Cogna Educacao S A S/Adr

Good morning, ladies and gentlemen, and thank you for waiting. Welcome to Cogna Educação's earnings conference call on the fourth quarter 2021 results. This event is also being broadcast simultaneously via the internet with a webcast and audio and slides, and it may be accessed in Cogna's investor relations website, bri.cogna.com.br, banner webcast for Q21. And the presentation is also available to download from the website. This earnings conference call is being recorded and all participants will be listening in listen-only mode. After the presentation, we'll have a Q&A for analysts and investors. And at that time, further instructions will be provided. Should you need assistance during the conference, please dial star zero for an operator. The information is available in BRL according to the Brazilian corporate legislation and Brazilian accounting practices, which now conform to international accounting standards, IFRS, except where otherwise indicated Before proceeding, we would like to clarify that any statements that may be made during this conference call regarding Cogna Educação's business prospects operating financial projections and goals constitute the beliefs and assumptions of the companies and are based on information currently available. Forward-looking statements are not performance guarantees. They involve risks, uncertainties, and assumptions. as they refer to future events, and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors could affect Cogna's future performance and could lead to results that differ materially from those expressed in such consideration. Now, I would like to turn over the conference to Cogna's Educação. CEO, Mr. Rodrigo Galindo, will start the presentation.

You may proceed, sir. Good morning, everyone. Thank you for participating in today's call to discuss the results of Q4 and 2021. With me in this call, Federico Fiel, our Finance Vice President, and the CEOs of our vertical business units, Roberto Valerio Croton, Mario Guio Vasta, in addition to Bruno Giardino, Vasta CFO, and Eduardo Onzek, our IRO and Corporate Finance Officer. Beginning on slide three, with an overview about Cognizant, our achievements in Q4 and in the year 2021. Looking forward. at this year. I mean, it has been a difficult year and we said that the measures we've implemented in 2020 were already bringing on consistent results. Q4 has confirmed this consistency, recovering our student base that is growing in the last quarters. Our student intake is growing volume and also revenue because we don't want to grow volume at any cost. And we're also generating cash, our main focus. And therefore, we feel confident that Cogna is on the right recovery track. So we're looking at the results of Q4 and 2021. Looking at Groton on the left-hand side. Let us try to understand the operational turnaround. First, we see exceptional numbers with relevant and perennial gains. In 2021, we began to capture efficiency gains, and in Q4, comes from 295 negative to a positive EBITDA, 191 million reals, growing 486 million reals in recurring EBITDA with a 28.7% margin, 25 percentage points better than the year before. Even if we deduct the effects of EBITDA, Our doubtful debt, we still had a growth and our margin goes from 13% up to 23%. That is a very robust growth and a sustainable growth. In 2021, our EBITDA margin goes from 3% to 28.7%, a new level of profitability for higher education, bringing long-lasting results. Now, student intake in 2021 had growth in both volume and revenue. So we have a higher intake. in three trade cycles in a row, but we believe that it is not worth growing volume without growing revenue. Now, with a growing student intake, Croton will resume growth in revenue as of 2023. To maintain distance learning growing and We've had an expansion of partner learning centers. We now have 2,517 learning centers. That's a great expansion. Now, talking about high school, we plan to expand. No, I'm sorry, talking about medical education, we plan to have 636 medical seats in 2022 with a potential of 5,250 students. And that represents an organic growth of 75% in the number of medical students. Still talking about Croton, we've had a growth in student base, 5.2%. led by 15.1% growth in digital. Another highlight was our growth in programs with a higher lifetime value, medical dentistry law, that have been growing sustainably in the last trade cycles. It means we have been able to implement our strategy as announced to the market, growing on digital and hybrid, and on campus, prioritize higher LTV programs. Now let's talk about Vasta in the middle of the slide. The 2022 trade cycle began in Q4 2021. As you know, we begin in Q4 and the year goes up to Q3 of the following year. And it marks the beginning of a new chapter in VASTA history. We concluded the 2022 trade cycle with an ACV annual contract value of R1 billion, 35% higher than compared to our subscription revenue posted in the commercial cycle of 2021. And 30% ACV growth shows we are resuming growth. One of the highlights is our supplementary solutions growing 47%. It strengthens our cross-selling potential offered to our very large client base in our core business. We have a robust client base. Now, let's talk about revenue. In Q4 2021, our revenue soared 16% at Vasta. And we announced the net revenue guidance for Q1 2021, different from previous years when the ACV was concentrated in Q1 and Q2. Now, in 2022, because new products have a different seasonality and because