Cogna Educação S.A. ($COGN3)

Good morning, everyone, and welcome for the disclosure of results of the fourth quarter 25 Cognite education. If you need translation, you have interpretation here on the bottom bar of Zoom. Just click the globe button and choose your language, English or Portuguese. For those here in the conference in English, you can choose to mute the original out by clicking the bottom there. This teleconference is being recorded and will be available at the RI website of the company, www. ri.cogna.com.br where we can see available the complete material of the results disclosure. It is possible to download the presentation also in the chat icon even in English. [Operator Instructions] Before going on, we would like to tell you that in statements made in the teleconference regarding the business perspectives of Cogna, preventions, operation and financial targets are the beliefs and premises of the company administration as well as the information available now for Cogna. Future considerations are not a guarantee for performance. And there are uncertainties and premises because it's referring to future events, therefore, depending on circumstances that may or not happen. Investors and analysts should understand that general conditions, conditions of the sector and other operational conditions may affect the future results of Cogna, therefore, leading to results that will interfere and be different from the ones expressed. So now I'll pass on the floor to Mr. Roberto Valerio, Cogna's CEO, who will start his presentation. Please, Mr. Roberto, the floor is yours. Thank you very much.

Good morning, everyone. Thanks for participating in this teleconference to discuss Cogna results in the fourth quarter of '25 and the complete year of '25. In this call, we have Frederico Villa, our Financial President and Glen Meleger, Vice President of Blast. The call will take about 1 hour as we generally do with the 40 minutes of presentation and 20 minutes for the Q&A. Well, I'd like to start emphasizing that '25 was one more excellent year of results for Cogna we've had wonderful results not only in financial terms as we'll mention in this call, but other results that are wonderful from the point of view of growth of the client base and students base, satisfaction of clients and students with the NPS targets and engagement of workers, we could reach the MDS that is our workers with more than 80 besides being among the best companies. So we are the 12th company to work. So we've loved a lot in many items related to our reputation that we follow with the annual research. And other awards from the ESG point of view. So I would like to start this conference by emphasizing that not only the financial results were wonderful, but also the company and there are many dimensions with a very good year. Specifically speaking about the financial results, I would like to emphasize in this first slide, the operational cash generation after that in the JCO that in '25, reached BRL 1.274 million with a growth that more than BRL 230 million comparing both years, 22% of this comparison from -- comparing '25 and '26. Obviously, we keep following the GSO. But more recently, especially after '24, hat was also a very good year. Our main indicator of cash flow is the free cash flow that we reached BRL 716 million in the generation of free cash flow with a growth of 81% compared to '24. That year, we've reached BRL 395 million in cash generation in this year, as I said, BRL 760 million with 81% growth and to us, this is an indicator, and we obviously have many ones, but this is the most relevant to our operations. The net debt, comparing the fourth quarter '25 and the fourth quarter '24 reduced about BRL 45 million, even with more than BRL 650 million of capital allocation where they're giving back to the shareholders BRL 181 million that were given by biotech problems and distributing the dividends, and we have a strategic purchase of a college and the capital that we allocated with more than BRL 420 million. Therefore, we could reduce the net debt in and that even with the relocation of these millions of [ rials ] mainly in these 3, 4 items that I mentioned, the leverage reached 1.2x the EBITDA that is lower than the same indicator in '24, $1.5 million comparing to the third quarter, there was a little increase, which is quite mature comparing the capital of [indiscernible] The company is generating a lot of cash. We know that over the next quarters, in 2016, this leverage will keep decreasing, and we are pretty sure about it analyzing the results of January and February. So when we see '26, that's what we see. So going on to the next slide, I would like to emphasize and make some comments because I know that at first, both revenue, EBITDA and the net income may be a surprise considering that we were growing in the first, second and third quarter in double digits in revenue, EBITDA and net profit. So when we analyze the fourth quarter, might be a surprise, but we have a simple explanation for that, that is quite easy to understand. with the 3 items here that I can easily explain. Obviously, we've had the opportunity. If you have the opportunity of reading the document, you understood. The first point is related to the PNLD that we have a relevant fact to emphasize in this point as it was disclosed on the media in the last -- in the end of last year with the high score purchase program that was postponed in the fourth quarter to the first one. So obviously, we didn't have revenue in the fourth quarter because it was there in the first quarter. So we've had January in February with some revenue even in March in [indiscernible] BRL 67 million in revenue, which would be about BRL 52 million in EBITDA. So it's not that the program is not there. It happened, but with a specific displacement that is real and will be seen in the first quarter of '26. But we need to consider this factor that for years and years, this purchase has been in the fourth quarter. So then I'll explain what we call the pro forma figures and taking that into consideration. So this is the first point to note. The second one has to be with BRL 35 million in reference. And we have more than 10 million company and corporate numbers here in the team in terms of taxes, and we are trying to find optimizations in such a way we can reduce our expenses and our payment of taxes and this reorganization obviously generate opportunities as this one to reverse the contingency in BRL 365 million in '24, that is not recurring and comparing to '25, and I emphasize it as a pro forma item. The same way in this context of opportunities of reverting the tax contingency in the fourth quarter of '24, we've had BRL 552 million in tax contingency in Cogna, which fostered the net revenue in but it has to do with the tax reversion in this analysis. So in this sense, it's quite simple. Basically, we have 3 items, the incoming bet entry items related to the reversion of tax contingency and the pro forma, as we see on screen, we see different results. So instead of the net revenue growing in the quarter. It's now growing 12.1% instead of EBITDA decreased 5.3%. It grows 5.7%. same way we have the net profit that is 84% to grow BRL 552 million instead of decreasing the 76% that was there. So I emphasize this point here that from the operational point of view, the company not only [indiscernible] , but also [ Kraton, ] they are performing quite well in good places, quite close to the first and second quarters, taking into account these 3 factors that I explained which make it clear that the figures are quite aligned to the previous quarters. Well, going on to the next slide, now a little bit of capital allocation that is a recurring question. Our strategy still the same, given the high interest rate. So while we're main goal here is to reduce the debt in such a way that we can reduce the financial debt. This is our priority, and we keep this way in '26. So since '24, we started -- we