Afya Limited (AFYA) Earnings Call Transcript & Summary

Good morning, everyone. I'm Renata Couto, and I'm the Relations Investors Director, and this is the fourth edition of Afya Day. Today, we innovate with our hybrid format after 3 successful digital additions, and it is a great pleasure to have you all here in our Sao Paulo unit for Medical Education. Today, we have the opportunity to share Afya's greatness with you. We will show the main differentials and what we deliver that brings the credibility of our company. This is an important moment to introduce to you the strength of our ecosystem, not only for medical education, but digital solutions. It transforms the experience of our users but positively impacts lives of those in Brazil. Throughout the day, you'll see our initiatives results and projections that support our commitment to excellence. Together, we will strengthen our commitment to push forward a very promising future. And for our agenda of the day, we will start by showing the differential of being focused on medicine. And after that, we will be showing how the medical career has a unique profile, and that's why we need differentiated products for physicians throughout their journey. And finally, we will show our growth avenues and the value generation upfront. So welcome, everyone, to our Afya Day. I would like to invite on stage, our CEO, Virgilio Deloy.

Thank you, Renata. Good morning, everyone. Welcome to Afya Day. It's a great pleasure to share with you the evolution of Afya since our last meeting, the results we have reached and the prospects to our future. We are Afya the largest hub of education solutions for medical practice in Brazil. Our mission is to impact the lives of physicians at every stage of their careers. We are unique in our reach and breadth of our services offering a complete ecosystem that meets both the educational needs and demands of modern medical practice. I am proud to say that we are the only exclusive player focused on medical education and solutions for medical practice. This specialization allows us to offer the most complete journey for physicians from training to daily support in their professional activities. Throughout the day, we will explore the initiatives that strengthen this position and create countless differentiators factors for the future of medical education and practical -- practicing medicine in Brazil. Afya stands out as a unique business in our industry due to a combination of strategic and operational factors that set us apart from any other player. Afya operates in an integrated manner in various stages of the training, education and development of medical professionals, supporting their professional activities and connecting these professionals, alumni from our schools with their main employers. Higher education and continuing education are only valuable if the workforce of these alumni appreciate, supports and looks up to the qualification of such professionals. Afya offers a full unified journey for its students and medical professionals that build student loyalty throughout their careers in an ongoing and long-term relationship. With a proven track record of successful acquisitions and organic expansion Afya has been able to scale its operation quickly, while maintaining efficiency and quality of services. The combination of organic expansions with acquisitions and diversification in other segments, education and digital services enabled a fourfold growth of our operations since the IPO, increasing our presence and national relevance in a planned and sustainable manner. In addition to the financial results, Afya stands out for its commitment to educational quality and positive social impact. The company works to expand the supply of physicians in vulnerable regions and ensure that its courses maintain high standards of evaluation by the Ministry of Education. This commitment reinforces Afya's position not only as a market leader, but as a transformative agent in the health care industry. With constant investment in innovation and technology to improve the educational experience in medical practice for health care professionals, Afya positions itself such ahead of the market with unique offerings that draw students, physicians and industry partners as its clients. Together, these factors make Afya a unique company with a robust business model, a well-defined growth strategy and a solid commitment to education and health in Brazil, ensuring its prominence and leadership in the market. And what guides us? Our purpose to transform health together with those who have medicine as their vocation. We work in partnership with future and current active physicians offering tools and knowledge necessary for them to positively impact health. Our mission is to walk together with those who dedicate their lives to caring for others. See, our purpose depicting as follows: [Presentation]

Great. Today, we are nearly 11,000 employees, passionate for our purpose. We have our executive team. I would like to introduce my colleague, Mirella that is able to connect all these 11,000 employees here. Stella also, she will be with us. Stella, if you could just stand up so everybody can see you. Stella also made a great project to connect everyone with our master brand. We'll be talking a bit about this project further on. Mirella brought, I mean, the number of acquisitions we have with all the different segments and how we can connect everyone and that's the purpose as executive and professional in this area to wake up every day with this purpose is to really feel it in your veins and really go after it for that specific day. So let's carry on here. So the numbers speak for themselves. Since 1999, we have trained more than 20,000 physicians with more than 22,000 medical students currently enrolled in our undergraduate units. But our impact goes much beyond the classroom. Since 2019, we have provided more than 2.4 million free clinical appointments, bringing medical care to several communities and offering our students opportunity to put what they learn into practice. We recently published a public commitment to reach 5 million free appointments by 2030 that is fully connected to the routine of our units. These numbers reflect our commitment to health and to excellence in training for our students, physicians. Since 2021, we have published more than 3,400 articles in national, international journals in health care. 3,400 articles national and international and this reinforces our commitment to medical research and innovation. Our ecosystem has also generated more than 5 million prescriptions and focusing and reaching them in a more efficient way, reaching more than 1 million prescriptions per month that means the volume of data that we're able to generate within our ecosystem. And in addition, we have more than 500 partnerships with hospitals and clinics, offering a robust network of support for practical training and quality care. 2023 Afya published more than 10 hours of medical content for medical practice services. More than 3,000 physicians are part of our faculty team directly contributing to the education of the physicians of the future in our country. At Afya, we brief medicine and dedicate our time fully to creating different ways to transform the lives of physicians. Afya stands out by placing physicians at the center of our actions, decisions, connecting them with the world all around medicine. Let's explore a bit this diagram and how this approach shapes our operations and our growth. Starting with the basis of our work, the origin medical education, undergraduate and then continuing education. Currently, we have more than 22,000 medical students across 14 Brazilian states in 32 units. Afya does not stop at graduation. We continue to support physicians throughout their careers, offering continuing education. We have over 40,000 students enrolled in the 3 journeys we offer. And with the popularity of the undergraduate program, this reach, we reinforce our commitment to the continuous and specializing training and education of health care professionals. In addition to academic training, we offer tools and solutions that assist physicians on their daily practice. Today, our platforms have over 250,000 monthly active users and more than 55 million consultations in our main medical decision support tool. The Whitebook, there's a penetration of approximately 80% amongst physicians graduated up to 10 years ago. It's pretty much an army out there. On average NPS above 80 in all medical practice solutions. This reflects the trust and relevance of our solution in the daily lives of professionals. At the end of the day, it's a ton of reputation out there that is being generated within our ecosystem. We also have a strong engagement from the pharmaceutical industry. In 2024 alone, we reached 47 contracts with large pharma companies and 109 individual contracts distributed within these clients. And with Medical Practice Solutions segments, we have brought the health care industry employees of our students and physicians into the Afya ecosystem is one of the great growth leverages for the upcoming years. This is a main differential of our strategy, connecting students and physicians with the industry and increasing greatly the adherence to the education and to the needs of the industry that will hire our physicians. And to make our ecosystem differentiating factors tangible choosing the medical school, there's now a video, so you can take a look at it with the testimony of Dr. [indiscernible], President of the Brazilian Society of Oncology and Executive of a large healthcare group in Brazil. [Presentation]

Well, we saw here in the video. Afya is growing stronger in the medical field. There is a reliable partnership established with over 350,000 medical students where they use one of our educational and digital services, recognizing the importance of integrating learning with technology. As [ Carlos ] mentioned and valuing the participation in the community, such as our ecosystem provides. Today, we're over 350,000 professionals and medicine students, and this is a wide number [ Carlos ] did not only visit all the units in the state of Rio, where his daughter was approved, but the company that he wants to work at the reputation here is definitely the name of the game to bring on differentiation. If you have 250,000 physicians using some solution with a high NPS. Today, we have 11,000 employees. We have -- we are one of the 40 top companies who work in Brazil. The name of the game is reputation where you are at. So if our focus is medicine, if we have nearly 600 hospitals and clinics, the higher number of employers as our clients, it will really show sustainability in the long run. To further reinforce our differentiating factors, we have invested in several initiatives to increase our connection with physicians. An example is the project of the master brand, as I presented to you, which STAR and marketing has created a project for us, and we've achieved significant results. In less than a year, we increased our brand awareness among medical professionals from 31% to 54%. Another important milestone is the holding of the Afya Summit last August, an event that brought together more than 1,200 physicians reinforcing our position as the largest hub for medical education and solutions for medical practice in Brazil, connecting physicians from all over the country with innovations and trends in the area. In addition, within our ecosystem, we have the Afya Research Center dedicated to understanding medical behavior. With more than 35 research studies conducted, the center not only offers us valuable insights for internal use, but also for B2B customers, strengthening our leadership and industry knowledge. Another achievement was the launch of the Afya portal in April 2024. In a short period of time, the portal already has more than 675,000 active monthly users and is responsible for 70% of our organic traffic. In addition to playing a key role in generating leads for all products in the ecosystem. This portal has become an essential tool to connect physicians to relevant content and practical solutions for their daily lives. Now shall we talk a bit about the physician's profile. This slide shows the profile of medical students at private schools. First, let's look at the age distribution. Most students are in an early stage of adulthood with 86% of students under the age of 30. In terms of employment and income, we observed that only 9% of students are employed, which is completely different from what happens in other higher education courses. We also observed a predominance of students with high financial conditions, whereas almost 60% of them have an income above BRL 10,000. Moving on to the educational background. Most students that is 87% come from private schools. In addition, we observed that parents of these students had a sound academic background with more than 60% having completed higher education programs. The data reinforces the typical profile of medical students and private schools. Young adults, mostly of high income and with a strong educational background, both for themselves and their respective families. When compared to students from other undergraduate courses such as law, business, engineering and other courses in the health care field, the data shows that the profile of medical students stands out compared to those in other fields, especially in terms of income, education and family support. Looking at this graph, we see the dotted line showing medical students and the other lines representing other fields outside of health care. I'll give you a moment to see it now. We understand that the investment for private medical school is high, but the interesting thing is to observe how fast students can obtain the payback. On the left side, we see the investment period with average cost of approximately BRL 750,000 over the undergraduate years considering an average ticket of approximately BRL 10,000 per month. On the right side, we present the return with an average compensation of approximately BRL 18,000 for newly graduated physicians between 1 and 3 years after graduation. Payback, as you can see, is up to 4 years after graduation. Showing an extremely attractive financial dynamic when it comes to investing in your graduation program. And what happens after being qualified as a general practitioner after 6 years of the underground program. What is the journey like? What's the income like afterwards? According to our data, 96% of general practitioners intend to specialize either through a residency program or through specialization studies followed by the certification exam by some medical association. On the right side, we see the salary difference between generalists and specialists. In 2023, the average compensation of a general practitioner was BRL 18,900 per month while the average salary of a specialist rises to BRL 27,200 per month. That is there's no other career that as appealing as attractive when it comes to continuing education. Not to mention the amount of guidelines and protocols that get updated throughout a medical career. However, one of the main challenges faced by physicians seeking specialization is the shortage of residency opportunities. We can see that the number of physicians trained each year has increased significantly from 15,000 in 2011 to 36,700 in 2023. However, the number of available residency opportunities represented by the horizontal line remains at 16,648 vacancies, creating a large disparity between demand and supply. This scenario limits opportunities for specialization and forces many physicians to see alternative paths such as the Board certification exam to qualify and to be acknowledged by society. In addition, for those who do get a position, salaries during residency are still considered quite low, which can be an additional financial challenge in the career of these professionals. Still on the topic of specialization, we can see the growing interest of physicians in pursuing further studies after graduation. First, we see that 30% of general practitioners are considering specializing through a post-graduate course. In addition, 39.5% of specialists also intend to complement their education. Finally, on the right side, you can see 48.3% of residents or graduate students expressed their intention to continue their studies after completing their current program. Evidencing the opportunity in continuing education of physicians in the country that is not only do GPs need continuing education, but within specializations. And even post grad students, see the need to continue to specialize continuously. How about the financial gain? Is it still worth it throughout your career? The high employability and competitive salary of physicians when compared to other professions is evident. Let's analyze the data on the slide. On the left, we see that the average annual salary of physicians is BRL 360,000 a year, which represents approximately 1.8x the average salary of engineers and lawyers and more than 3x that of dentists without mentioning other careers. In addition, on the right, we observed a high employability rate of physicians, which reaches 97%, which reflects the strong demand and stability of this profession in the market. Now let's explore we anticipate for medicine in the coming years with technological and demographic and behavioral changes. The health care industry is constantly evolving. And Afya is attentive to these transformations to continue supporting physicians at all stages of their careers. It's a broad discussion how medical seats in Brazil have been increasing and how this will impact the total number of physicians in the following years. In the current scenario, we have approximately 550,000 physicians, which is equivalent to 2.69 physicians per 1,000 inhabitants. However, with a very unequal distribution across the country, the Southeast with more than half of the physicians in the country has a higher number of physicians per inhabitant compared to other regions such as the North where health infrastructure is often precarious, which includes the number of available physicians. On the right side, you can see our projections for the coming years. The goal is to reach the OECD recommendation of 3.5 physicians per 1,000 inhabitants up to 2028 following the population growth and ensuring the demand for health care is met. We anticipate that by 2033, Brazil will reach 4.4 physicians per 1,000 inhabitants. These numbers reinforce the importance of continuing to invest in the training and distribution of physicians across the country to achieve more equitable and efficient coverage. But the question we are asked the most is, is there an access of physicians in Brazil? Or will there be? In spite of the increase in the number of physicians in Brazil, we observed that there are -- there is an increasing demand for physicians. With the aging of the population, the increase in spending on private health care and the low penetration of health insurance plans in Brazil. On the left side, we can observe the significant increase in life expectancy over the decade. The projection for 2040 is that it will reach 80 years, representing an increase of 33 years over a century. This aging population almost record breaking in Brazil as compared to other countries. Naturally, the demand for medical care increases and, consequently, the need for more professionals in the market. On the right side graph, we can see how this longevity impacts private health spending in Brazil. Between 2006 and 2022, there's been a consistent growth in private health care spending with a compound annual growth rate of 11.4%. This demonstrates a resilient and expanding market, especially considering that private health insurance penetration in Brazil is only 22%, far below the 67% observed in the United States. These factors that we have highlighted clearly show the growing demand for medical health care -- for medical care in Brazil. And to keep up with this evolution, the health care industry also needs to be modernized and to incorporate technological solutions that make health care more accessible and efficient. Afya as the largest hub for medical education and solutions for medical practice in the country is prepared not only to keep up with the transformations in the sector, but to lead them. As you will see below, we are developing innovative and different solutions in all our segments, seizing opportunities and strategically and uniquely navigating this market, seizing all the opportunities. Now I would like to yield the floor to our VP of Undergraduate Studies, Erico Ribeiro, who will give you tangible examples of what makes our business model sound robust and what sets our medical degree apart. Thank you.