we have a lower PAR revenue, we see less concentration in Q1 and Q2, which would be Q4 in the calendar year and Q1 in the following calendar year. That would be the full commercial cycle. Now, so we come to $370 million in Q1-22 in terms of revenue for VASTA, growing 32% compared to Q1-2021. Now, this revenue guidance is very consistent. I mean, we are already on March 25th. The first quarter is about to end. Adding up the first quarter of our trade cycles, we will reach $768 million. they represent 23% increase compared to the revenue of the year before. It means that our revenue continued strong in Q3 and Q4. So 32% growth in Q4 compared in Q1-22 compared to Q1-21 and we continue with a strong performance. Now, some more information about Vasta. By October, Vasta concluded the acquisition of Elev, a learning platform. And in November, we started the integration. It's following the plan. We already concluded a few milestones, the definition of the new organizational structure, definition of commercial team, editorial, digital, and the onboarding of Eleva students in Pluto platform. Eleva will now be included in our go-to market for the commercial cycle beginning in 2022 for 2023. So VASTA will be able to tap the full sales potential of our new platform. Also important to highlight is the strength of VASTA brands, especially plural. In 2021, we started, and we've already spoken about this, we've started important partnerships. For example, Fibonacci Learning System. It is one of the top 10 performing schools in the national exam. Also McKinsey and the partnership with Macmillan. We already had this partnership, but it's now even stronger. It's one of the largest publishers in language worldwide, in addition to EdTechs worldwide, offering our solutions for offering their solutions, I'm sorry, on our Pluto store now. So it shows our capacity to partner with other important brands. Finally, on the right side of the slide, let us talk about Cogna. Cogna's results in Q4 show a performance recovery with a recurring EBITDA 96% higher compared to Q4 2021. So we have Cogna. 20.6% EBITDA margin. So a growth and post-CAPEX operating cash generation of $494 million. I think this is the biggest piece of news. In 2021, almost $500 million. I mean, it's more than double compared to the previous year. And that confirms our strategy to concentrate our efforts on cash generation. Also important, I mean, student intake is key, but we must have revenue. As we mentioned, student intake and volume has to be followed by revenue. EBITDA is also important. So that's why we are also working to improve cash generation. Now, in terms of leverage, it is kept at a comfortable level with a net debt recovering EBITDA ratio of 2.16 times. It confirms our confidence in the company's future results. We have recently announced a stock buyback program. Now, three of our executives have also announced individual Cogner stock investment plans. So their investment plans are personal decisions. I mean, they're investing their own money without any kind of benefit or special condition compared to the market. It only shows that our executives are confident in the organization. In 2021, we also consolidated initiatives related to Cogna ESG. Our practices matured in line with our ESG strategy, so we launched Cognos Commitments for a Better World. This is a public manifesto with our goals until 2025 based on three pillars, balance between people and nature, education, diversity, and human rights, and progress. governance and integrity. So we have not only public goals, but also our own internal goals, and they reinforce our commitment with ESG. Now, some examples of our goal, percentage of women in leadership position, percentage of ethnically diverse people in leadership positions, inclusion of LGBTQIA+, among many other As I mentioned, we also have public goals, which our society can monitor and follow because it is our commitment to evolve in our environmental, social and governance practices. Let me now hand it over to Roberto Valerio, today, Croton CEO. And on Monday, he will be Cogna CEO. He'll talk about Croton operating and financial highlights. Roberto, over to you. Thank you, Rodrigo. Good morning, everyone. I'll begin on slide five to summarize Crofton highlights. In 2020, we started... actions to restructure our operations and strengthen our operations and croptons balance sheet these initiatives paved the way to resume profitability and now in 2021 we've began to capture efficiency gains from these efforts that began in 2020 From the operating viewpoint, our student base grew pushed by distance learning. So student base grew 5% and distance learning grew 15% compared to the previous year, which more than offset the drop we had on campus. Now, it's important to highlight that the profile of our growths growing distance learning is in line with our strategy to focus on hybrid and digital programs and also to prioritize higher lifetime value programs, as Rodrigo mentioned. So our goal is to increase profitability from our operations. with higher LTV programs. Our learning centers, we've implemented almost 1,000 new units, which represented a 63% growth compared to Q4 2020. So now we have 2,500 units. If we were a franchise network, it would be one of the largest in Brazil. So we've... Also, expanded hybrid programs and only digital programs, and that has helped pave our way towards future growth. Why? Because they are the basis of pre-contracted programs. Not only the programs, but also