restarted generating net profit, so not only with the buyback programs, but specifically with the payment of dividends. And the third item is specifically and strategically in a very intelligent way and with the positive multiples to make one or other M&A to complement our portfolio. And I can mention 2 here that I emphasized in the presentation, but I can even mention one small -- another one but we have the medicine in Dorado that strategically is stated that we want to grow in the mating courses. Our strategy is not to operate with medicine nationally is to focus in Mauro, -- so Matros do Su, Bai and Marion. So only some states. So here, in this case, Doralda Grosu, we've had already 2 maintain schools. So it's quite strong there with a brand, and we have the capital in some that obviously is strategic to us with a small purchase of [indiscernible] of OPM that allows us to grow our part of services and other institutions. And currently, we work with McKens SPM and May institute, other and other premium brands. specifically in the segment of post graduation and extension courses. So this is an example just for you to understand what is the strategic M&A that is to reinforce our business portfolios in this strategy of the 200 years. That is our current strategy. Now going on to Kroton in Slide 7. I emphasize the first graph with the intake. We kept to grow in the second quarter in the intake, which grew 3.7% when we consider the students who are paying that, that is what I emphasize, although we have the complete information there. But we grew 2.7% in distance education and on-site also with a stronger growth. And I mentioned that. And later on, I'll talk about it. I'm pretty sure you'll ask about the intake process in '26, but our intake for the on-site is growing for the last 3 cycles. And in the second semester, it was not different. It grew 16% and long distance, it grew a lot as well. The churn despite the growth rates being consistent and growing, we have a dropout rate that is stable, so no point of attention here. So both the academic and the financial engagement kept quite positive in the second semester. The final student base grew 3.7% overcoming and almost reaching 1.1 million students according to the third graph. Now going to the next slide that is the revenue slide. I tend to say that when the base grows and it grew 3.7% and the average ticket has 2 that, in our case, grew 7% in the semester. There's no how the revenue not grow. So this is the result of the revenue in the pro forma view in the quarter growing 7.9% and in the year, 12.1%. So you may ask, so in the quarter is smaller than the year. So you reducing the pace, no. It's because we have the first and the second quarters as being the strongest ones with a better growth in the revenue because the volume is greater and more concentrated. And specifically this year in '26, we have the effect of Palace that we are debating in quite a strong way with you. So the growth in all business segments emphasizing online education, but also on site and Kroton Med growing also strongly. So going to the next slide, Slide 9, talking about the gross profit. The gross profit reached almost BRL 900 million, growing 4.3%, the year 11.3%. It's important to emphasize that we have this trend that probably, you will ask in this call that is regarding the pressure in the gross margin. So it's natural for this pressure to happen. It's not the case in the second semester of 25, but we'll have a greater participation of on-site which pressures the margin, but it's important to say that in the net, the EBITDA is growing because the on-site tickets are much better. So that's why we have the cash generation. That is our main indicator here. That will be positive, although we have a small pressure in the gross margin that we'll try to mitigate with a series of actions that we can discuss in this call. Among which we have the process division and the use of the AI and so on. And specifically in the gross margin of Kroton that was a decrease of 12.5 points percent. It's natural from the point of view of being expected due to the maturation. So we have 9 medicine schools, 4 under development, and we purchased 1 that started operating this year, specifically in the fourth quarter. So it pressures the margin a little more. It's natural for that to happen. Regarding on-site as in DL, the reduction in the margin has to do with the health care courses that are maturing besides an increase in the professors personnel in the fourth quarter because as we make in new groups in the third and fourth quarter that you don't allocate the hours in July, but I'm pretty sure that in September, October until December, we have the hours there because we have classes there. So that's why we have this pressure in the fourth quarter. But in this semester, it's important that it's stable. Now talking about costs in the next slide, Slide 10. I'd like to emphasize that we have quite clear here not only the accountability of the fourth quarter, but also the pro forma and the analysis here are related to pro forma. So the corporate expenses had an increase of 0.7 points related directly to the social taxes regarding the shareholders. So we increased with the actions we need the provisions regarding the stocks that are distributed and CMP improved in the fourth quarter, we can see quite a positive plan due to the processes that we are dealing and operational expenses are stable. And as we mentioned in the previous quarter, it's more concentrated in the fourth quarter because we could make an economy in the third one. So it's natural. So in the semester, everything is stable. And the costs are related to the hours of work of the professors and the main courses, as I mentioned. So this is the quarterly view annually in Slide 11. The explanations are basically the same. So we have the corporate expenses related to the stock more valuable. That PD that has to do with more provisions, and Fred will then explain it better if you have doubt, but it was quite well discussed in the year with the provisions of and the improvement in operational expenses that we grew almost to 2 points that are related to processes and development of systems expenses in markets with the efficiency and improvement that we are reducing the cost of heavy new students. Therefore, we are gaining in efficiency. Going to Slide 12 now, we can see clearly the adjustments that were made in the fourth quarter '24. But in the comparing with the fourth quarter '25 and have to be considered, there are the adjustments and the movement of discounts of inactive students that until the third quarter would impact and reduce the revenue. And in the fourth quarter, we started allocating PDA. So this table shows clearly this adjustment. I mean, this reduction in the revenue and the reduction of PDA. And it's important to say that in this movement we see an EBITDA that is muted. It's just an allocation that is quite well mentioned. In the second graph, we can emphasize, first of all, the reduction in the receivables and we kept improving this indicator in the fourth quarter with 3 days less, so it's quite positive in this 41 days. And in the other line, we can see the reduction of 18.4% and in the fourth quarter, reflecting what I mentioned in engagement and financial engagement I mean, academic and financial engagement. As a consequence of everything that I mentioned, I think the last slide of Kroton that is Slide 13 shows that in the quarter, we've had a reduction in the gross margin of 1.2% for reaching 26%, but the EBITDA grew 3.2%. That is namely, it keeps growing. And when we see the accumulated view, the margin is basically stable, 0.2% with a strong growth of EBITDA of 13% that is a growth and the same level of the revenue that is we have the revenue and the EBITDA growing more than double at double digits. With that, I finished the Kroton presentation, and I'd like to pass on the floor to Guilherme Melega to talk about Vasta.