Good morning, everyone. I'm Erico Ribeiro, I'm the Vice President of Undergraduate Program. And I'll show you the main points that we have specifically on our facilities lab, our centers. There are great things here to show you today, and I'm sure you will really enjoy what's new and what's to come. We are leaders in the medical education market. We have 32 schools that offer medical course and 5 schools that offer only other courses, totaling 37 colleges in the country. We have in total 3,593 seats for medical schools, which represents only -- which represents approximately 11% of the private market. It is important to highlight the quality of our institutions, which is proven by our regulatory average scores of 4.4 out of 5, which is a reason to be proud. We have state-of-the-art infrastructure and an extremely relevant fact is that we have 3 simulation centers accredited by the Society for Simulation in Healthcare. Palmas, Unigranrio, Pará, we are the only Brazilian educational institution that holds this international accreditation. We put a lot of effort into bringing this experience to our students. We also have excellency in laboratories and academic environments, which together compose the necessary environment for students to learn with the active teaching methodology, where the student is the leader, the protagonist of their own development. This brings our students to the very center of the academic development process. We have our students practicing from day 1 from the first term in an assisted way. This is very important because throughout their academic journey, they're in a safe environment to practice so that when they get to their residency and internship, they're prepared and empowered to make the best in treating their patients. They have the simulation environments with real patients. They're always prepared and making the best out of their academic journey for the time -- by the time they reach practical medical care. Now I'd like to talk a little bit about our journey, the journey of our students. So when we talk about the student's academic journey, there are 3 main aspects we will highlight. First, we have an extremely differentiated and unified curriculum. Our curriculum is nationally standardized, which means that all students are exposed to the same training regardless of the unit where they study. The differentiation between them comes from the path chosen by students who are the protagonists of their respective journeys. Then we have the use of our tools in our ecosystem in the teaching model. This sets us apart and sets their academic journey apart. It's interesting to hear the testimony from the father of a student talking about the technology and how it is ingrained throughout the entire academic process and journey so that our students really stand out in the market. It allows for a unique condition for them so that in the future, when they are physicians, they are in a unique position entering the job market. And how can we really prove and observe in our students that our curriculum and the journey we provide them with. And our ecosystem really makes a difference. How do we prove that? Each semester, we have our students taking progress test. They are assessed periodically, and we assess their level of knowledge, and we set the bar high, so they can have differentiated training and qualification to also be prepared for residency and other tests at the end of the course, such as the [indiscernible] course. Another very important factor is our regulatory average scores. 96% of our students are between 4 and 5, which proves our commitment to the quality of teaching. Right from the beginning of the course, our students participate in the objective structured clinical exams which strengthens their clinical skills. Our students practice in our simulation centers throughout their journey to be ready when they get into their internship. Now talking about our curriculum model follows a spiral concept and has some components that must be brought into the spotlight. The first aspect and perhaps the most relevant is what we call Interdisciplinary Axes. The disciplines are in place on an axes and throughout the course, they are revisited throughout their entire journey in an integrated way by the other axes. This differs from the traditional model where disciplines are often forgotten after their completion. An example of what I'm saying here is the discipline of anatomy, which is often taught during the first term in a medical school. In our case, students continuously return to the fundamentals learned throughout medical training. This brings a very strong robustness and consistency in the student's training especially because they are integrated with the other axes. Now another important aspect is the integration between theory and practice. From first day of class students have practical experience in our outpatient clinics and laboratory so they can put theory and practice together. The third relevant point is the practice with real patients. Students start the course and are able to apply their knowledge to their -- in our outpatient clinics with real patients not restricted to simulation environment. This is important because students immediately start having direct contact with patients conducting anamnesis since the first term. The fourth factor that we will highlight is evidence-based training. At any point of learning, whether in clinics or in outpatient clinics and conducting anamnesis and simulation exercises or mentoring, students always work with medical evidence that is they work on data and fact that gives them consistency and it allows them to be the protagonist of their own academic journeys. It's important that we can evaluate and verify that everything we do for our students generate results consistently. And also master's students are assessed through their grades and the disciplines and based on their medical evolution through a system of goals. This is done by the progress test. If the goals are not achieved, we develop an individualized action plan for the student to recover. Finally, our operation has an outstanding impact on the regions where we operate through free consultations for the local population. This generates a lot of value for these demographics because they are inserted in regions where there's a shortage of professionals. And at the same time, they benefit because they have the opportunity to practice and strengthen their knowledge. This shows how consistent our model is and how unique it is, bringing to students a very exclusive education experience. I'd also like to talk about the ecosystem at Afya. And the message here is how our ecosystem brings uniqueness to medical training. Our students can use most of the solutions present in our ecosystem throughout their training. In the first terms, students have contact with medical harbour tools such as Bioatlas and Athena Hub. These tools are present in more than 25% of the interdisciplinary axys of the elementary scope. So students have access to our tools for the first 6 years or for the first 4 years of course. Another important factor in the more advanced periods is these of tools such as the Whitebook and continuing education content in the more advanced terms. These are available throughout the internship stage. And why is this so important in the training of our students? It is important because they have independence. And the active methodology makes them look for our solutions throughout their training at any time. The tools work as a potential catalyst for learning. Students are curious, and they can independently choose their paths. In addition, we bring students closer to professional situations that they will encounter in the future, which -- we shall also highlight they're present in almost 64% of the curriculum offered to our students. So throughout the period with us, they have worked with our tools. Well, at this point, we'll describe how we measure the evolution of our students, how we validate the uniqueness of our curriculum. We've talked here about that point about our ecosystem. And now we'll talk about how can we make sure it's working and how our students are really differentiated and are having a great education. On a semester basis, all students are assessed simultaneously on the same day, at the same time by the same test in all the different years. And there, we can see what they need to reach in terms of the target as we show there the graph on our left, we can see from the fourth period on, they have what they need, which is 61% from the whole program. And for the 12, they will reach 100%. What happens when we talk about those that have not reached that. We developed a customized project for them that can really go through review of session, mentoring, group study, monitoring and personalized tutorials. So they will get not only their grade, but there's much more. So the next semester, when they go again to the progress test, they can be at the same level that have reached that level. Look, how interesting what happens when we see the graph on our right. As we see in our track record, we have had many acquisitions. And one of our curriculums are the legacy ones. And after we integrated, we start the Afya curriculum. So we still have many institutions that follow the acquisition one. And when we compare the test of the ones that started right from the beginning with the Afya curriculum, with the ones that were students that are in the legacy curriculum, we can see these differences in terms of performance over their journey with us the Afya curriculum compared to the legacy ones. It can be applied from the first semester on. As you know, in all the acquisitions, there is a period of coexistence of our curriculum with the previous one. And we have this because once they have enrolled, they need to have the same curriculum from beginning to end. So the graph shows the difference of the behavior of those students from curriculum Afya and the legacy one. And this shows the strength of our curriculum and how we're able to see their performance so that they can reach the last semester with 100% of learning so that we can deliver to the market that student. And at this moment, we will show the testimony of our student Victor. And what he'll say about his education. [Presentation]

