Vasta Platform Limited

Ladies and gentlemen, thank you for standing by. My name is Bhavesh and I'll be your conference operator today. At this time, I would like to welcome everyone to the VASTA Platform Third Quarter 2023 Financial Results Conference Call. At this time, 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'd like to ask a question during this time, simply press the star followed by the number one on your telephone keypad. If you'd like to withdraw your question, please press the star followed by the one once again. Before we begin, I would like to read a forward-looking statement. 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 our 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 benefit, and our expectations regarding the market. Forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management. These risks include those set forth in the press release that we are issuing today, as well as those more fully described in our filings with the Securities and Exchange Commission. The forward-looking statements in this presentation are based on the information available to us as of today. You should not rely on them as predictions of future events, and we disclaim any obligation to update any forward-looking statements except as required by law. In addition, management may reference 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 IFRS. Thank you so much. I will now hand the call over to Marcelo Werneck of Investor Relations. You may begin your conference.

Good evening, everyone. Thank you for joining us in the conference call to discuss VASTA platform third quarter 23 results. I am Marcelo Werneck, VASTA's Investor Relations, and today we have the presence of Guilherme Mellega, VASTA's CEO, and Cesar Silva, VASTA's CFO, who will be joining me on the call. During the call, we'll cover key highlights, financial insights, and strategic developments that have shaped our performance in the 2023 commercial cycle. Let me now hand over the floor to Guilherme Melga, our CEO, to make his opening statement.

Thank you, Marcelo. Thank you all for participating in our earnings week call. I'd like to cover slide number three with some highlights of our 2023 commercial cycle. In this quarter, we concluded the 2023 commercial cycle, and we believe that the commercial cycle is the best way to understand our business. Our net revenue increased 24% to $1,437,000,000, mostly due to the conversion of 2023 ACV into revenue, and also due to the performance of the non-subscription products and B2G. last year's subscription revenue has reached 1,207,000,000, an 18% increase over the 2022 sales cycle, or 22% excluding textbook subscription products . Our complementary solution segment continues to stand out, showing the highest growth rate among our business segments, with a 42% increase in the current cycle. Moreover, As mentioned in the last quarter, in 2023, Vasti started to offer its products and service to the Brazilian public sector, B2G. In the third quarter of 2023, we generated 40.7 million reais in revenues with the B2G sector, and in the 2023 sales cycle, we generated 81.2 million reais in revenues with the B2G. Moving to the company's profitability, In the 2023 commercial cycle, our adjusted EBITDA experienced a growth of 23%, reaching 411 million reais, while maintaining an adjusted EBITDA margin close to 29%. Finally, this was another year of significant improvement in our cash flow. In the 2023 sales cycle, free cash flow totaled 145 million reais. 167% increase from 55 million reais in 2022 cycle. The last 12 months, pre-cash flow to adjusted ABTDA conversion rate improved from 16% to 35%. I will now turn back to Marcelo to talk about the financial results of the quarter and the 2023 commercial cycle.