Estácio: 1Q11 Conference Call Presentation

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Estácio: 1Q11 Conference Call Presentation

Estácio: 1Q11 Conference Call Presentation

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  • 1. 1Q11 RESULTSEduardo Alcalay Rogério MelziCEO CFO and Investor Relations Officer May, 2011
  • 2. HIGHLIGHTS Expansion of the student base following the second cycle of RECORD-HIGH ENROLLMENT Addition of 73,500 new students (+24.4%) Expansion of 11.6% in the total student base Greater efficiency in the main cost and expense lines Start of consolidation phase, with synergic and strategic acquisitions 2
  • 3. RESULTS’ HIGHLIGHTS Continued growth and margin gains: EBITDA margin expansion of 2 p.p. Main Indicators (R$ MM) 1Q10 1Q11 Change Net Revenue 256.0 275.8 7.7% Recurring EBIT 32.3 38.7 19.8% Recurring EBIT Margin 12.6% 14.0% 1.4 p.p. Recurring EBITDA 39.6 47.9 21.0% Recurring EBITDA Margin 15.5% 17.4% 1.9 p.p. Net Income 25.6 28.7 12.1% Recurring Net Income 31.3 33.1 5.8% 3
  • 4. RECORD ENROLLMENT STUDENT ENROLLMENTImprovement in Brand Image On-Campus (In thousand students) Distance LearningPerception of Quality/Excellence Total Student 73.5Management – Engagement/Discipline +24.4% 59.1Estacio Cup and Variable Payment 12.0 10.2 61.5 48.9 GROWTH IN ENROLLMENT 1Q10 1Q11 4
  • 5. OPERATING PERFORMANCE – STUDENT BASE STUDENT BASE – EDUCATIONAL SEGMENT On-Campus (In thousand students) Distance Learning Total Student Base 241.4 +11.6% 216.4 30.9 16.4 +5.3% 200.0 210.5 1Q10 1Q11 31,000 Distance Learning students at the end of 1Q11 25% growth in FIES student base from 4Q09, totaling 8,100 students in 1Q11 5
  • 6. OPERATING REVENUE OPERATING REVENUE (In R$ million) Growth of 5.3% in the on-campus average ticket 398.2 Passthrough of inflation in the on-campus average ticket +9.0% 365.4 122.4 109.4 +7.7% (R$) 1Q10 1Q11 Change 256.0 275.8 Average On-Campus Ticket 412.9 434.8 5.3% Average Distance Learning Ticket 166.7 171.4 2.8% 1Q10 1Q11 * Average on-campus ticket excluding the acquisitions of FAA and FAL.Net Revenue Deductions Gross Revenue 6
  • 7. CASH COSTSVertical Analysis (% Net Operating Revenue) 1Q10 1Q11 ChangeRecurring Cash Cost* -62.0% -61.2% +0.8 p.p. Personnel -39.1% -38.4% +0.7 p.p. Brazilian Social Security Institute (INSS) -8.0% -8.8% -0.8 p.p. Rentals, Condominium Fees and Municipal -9.2% -9.1% +0.1 p.p. Property Tax Textbooks Materials -0.9% -1.1% -0.3 p.p. Others -4.7% -3.7% +1.0 p.p.* Cost of Services excluding non recurring and depreciation. Perssonnel eficiency offsets Brazilian Social Security Institute (INSS) step-up Budget Matrix reflects on Rentals and Others Textbooks Materials: new internal structure 7
  • 8. SELLING, GENERAL & ADMINISTRATIVE EXPENSES (SG&A)Vertical Analysis 1Q10 1Q11 Change(% Net Operating Revenue) SG&A* -23.8% -23.5% +0.3 p.p. Selling Expenses -9.6% -10.5% -0.9 p.p. Provision for Doubtful Debts -2.0% -1.9% +0.1 p.p. Marketing -7.6% -8.6% -1.0 p.p. General Administrative Expenses* -14.3% -13.1% +1.2 p.p. Personnel and Payroll charges -6.2% -6.5% -0.3 p.p. Others -8.1% -6.6% +1.5 p.p.* SG&A Expenses excluding non recurring and depreciation. G&A efficiency offsets Maketing investment 8