What an amazing testimony, it describes exactly when we're talking about, our curriculum, our ecosystem and the progress test and how we measure our students evolving in the Afya model. And he said something very interesting about care, right from the beginning of the course and the differentials. And here, we'll be talking about a recent acquisition, which is in Salvador, where we got in Salvador July 1, 2024. So this is a very recent acquisition integration that we just started recently. And when we got to Salvador, one of the largest cities in the Northeast, we already had our medical education with Dennis here. And we started in Salvador with our program. It was a huge challenge because when we got there, we had 1,044 regulatory seats that had been maturated and approved, and we had only 59% of the seats taken 849 students and many of our competitors already had gone through all their selective processes with the enrollment, and we would start at a short period of time, and we know that we don't have much time to start classes later on, which would be in August. So there was a challenge for us to start in Salvador in less than 2 months, and then we were able to get an amazing result with adding 317 students. And in a very short period of time, most of the students came from transfer from our competitors where the ticket was lower than ours, and they decided to come study with us. So I would say 1/3 of the 317 students. And that way, we completed a short period, and everybody knows how hard it is in midyear with the number of students, which was great for our marketing, very consistent with our brand and being to Salvador, it really did make a difference. And another aspect that made much of a difference is that we just want to have the brand there. We started with all our tools that we have highlighted, mainly our teaching model that we already brought to all our students that started in the first semester. And all our ecosystem and the ecosystem that we offer to all of them, we started from day 1 at [ Unidom ], July 1, where we started with our full ecosystem. So it was a huge achievement, and we're very proud of this historical coming to the Salvador market. Now talking about another case study that we're very proud of. It's the Mais Medicos program. We have 10 institutions that come from Mais Medicos . So you can fathom last year our [ Paturago ] unit was the one where we had the first students graduating for Mais Medicos and the first class of Mais Medicos in the Mais Medicos program in the Northeast in Jabatao. And we had this whole research with our students are alumni and we asked 163 students that were intern. 68% observed improvements in the conditions of basic or local health care infrastructure in the city, 64% expressed the wish to remain in the city where they graduated, showing a positive impact of Mais Medicos on the development of local health. 66% of respondents show they wish to specialize while working professionally in the city that they graduate. That was very important for us to really have the big picture of the Mais Medicos program and the impact we bring to all the regions where we are. So the expectation. So when we see from the students to remain in the regions where they studied because they got a job and they're able to go through a residency and specialization in the cities they're at generates a strong point. It shows how Mais Medicos is really heading the right way to be able to find other institutions for Mais Medicos and also to be able to have the Mais Medicos 3 also enabled to us. And now let's go through a video that clearly shows Mais Medicos in the region where we're at. [Presentation]

Isn't that touching? That really shows much of what Virgilio said about the main opportunities that we still have, because the number of physicians per inhabitant in the Northeast, other areas of the country in Brazil is much less than 3.783 as the goal for the country. So there's much space in Brazil to go around and really make a difference. And we are consolidating our position as one of the main players in medical education in Brazil, leveraging our broad network and academic excellence to train highly qualified and prepared professionals. The strength of our brand, cutting-edge infrastructure, top-tier academic model and a robust ecosystem reflects the increase of freshmen students as demonstrated in the successful coming to Unidam in Salvador, reinforcing our credibility and highlighting the sustainable growth. We are fostering effective in fast integration from the experience that we had with all the acquisitions is a key differentiating factor with agility in obtaining synergies after acquisitions, allowing us to maximize the benefits and value generated by our assets. Our social commitment goes beyond the classroom, exemplified by the Mais Medicos program, reinforcing our contribution to public health in providing quality medical education areas where there is a shortage of physicians in the country. These pillars reaffirm our leadership and reflect our ongoing commitment to transform medical education in Brazil. In addition, it shows our sustainable and growth positioning. Thank you all. And now I call on stage my dear friend, Dennis Del Bianco, Vice President of Continuing Education.

Good morning. Good morning, everyone. Welcome to Afya Medical Education, Sao Paulo unit. After all, we are hosting this event at the building where our headquarters is located. I'd like to welcome those who are watching online. And it's a great pleasure to be with you this morning to present Afya's continuing education business. In the next few minutes, I will show the scope and the breadth of action in the continuing education area and explore with you the main differentiating factors of Afya Medical Education, a brand that from now on, consolidates all our medical education and updating offers beyond the undergraduate program. I'd like to start by commenting on the paths, virtually brushed upon it, but the paths that physicians take after graduation. Some physicians will choose specialization through medical residency. But as we saw in Virgilio's presentation, the volume of residency seeds has not been keeping up with the growth of undergraduates. So it is getting increasingly difficult to get a residency position, especially in the most impeditive specialties. For physicians who did not go through residency, the alternative to specialize the board certification examination, following the rules of the chosen medical specialty at hand. Usually, these requirements include a test and the need to prove the practice in that specialty for a certain period of time. For both specialists and generalists, a common factor that has come to the surface and Virgilio and Erico's presentation is the constant need for updating and training. Throughout my presentation, I will show how Afya Medical Education offers the Brazilian physician community, quality, medical training and updating, whether in their preparation for the residency exam or in their training and preparation for medical society's Board certification examination, or in their continuous updating and training and medical skills or management and career. Just over a year ago, we decided to create a single continuing education business unit, bringing together the in-person postgraduate operations, which were together with the undergraduate ones and can be seen in this building. With the 4 health techs that made up the continuing education pillar within digital operations. Today, I will focus my presentation on the three key differentiating factors of Afya in relation to our continuing education available in the market. The first is our ability to make hybrid offers or as we call them phy-gital, physical plus digital. These offers combine the best of in-person such as practice which is so necessary for medical skills and the past from the digital world, both with the flexibility, that's so important to physicians schedule and the individualization that is so important to the learning process nowadays. The second differentiating factor is the breadth of our portfolio. As you will see today, we already offer training for all physicians journeys, whether medical or management skills and various specialties. This year, we will carry on fulfilling the portfolio and in the coming months, dozens of new programs will be released. The third differentiating factor is linked to Afya and the fact that we are the largest hub for training, updating and solutions for medical practice in the country. Through our medical practice solutions, we have a daily recurring relationship with hundreds of thousands of Brazilian physicians, which no other continuing education competitor can have. Now on the right-hand of the screen, and you can see images of our Belem unit. Recently, we've opened this unit in Belem and the state of Para, and all of our units follow the same standard, both in the classrooms and their own outpatient clinics. Likewise, when we think about our remote or digital products on the left side of the screen, all of them from this year onwards will be consumed on a single platform customized to our students. This is the power of phygital, to have a unique physical infrastructure and a unique digital infrastructure. Now talking about the physical infrastructure. In 2024, we opened 5 new physical units. Four of these units, we're open within our other graduate institutions in a partnership with Erico, my partner here. There have been partnerships in new units into Sola, Teresina, Palmas and Victoria [indiscernible] and 1 standalone unit similar to this one, where we don't have the undergraduate program together in Curitiba in the state of Panama. Today, we are in 20 large city centers in 17 states, including the federal district. All our units from [ Porto value to Porto legre ] from north to south, follow the same standard. In total, our units are the same, whether you're visiting a unit in Manaus or in Bahia, in the countryside of the state. Our units have more than 320 offices -- which our own offices dedicated to the practice in continuing education programs. And throughout 2024, we will provide more than 50,000 free consultations in the specialties we offer and partnership with the public healthcare system, the local health departments. Let me repeat that. See, there are 50,000 appointments for free. Many times with specialties such as psychiatry and neuro pediatrics. There's a bit of a difference here because in this scenario, we're providing specialized care. This practice with supervised care for real patients is also a clear differentiating factor for Afya in relation to most of the offers available for graduate programs. In addition, the presence in all regions of Brazil and the reach of our network and in-person units is differentiated, especially if we think about the extension of other graduate seats through the Mais Medicos program. And in the locations indicated in the Mais Medical 3 program. We have chosen the hubs where we want to be present, which are the basis for medical consultations and care, and this is also a basis for our students to obtain practical experience. Now on the digital side, in recent months, we have made an enormous effort to concentrate all continuing education solutions on a single platform that will soon be connected to the Afya portal, which Virgilio just showed to you. It is worth highlighting that this will be one of the last times we will show the original companies in a presentation like this. All these companies -- as of this year were integrated and incorporated recently into a single legal entity. So now their offers, their offerings for continuing education, but not from cardio papers or [indiscernible] Além da Medicina in the beginning of the year, these are working completely integrated, but obviously, these offerings are still leveraged through the digital relevance these brands have. If we put all our profiles together, combined, they have over 1 million followers on social media. As a single team, we became much more effective. We've launched 64 new courses this year, to this date and produced more than 30,000 digital educational objects. It's an whole army working towards the development of healthcare in Brazil. The combination of digital knowledge with in-person reach is unique and a clear differentiating factor for Afya. The second differentiating factor I would like to highlight is the breadth of our portfolio in continuing education. Apparently, we segment our offerings into three large groups, or three journeys, if you will, the residency journey, the graduate journey and other courses. When we talk about the residency journey, basically, we're talking about the preparatory courses for medical residency, such as the metal preparation course and mentoring programs such as the Além da Medicina program, which was running under the [ Mentoria Residencia ] brand. Now in the graduate journey, we have a graduate courses preparation for the Board certification examinations as well as mentoring programs for these exams. And in the journey, we call other courses. They are divided into hard skills, which is how we call the medical sales, the soft skills, which are career and management skills and medical update courses. As you can see, Afya Medical Education is the result of the integration of acquired companies and each journey in practice is composed of a combination of the offers of more than one of the original companies with the new offers launched this year. We've effectively thought about the medical journey and composed it, taking elements from each of the companies acquired. And of course, the new offerings are fitting into these journeys. Now digging into the details, if we're talking about the residency journey, here's what's to highlight. First, the preparatory course was completely remodeled to a new methodology aimed at solving questions in preparation for the residency team. Of course, ultimately, the goal is to pass the exam and to prepare for the exam has been quite a big demand, and we've been achieving great results from it. The use of generative artificial intelligence has also allowed us to speed up the release of new functionalities. So for example, we had a request from one of our med cell students from preparation courses, they wanted to study flashcards. And using generative artificial intelligence, we've availed worth 6,000 flash cards generated with the help of AI. They've been validated by our medical professionals. And on the mentoring side, this year has was one of consolidation of this offer with several competitors turning to offer mentoring as well. We shall mention that we are extremely satisfied with the growth of this product. It has a cycle that ranges from September to August next year. And honestly, in terms of sales, we couldn't be happier with the repercussion, the changes we've made have been having. Now moving to the graduate journey we are focused on expanding into new specialties, both in graduate courses and in preparatory courses for board exams. We have more than 5,400 graduate students in more than 20 specialities. When looking at the preparatory courses for Board certification exams, we currently cut five specialties and soon will launch others. Following the success trail of students using the original brands, cardio papers, [ endocrine ] papers who have already represented, respectively, [ 67% ] and [indiscernible] of all those who have passed the board exam -- there are all -- all of these were students from cardio papers and endocrine papers. Looking at the next wave, we have dermatology coming up. In the last year, in dermatology, 40% of approved candidates were our students, which is a reason to be proud. Now in the other courses group we will find hard skills and soft skills and the courses. So as an example, just to make it clear for everyone, we have courses on [ Retnia ], on ECT, if we are looking at dermatology, Botox application courses, they could be longer or shorter courses, but they're all connected to medical skills. In the soft skills group, we offer courses focused on management and career skills. We have programs that help physicians manage their office and their own finances, for example. One thing I would like to highlight about the soft skills is the launch of the course artificial intelligence and medicine. It was quite successful, and it was offered in a hybrid format. So it's an entirely digital format, reaching almost 1,000 students. And we've also released a workshop hands on in person of workshop physicians could practice while they had learned. We have 3 groups, 2 in [indiscernible] , 1 in Rio de Janeiro, and we have another group coming in early November. And the average NPS of these workshops was above 80%, which is a great result from physicians who have participated. Finally, I'd like to talk about our medical update front, which effectively keeps physicians updated in terms of news, protocols, guidelines, congresses on that specialty and we are launching 4 new specialties, reaching a total of 7 courses available up to the end of the year. And finally, but probably this is the most important item and the differentiating factors. I'd like to highlight the value that the continuing addition business has in being part of a complete hub of training and solutions for medical practice. It is a clear differentiating factor for Afya Medical Education, to be a part of Afya, to be in daily contact with hundreds of thousands professionals through our medical practice solutions, and where each individual is in their own journey. This really sets us apart. This closeness makes all the difference when it's offering the most relevant training or updating content for that individual. Our relationship, with medical professionals starts in the internship, which are the last years of graduation. For Erico's students, we start having this relationship with them in the fifth and sixth year. And this is the phase in which the student usually starts using the Afya Whitebook on daily basis. And this relationship continues throughout their career and eventually, they start their office and in addition to Whitebook, they're going to start using iClinic. Both Whitebook and iClinic provide daily contact and closeness with medical professionals, which no other group offering continuing medical education has. It's a clear differentiating factor for us. So before closing, I would like to leave you with three topics as a summary of my presentation today. First, emphasizing that Afya medical education now offers all of Afya's continuing education products covering all physicians' journeys from preparation for residency or board exam through post-graduate studies focused on practice to the training of medical and management skills and continues of training. Second, as we've seen the combination of the phygital model, the scope of the continuing education portfolio and our integration with the entire hub of solutions for medical practice puts Afya in a position that's unique to continue being the main partner of physicians and their training and updating throughout their career. And last but not the least, I like to emphasize that Afya Medical Education by combining a single and integrated digital platform, with the 20 physical units distributed in all regions of Brazil, to offer the Brazilian medical community a unique reach, not only today, but also thinking about the near future to serve the regions where the units concentrate, physicians coming from the Mais Medical 2 program in maturation now and the potential new units under the Mais Medical 3 program. These will make a whole difference in Brazil's healthcare evolution. Thank you all for attention, and I'd like to yield the floor now to the VP of Medical Institutions.