the use of our learning centers. They're still maturing, and they will be able to potentialize our growth. Another growth avenue for Crofton is medical education. On Cognite Day in 2021, we announced CrotonMed CarveOut. And this operation, I mean, this transaction, our goal was to provide more visibility to the market on this business. So now, as of Q1 2022, we will begin to report some CrotonMed operational and financial indicators separately. Now, in December 21 and February 22, our medical programs were approved. in the Mais Medicus program in the cities of Codó and Bacabal. Now, activities have already started. And the idea is for us to attain 636 medical seats in 2022. And that will help us grow. organically this operation in more than 75%. I mean, we can have 5,250 students. Now, let me speak a bit more about our turnaround. We now have a total number of probably 5,000 units So I think it's important to remind you that all of this is in line with our goal. We want to become an asset light operation, and we are going to optimize other operations. So we continue to be present in these cities, but in many cases, we have partners. we've had great discipline in cost control and that has helped our numbers so looking for more operating efficiency we've had a reduction between 13 and 23 percent in our cost and expense lines we have also been able to improve collections by 6.2 percentage points even during this challenging environment. And this improvement has helped us generate cash during this period. So we have improved collections, we are more efficient in timely collections, and we believe that as we can understand our students better, as we can understand student engagement, then we will be more efficient in timely collections. Finally, our financial result had a significant improvement in EBITDA margin, going from 3.7% up to 28.7% in 2021, a R788 million improvement, and above all, And as Rodrigo mentioned, the most important thing is that this growth brought strong cash generation. So this is quality growth. On slide six, we can see some of our student-based indicators. Total undergraduate and graduate student base grew 5.2%, especially led by digital. Following the same trend of the last few quarters, growing 15% during this period. On the other hand, because of our strategy, we had a reduction in our on-campus student base. Now, let me also highlight our average ticket on both segments, distance learning and on-campus. They remained stable in the second half of 2021. despite the fierce competitiveness we've had based on price. I mean, price competitiveness on the market. So it means that we have been very careful in our trade cycle. So we've had a bigger penetration of digital. So a slight reduction in the average ticket of digital. And a slight increase in on-campus average ticket, showing we are being able to prioritize higher lifetime value programs.

So, of course, this, of course, offsets some of the other students. With this, I would like to turn to slide seven, in which I will cover our efficiency assessment. in enrolling new students. This is the result of our very consistent efforts and it's a sign of the sophistication of our digital marketing strategies. We have other initiatives. In the year, we were able to succeed in two actions. We had growth of 16% in total student intake while decreasing marketing expenses used for attracting students. And this led to a reduction in 35% of the student acquisition cost, the so-called CAC. And even in this highly competitive scenario, we were able to do this. And I believe that we have reached the lowest student acquisition cost in the industry. Now, moving on to slide eight, in which we'll discuss... Rather, slide seven, he corrects himself. We will talk about the consistency of our accounts receivable. The coverage ratio reached 59.9%, a high level that enhances our security. And the average time for receivables in out-of-pocket amounted to 60 days, a reduction of 14 days. And this is very consistent with the improvement in this economic scenario, a reduction of 14 days overall. Several initiatives seek to improve the quality of our student intake. We used analytics during the re-enrollment period. And as we have mentioned before in previous conference calls, And with the increase in efficiency in collection in the last quarters, we had an increase in timely payments of 6.2 percentage points starting in the first quarter, 20. Consequently, PDA was reduced. And in spite of the effect of out-of-pocket, our PDA decreased significantly. 379 million reais, that is 67% in the annual comparison. So with this, the message I would like to highlight to you is that timely payments show a positive trend and we have sound numbers in our figures. Next on slide nine, I would like to share with you some more detail on working capital and accounts receivables management. We monitor the level of engagement of our students very consistently. This is done to prevent dropout tendencies and also to recognize a dropout as soon as it occurs. Because like this, we drop the student from our base to avoid deterioration of our accounts receivable. As we have said in previous quarters, we are now using a new provisioning model. This model was developed with the support of an international consultancy and shows accuracy of 88%. It's also important to underscore that none of the model's criteria were changed in 2021. Finally, on our financing programs, it's important to remind you that coverage rates are stable and that we have