  • 9. PROVISION FOR DOUBTFUL DEBTS AND RECEIVABLES Accounts Receivable (R$ MM) 1Q10 2Q10 3Q10 4Q10 1Q11Gross Accounts Receivable 208.8 249.9 256.3 201.8 228.8 FIES 4.6 5.4 17.5 15.3 21.2 Tuition Monthly Fees 179.5 220.0 207.9 168.2 184.2 Financed Tuition 24.7 24.6 30.9 18.3 23.5 Cards Receivable 1.1 6.0 11.8 6.9 12.8 Checks Receivable 15.5 16.8 16.2 6.9 6.6 Fees Receivables 8.2 1.8 2.9 4.4 4.1Provision for Doubtful Debts (85.1) (102.2) (107.3) (45.4) (49.9)Net Accounts Receivable 123.7 147.7 148.9 156.4 179.0 (-) FIES (4.6) (5.4) (17.5) (15.3) (21.2)Net Accounts Receivable Ex. FIES 119.1 142.3 131.5 141.1 157.8Days Receivables Ex. FIES* 43 51 47 50 55* Calculated based on net revenue in the last 12 months 9
  • 10. EBITDA AND NET INCOME EBITDA NET INCOME (In R$ million) (In R$ million) 17.4% +21.0% 15.5% 47.9 12.2% 12.0% 39.6 +5.8% 31.3 33.1 1Q10 1Q11 1Q10 1Q11 Recurring EBITDA Margin Recurring EBITDA Recurring Net Margin Recurring Net Income 10
  • 11. CASH FLOW Recurring Operational Cash Flow 1Q11 CASH FLOW (In R$ million)¹ Financial Result except Operating Financial Result (-R$4.2 million) + Financing (+R$1.8 million)² Composition of Investments: Acquisition Goodwill (-R$15.5 million) + Fixed Assets at FAA and FAL (-R$3.2 million) + Expansion CAPEX (-R$5.9 million) 11
  • 12. EVOLUTION IN QUALITY – REGULATORY ASSESSMENTS COURSES EVALUATION - ON-SITE VISITS 2010/11 Grade 3 Grade 4 Grade 5 No grade 7 Courses 9 Courses 46 Courses 50 Courses 12
  • 13. OUTLOOK • Ensure a high-quality education on a sustainable basis on a national scale Quality • Content • Tools and processes • People • Technology as a key competitive advantage: distribution of contentTechnology and relations with students Efficiency • Generate margin expansion through better control of costs and Gains continued organic growthAcquisitions • Value accretion through scalability and assets that complement the current portfolio 13
  • 14. IR CONTACTS Investor Relations: Flávia de Oliveira Email: flavia.oliveira@estacio.br Phone: +55 (21) 3311-9789 Fax: +55 (21) 3311-9722 Address: Av. Embaixador Abelardo Bueno, 199 – Office Park – 6th floor CEP: 22.775-040 – Barra da Tijuca – Rio de Janeiro – RJ – Brazil Website: www.estacioparticipacoes.com/irThis presentation may contain forward-looking statements concerning the industry’s prospects and Estácio Participações’ estimated financial and operating results;these are ere projections and. as such. are based solely on the Company management’s expectations regarding the future of the business and its continuousaccess to capital to finance Estácio Participações’ business plan. These considerations depend substantially on changes in market conditions. government rules.competitive pressures and the performance of the sector and the Brazilian economy as well as other factors and are. therefore. subject to changes withoutprevious notice. We are a holding company. and our only assets are our interests in SESES. STB. SESPA. SESCE. SESPE. SESAL. SESSE. SESAP. UNEC. SESSA andIREP. and we currently hold 99.9% of the capital stock of each of these subsidiaries. Considering that the Company was incorporated on March 31 2007. theinformation presented herein is for comparison purposes only. on a proforma unaudited basis. relative to the first three months of 2007. as if the Company hadbeen organized on January 1 2007. Additionally. information was presented on an adjusted basis. in order to reflect the payment of taxes on SESES. our largestsubsidiary. which from February 2007. after becoming a for-profit company. is subject to the applicable taxation rules applied to the remaining subsidiaries.except for the exemptions arising out of the PROUNI – University for All Program (“PROUNI”). Information presented for comparison purposes should not beconsidered as a basis for calculation of dividends. taxes or for any other corporate purposes. 14