Well, always the best to the end, right? Well, I'm just kidding the whole strength is to work with all the units together. So good morning, everyone. I'm very happy to be here with you for one more year presenting the evolution in our digital solutions for medical practice. Our mission is that for -- we want to equipment positions with tools that increase their assertiveness and effectiveness in local decision-making, improving patient experience and optimizing management of medical practice in their offices. I will explore here with you how we have developed the solutions to meet the needs of physicians in their professional routine. I will start by presenting the evolution of our operating model. In 2019, we started structuring the thesis of this business unit. Identifying the mean opportunities for developing and offering digital solutions to support the medical practice. From 2019 to 2023, we moved on to the initial phase of executing our thesis. During this period, we combined 12 health tech businesses with more than 20 digital solutions for physicians. We organized our structure with 6 strategic pillars, each addressing specific needs in their journey from continuing education to their clinical practice routine. And this allowed us to overlay value propositions that were previously isolated in health techs, unifying them functionally in pro groups across the six pillars. Starting in 2023, we evolved the pillar model to integrate structure that way favoring the management delivery of our product portfolio. We captured operational synergies, gaining efficiencies in terms of resources and product development, as well as enriching the offering experience for physicians and B2B customers. Having made this introduction, let's now explore each of the vertices of our digital solutions for medical practice support portfolio and to understand how these solutions connect and add value to the Afya's ecosystem and to physicians. Remember here that one of the results of our operating model implemented at the end of 2023 was the integration of digital Continuing Education solution offerings into the medical graduates programs, same new business unit, Afya Medical Education as explored by my partner, friend, Dennis Del Bianco. And I'll start with the solutions centered on the main activities of physicians, routine, which we call here B2P solutions, business to physicians. One of our main solutions is the Afya Whitebook, the most used tool in Brazil for clinical decision support. The Whitebook offers physicians in a quick practical manner, the necessary resources for the diagnosis and treatment of diseases through an interactive decision tree that guides the process efficiently. Contributing to assertive medical practice within this context. The Whitebook also has more than 200 clinical treatment parameter calculators, a wide range of specialized content that is constantly updated and more recently, an integration that allows physicians to perform the digital prescription, right from the Whitebook. And as a result of this work, Whitebook impact over BRL 55 million consultations per year and receives over 21 million searches for medical content monthly, maintaining a high NPS of around 87. As a result of the evolution of our operating model, we are accelerating the integration of products that generate value for physicians in our business model. An example is the recent availability in the Whitebook of our digital prescription tool. Up to now over 6,000 physicians have already prescribed through the Whitebook tool. Integrations as this one will be increasingly frequent in a technically and economically efficient way, always with the aim of delivering more value and convenience to physicians. Very soon, the prescription will also be available on the Afya portal. It is important to highlight that the Afya Whitebook due to its volume and audience qualification, act as a catalyst for the engagement of physicians within the Afya ecosystem, bringing these physicians more convenience in the consumption of solutions and services that address their demands for the medical practice and continuing education. Another evolution that I want to highlight is the increasing adoption of artificial intelligence in our solutions in the Afya Whitebook. We recently launched the radar Whitebook that allows them to have a [ Afyamological ] information real time helping in the decision-making during their clinic and they can choose a region of the country and have updated information about [indiscernible] trends emerging conditions. And another feature that is in a test phase in a -- based digital assist to facilitate access to drug formation and natural language interface. This video shows a use case of the radar book, also a natural language here by our physicians. Now let's talk about our clinic and office management tools. Afya offers clinic and office management systems that empower physicians and increase their productivity. With routine automation physicians reduce time with administrative tests and can focus on what really matters in their vacation, which is patient care. Our tools assist professionals and various activities in their office routine as appointment scheduling, making it easier to control and organize their calendar electronic medical record, which consolidates all patient data in a single safe place, telemedicine tool providing remote service with practicality and security, electronic prescription, allowing the generation and sending of prescriptions digitally to patients and integrated with an electronic marketplace of medicines, integrated financial management, which allows execution of financial entries directly from the medical records and personalized communication with patients, both for calendar management and also for marketing campaigns. And these solutions translate into expressive results, with over 33,000 physicians, over 1 million monthly prescriptions, as Rogelio mentioned, and 20 million scheduling appointments per year. The Afya clinic also brings AI-based features to generate more value for medical or for physicians users. These user groups are now testing two new features, the summarization of a patient's medical record history, bringing to physicians quickly relevant information from that patient during the consultation, assist the consultation, which transcribes the conversation from audio into the electronic medical record, allowing physicians to focus more on the interaction with patients ,then on note taking proving quality of care and optimizing the time spent on administrative activities. This video shows this feature here of transcription, voice and text for their medical record. [Presentation]

We are highly motivated to accelerate the pace of innovation that has value to physicians. And now I'd like to explore products that optimize physician-patient relationship. Our family of products for a physician patient relationship aims to provide our solutions focused on improving interaction and communication between physicians and patients and contributing to better have adherence to treatments. Glic is an application to support the treatment of patients with diabetes, allowing the measurement and recording of patients' glucose levels, manually or through integration with glucometer already available on the solution, recording eating habits, insulin calculator, allowing better treatment and quality and the exchange of information with physicians and patients. Recently, we expanded integration to scales and pressure [ guards ] to be able to embed in the process of obesity and hypertension. Cliquefarma is a drug marketplace that allows users to search for prices and purchase digitally, acting as a partner channel of drugs and facilitating the use of drugs and increasing, therefore, adherence to treatment. The AgendarConsulta.com portal is a platform that facilitates the search for physicians and the scheduling of appointments by patients, providing convenience and ease of access to health care and also serving as a demand generation tool for physicians. Prescription for patients, a channel that centralizes electronic prescriptions, allowing patients to access their prescript digitally and safely. On this slide, I show some of the results that these tools already have achieved. For Glic, we already have over 250,000 registered patients, 619,000 users we have 3,000 registered physicians and 24 partnerships with health care companies. Glic is the only digital tool for the treatment of chronic disease recognized by certified ANVISA and the Brazilian Diabetes Society, SBD and has ISO certification at Glic Pharma, we recorded 3.5 million visits in the first half of 2024 alone, reaching a gross merchandise value of BRL 275 million. Our platform has 78 drugstore chains, our partners, and we also have over 604,000 products in the assortment. In agendarconsulta.com, portal, we have had 250,000 unique visitors generating more than 82,000 consultations. And finally, the prescription patient page was visited by 1.8 million patients throughout 2024. It is worth noting that these products are monetized in the B2B model generating demand and purchase of medicines, vaccines and, in the future, also some exams in addition to sponsorship of content for patients. Patient support program channels, the PSP, and sell-out intelligence. These solutions have intentionally a small focus up to now, but numbers show their relevance and potential to our ecosystem. In 2025, we will intensify efforts to capture synergies and integrate these 4 digital assets aimed at strengthening physician patient relationship. The goal is to evolve into a single level channel in a single application channel. The portal of the patient centralizing all features and facilitating the patient experience with strong emphasis on supporting the treatment of chronic diseases, facilitating research and purchasing medications, and scheduling appointments. Finally, we summarize in major numbers, the impact that our ecosystem has on the physicians and medical students universe with data referring to the first half of this year. In the Medical Practice Solutions BU, we reached over 250,000 active users per month in continuing education, more than 44,000 students using some of our products, as explored by Denis Del Bianco. And for the undergraduate program, we already have 23,510 students enrolled. I don't know if it has already increased because we're still actively capturing students, as shared by Erico Ribeiro. With these numbers, our ecosystem positively impacted more than 320,000 users. All this ecosystem enables us to create innovative solutions for the relationship of this qualified audience of physicians with the health industry, creating value for both and reinforcing the virtuosity of our ecosystem in which we primarily serve physicians. We also have relationships and solutions for pharmaceutical organizations, hospitals and laboratories diagnosis, which are major employers of the physicians we train in our undergraduate and continued education programs. On this slide, we present Afya's value proposition in the physician health industry relationships, structured in 4 main areas: medical campaigns, generating and distributing medical content and congress coverage, providing constant education and updates to physicians connecting them directly with industry innovations and information. Marketing and advertising for physicians and for patients using our solutions as channels, e-detailing the medical engagement through sample delivery, facilitating trial and knowledge of medications, insights, which is the generation of intelligence, prescriptive profile intelligence, sell our most medical consumed content of the interest to the industry. And also, we have ad hoc research studies as shown by Virgilio, which is of interest to Afya and the industry. And I am pleased to bring as an example, a B2B partnership case with Hypera Pharma, a major national pharmaceutical organization, illustrating how Afya acts as a strategic partner for the pharmaceutical company, maximizing impact and return on investments in relationship initiatives with physicians. In this project, we aim to support Hypera in implementing innovative relationship strategies with physicians, seek engagement in a more relevant and efficient way. Afya has the role of facilitating engagement actions, always empowering physicians in this relationship, whether through sponsored medical care content campaigns, bringing quality topics to physicians or facilitating access to samples to these physicians that show interest and also through highlighting prescriptions in specific categories of interest to Hypera, always continuously and strongly measuring results reached. This offer is quite recent. And we have different ways, innovative ones, to engage with physicians, always loyal to our primary purpose of serving and empowering physicians that demand update on innovation, on samples, but in a way that is more and more aligned to their interest and availability. This video is a brief illustration of how Afya is present in the routine of physicians and how it impacts the industry on the data base. [Presentation]