discontinued PEP in the beginning of 2021 for new students. So we see in the graph that there is this increase in accounts receivable, but this is the maturing of the students that were already with us. In addition to this, in the first quarter 2021, we have implemented a change in the PMT model we are now offering a payments plan along the school year, that is along the student's way they pay, instead of paying at the end of the program. And as a result of this, they are paying in proportion to the number of months they have studied with us. This decreases default rates significantly. and has been helping us a lot with the numbers in PMT. Moving on to slide 10, net revenue reduced 12.2% in comparison with the same quarter in the previous year, owing to the reduction in on-campus undergraduate students, which was partially offset by growth in DL. Year to date, net revenue was down 13.4% in the fiscal year, but Even with this reduction, the changes in hybrid and digital programs, in spite of this reduction of revenue, have a very positive in margins because both digital and hybrid premium are more profitable than on-campus programs, as I have seen. mentioned before. Moving on to my last slide, I would like to highlight that recurring EBITDA in the company had an increase of 486 million in comparison with 4Q20 in the comparison. And we have reached growth of 78 million and margin EBITDA of 28.7 since we are trying to recover our margins. This is something that shows that Croton is back on track. 28.7% of margin is something that's 25 percentage points higher than in the previous year. And even disregarding the PDA adjustments in the fourth quarter 2020, growth represents 59% in EBITDA with a margin evolution of 12.5%. in the quarter. So the evolution on recurring EBITDA and EBITDA margin showed that we have put Croton back on track. We are pursuing the profitability route after the most significant turnaround in our history. We completely restructured our campaign, expanded our partner centers, and invested in a strong digitalization program. With this, I close my presentation and cash generation and EBITDA shows the quality of the work that has been done. With this, I hand it over to Mário Guil, VASTA CEO, who will now present on the operating and financial results of his company. Good morning, Roberto. Good morning to all. I would like to start on slide 13, in which we discussed the VASTA project. Since the fourth quarter 2021, a new trader cycle began, and we're starting to reap positive results with revenue up 16%, of which 22% coming from growth in subscription products and services. And in non-subscription, if we not consider par, growth amounted to 34%. in the comparison with the same quarter in the previous year, or 72 million more in revenue. In line with 4.20, the non-subscription business is losing weight because we follow this strategy and VASTA is becoming ever more resilient and predictable with subscription business reaching 87% of our revenue in recurring EBITDA Vasta grew 15.4% in the comparison with the same quarter in the previous year as a result of the growth in net revenue and reduction of marketing and corporate expenses. I would like to finish this slide by saying that 2021 was a very challenging cycle, especially the first quarters. However, we have demonstrated excellent growth revenue performance in fourth quarter 21, pointing out to a positive 2022 trade cycle and a guidance that the first quarter 22, whose guidance will be given next, indicates even stronger growth. Now moving on to slide 14, I would like to dedicate a few moments to ACV. As I said 2021 was one of the most challenging years in Vasta's history, but we closed the trade cycle with ACV of 1 billion, representing growth of 35% in relation to the subscription revenue recognized in 2021. 22% of this growth driven by organic growth growth. And here I am referring to the acquisition of Eleva in the other 13%. Complementary solutions had the highest growth rate among all products. We have captured cross-selling potential strongly, something that we derive from our large client base, customer base in the core business. However, only one-fourth of our customers clients are using one product through cross-sell. So our ACV has grown consistently since 2019, an average 20%. We have an average growth of 20%. So leaving 573 million to 1 billion this year, this growth is the result of the maturing of our go-to-market together with the qualification of our multi-brand portfolio and the strength of the plural platform, which is now the leader in traffic in Brazil and in support to K-12 schools in Brazil. Moving to slide 15. Well, for the first time, we'll give some guidance on the next six months. So net revenue for the first quarter of the year 2022 will reach 370 million reais. So the overall growth represents 32% when compared to 1Q21. However, unlike previous years, ACV is not as concentrated in the fourth and first quarters. We have new products. all the par products that were transformed into digital platforms, they are only recognized from the second quarter on. So as a result, there is less concentration in these two quarters. And this is very positive for our revenue. There's a better dilution along the year. So with this, I close my contribution and I hand it over to Fred Villa. Good morning, everyone. We'll start on slide 17. And I'll try very brief in discussing our operating results. So in the chart, the fourth quarter, well, we had 203 million in net revenue. So our