Thank you, Roberto. I will now go to Slide 15 to talk about the net revenue of Vasta. So I'll start with the red on the left in the quarter that we reached a revenue of BRL 73 million with a EUR 10.7 million increment in the period and I emphasize our business segment in the subscription revenue, we reached EUR 646 million, 4.4% growth, and this is a partial growth. So for us to have the overview of this growth, we need to consider the first quarter. So as we had a significant growth in our B2C channel when the schools operated with our e-conference and we sell directly to schools, we had a displacement in the revenue of ACV in the first quarter. So the results would be even stronger in the fourth quarter. In the B2G, we had BRL 84.7 million revenue that is a consistent growth compared to last year. We have more than 20 contracts in B2G. As we imagine, it's quite a close and good segment. So we are growing a robust way here. And in the fourth quarter, we reached 34.7 with a growth of 7.3%. When we consider the annual figures of the company, we reached BRL 1.811 billion. So I would like to emphasize here the non-subscription revenue that reached BRL 116.9 million, growing as a result of the improvement in the performance and the payments in our SAP courses and the schools that we operate in flagship. So both the growth of Lysopaterand and [indiscernible] everything resulted in this revenue of non-subscription. And the 2 REO 10.4% reach and BRL 115 million. Now in Slide 16, I'll talk about our EBITDA, the EBITDA in the quarter that traditionally happens this way has been the greatest volume. We have a big supply for the return to school in the next cycle. So we acknowledge here BRL 358 million in EBITDA with a growth of 19.5%. This growth traditionally brings EBITDA margins that are greater than the average of the year as a result of the reduction in the fixed courses with this volume and gain on productivity that we have. So our EBITDA margin has a growth of 13.4% in the semester. When we analyze the yearly figures, we reached BRL 539 million with a growth of 7.7% here, emphasized that we are keeping the level of growth. In here, we didn't have all the growth of ACV in the first quarter, and we have stable margins. with a level of 29.8%. So we are keeping our level of growth, investing in new business and without losing the margin. So we are keeping our margins even investing in the growth businesses as a start outlook, for example. Now talking about the costs in Slide 17. Here, we have the quarterly costs. We reached a total cost of BRL 488 million. So it's a 2.9% growth. When we compare to the revenue, the result is an expansion in the margin. As I mentioned, of 3.4% in the margin. The gains in productivity and scale in our CPV in the total cost that reached [indiscernible] here. In Slide 18, we have a better understanding of the cost and expenses of the company. So here, we can see the yearly overview of cost and expenses with 8.3% growth. And I emphasize that in percentage, terms of percentage, we were absolutely flat in costs. So our investments in marketing and sales grew. And it's offset and absorbed with the better productivity that we have in our courses and expenses. Now looking ahead, I would like to emphasize that in the B2B, we have a first quarter with the growth to have the snapshot of the growth in the ACV and in B2G, a robust growth, we reached BRL 150 million in this business line, working a little more than 2 cycles of intake in B2G and a very favorable perspective for the B2G in the year '26. We have the first quarter quite strong, and we operate with the closing capital of Vasta in an integrated way with Saber. So we have the same team, same portfolio so the B2G is still one of the biggest growth of the company. especially now that we can work in a synergic and joint way with Saber. I finished by emphasizing that start in the year. It has 3 units working in -- and we have a pipeline of more than 60 contract times. So soon this business line will also represent significant results here to our business. I now pass on the floor to Fred.