We are actually building a new experience in the relationship between physicians and the health industry. It's disruptive through our ecosystem of digital solutions that generate relevance to physicians and efficiency to the industry. I would like to share the evolution of our basis of clients with whom we are evolving with our offers and value creation. And I take this opportunity to thank them for their partnership interest. The graph on the left, we see the evolution in a number of customers that are active since 2022. In 2022, we had 38 points. In 2024, we reached 47 clients of whom we relate to on a daily basis. These figures and partnerships reflect Afya's steady growth and relevance in the B2B market, consolidating our role as a strategic partner for major players in the health care industry. Throughout this presentation, we show the evolution of our strategy to build an ecosystem of digital solutions for medical practice support. We have moved towards a product portfolio structure with more efficient integration of our solutions into an increasingly cohesive and physician-centric ecosystem, from core medical practice and solutions as Whitebook and iClinic to tool centers and physician patient relationship, we're building a robust ecosystem that makes it easier and also connects every stage of the physician's journey. With this integrated approach, we are also creating value for our partners, our B2B partners, as shown in our partnerships with major players in the pharmaceutical sector. Our product strategy is clear, to bring together and integrate solutions to maximize impact, improve user experience and ensure that Afya remained at the forefront of digital transformation in health care and the physician's best partner in their journey of training, education and practice of medicine. I close this section on digital solutions for medical practice and now will share our growth and value creation strategy, I call on stage, my friend and CFO, Luis Blanco.

Good morning. Welcome to the fourth Afya Day, our first Afya Day in the hybrid format. So welcome to our flagship building in Sao Paulo City, and welcome to those watching online as well. At this point in the presentation, we will discuss Afya's exceptional pathways to growth and value creation. Our trajectory has been defined by a strong pace of expansion and now is the time to explore opportunities to further consolidate our leadership position. We will discuss the key initiatives and strategies that will drive our business forward. In this presentation, we will explore 3 strategic pillars for Afya. First, we'll discuss our growth opportunities followed by our capital allocation discipline. Finally, we will address our cash generation capacity. Starting with the organic growth pathways for undergraduate programs. In addition to the maturation of existing seats, we see significant potential for expansion due to our pricing capacity. In the chart, you can see the net ticket has increased 13% between 2022 and the first half of 2024. This represents 210 basis points in the period, reflecting the strength of our value proposition. For 2025, we project a 5.1% increase in freshmen tuition fees exceeding the IPCA index or inflation index expectation, which is approximately 4.5%. When combined with the maturation effect of the ticket, we expect to maintain in 2025, a highly favorable ticket dynamic for Afya. At Afya Day 2022, we established an ambitious goal: to obtain authorization for 600 new medical school seats between 2022 and 2028. Since then, we have made significant progress with 222 seats authorized by [ 4 ]. Expanding our portfolio is crucial for optimizing the distribution of physicians across the country, especially given that we are in regions where there is a shortage of professionals. Now we will move on to explore the organic growth path in the other segments. In continuing education, we are driving our business on 3 main fronts: creation of new units for Afya Medical Education, expansion of the product portfolio, and B2B initiatives. In 2024, as Dennis mentioned earlier, we have completed the opening of 5 new units where 4 are cross units and 1 is a stand-alone unit. In addition, we are increasing the offer of courses and content for physicians properly aligned with their needs and to the context in which they are inserted such as highly successful courses on artificial intelligence and medicine. We are working effortlessly on B2B initiatives, on topics such as training, hospital clinical teams in order to support and draw new professionals and cover events for the industry. Speaking of our Medical Practice Solutions unit in 2024, Afya made significant strides to expand penetration among physicians and develop B2B. We launched new tools such as the Raider Whitebook, which leverages AI from behavioral data to identify top trends and make projections. As Lelio mentioned, we also introduced the Smart Clinic to iClinic, which assists doctors with a transcription of appointments and medical records, allowing physicians to be fully focused on their work. With this, we hope to attract and engage even more physicians in our ecosystem on an ongoing basis, increasing their productivity and assertiveness. In the B2B segment, the development of the physician base and data volume makes Afya more and more appealing to new customers. This resulted in an increase in the number of partnerships to 47 unique customers and a total of 109 contract signed, representing a growth of 24% compared to 2022. We now return to the other graduate program to talk about a very important growth path, which is the MICE Medical III program, a program of great importance to public health care in our country and which has contributed significantly to the improvement of the distribution of physicians in Brazil. We are competing for 23 of the 95 potential campuses offered by the program. It is worth mentioning that for each campus, 60 seats will be authorized. So we have a potential to increase up to 1,380 new medical seats. The estimated investment per campus is approximately BRL 25 million, and the results are expected by May 30, 2025. Here, we will talk about the expansion in our undergraduate program through M&A, which has been a very important avenue throughout our history. In 2022, we set a guidance or goal to add 1,200 medical seats through acquisitions by 2027. By October 2024, we have already achieved 640 seats, showing relevant progress in relation to the established plan. This result includes the acquisitions of UNIMA and FCM Jaboatao, which brought in 340 seats, at an EBITDA multiple of 5.8x. And now in July, with UNIDOMPEDRO, adding 300 seats at an EBITDA multiple of 4.2x. The multiples mentioned reflect the scenario after capturing synergies and the complete maturation of the assets and underscore Afya's ability to generate value through M&As. In this slide, we summarize the expectation of growth in our undergrad portfolio. Today, we have 3,593 seats, and we have a promising outlook for growth until 2028. And the organic growth path, we estimate an additional increase of 378 seats through administrative requests, with the Mice Medicals program in it's Phase III, we have the potential to add up to 1,380 seats, and we expect to add 560 seats with future acquisitions. Adding all these factors together, we project to reach between 4,531 and 5,911 seats by 2028, reflecting our ability to capture opportunities and sustain continued growth in undergraduate medical education in the country. With that, we conclude the topic of our growth opportunities, and I would like to explore our capital allocation discipline now. Since the IPO, we have carried out more than 20 business combinations. That way, we can highlight our expertise as an asset integrator. Each acquisition is approached in a systematic way, which guarantees effective and consistent results in a short period of time such as the case of UNIDOM presented by my partner, Erico, to you, and the cases of UNIGRANRIO and UNIMA and FCM Jaboatao, which I will comment further on. We can divide our onboarding process into 4 main steps. First, we evaluate how aligned the infrastructure, organizational structure, and teaching model are with Afya's standards. Then we diagnosed the efforts necessary for the migration and incorporation of the processes and the teaching model into Afya's standards. In the integration phase, we migrate all the processes and systems to our shared services center and standardize the TT model. And finally, we offer ongoing support, monitoring and stabilizing post-integration operations, both remotely and in person. Thus, we are able to leverage acquisitions with sustainable results, both in the short and medium and long term. I'd also like to show you the UNIGRANRIO case study, which highlights a successful integration. Where in a short period of time, we managed to exceed the expectations of the business plan established at the time of the transaction for 2023, which was the year of maturation for UNIGRANRIO. IP forecast net revenue of BRL 343.2 million with the disclaimer given to you at the time of the transaction, and an EBITDA of BRL 169.9 million and a projected EV EBITDA multiple of 4.1x after maturation and synergies. During this period, we recorded revenues of more than BRL 368 million in 2023 with an EBITDA of BRL 176.3 million and resulting in an EV EBITDA of 4x. That way, we reached an unleveraged IRR of 25.3%. We also have the case study of the acquisition of UNIMA and FCM Jaboatao. Also considering the end of maturation of this asset, which is 2024 for UNIMA and FCM Jaboatao. BP forecast net revenue BRL 260.5 million and EBITDA of BRL 143.2 million and EV EBITDA multiple of 5.8x. For this period, our forecast predicts revenue of BRL 29.4 million and an EBITDA of BRL 173.9 million, an expressive -- significant improvement, which was in the EV EBITDA, which was reduced to 4.7%. That way, we estimate an unleveraged IRR of 23.1%. The cases presented show that when we combine the discipline of capital allocation, acquiring assets with high synergy potential and correct prices with our strategic positioning and integration expertise, we achieve great results. Beyond all the investment in new operations, we should also talk about our organic investments. For 2024, we are projecting a CapEx guidance between BRL 220 million and BRL 260 million, which represents a range between 6.7% and 7.9% of net revenue, considering the middle point of the net revenue guidance for 2024. These investments seek to sustain continued growth by ensuring an infrastructure that meets the needs of our operations to continue offering the best to our students and medical partners. Our approach aims to align CapEx with strategic priorities, maintaining efficiency in resource allocation and ensuring that each investment directly contributes to the advancement of our long-term objectives, ensuring the quality of the services provided. With that, we conclude the topic related to capital allocation. And now I'd like to talk about our capacity to generate cash. I really enjoy this slide. It's a slide that we present throughout our quarter and now we have the reconciliation of the net debt of the last 12 months. And this chart demonstrates how we finance our business using mainly our own operating cash generation and reinforcing an extremely sustainable business model. In the last 12 months, we generated more than BRL 1.2 billion in cash flow from operating activities and allocate -- it was allocated to CapEx, acquisitions, interest, carryovers and other obligations around BRL 660 million. Our net debt, as a result, was reduced by more than BRL 540 million, reaching the end of the semester with a net debt of BRL 1.46 billion, clearly showing the strength of our sustainable growth strategy supported by solid cash generation. When we analyze the evolution of cash generation from operating activities, we observed that since 2019, the year of our IPO, we have increased our generation from BRL 308 million to more than BRL 1.2 billion, which represents an average growth of more than 30% per year and reinforces our continued ability to sustain our growth through acquisitions and investments. This increase not only reflects the efficiency of our operations, but also reinforces our comparative position vis-a-vis our peers, where we maintain substantially higher cash flow per share growth in comparison to the competitors. And this allows us to take advantage of strategic opportunities, ensuring a healthy capital structure and maximizing the value to deliver to shareholders. Our growth is supported by our unique ability to generate cash, and this is mainly due to a few factors: higher ticket and margins in medical courses, full occupancy of our medical seats, low dropout rate, reduced DSO, and profiled students with greater resilience and purchasing power. These elements ensure robust cash flow to sustain our expansion. Another important pillar to sustain our growth is our capital structure, which is solid and optimized. On the left side, we show how we closed the second semester with a gross debt, excluding rent of BRL 2.1 billion at an average cost of 91% of the CDI. The major contribution to this is the operation we took with Softbank in 2021 and at a prefixed cost of 6.5% per year in real. When we analyze the evolution of net debt and our leverage, we see the strong capacity to leverage our business, growing it through acquisitions, generating cash flow and getting prepared for new transactions. In early 2023, we completed the acquisition of UNIMA and FCM Jaboatao. And we closed the year with a net debt of BRL 1.8 billion and an EV EBITDA leverage of 1.6x. In just 6 months, we reduced net debt at around BRL 350 million supported fully by our cash generation. It's important to emphasize that this has been sustained by our cash generation. Now on the next slide, we will comment on our last fund raising round with the IFC, the World bank's financial entity, that is a reference for sustainable practices. In August of this year, we concluded the raising of BRL 500 million from IFC. This was the first IFC debt in the world of education that has a kicker linked to social indicators. The funds will be used to expand Afya in the education sector at a CDI plus 1.2% rate with the possibility of 15 bps reduction when achieving sustainability metrics. The main objective is to offer a 3.4 million free medical consultations by our undergrad program by 2029. And another goal is to maintain our grades at between 4 and 5 as per the Ministry of Education. And up to 2030, we have published a public commitment to carry out 5 million free consultations in all health care areas. And since 2019, 2.4 million have already taken place. I'd like to show you a video that presents Afya's collaboration with IFC now. [Presentation]