growth represented 56%, 50 million reais. or approximately 25%. This was driven by the growth in sales in the national textbook program that grew 34 million or in the comparison with the previous month. So looking at recurring EBITDA, we also see the effect in our EBITDA with growth in our recurring EBITDA of around 40% and growth of 3 percentage point in margins. So our business is growing very significantly in revenue and also in margin. This demonstrates the strength and resilience of our business in Cogna and especially in the National Textbook Program. So now, moving on to the last part of my presentation, I will talk about Cogna. Cogna, net revenue. Net revenue both in the quarter, looking at the comparison with the fourth quarter and the year of 2021, there was a reduction in our revenue. This was the result of the change in mix in undergraduate. with more participation of hybrid and digital and less on campus. Something that also helped Cogna was the strong ACV in the beginning of the 2022 trade cycle. By looking at our figures in the fourth quarter 2021, it was a very tough year for Vasta But at the same time, very strong for Croton. And 2021 is now behind us. And it is the inflection point. Looking to 2022, we expect our revenue to resume the growth cycle. So now moving on to slide 20, I would like to talk about recurring EBITDA. We see in the two charts recurring EBITDA. And thinking of both the fourth quarter and the year of 2021 recurring EBITDA grew 524 million. We started with a negative EBITDA of 1 billion reais and we're now at 524 million. And if we disregard the effect of 415 million reais, our EBITDA grew and reached 27 percentage points in recurring margin. And this happened, well, I have already mentioned that there was a change in the undergraduate mix with a focus on digital. And we also work very hard internally to improve our timely payments rate, starting with an improvement An adjustment to our PDA and also reduction of the corporate and marketing expenses. This, once again, is a sign of our resilience and strength with a strong EBITDA growth, delivering 1,355,000,000 in EBITDA with a margin of 25 percentage points. Now moving to slide 21 from revenue, we start discussing adjusted EBITDA with the important focus on operating cash generation. We have reached 494 million reais in the year. We actually grew twice as much than in 2020. We started With 240 million reais, we reached more than 900 million. And the conversion here reached 36.5% in 2021. So operating cash generation was the focus in 2021. It will continue to be our focus in 2022. And now with this OCG, we would like to... reaffirm our guidance of R$1 billion in OCG for 2024. And as a consequence of revenue adjusted EBITDA and operating cash generation, let's now turn to leverage. And the message here is that leverage is under control. We're feeling very comfortable with the leverage level we have. The net debt over recurring EBITDA ratio reached 2.16 times. This is in line with 3Q21, in which we had 207. And just to remind you, in the fourth quarter, we are not having any waiver adjustments on our covenants. So we have approved as well a strong buyback program in February 2022, a maturing buyback With a due date, February 23, the program is ongoing, is in execution. So we believe that because of the EBITDA delivered and our commitment to operating cash generation, everything is now balanced for next year. And now on the topic of cash flow and indebtedness, on December 31, 2021, we had a solid cash position amounting to R4 billion. We have enough to amortize our short-term debts. We have amortization of debt, as you can see in the chart of August 2022, of around R2. billion and we're feeling comfortable about our ability to meet these obligations. We can also obtain additional financing lines if needed. But since we have such a strong cash with strong cash generation, our net debt represents 3 billion reais. We have maintained the net debt in line with the last four quarters. In spite of the interest rate increase, the average interest rate interest rate was around 2% and now we are close to 12%. Our average cost of debt is the interbank deposit rate plus 1.78% with a term of 28 months. Our leverage is in very healthy levels. We have a solid cash position and also a commitment to generate operating cash. So with this, I close my presentation and I turn it over to Mr. Rodrigo Galindo. Thank you very much, Fred. Now, moving on to slide 24. Well, in this slide, we have a summary of the highlights here to date, and it shows everything that happened in 2021 in the company. And you can see clearly that the only downside we have noticed is the revenue from on-campus undergraduate students. But this is a result of our strategies because we're giving more priority to hybrid and digital and courses with high LTV. Now, I think that this highlight shows that, well, net revenue declined 10.5% in the comparison with 2022, but this was expected. This decrease has also been dwindling. The trend is for this to reduce. And since we have had some student intake cycles with growth, the tendencies that Croton will resume growth by 2023. And looking to the left, what we can see, it's on campus that's driving this trend. Now, in hybrid and digital, we see revenue growing in VASTA even stronger, 32%. The volume of intakes is going to continue growing with a stable ticket. This is the message. Now, looking at recurring EBITDA, even with the decrease in revenue, we grew from $690 million to $1.4 