Thank you, Melega. Good morning, everyone. I'll start in Slide 20, talking about Saba and remind you all that [ Sabeco ] prices, the national program of diabetic books and languages and up that is our business platform. So I emphasize that when we analyze the fourth quarter of '24, we had a reduction in the net revenue, the total of Saber of about 11%. And Roberto previously mentioned that we had a specific impact with the delay of the agent of the national program of the direct books of the federal government with an impact of about BRL 166 million, but the good news here for the quarter and for the year is what we call notes with a net revenue in languages comparing the year to having a growth of about 14% and the other businesses that are meant and our products of Asset Brazil that we sell to smaller states and the cities, we had a growth of 21%, which reinforces our strategy and our growth in the businesses with the government. In the accumulated, we also reduced our revenue in about 10%. The impacts are quite similar. The main one being effect in the displacement of the agenda of the national program of the DEC books and the 2 lines of languages in opiate Brazil product keeping growing 37%. And in Slide 21, we are now talking about the recurring EBITDA. So this impact here of this displacement we had a significant impact in the recurring EBITDA of the company. So in the fourth quarter, there was a reduction of 35%. And the accumulated of 12 months we've had an impact in the EBITDA of 21%. And please remember that as we mentioned before, this displacement with the purchase of high school will be in the first quarter of '16. In the EBITDA, we have about BRL 52 million. Finishing this brief presentation of Saber going the next slide, talking about Cogna to finish the presentation. I'll be very brief. In Slide 23, we show that regardless of the displacement that happened in Saber, we've had here a revenue growing 9.3%, reaching [indiscernible] close to the best historic of the company in pro forma in Slide 24. We can see a growth of revenue in the year of 11%. We reached BRL 7.184 billion. And now briefly talking in Slide 25 about EBITDA. We reached in the year a growth of [ BRL 2.3 billion ] with a growth of 5.7% with a margin of about 33%. When we go to Slide 26 regarding the pro forma, as we have demonstrated, we've had here a growth in the EBITDA accumulated by the end of the year, a margin of about 33% as well, reaching to BRL 1.351 billion with a growth of about 10%. And an important point now in Slide 27 is the net profit of the company. We mentioned that in the past, our main indicators were the operational cash flow indicators and the recurring EBITDA, but now we look more at the free cash generation and free profit. So we show how strong is your business with this impact being of BRL 624 million of net profit for the dividend distribution and remember that we had an anticipation in December '25 with the payment in February 13 of '26 of about BRL 120 million. And now according to the disclosure, we will have a complementary payment to reach the the 25% of BRL 28.5 million, ] which demonstrate here when we look in the next slide that if we adjust that -- in the same period last year, we've had some recurrence in our net profit, especially the reversion of tax contingency with effect in the financial revenue and the taxes paid and in the contingency line. So note that in the accumulated analyzing the net profit and the contingencies that were specific for last years, we reached the same profit of BRL 625 million, growing more than 700%. And this is important to us in the profit -- net profit generation because we are strong and we migrated our discussions of cash. So we see here in the quarter that our operational cash generation was BRL 335 million with the free cash of BRL 333 million. When we analyze this generation of free cash flow, we had a negative displacement. But remember that in the fourth quarter last year, we paid BRL 138 million of interest in this fourth quarter of '25. We paid BRL 213 million so it's just a displacement in the quarters regarding the liability management that we did during the year '25. In the accumulated, the positive news in the generation of operational cash and free cash is that we grew 24% in the operational one, reaching more than BRL 1.2 billion. Even with the displacement of the national program of the direct books and our expectations would have -- would be to have a revenue, EBITDA and the cash in '25, and we didn't have, but we show strong we are in generating operational cash flow that we generate in our business units, Kroton and Vasta that we emphasized in this generation comparing the years. And the free cash flow, we had a growth of more than 80% reaching BRL 716 million, which shows that looking ahead, it's not a guidance, but it shows that what we can foresee for '26 and '2y is a growing cash fee generation that can be even stronger with the reduction in the interest rate. It doesn't depend on those, but it's the expectations in the Central Bank. To finish the cash generation, we now have the position and indebtedness of the company. So we have a net debt of BRL 3.8 billion with a net debt of BRL 2.835 billion the company still has an availability of BRL 1.2 billion, and the good news, the quite positive news is that after negotiating over the last 3 years that we renegotiated 2x our debt, we have the agenda of amortization and note that in '26 and '27 we have accumulated only BRL 6 million of debt amortization, which is quite nice considering the operational cash flow generation for the company for the next year. And the last slide here, we have the company with a reduction in the net debt in BRL 45 million about our leverage that in the past was a problem now is under control. So we observe a lot the leverage of the company, and we reached 1.21 it's greater than the third quarter. But remember that in the fourth quarter, we closed the capital of Vasta with an investment of about BRL 422 million. If we didn't do that, and we did because we understood it was the better capital allocation. Otherwise, our leverage would be for 1.3. So regarding the last liability management that we had, we reached an average capital cost in the fourth quarter of '25 of CDI plus 1.32% with the duration of above 33 months. So we see the best way of generating the operational cash and free cash and the reduction of debt and the better allocation of capital for the shareholders and reduction of the average cost of debt and increasing the duration. With that, I finish the presentation, and I pass on the floor again to Robert Valero.