I'm [ Carmen Valeria de Paula ]. I'm the Regional Manager for Health, Education and Services in Latin America at the International Finance Corporation. I'm so pleased to be part of Afya Day in Brazil and share our recent experience with Afya and IFC. Unfortunately, since I am in Washington, D.C., I cannot join you in person. IFC, part of the World Bank Group, improved people lives in developing countries through investments in the private sector, including higher education, a sector that is super dear to my heart. We recently extended a sustainability-linked launch to Afya to improve their accessibility and quality of higher education in Brazil. Afya is the first education company in Brazil to have a sustainability linked loan based on social indicators. By linking the loan to specifically social impact targets, we can expand access to educational programs to those who need it most. The key performance indicator tied to this financing prioritized communities with high and medium levels of social vulnerability and enable us to closely monitor progress and outcomes. We want to be sure that our funding is directed to where it would have the greatest development impact. I am proud of IFC and Afya's commitment to working together to create lasting positive change by improving educational outcomes and boosting prosperity, especially in historically overlooked communities. Thank you, and welcome to Afya Day.

Thank you, Carmen. I'm sure you're listening to us online and also for Carina being present here from IFC. Thank you for your full support. My last slide here, I would like to highlight as a take away the 3 essential points that demonstrates why Afya is at the forefront of the medical education sector. First, robust growth opportunities with high predictability and profitability. Our business model has shown consistency in delivering predictable results with attractive margins and long-term sustainability. Second, discipline in capital allocation that is both organic and inorganic. We have been very careful in our acquisitions and consistent with our targets. And also, in the investment in our infrastructure, ensuring that each initiative generates value to our shareholders, either through organic growth or strategic acquisition opportunities. And finally, consistent cash generation and strong balance sheet. We keep a strong ability to generate cash, allowing us to sustain our investments and, at the same time, maintaining a healthy capital structure. These pillars reinforce our commitment to operational, financial excellence, consolidating Afya as a reference in the market. Thank you very much, and I'd like to invite back on stage Renata Couto.

Thank you. Well, I would like to thank all the Vice Presidents that helped us here today with their presentations, which is essential so that you can learn more about Afya so that you can be here with us and understand our long-term plan. And now we'll open to our Q&A session. [Operator Instructions]. First question from Samuel from BTG.

Talking about the organic expansion, as you said about the guidance that you presented in the event 2022, about 200 seats per year. Could you talk a bit about the level of valuation for the targets? And if you see an accommodation after the expansion of the supply of your sector, as you mentioned. And also, there was a great focus by Blanco in terms of cash generation, where there's a drop of net debt, and that is related to the first question. So do you see room for extra cash to have an agenda for dividend distribution, which would be the first time since the IPO? Thank you.

Thank you for the question, Samuel. I'll answer them both. When it comes to M&A in the last transaction where we already see the price of the transaction less than the previous ones, where the multiple was less than what we had before. And the trend in our opinion, is still to carry on because we see a new generation of assets coming to market, especially those that were obtained through licenses. So the next transaction should have a multiple embedded in the transaction that is less than UNIDOMPEDRO. That is our expectation. And we see in the conversations that are always very active in the market. So I believe that's where it comes from. And when it comes to cash or capital allocation, we have the following vision where we see -- we go through our transaction, we leverage the company, then we are able to leverage, and then we get ready for the next step. And on this third quarter that we'll release in November through the results with the earnings, we always have a focus on the balance sheet. UNIDOM acquisition, where we had BRL 160 million for EV. And another one that's very important is the earnout that we have for each additional city [ Maceio ] that increases our debt in BRL 110 million. So we are leveraging the company now so that we can increase to BRL 270 million. And the dividend is something that will be in our discussions during this next period. Once we get greater scalability, adding the 200 seats per year do not influence as much our leverage. This microphone is at a high volume. Anyway, just to talk a bit about the dynamic of M&A and talking about the authorizations that we have from the judicial requirement in terms of the pipeline now available on the dynamic of the cash generation of Afya is intact. That means so we are integrating better. We're extracting faster value, and we're able to bring greater value after the undergraduate program. There's more products, relationship, B2B engagement. So we had a cash at a level. And now it's better because we extract value from an acquisition now at better prices. Could you complement also, Samuel, a point that everyone should recall that we have the 200 seats per year, and we generate more cash year-over-year. But next year, there is a challenge, which is how many more physicians will have to get the BRL 25 million that Blanco informed. But yes, other than that, dividend can be in the plans for the future, yes.

Next question from Mauricio Cepeda.

Thank you. Since you've taken a step back to talk about the medical career, I'd like to take a few other steps back. Clearly, seeing the graduation rate of meta physicians, it's growing rapidly. We are reaching the OECD numbers very quickly. We must exceed them even, but there's some dispersion in Brazil. As you said, some places have few physicians, some places have too many physicians. And on the other hand, I see you've mentioned the private health care system with low access to it, but it hasn't been growing. So we're lacking these drivers. So how do you plan to position in this environment? Do you plan to position yourselves as that school that's good enough? So physicians get qualified in order to find for that high competition environment has physicians so you keep the monthly tuition fees higher? Or is it not just a matter of seat opportunities, you can take that as your positioning? So that's what I want to know about positioning. And since you talked about medical solutions, I understand there is -- there are multiple solutions for different audiences that you offer. So how do you compatibilize the management of quality of all this against the potential in the market? And how do you compare it to the more consolidated businesses you have within Afya?

Great, Mauricio. Thank you. Excellent question. I love that you asked it, and Lelio, you can help me with the digital services. As far as positioning goes, well, it's a combination of the 2 things, right? We can't really talk about the future of Afya if we don't have positioning, reputation around this ecosystem we've been creating. We start as an undergrad school, as a medical school in 2018, we horizontalized that relationship. We've become a one-stop shop partner in the relationship with physicians throughout their entire qualification training process, we went public to consolidate this market. Then the pandemic hit us, and it became clear that if we did not look for everything in digital disruption, we wouldn't really be able to survive. We had to innovate in everything that was possible, the relationship between physicians and patients. So we needed a curriculum that differentiated these physicians qualified here in the post-pandemic world. But we also wanted to turn this into a good business, a sound business that's sustainable and that positions us well in the industry. So you can't really talk about higher education in any career if you don't have employer at the end of the day who will consume, so to speak, your product, which is your alumni, right, in an integrated way with their everyday activities. And of course, we must require quality and a curriculum that's compatible with what the job market is offering, and that is what we put together in our ecosystem, the reputation part of it and the pricing aspect of it and the business dynamics in all cycles since 2019, it's all intact. There has been a boom in the market. Afya has closed the year with boom in seats -- an expansion in seats and now we have 350,000 people who know Afya. Afya didn't use to be a brand. It was a holding, but now it's a niche brand, acknowledged by physicians, differentiating itself day after day, not only for physicians but also for their employers because at the end of the day, you have 109 contracts, several providers here, and they're also making choices where their daughters are going to study and where their colleagues should specialize and who they are going to hire to help them with continuing education of their own staff. And Brazil now has 2/3 of its physicians in the southeast of the country. And there's 90% of the cities you have less than 1 doctor per 1,000 inhabitants, which is a deplorable scenario. So what we've been working on now is a very nice strategy. Denis mentioned it, but I'm not sure if it was entirely clear. We are creating a satellite network with our specialization units in the capital cities where we attract excellent professionals. We have first tier, top-tier infrastructure and these serve as hubs for other units, especially in the internship where students might even travel out of state to conclude internship because our curriculum is integrated, students have this mobility. So we bring students to the capital, they use our structure for continuing education and capital, not only attracting these students, but also bringing them closer to professionals that help us, not only filling the seats in the countryside and to keep them there, but also having that appeal of living in the capital, experiencing the capital and getting closer to other professionals. So this makes -- this combination makes a lot of sense. If we you think about a medical career in Brazil, you can't really look away from the doctors in the countryside.

Yes, it's a great question. I think we have an advantage of a model that covers several steps of the journey of a doctor. And of course, with this comes complexity. We have over 20 solutions, 70 technologies stacks. So how do we address this complexity. We've created an IT infrastructure in layers. We have the foundation, the technological foundation layer with more senior professionals where we create an architecture to reuse solutions. Prescription is one of the examples. We did it in-house and it's the same solution available at iClinic and WhiteBook and the Portal. It's a solution that serves several channels. At a high level, we have solutions for physicians at the beginning of their career and then the core solution, which is WhiteBook. Some of the acquisitions we've made we incorporated WhiteBook to it, MedPhone was one of them, for example. And this was turned into calculators library within WhiteBook, it's one single product. So we have physicians at their practices, and we want to increase our market share by here. I have more than one solution for them. We've been working on components, and we have been building relationships between physician and patient and physician and in the industry, but always with a focus on the physician. So we've been reusing lots of solutions while on the flight because we don't want to miss out on the growth potential and focusing on the number of physicians, a qualified audience. We have a model that I can see in the rest of the country. [ MB3 ] is similar in the portfolio company in the world. And now [ Topsend ] is now far moving to searching for this more qualified audience of physicians, but we do have that already. We have over 250,000 physicians using the solution on a daily basis. And we have data, we have behavioral data, whether on how they consume content or the prescriptions. These are great assets for us. And we have the closeness with physicians. So based on the footprint of their behavior on our solutions, and knowing these physicians, we can become more and more relevant for the physicians and efficient for the industry. The industry is still communicating in a very spammy way with physicians. And we can communicate in a more relevant way with physicians. So our technological foundation is focused on that. It might take some time to gain efficiency. But the good news is that we are likely to gain a lot of efficiency in this area. We have already gained a lot of efficiency, but with these improvements of reusing technology, of course, there is more to come. But there is complexity in managing this portfolio.

