Auna SA

Good morning and welcome to AUNA's second quarter 2026 earnings conference call. My name is Rob and I will be your operator for today's call. At this time, all participants are in listen-only mode and please note that this call is being recorded. There will be an opportunity for you to ask questions at the end of today's presentation. Now, I would like to turn the call over to Ana Maria Mora, Head of Investor Relations. Ma'am, please go ahead.

Thank you, operator. Hello, everyone, and welcome to AUNA's conference call to review our second quarter results. Please note that there is a webcast presentation to accompany the discussion during this call. If you need a copy of the presentation, please go to our investor relations website or contact AUNA's investor relations team. Please note that when we discuss variances, we will be doing so on a year-over-year basis and in FX-neutral or local currency terms with regard to Mexico and Colombia, unless we note otherwise. Let's move to slide two. In addition to reporting unaudited financial results in accordance with international financial reporting standards, we will discuss certain non-IFRS financial measures and operating metrics, including foreign exchange neutral calculations. Investors should carefully read the definitions of these measures, the metrics and reconciliations included in our earnings press release published yesterday after market close, to ensure that they understand them. Non-IFRS financial measures and operating metrics should not be considered in isolation as a substitute for or superior to IFRS financial measures and are provided as supplemental information only. Before we begin our remarks, please also note that certain statements made during the course of today's discussion may constitute forward-looking statements, which are based on management's current expectations and beliefs and which are subject to a number of risks and uncertainties that could cause actual results to materially differ, including factors that may be beyond the company's control. This includes but are not limited to our target leverage ratio, suppliers and information systems in Mexico, the results of key initiatives we're implementing in Mexico, Colombia and Peru, the expected capacity and market of storage checkups once built, The execution of our strategic plan, including the recovery of our growth levels and the rollout of the Aunaway in Mexico, our planned investment, our expected revenue growth and adjusted EBITDA growth, our revenue and adjusted EBITDA guidance, and the creation of further growth and sustainable value for all stakeholders. For the description of risks that may impact our forward-looking statements, please refer to our Form 20-F filing with the U.S. Securities and Exchange Commission and our earnings press release. Slide three, please. On today's call, we have Jesús Zamora, our Executive Chairman and President, Gisele Remy, our Chief Financial Officer and Executive Vice President, and Lorenzo Massart, our Executive Vice President of Strategy and Equity Capital Markets. They will discuss AUNA's consolidated and segment financial and operating results for the quarter, as well as provide an update on our various strategic growth initiatives. After that, we will open the call for your questions. Suso, please go ahead.