Thank you, Fred. Now go into the last slide with the general messages, we have quite a positive view from the point of view of growth. Obviously, we have the World Cup holidays and the elections here. But even though we are quite positive for 3 business, they all can grow. And remember that the long-term view, we still have a growth rate that is sustainable in double digits in a constant way based on a simple strategy. that makes the core businesses in high education and basic education grew close to double digits and complement -- being complemented by new projects with new perspectives of growth, and we are here during this year and in this call discussing them like the selling to governments and housing businesses in the market with the content creators in for producers and fluence and other technical and professional courses. So we have quite a positive overview to the sector as a whole. And we have the advantage of being a company with quite a diverse portfolio. So we always have businesses and opportunities of growth with the strategy of using our competencies for all businesses in such a way that we can grow without allocating a lot of capital and having M&A to operate and searching for new things. So it is still valid for '25 from the point of view of evolution. We are evolving in processes and systems. We are speeding up more and more the implementation of AI in many tiers. Obviously, we cannot implement AI, no processes at [ bonds. ] But we are trying to generate one or other initiatives of intake and creation of AI solutions that can be easily implemented by the managers without any specific support in the use of that. So over the years, will search for efficiency in this kind of initiative and from the point of view of experience, it is still our focus not only in the NPS indicators but all the engagement indicators and improvement of learning with quite ambitious project that we know will benefit many different products for basic education like Plural and higher education, and the smaller projects like Red Balloon that can benefit also from this. And from the point of view of people and culture, we are working strongly in the entrepreneurship and a team culture focusing on the client with a culture that is to grow and search for opportunities with this mindset I say that we have a good work environment with high engagement. So as I mentioned, with the participation in the great places to work not only with the CEO, but in the ranking being the 12th best one to work, which is not easy. It's very difficult to have that, and we are quite happy to be in this segment being also acknowledged by other organizations like [indiscernible] , the City Hall of Sao Paulo Romania awards and acknowledgments that are important to us. We also have good innovation, then we are speeding up businesses, and I can talk about the B2G, that is one important point of Cogna and the ESG initiatives with strong ways in our agenda. We have a lot of acknowledgment here, but what I would like to emphasize is the distinction because we are in the top 1% global indicator in the Global Sustainability Yearbook, by S&P, that is very difficult, and we are the only Brazilian company in this group. We are very proud of that. So having that said, I open for questions, and we are available to answer any questions you might have.

[Operator Instructions] We will now go to the first question from Lucca Marquezini from IBBA.

I have 2 questions. First, regarding port costs and thinking about prestay regarding the implementation of the new regulatory framework, we would like to know if it will impact the cost in '26. We had a competitor mentioning that they had the movement of adjusting their role of professors, I would like to know if you are adjusting that and how you are preparing for this increasing on-site education. And the second regarding the competitive dynamics in medicine, talking to other players in the industry, we can see a big concern in creating new groups in medicine. So how is it translated in your units, not only in having the amount of students and also the average ticket. So thank you very much.

Lucca, thank you for your question. I'll answer this. But Fred, if you have something to say regarding the personnel costs Yes, it's quite natural if you have a greater mix and greater participation in on-site. It's natural that the cost of the personnel is stronger, but I always reinforce that despite the cost is greater, the nominal contribution per student is much higher in the on-site courses just to emphasize. And Lucca, we have a series of initiatives here in the company, and I may emphasize especially the use of operational research to improve the groups and the classrooms. And I don't know what was said by other companies. I have no information regarding that. But on our side, I would say that we have nothing new. It is an allocation methodology that we have -- we've had for years. We do that for many years, and I cannot say anything specific regarding that. Regarding the competitive dynamics in medicine, there is no doubt that we have competitive markets. I don't know if I'm the best player to talk about it, but our discussions in medicine and our maintenance schools are only for the states, but with strong brands working on the capitals and they are traditional brands in the cities. So I would say we don't offer so much impact on increase of competition in medicine. But as far as I know in the sector, it's natural that we have an increase in competition. And please remember that not only me, but many people in the sector understand that will have 2 tiers in medicines. The good colleges and good locations in cities that somehow the students want to live and study that are the ones that will be able to deal with prices and have a good amount of students and the new and distant ones without a good name, that, in fact, need to have a greater effort. And our understanding is that our medicine schools are in this first condition, and we work more and more so that they have a better infrastructure and what we can give better in terms of diabetic material and professors. So although we are in regions that we understand we are competitive, it doesn't mean that we won't reinforce the -- our material and professors and the way to the study. So I'm pretty sure it is in our road map.

Next question is from Samuel Alves from BTG Pactual.

I have 2 questions here. The first is about the summer intake, if you could give us more details -- if you could tell us if it's growing on site and if hybrid is compensating the decrease of the DL if you talk about the summer intake, it would help. And the second question is about CapEx because we could see an important increase of 35% in the fourth quarter. By the end of the year, we had 7% of revenue to a 6% in '24. So I'd like to talk about this line what you are expecting if you could tell something about the '26 budget plans of investments?