May I just add a comment very briefly this complexity is directly proportional to the reputation we have been building in our schools. It's intangible. It's hard to measure it. But looking at the ticket capacity, the seat capacity, I mean, we have always been expanding and this has an intangible value. And also from an investment point of view, there is some complexity in its management and execution, but it is a business that considering continuing education, have BRL 200 million in revenues but BRL 500 million in investment, it's a huge scale ahead of us. So not only do we have the intangible that we also look at the beauty of a business that's distributing a lot of value.

Marcelo dos Santos, JPMorgan. Some questions first for Virgilio, a bit more of what you said on your presentation where you talked about 4.4 for each 1,000 habitants, 4.4 physicians. So what do you think will be the behavior of the market? Do you think on average, not talking about Afya and not talking about Afya will do. I know there's a brand. But how do you believe the industry follow? I'd like to see your reading as an expert in the sector. And second, for Erico or maybe Virgilio as well. I'd like you to tell us a bit more about the vestibular, the application exams for college. I'd like to know when you talk to private players, they say that it's still good. But when they start to have the candidates come in, there are many that give up. There are still a number of seats, but before you would call in the first, second, third list and what is the level of deterioration in terms of the quality of this candidate? I'd like to hear your opinion on it.

Sure. Well, first, the dynamics of price, let's talk about the good players, the ones that have the niche where there is great reputation in some cities compared to the ones that are already suffering, they have been for some time now. And there are major players today in capitals where they don't get the pricing, and they don't have 100% of seats filled. So this will get worse. We see, well the infrastructure is okay, the faculty is okay because they're at the capital, the assessment from the Ministry of Education is okay. But what is the reputation they're building? What is the value they're bringing in for the students after they graduate. So Unidompedro was an acquisition, an okay brand, an average facility, there was a backlog that we had to quickly correct, but there was a gap of capturing students and of ticket also. So this is a point what happened to Afya when we got to the city was 317 enrolled 1/3, 100-some came from transferring from competitors in that city with an average ticket less than Unidompedro was at when Afya got in. So there was a quick recognition of the brand and an understanding, an expectation that the improvements that we would bring be following through. So this is recognition, achievement to the branding work, but there's a reputation that is very strong. Some players in Salvador asked our request to have allocated positions to have them in their hospitals that were starting that operation at that point in time. So this really makes a difference. I mean, the name of the game is really showing your differentiation. I'm always on their back here saying, every single day, is our differentiating point here? What is it about us? Where is our Afya honor? Where are the best students recognized, the research studies, the simulation center, which is one of a kind in Brazil? So this in the medical universe, are so much centered on that. So if you don't have that reputation, you won't have an asset. You won't fill the seats. So we can call this event a differentiator, what we want to create so that we can have sustainability in filling up our seats and at least to pass down inflation to our prices.

If you allow me, Virgilio, when it comes to the market, Marcelo, we see much more the association of the price related to the compensation of the physicians then the offer of the seats. When we see 4.4 physicians into the future, what is the demand for this physician? Where are they located? Are they spread around the country? If there is a greater concentration or not, Afya is really shielding that, as Virgilio said, to become a recognized player in that niche. So when see the major brands that I don't need to mention here, but don't have this. But when we talk about the market, it's more about the compensation of the physicians, how will evolve over time and their payback to invest on medicine school.

Marcelo, when it comes to the candidate seat ratio, we don't see a drop. We're starting the capturing cycle for 2025. So we concluded 2024, 1 and 2. So for the last 2 weekends, we dedicated to the screening process of our units. So when we close 2024, and we did the math, we saw that we had about 6.5 per seat, so we still at that level. What happens when we have the enrollment? So what's easy for us because many times, the list of the classifications from this screening process will already have that. So what I'm saying that there is an exceeding classification in the units where we have much -- many people looking for the seats. So we have what we call mobility university, mobility, they classify and they go to the ones that they can fill the seats. A change that we bring for 2025 is the integrated vestibular. Some already have that in a way that we can have a national classification for a candidate and they have the first and second option. With this wish for Afya that has been increasing, you're able to improve even if you have a seat for those that have as a first option unit, for instance, like Santa Inês. We're able to bring a student that is better qualified in the national vestibular, the application exams to that unit. So we improve the seats filled in those regions. And why do we convince and why do we get this flexibility? First, because we have an integrated curriculum. We have the flexibility of having them come to the capital so they can have the internship fifth and sixth year in the capital and also even have a transferring internally within our units. So this really makes it easier to fill the seats and also really push the bar when it comes to have a healthy ecosystem in the long run.

Congratulations for the event. Flavio from Bank of America. In terms of the medicine seats, you talked about the residency and also specialization. I'd like to understand how your mind works when it comes to the revenue in the midterm and how much it should contribute and in terms of the medicine programs we have?

So to understand the competitiveness of specialization courses and residency because we follow all the medicine courses but this is one we have less information. I will start and then Denis, you can add to that. So we have 85% for undergraduate and 15% medical practices with continuing education. And what we see in terms of growth in the long run definitely depends on the speed of growing the undergraduate if we have the acquisition in a way that can be quicker from the plan of 200 seats per year. But what we've realized is that undergraduate has been growing to 10% and continuing education at the high 10s and the medical practices solution, 20%. So this setup will change according to the speed of growth, but undergraduation program is the relevant part and essential to our business. And this mix will be changing over time, because of the different speeds of growth for each of the segments. We will not, Flavio, have a long-term guidance for segment. We'll just have the long-term view in a consolidated manner because that can vary according to the opportunity we see in each of the segments. So this view having a specific number for each of the segments, we will just have it in a way that is consolidated. And to add to the competitive environment, and what do we see starting from all the movement and the shift in the market, we see competitors heading the same way pretty much, so we see an increase of competitors when it comes to in-person programs and also we see the digital, but we don't see a full delivery of program. So when you have residency, you have many when you talk about gradual program. So definitely, it's less regulated til the barrier of entry is less. And they're good competitors. They are very bad ones. So this is something we see every single day. But yes, there is an increase in competition, not only from the educational groups but also health care groups, influencers coming as providers of continuing education overall in health care. But it's a dynamic that we deal with a daily basis. And what Virgilio said, the name of the game is differentiator and reputation, and that's what we see a great work that we've done. And Flavio, just to add, you saw in Denis' presentation that when it comes to continuing education, we had 5 units in 2019 to 20 units now. So it's organic because we see that the portfolio, of course, is that we have incorporated into the units is very strong.

And why did you make this decision? Did you see the competition?

Yes, there is competition locally in Sao Paulo, it's strong. Sometimes you go to the Northeast, you have a player that has a very strong presence, but they are a standalone players where they do not have a full offer and they don't have the 350,000 component consuming our ecosystem with very high NPS, high reputation at the top of the funnel that you need for medical education. And you have a dynamic in the market when you look at the macro data that is very important because on one side, it's an internal hedge, I'd even say because you increase the competition there of medical seats. But on the other hand, you have many more physicians graduating with a level of residency that is constant, they will need your specialization. So the incentive is even greater. And you can have continued education, which is a full integrated offer with the employers, the pharmaceutical organizations, other providers, where do they come to hire? Where will they encourage their physicians to go after continuing education that can be a business-based or medical-based. So this brings a differentiation that really makes us perform over the market behavior.

If I may, since you brought up the question about guidance. If I'm not wrong, in the last 2 half year days, we had long-term guidance where we would double the size of the company in comparison to the previous year, and we reaffirmed this guidance.

I'm from Itau BBA. First, on the side of the bank, you said the expectation is to get about 1,400 new seats because of Mais Medicos III. Can you give me details about this number, break it down and maybe a perspective for each region, that would be helpful. And also about Medical Solutions, I remember in the past, you've mentioned this is a small number of physicians who would do continuing education and also use Medical Solutions. Can you tell me about that cross-sell evolution over time and opportunities as well?

Sure. Lucca, for the first one, about is Mais Medicos III, we have 23 opportunities of offerings. We've presented our proposal, the competitive process is ongoing. It's going to be finished until May next year. And we've presented 3 proposals -- We've submitted 23 proposals in each -- for all of the states where we have a permit. The 1,400 number is the maximum number in case we obtain all the 23 states. It's hard to be accurate as to what -- as to how many units will be involved because I had a range from 0 to 23, but we believe we are in a very good position in the current scenario to obtain states. They're not going to be diluting our current market share in terms of seats. And just to add to the answer, the regulatory scores are extremely important in this definition. With the public bidding, our regulatory scores are very sound, and that is why the outlook is very positive, considering all the possibilities we have, especially because of the score. The other items are also very relevant in the competitive process. There is the pedagogical processes, and we always achieve excellent scores. So we believe that the combination of regulatory scores plus the project scores put us in a very good position to grow with this. Now with regard to cross-selling, and I might want to add something to answer Flavio, we've been getting lots of initiatives -- lots of opportunities to look into our ecosystem. Consider WhiteBook has 220,000 active users, especially in the beginning of the career. It is very likely that the continuing education physicians are still on this base and we've been increasing the overlapping and cross-selling of products continuously. We created an area here last year, which is called the journey. We're looking at the physicians' journeys, creating actionable intelligence based on the data we obtained on physicians and one of the purposes is to increase cross-selling. We increased the engagement with this physician, and we increased cross-selling, whether it's in continuing education or because a physician will start their own practice, and they're likely to be here in our post-grad classrooms or they're using WhiteBook. This is how powerful the ecosystem is, and that's what differentiates us, both in the undergrad and the post-grad and the medical practice solutions, we've been engaging more and more with the physicians who are already in our ecosystem. The number has grown already 22, 23, 24 and I'm positive it will continue to grow. This reduces our CAC but it will increase the value delivered by the whole ecosystem. Now I'd like to comment on the 2 points. WhiteBook, for example, is a great top-of-the-funnel for us. If you consider that it has 80% penetration among recently graduated physicians, considering they will have to specialize through residency, through a post-graduate degree. Soon, they will be specialists starting their practices. So the cost of acquisition of a new client is drastically reduced here, not only through WhiteBook, but also through Afya's portal, which integrated with our strategy for the top-of-the-funnel of this year. Now about Mais Medicos, I'd like to add to what stands us apart because -- what sets us apart because when you have a pedagogical proposal for a city administration, and within our project, you see a solution such as WhiteBook, you see a solution such as the medical records solution, all offered for free for the city administrations, this makes us stand out. Not to mention the contribution you have in terms of tuition. And many of these contributions have a very low cost for us, for example, to offer a digital solution like this, it generates value for us. It's often priced as part of the rebate you have to give to the municipality, but this enriches the pedagogical process and the social impact on these regions. You've seen the WhiteBook radar. And you can see a new illness that's becoming endemic or a pandemic or an outbreak in that region. You can mention the value of that when you're offering that to the city administration. So of course, we stand out by a lot with these features to offer them.