Thanks, Annie. Great. Let's turn to slide four, please. Our second quarter results demonstrate sustained commercial momentum across AUNA's regional healthcare platform. and substantial progress in the operational enhancements we implemented last year, particularly in Mexico. Despite encountering margin pressures across each of our markets during the quarter, the underlying performance of the business remains robust, and we continue to see strong demand across the platform. Consolidated revenue experiencing 9% increase during the quarter, primarily attributed to volume growth, and an improved mix of higher complexity services across all three of our markets. Consolidated adjusted EBITDA decreased 9% on an FX neutral basis. This decline was attributed to temporary margin pressures in Mexico and Colombia, as well as the impacts of accepted penalties related to billing matters, primarily in the reconciliation of prior years receivables in Peru. In Mexico, the recovery in volumes accelerated during the quarter, with surgeries increasing 7% and oncology chemotherapies and radiotherapies increasing by 20% compared to the first quarter of 2026. This growth was attributed to the continued benefits of the improved tier classifications secured with major insurers, and from the expansion of AUNA's oncology offerings. Favorable pricing and high complexity care and the improved economics of our new Iste Leon contract also contributed to a 4% increase in revenues. Peru achieved 8% revenue growth, primarily attributed to a higher average ticket and sustained membership expansion. Aligned with AUNA's business model, growth of high complexity surgeries also supported increases in the quarter. in conjunction with an increasing penetration of the B2B market. In Colombia, volumes and capacity utilization experienced a second consecutive quarter of growth, contributing to an 18% sequestral increase in adjusted EBITDA. Our leverage decreased to 3.6 times from the first quarter of 2026, supported by the cash generation of the business, Additionally, we strengthened our cash position once again this quarter. Cash increased 43% against year-end 2025, and free cash flow increased 181% year-over-year, reflecting the disciplined cash management we continue to maintain across AUNA's regional platform, including improved collections in Colombia. Let's move to slide five. Despite our platform's robust revenue growth and positive cash flow, consolidated adjusted EBITDA experienced a decline primarily reflecting our investments in Mexico's medical and leadership talent to facilitate growth, as well as the billing reconciliations in Peru. As illustrated in the lower portion of the slide, capacity utilization across our healthcare services witnessed a 2.3 percentage points year to date increase to 66% and a sequential increase of 2.8 percentage points. On the insurance side of AUNA's platform, Memberships continued to expand, experiencing a 6% increase in the quarter. Additionally, MLR remained stable around 50%. Let's move to slide 7 to take a closer look at Mexico's performance. In Mexico, the sequential increase in patient volumes was once again concentrated in high complexity areas, particularly surgeries and oncology. resulting in a 7% and 20% increase respectively. Oncology continued to perform exceptionally well with revenues increasing by 110% from the first quarter of 2025 and 6% sequentially. In September, Aona will be inaugurating an ELEKTA EVO linear accelerator in Monterrey. The most advanced linear accelerators available for radiology on the market to provide the best-in-class treatment for our patients. Increased physician onboarding and productivity also contributed to growth during the quarter. Other growth drivers included our East Te Leon B2G agreement, surgical and hemodynamics packages, and out-of-pocket revenues, which collectively helped Mexico achieve 4% revenue growth. Revenue also increased 5% sequentially, while adjusted EBITDA increased 3%. On a year-over-year basis, adjusted EBITDA declined 16%, primarily due to our continued investments in medical and leadership talent. The growth during the quarter was impacted by the Easter holidays in April and the impact of the new value-added tax on insurance in Mexico. We observed a noticeable increase in volumes and revenue in May and June, and we expect stronger year-over-year growth in the latter half of the year. AUNA is also committed to enhancing variable cost efficiencies in Mexico. Beyond the margin benefit, this strengthens our value proposition with the country's largest insurers and remains a significant competitive advantage for AUNA. Slide 8, please. In Peru, both OncoSalud and healthcare services contributed to revenue growth during the quarter. OncoSalud's revenue increased 11%. driven by annual price adjustments and improved service mix and 6% membership growth. Membership growth was also supported by a new B2B plan covering 7,000 Serapal employees, reflecting the progress we made in strengthening our commercial execution in the large corporate segment. We are also witnessing positive momentum in healthcare services. New commercial initiatives targeting corporate policyholders contributed to a 9% increase in emergency treatments during the quarter, and by 14% from the first quarter of 2026. Capacity utilization reached 83%. Despite Peru's revenue growth and higher capacity utilization, adjusted EBITDA was flat year over year, in part due to the accepted penalties related to billing matters, primarily in the reconciliation of prior year's receivables. Underlying profitability was also affected by higher B2B onboarding costs at OncoSalud, physician retention incentives, overtime expenses, and pharmacy costs. Following the quarter's close, we took possession of a new clinical facility that will expand our capacity in the south of Lima. The project will expand surgeries and chemotherapies, and add 30 beds through an asset light cost efficient model and is expected to become operational between the end of 2027 and the beginning of 2028. We also acquired a Versius SP4 robotic system designed to support minimally invasive procedures through independent robotic arms and a laparoscopic approach, strengthening the owner's high complexity surgical capabilities. Let's move to slide nine. In Colombia, we continue to make significant progress in diversifying our payer base and expanding risk sharing agreements. These contracts now constitute 24% of our revenue, up from 14% a year ago, and cover more than 3 million lives. They were a crucial contributor to our 13% revenue growth and are also enhancing cash conversion and predictability. Simultaneously, intervened payers declined to 12% of revenue, from 18% last year, with growth from private payers more than offsetting that reduction. Higher volumes also continue to improve capacity utilization to 79.2% from the same period last year, which has now been above pre-Nueva EPS intervention levels. Adjusted EBITDA declined 12% year over year, reflecting higher costs associated with greater complexity, the minimum wage increase, Talent Investments and the growing mix of risk sharing agreements. However, we observed a clear sequential improvement with adjusted EBITDA increasing 18% and margins expanding 1.7 percentage points. We anticipate that contractual price increases in the second half to largely offset these cost pressures and support stronger EBITDA growth. Finally, after being deliberately cautious with growth capital in Colombia over the past two years, with the recent elections and the plans of the new administration, we are beginning to invest selectively again. We are identifying attractive opportunities emerging in the market and intend to position ourselves to capture them. Following the quarter end, in light of the new government emergency stabilization plan, We expanded operating capacity at our IMAT Oncomédica facilities in Montería at an 18 adult ICU beds and 24 hospitalization beds. This capacity was largely ready for operation, thus necessitating minimal incremental capex, and we anticipated to be highly accretive throughout the remainder of the year. We identified additional opportunities to continue expanding capacity in a similarly capital efficient manner. With that, I will turn the call over to Gisele, who will review our results in greater detail.