Samuel, thank you for your questions. I'll answer the first one, and Fred will talk about the CapEx for '26 as well as '25 answer questions. Regarding the summer intake, the on-site is growing by the positive way in double digits as well as the semi residential the hybrid that is growing double digits. And due to the portfolio, it's decreasing, and it's natural. And the net of business that I believe is your next question is that the revenue in '26 grows compared to '25 and it grows in line with our growth over the last 2 years and on the same average. It's important to remember that despite the DL is decreasing, and we have a big amount of students. They have a ticket in the hybrid and especially on site are higher. So as the nominal contribution per student. So I think it's a piece of information that I can give you. So we have a positive net with the growth of revenue, and that's why I mentioned in my presentation that we analyzed '26 in a positive way.

Samuel were now, it's Fred, considering your question on CapEx that regarding the figures, our CapEx for '25, it was greater than for '25 and even compared to the revenue, as you mentioned, and it's only important to mention that it's an obligation to say that this year, we've done. And every quarter, we talk about the interest in the CapEx. So debt that we took related to investments and this interest were in millions of rands and now we have only BRL 44 million. So it's explained there. We have this displacement. However, in addition, we had greater investments in technology and infrastructure. And when we look ahead some will look to the next years. It's not a guidance, but we would have an investment CapEx in the revenue in '26 and '27, much closer to the percentage of '25 than '24 or '23. So it would be closer to 7%, not 6% or 5% as the CapEx of '26 and '24 -- '25 and '24.

Next question is from Marcel Santos from JPMorgan.

Thank you for the questions. The first oneis, if you can comment about the competition intensity that you see in on-site hybrid or DL in the first half of the year. how is the ticket, what you can see in competition on the market. And the second question is if you are having a strong cash flow, could you talk about the M&A and what you imagine what you could do if you have any organic movement what focus you would have to assess these opportunities? Thank you very much.

Okay, Marcelo, regarding price competition. I believe it's nothing different from the regular behavior. All big companies are quite sophisticated from the pricing point of view, generally, when a player talks about SKU on a unit or hold the others react I would say that there is no highlight here on average. We can repass the tickets in one course or the other, but it's the same competition, okay? There's nothing different. I think it's even natural due to this accommodation due to the new regulatory framework and how things are stabilizing from the point of view of integration of DL and [indiscernible] and what we can see in terms of enrollment in nursing costs that grow strongly. We have units here that we have more than 100% growth even with us increasing the price and competition in general is the same. It varies depending on one side or the other. And of course, that is available for the competition or not. So this is what I can tell you in terms of information. Regarding the M&As, our mindset is to use the capital a lot to reduce debt and pay less financial expenses. And considering the shareholders that for many years, received no dividends, but we analyze the M&A in a more strategic point of view as a complement to some portfolio or to speed up some competence or capacity that we don't have. But that can be distinctive for us to be in a new business to serve premium brands of post graduation or extension courses or to serve the infill production market that is a growing market. But as Fred said, it dozens or hundreds of millions, it's not that big in terms of consuming our cash generation in a relevant way. Fred, anything to say?

Well, regarding strategy, Habeco defined quite well that our mindset is to capital allocation to reduce financial expenses which doesn't mean leverage, we are quite close to the leverage. That is a good one. But looking ahead, this is the mindset. Operationally, we are growing with an increase in net revenue and with that, generate more operational cash flow, flow and free cash flow. So we can say that we are starting the first quarter quite similarly to what we can see in the last year regarding the operational cash and the free cash generation. So nothing different from what we are doing and what we can see is that analyzing the operational cash and the free cash generation, it's exactly what we are delivering '25. And now to complement. It's important to say that we have an internal M&A team that assesses that and some opportunities among in many segments of high education, basic education, digital products. But as it was the case of the purchases that we have recently, and as you know, in our profile, we search for assets with the potential of bringing competence and opportunities of growth in honest figures. We have a lot of assets available with the disproportional values compared to what we understand is good to generate to our shareholders. So we have our assessment. But in fact, we have just a few going through this VPL future. So we are quite diligent in this sense, just to emphasize.

So just to summarize, you said that you want to have leverage and you are quite close to what you want to be. And M&A, if you have our hundred dozens or hundreds of millions -- we can conclude that dividend seems to be the buyback. I don't know the return to the shareholders is the destination of the cash. Is that so?

The delta after the reduction. And please remember that we want to reduce the net debt, not for leverage, but we want to reduce to pay less financial expenses as we have big the debt, we have space for reduction, but not for leverage in itself, but for the financial expenses. Obviously, the average of that can be dividends to the shareholders. That's why it's in our strategy. Okay. I would just add one point of view here. That is something that we've talked for years that allocation to long-term capital, I mean, until 2030 gives us, in the next years a window of growing with rent contracts that we can reduce this expense. And just to move from one point to the other, we also have me to use CapEx for that. And obviously, these are projects that add value, but it can also be part of the capital allocation in this period until 2030.

The next question is from Lucas Nagano sell-side analyst from Morgan Stanley.