billion. And the reasons are listed below. Increase in hybrid and digital education. And this brings higher profitability. Also lower PDA and higher cash conversion. Also the new digital marketing strategy that reduced expenses and also improved our financing efficiency and also reduction in corporate expenses. Here we're talking about post-CAPEX OCG, which amounted to $494 million from a base of $240 million, as we saw in Fred's presentation a few minutes back. And this was also driven by some relevant factors, positive impact of our operating results that I just mentioned, lower consumption of working capital and higher disciplined capital allocation and also reduction of lease costs. So we have lower revenue, but with much more EBITDA and much more OCG, which is very consistent with our plans. Now on slide 25, we talk about our outlook, the outlook for our business units. Let's start with Cropton. So what do we envision? We envision double-digit growth in student intake, both in DL and also on campus. This is what we expect. We won't be disclosing the numbers right now, but you'll get them in the first quarter 2022, as we have done in the past. So we're talking about growth in volume and revenue, another trade cycle with very healthy growth. And looking at our student base, on campus should show a small reduction while digital and hybrid will continue growing steadily. On the fourth bullet, we see Croton MAD growing strongly and as of the first quarter, we'll start disclosing some operating data to the market just to show its strength. And finally, at the outlook for Croton, we expect the post-cash generation will continue on the rise. Now, VASTA. As of this quarter, we have the beginning of the trade cycle 2022. And we are now at March 25. And the data has been showing that we have resumed our growth curve. And just to complement, we have another source of growth, the B2C platform for young people and adults, to which we'll be adding new products and services. It's also a very attractive, addressable market, and we will be announcing those new products very soon. So we're feeling very confident that 2022 will be a great year for Vasta. And on slide 26, we will talk about Cogna and its outlook. I would like just to highlight a few points. First of all, the B2C platform for young people and adults is moving ahead according to schedule as presented in Cogna Day. Other services are being developed and everything is moving according to plan. The balance sheet will continue to be sound with leverage at healthy levels. All of our practices are in managing working capital will be driving this. And in addition to this, we have started the buyback program, the stock buyback program, and we'll continue on. And we also have the main officers individually invested. So operating cash generation, this reached almost half a billion reais in 2021. And we expect that cash generation will continue growing, and this gives us the comfort to say that our guidance of $1 billion by 2024 will be reached. And finally, as you know, starting on March 28, Roberto Valeri will take over the position as Cogna's CEO, and I will become chair of Cogna. It was a succession program that started in 2018, in which I communicated the board that I would like to leave management and focus more on the board issues and also the digital development of the company. And then there was a development program. We discussed the topic in 2019. We started defining successors and it became clear to us that Roberto Valeri was the right person for the job. He was invited in May. We did not have a specific date, but we had been expecting something in the first quarter 2020. Then the pandemic hit, and then we decided that it was not the time for changes in the administration. So only when the results were positive and only when the future outlook was positive, this would be the time for change. So the two premises were met together. Recently, we had the positive environment for the implementation of the change and we announced it in January to the market. It's with a great deal of satisfaction that I give my position to Roberto Valero, such a great officer of the company. And I would like to express how happy I was along this journey. There were highs and lows, but the journey was amazing. And I can show you this by two facts. Our revenue was 600 million reais and our revenue increased nine times or 22 keg for 11 years in a row. EBITDA grew even more. It grew 26%, 34% a year for 11 consecutive years. So with high peaks and lows, it was a very successful strategy. And we impacted the lives of over 1.7 million students that are taking undergraduate programs in Brazil. And it's been an honor to participate in this. I would like to thank our 20,000 students employees who dedicate their lives to education and who made it possible. Roberto, welcome to the new position. Please know that you can count on my support as chairman of the board to lead this organization through another very successful cycle. With this, I close the presentation and you're all invited to participate in our questions and answers session. We will now start our Q&A just for investors. and analysts. If you would like to ask a question, please dial star 1. If your question is answered, you may leave the queue by pressing star 2. The questions will be answered in the order they are received. Please take off the headset from the hook as you ask your questions, like this will have better sound quality. And please wait while we collect the questions.