benefits, and our expectations regarding the market. Forward-looking statements are based on our management beliefs and assumptions, and on information currently available to our management. These risks include those set forth in the press release that we issued today, as well as those more fully described in our filing with the Securities and Exchange Commission. The forward-looking statements in this presentation are based on the information available to us as of today's hearing of. You should not rely on them as predictions of the future events, and we disclaim any obligation to update any forward-looking statements except as required by law. In addition, management may refer to non-IFRS financial measures on this call. The non-IFRS financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with the IFRS. Let me now give the call over to Gil to make his opening statements.

Thank you, Bruno. Thank you all for participating in our earnings release. Let's jump to the highlights of the quarter on slide number four. As the main highlight, we can see the VASTA not only consolidated the recovery of profitability, but also delivered a strong cash flow generation, attesting that the business is back to normal following a 2021 cycle severely hit by the pandemic. Net revenue grew 35% year-on-year and 27% in the cycle to date, driven by an acceleration in growth of subscription revenue that grew 33% in the 2022 cycle to date, and is representing almost 90% of the total revenue of the company. And that shows that VASTA is a true platform with a predictable and recurrent revenue. Adjusted EBITDA was 11 million reais in the second quarter, recovering from a loss of 17 million in the same quarter last year. In 2022 cycle to date, the adjusted ABDA margin expanded 6.6 percentage points to over 30%, the highest for this period in our recent history. We attribute this increase not only to the normalization of the business and sales mix of superior quality, but also to the efforts such as the workforce optimization and our financial discipline. Operating cash flow totaled 103 million reais in the second quarter, a significant improvement from a consumption of over 60 million in the second quarter last year, driven by the recovery of operating results and better working capital dynamics. As we approach the end of 2022 cycle, subscription net revenue growth converts to the 35% growth implied by our 2022 ACV of R$1 billion. Therefore, we reiterate that in 2022, we will collect 100% of the ACV by the end of this commercial year or by the end of the third quarter of this year. With that being said, I pass the word to our COO, Guilherme Melega.