I'm Leandro from Citi. I have a quick question about the increase of seats, the expansion of seats. You've mentioned a lot about the demand and candidates per seat and the quality. But I'd like to learn more about the faculty, if you have any thoughts on the cost per class and attracting professionals and how reputation has been helping you at attracting new faculty?

It's always a challenge in more remote areas to attract faculty. We have several leverages for that and one of them we love is the possibility to qualify masters and doctors in these remote areas through our stricto sensu, which we have in UNIGRANRIO. Because we have a stricto sensu program, we have a way to bring these programs to these remote regions. For example, Manacapuru in the countryside of Amazon state. We have a master's degree program in partnership with UNIGRANRIO where we're qualifying professionals right in the Amazon state. So not only can we qualify them theoretically as required for masters and doctors, but also we are using preceptorship for alumni. So throughout their journey, as they graduate, we are -- they already start coming back to our units in a preceptory program, for example. This helps the qualification process of our future professors. Yes, and this sets us apart. But just like the ecosystem puts a lot of effort into attracting new students, we have doctors, physicians of all cohorts. So you can imagine the power of partnership with -- that's public and private with the government. You have the Secretary of State, the Secretary of Health, you're statistically relevant with 10,000 physicians in the state, and you need to get closer to these physicians. So we can take the stricto sensu programs for these physicians if they come in for a career with us. So not only do we have engagement with the public government, we also have the leads from our entire ecosystem, helping us identifying the potential candidates for specialty medicine courses to work in these regions. This is very helpful. And we've been improving this. It's getting easier and easier to find faculty members in the countryside. In the capital cities, of course, that's not an issue. We have to improve quality, but there are more and more faculty members available here. But in the countryside, we've managed to do these -- to make these partnerships and make it very appealing for the Mais Medicos. And I think the brand has helped us a lot with that. Just to add to what you said about the seats, we've been seeing lots of colleges that have been obtaining permission to offer new courses, and they won't even open it. We've seen cases of medical schools that recently got a permit and they never used the permit given by the Ministry of Education to actually start their units, to open their units, to start with enrollment processes and so forth. We have not -- so this is something we've been noticing, some colleges are not even starting the process. I think we have more time for one more question.

Yes. I'm Andre Salles from UBS. First, I'd like to ask about is Mais Medicos III seats based on the studies you've carried out, taking into account 2 points. One of them is the payback to the municipal's health care system and the scholarships. And how do you look into these opportunities for this program? And the second is I'd like to explore a bit further the cross-selling opportunities that you have already mentioned about, but if you could break down the details of cross-selling between WhiteBook and iClinic? I'd like to know if you see this as a potential catalyst to move us away from pen and paper-based prescriptions? How long into the future are you looking for that?

Well, we'll start talking about Mais Medicos, we have the experience with I, II and now III. So you are very specific there in your point. So Mais Medicos has an economics different from a unit that does not because of these 2 factors you mentioned. First, you pay the cost of the scholarship that is anticipated. You start, which is a percentage of the revenue. And then it's mandatory until the recognition. So you pay for it, which is the economics related to the regular unit, and then you just start paying for it when you are in the internship. And the other one is the actual scholarship grant. So you have that effect. But on the other hand, for Mais Medicos, you don't have any type of anticipated pay until you have the CapEx of the acquisition that is with Mais Medicos III, we think about BRL 25 million. So when we think about -- and all the experience we have with Mais Medicos I and II, we see still the rates of [ tier ] that is positive over 20%, which are our minimum threshold for any investment. So yes, it's appealing investment our allocation of capital, and that's why we have a 23 proposals on Mais Medicos III. And to add before you answer, I mean, when we talk about margin of Mais Medicos, the question I usually get is that there is any wish to compare to other universities. When you compare with other university, with other courses they can have a prevalence of medicine, but they have other courses. So it's quite different. But when it's a pure medicine course, you see that difference. And there's another also points that are trade-off. You go to Mais Medicos program in the municipality. So you have that, go to the municipal and the cost also be much less when you get further up. And the cost of the faculty also, it's much less compared to a major capital. So the rental can be compared, the tax on property. So that is good trade-off in terms of the whole mix to be healthier. And the portfolio of the product also, you have the graduate programs, the digital solutions also and cross-selling. How do we do that and how has we evolved? The most spontaneous to have the campaigns on the base. So I mean that I have the campaigns on the WhiteBook. So it's about knowledge, iClinic and education generating lead that can be a bit lower cost. And what we have created with journey where we capture data from the medical behavior with a structure of data. We have book, which is the unique view of the client. So we have all this in a layer. And then we have a CDP, which is customer data platform, where we can capture data from the digital footprint and their behavior in all the solutions. And then we are able to be more of assertive target so that we can have something specifically offer to that physician. So what are the triggers in the behavior that will make that physician be at that point of consuming iClinic or a continuing education solution. And on the other hand, all the laboratories of continuing education uses our solutions. So physicians that come, 6,500 students per year, they experience these solutions in the offices we have here, which is over 320 around the country, and we'll have good things also in the pipeline that they will try that, and they will become a lead to me, to that office solution option. So you said something that's very interesting, how can we go from pen to paper when it comes to prescription. Prescription is a very strategic point when it comes to that. As the physician generates the prescription, the profile of prescriptions of interest to the pharmaceutical company and the patient consumes the prescription, buying medication and having test them. So that's important to leverage, and that is core to us. Brazil, the electronic prescription is allowed only for the regular medications. And we have an expectation and this is something that will take place for the other higher control medication, it's all made on -- by paper. They need to buy -- or ask for authorization to get a stamp and to get that printed in an authorized print shop and they are in charge of all of those pads that are numbered and that's how it works with a higher value medication in the market. So when you go to the digital, it will increase the number of prescriptions. What we realize, it's a generational behavior. The past generation of physicians prefer to prescribe on paper. Most of you have had that, you take your paper when you're out of the office or even digital, it's a printed version. Sometimes it's digital but they print to be able to have that given to the patients. The younger generations that are digital-native, they prescribe on the phone, on the digital tool. So over time, we will end up having a behavior that is more digital and added value to -- in the prescription. A topic the physicians have demanded and that we bring in our prescription is to know the price of medication. There's a standard price, which is not the one that's ever used, and there is the retail price. We have the retail price through Cliquefarma. I have the range, the average and that is very valuable to physicians when prescribing it, and that's something that we are already embedding in the prescription. We have the whole part of WhiteBook of support in the decision-making that is interesting when it comes to the [ anemnies ] and the prescription. So we bring this to iClinic, and this will make us increase prescription volume. So you have the prescription on the WhiteBook now. So in no time, we have already 6,000 physicians prescribed. We have that on the portal. We are starting to have our prescription on a stand-alone version in partners in the market that want to use our prescription and why? Because it increasingly more brings added value that the competitors don't, price of the retail, WhiteBook knowledge, and this will make that go from the pen to the digital, and that's what we're building towards. But with cross-selling that can be much more well structured in terms of the physician's journey. And there are 23,000 that are using, as we speak, prescriptions -- they will make electronic prescriptions. All professors now -- which is something very interesting, all of our professors from undergraduate have free access to our solutions and we engage professors so they become the influencer in the region where they're at and they promote the solutions to students, and we'll do the same with the professors of our graduate programs. Okay, due to our time and respect everybody's time. We'll have our last question now.

Can I ask more than one?

Sure.

Renata, you said the ticket you obtain from students depends on the generation of value after graduation. So can you tell me about the future perspective for that? And also, you talked about generating cash flow and the competition I'd like to see that number, the competition with -- in Afya comparison, I'd like to know where the number came from. And the medical market is more niche, it's more protected so to speak, but we see large education groups from other modalities, from other courses looking at your margins because their margins are much lower because they have much more competition, right? And the same happens in the job market also. So can you tell me more about that, please?

Well, I'll answer the first part and then you answer the second. Our name -- the name of this event here is differentiating factors. The market is worn out. As you can see, virtually physicians have almost 100% of employability if they have -- if they're registered, right? So it's probably more than 100 if you consider that sometimes they have employees and are -- they might -- and each physician has more than one registration so employability is extremely high. And income is very appealing that justifies this investment. But looking into the future, imagine a hypothetical scenario where this market is saturated. What we are doing at Afya, I think perhaps the biggest differentiating factor for us is that within this hub we've built, we have the main employers. And what the main employers are doing? They want to get closer to physicians, they want to hire the Afya know-how in order to physicians, the best timing, the lowest cost of opportunities for physicians who are accessing them. So we have the knowledge, the expertise on this. On the other hand, hire the physicians. The key providers also have a big need because at the end of the day, they need physicians to perform procedures for them. So you're recommending surgery, where you're performing it? Who has 30,000, 40,000 professionals who ultimately will drive demand for providers. This further down the road, I have no doubt will be a great differentiating factor. If you look at the very traditional schools in Brazil, like Fundacao Getulio Vargas or ITA, the industry hiring these professionals are very close to these schools through scholarships, through internship programs, and we must be close to all of them, too. So if you look at 60% employability, 70% employability, who, at the end of the day, will have the best condition to employ your alumni. I think we will have a great condition to employ our students if/when we come to it. I think it's important for you to look it up. I looked up to present it to you. In other countries, the number of physicians is superior to OECD. What happens to their compensation, their salaries? Still, we see physicians have superior salaries justifying this investment in education. And about the cash flow, well, first, I can talk about our own. When we presented our cash flow, we looked at the reported cash flow that includes the 3 branches, and within the 3 branches in undergrad, we have 85% of our revenues, and we have part of it that's non-medicine related. 85% or 86% of our tickets come from medical courses and the rest comes from non-medical courses. So we took that into account. We don't disclose the cash flow per segment, only for medicine. And just to compare it with other public companies, with their consolidated cash flow, they also don't report the breakdown openly. And this is the comparison we drew here to show the evolution, not only in absolute terms but also based on each action from the IPO and throughout our evolution in comparison to other players listed in the Brazilian market. But in medicine alone, no, we don't have that information open. It's the whole cash for the company and that's the same for other companies.

All right. So we are going to wrap it up. The questions we received online will be answered still today, but due to the lack of time, we need to close it now. So I'd like to thank you very much for your participation. We tried demonstrating all the differentiating factors and the goal is that you are aligned not only with our strategies, but our future and what we plan for Afya. That's all for today. Thank you very much, and I hope to see you soon.