Good morning, Valero, Fred, thank you for the opportunity. And first, you said about the intake and you still have the [indiscernible] campaign that you were using last year for new students of 60% discounts? And how you follow the levels of reenrollment. And the second question is about the as we've had some years offering these services, can you comment how it is compared to the expectations and the challenges and the intent if they are the same? And looking ahead and looking to the '26 perspective, you mentioned more than 20 contracts, but do you have any big representation in the contract? And can you talk about it?

Lucas, thank you for your questions. I would have Fred and Melega answering. But regarding Agfa, we are still applying that. It's part of our strategy today. the student in road. They come with Pagantis first and second installments divided along the course. And Fred can talk about the impact, and then Melega will talk about B2G. Well, I'll start talking about Baas he mentioned, last year, we already offer quite faster to our student base. And the second this summer cycle, we are offering to all the student base and the fast if you observe regarding the figures we are growing in a program that is an installment program for the first and second months and now that we also have the growth in ACP, so we are growing the revenue. However, I grow in my ACP that we do initially 63% over the value and then I adjust according to the segment in such a way that it net is about 45%. So it's not a problem. The problem would be if I wouldn't adjust my ACP. So with the [indiscernible] fast, you're analyzing that what is important to us is dropouts because we monitor that a lot. So when the student drops out, our provision is 100%. So this is the secret here of having Pagifas are not having a problem in the receivables and in the provisions. And just to complement, if you look and look at the graph that you have specifically about the dropout, you can see that it's controlled. It's stable. So to answer your question, no, Pavaso is not bringing difficulties to us, although the base is growing, and we even have some segments in which the dropout is reducing comparing the years.

Yes. And just to complement, it's easy to see. If you look here by year, you see it growing if you compare the quarters, it decreases and why? Because I'm receiving [indiscernible] and you can analyze and see the same effect in the net receivables. So it's not a problem because we monitor it closely with the calculation of the provisions. I'll now pass on the floor to Melega to talk about B2G.

Thank you, Lucas. Now in terms of B2G to answer your question, the B2G yes, it is still a big way of growth of our basic education. It's performing quite well in Sound in Saber and for '26, the opportunity here is to regroup in some and Saber to have a new market for B2G. So we would have separated portfolios in both companies with different commercial teams and even separated platforms. So as of '26, we go to the market with a more integrated approach with the market segmentation and integration of portfolio. So we did that in the state and capital in big cities and smaller cities. We'll be working with the APT so we can work that in smaller cities with a smaller education secretaries with a good team of accounts for big contracts. So our learning is that, in fact, there is a higher concentration of supply, therefore, revenue in the fourth quarter as well as in the first quarter, the second and third quarters in B2G, they tend to be weaker because the supply is in the fourth quarter, but we have quite a strong pipeline in the first quarter is also robust in B2G. And we have more and more diversification on the market to explore all the potential of the market.

Just to complement, Melega, it's important to say that we -- when we started, we had one big client. Now we have dozens of them. We do not depend so much on one client anymore. Obviously, we have big and relevant accounts. This is the first point. And the second one, regarding your question of the performance of new businesses in line with the expectations. I can answer with the figures. In '22, when we saw the opportunity we had BRL 40 million in solutions, excluding PNLD. So we are now almost BRL 63 million. So we multiplied by 9 in 3 years. So it's a strong result, and we can see a huge potential because the turn of this is very strong and we are motivated and when we consider Saber and [indiscernible] and in the market, as Melega mentioned, generates a lot of enthusiasm to reinforce this point of why I mentioned that from the point of view, we look at 26% in a good way with -- in a positive way.

Next question is from Eduardo Resenda from UBS.

Good morning, Roberto, Felger. I also have 2 questions. The first is about the PLD, the diabetic book program. You mentioned a guidance of revenue displaced for the first quarter that comes from the purchase program for high school and I'd like to know if there is another program to enter in this line in the first quarter, and what do you see in this dynamic for the year, mainly considering budget issues from the Ministry of Education, elections and so on. Anything you can tell helps us a lot. And the second question is more specific because we see the level of adjustments intercompanies increasing a lot over the year. If you can share what those adjustments would be if you have any dynamics on revenue and government invest and it will help me a lot.

Okay. Fred here, I'll answer the first question and Melega will then complement. So we only had here the displacement of the program of high school, and our expectations was that it would happen in the fourth quarter, and it will happen in the first one with some displacement that may happen to the second quarter. We can still have displacements in this sense. But what we've already disclosed in our expectations is what is being displaced from the quarter to fourth quarter to the first one and what we have for '26 is the purchase of Fuathis year book. This is what will happen in '26. We don't have any other high school program. We only have these programs that will regularly happen in '26. Regarding your second question about something in the government due to the budget for '26 with the elections and so on well, we need to experience each quarter to understand. I cannot say that it will or won't happen. We don't know will give visibility every quarter to you. The second question, Melega will talk that is regarding what happened and this increase in intercompany and before Melega,we are talking about intercompanie so it's not -- it's an operation that was not carried out. So from one company to the other, one company didn't sell to the other, so it's not in our results. So Melega, if you can say something?

Okay, Fred. Let's go on. Saber has a complete portfolio even with the vast products. So when there is more than a signal, but when we have a formal contract, of Saber to supply the public market will supply internally from Vasta to Saber. So this movement, you can see the fourth quarter is sales to the public market of Saber in the fourth quarter. So here, we have the stock movement to supply the market. So it's quite a positive sign in the first quarter of Saber. It's quite strong in solutions for the government. And just to complement here, it's important to remember that in [indiscernible] we are focused in purchase in big networks, and Saber quite a capitalized commercial team and many teams dealing with the P&L. So if we have an opportunity of the commercial team in a to sell Somos products like the MAX educational system, they sell. Therefore, we have this intercompany. So that's the explanation for you to understand and to have a concrete example.

Next question is from Flavio Yoshida, sell-side analyst from Bank of America.

We have 2 questions here. The first one is regarding the personal quest cost in Proton that impacted negatively the margin, so we would like to understand what to expect looking ahead and understand how much of that is related to regulatory changes. And the second question is regarding the fast pace, if you have any update because we are reaching the date. So I'd like to understand the little of what you have in terms of updates.

Thanks Flavio, I'll try to answer your question. So when we look at specifically at the fourth quarter with this pressure in the primary margin regarding the increase? Is it related to the mix of puts with a stronger intake, especially in the middle of the year, in the mid-teen courses and the maturation of meditation of health care courses, so it's not related directly to the framework, but the direction, the guidance is the same as expected from macro with the regulatory framework that is a mix in the own site. So directionally, that's it, which doesn't mean it's negative from the point of view of EBITDA because, as I said, the nominal contributions per student in the on site is quite higher from the DL. And regarding the fast track, the first pass, as you mentioned, we have this expectation of authorizing about 120 poles, nursing pot and the Ministry of Education date is March 27. So we are close to having what according to this fast pace was called a pre-authorization to operate the courses and that with [indiscernible] coporations and deeper assessment of the Ministry of Education which means that, obviously, we didn't have in the fourth quarter, '24. The opportunity of, I'm sorry, the opportunity to enroll students in the nursing costs, which reduces the pace of growth of the revenue, but with they to the enrolling from April 1, we restart this growth especially for this 120 folks that will have. So the level of competition will be very low. So we understand it will be quite a positive result and also considering that the amount of competition will be limited, but this is just my point of view. And Fred, as Fred says, we have to experience to live that you see.

Next question is from Renan Prata from Citi.

I have the 2 specific questions. One is about the P&L. As you mentioned, the results from the first quarter, but I would like to understand the cash flow dynamic. Generally, this result in the first quarter would be in the fourth quarter or you generally consider the subsequent year like in this case, '26. I would like to understand this dynamic of the result -- not the result, but of the cash and a basic follow-up that when you mentioned the offsite intake that apparently is okay in the first quarter. Well, we don't have in terms of nursing in the polls. I believe that, as Valerio mentioned, it's '27. So in a hypothetic situation that we could have the intake, it could be an upside -- common side, is that correct?

So Renan, I will start talking about the nursing course. And you are correct. There is no benefit of on-site enrollment in any poll because it was not authorized, but our units already have the course -- so they are strongly benefit from this increase in the volume of in this cars specifically. Because on average, it's growing more than 50% comparing the years with auto units growing more than 100%, as I mentioned before. So yes, as reauthorizing these new poles, we should have an additional volume of enrollments in the on-site courses of nursing.

So Fred speaking here about the P&L dynamics in previous years, the receivables were in the year. So as the income so it happened in [ 2 ] we were at in 24, and we received in '24. Our expectation was to have this revenue, this EBITDA as well as the cash in the fourth quarter which didn't happen as everything displaced with the income, the receivables will happen in the first quarter or part of the second quarter. And the amount here is the displaced amount. This is the guidance, what displaced then not the one that is on the P&L in the first quarter, but just the displacement that should be in the year of '25 and was displaced to the first quarter of '26.

The next question will be made in English by Andres Coello from Scotia Bank. We'll open our audio that you ask your questions. Andreas Coelle please, you may go on. Andres Coello, you may ask your question now.

I'm sorry to ask this question in English, but it's actually very simple. [Foreign Language]

Okay, Andres, thank you. I'll answer in Portuguese to the CVM rules. So you will hear the translation. Okay. But according to the rules, I have to answer in Portugues we had an adjustment, and we are talking about the EBITDA, not the net revenue. We adjusted BRL 88 million for the -- so in this comparison, and talking about Cogna a whole and then talking about stand-alone per company. We -- in the EBITDA, we had this adjustment of BRL 35 million as a nonrecurring item in BRL 35 million. We have that. And due to simplicity, we made this adjustment just to know what is cognize as a whole. And then because we had this adjustment of BRL 35 million that it was specific and nonrecurring. And the second amounting faster. The second I'm sorry, i[indiscernible] the Kroton one is recurring and that is nonrecurring. I'm sorry. That's it. [Foreign Language] So we are available and we are get in contact with you. We will get in contact with you.

Okay. Thank you. So the Q&A session is now over. Now we would like to pass on the floor for the final considerations of the company.

So with that, we finish the results call of '25. I thank you all for your participation. Please remember that our team is at your disposal to clear any doubts that you might have. Thank you, and we go on.

The teleconference of results regarding the fourth quarter of '25 of Cogna Education is over. The Department of relations with investors is available to clear any dumbest you might have. Thank you all for your presence, and have [Audio Gap] [Statements in English on this transcript were spoken by an interpreter present on the live call.]