Estácio: Literatus Presentation

1. LITERATUS PRESENTATION

2. 2
The Manaus Market
Location Status
 The main player in the market is Uninorte with a 40% market
share.
 Literatus’ number of entrants grew by 61% between 2010 and
2011. It is the city’s fifth largest institution.
 Back in 2012, Literatus had a 12% share in total enrollments and a
9% share in new entrants.
 Literatus’ student enrollment CAGR (08-12): 49%.
 The Amazonas state is the 13th largest post-secondary market in
terms of enrollments and 11th in relation to new students
 The number of entrants increased 12% in Amazonas
between 2010-11
 Between 2007 and 2011, Teresina posted a 9.5%-enrollment
growth. Between 2011 and 2012, growth came to 12%.
 Manaus is the only city in the state to offer higher education
courses.
Region with a higher concentration of shops and banksTarget Shopping Center Competitor

3. 3
The Manaus Market
Positioning
29.670
10.564
7.891 6.747
4.783 3.674 3.648 3.068 1.949 1.620 1.530 1.360 934 516 357 298 203
Uninorte UniNilton
Lins
Fametro Unip Ciesa FMF Esbam CESF Boas Novas UNI
LASALLE
CEULM
ULBRA
FSDB FT IAES MATERDEI FOM
37% 13% 10% 9% 6% 5% 5% 4% 2% 2%
Mkt
Share
2% 2% 1% 1% 0% 0% 0%
Share in Total Enrollments
13.289
5.457
4.059
2.412 1.966 1.851 1.369 851 787 394 280 218 208 135 55 53 0
Uninorte Unip UniNilton
Lins
Fametro Ciesa FMF Esbam CESF Boas Novas UNI
LASALLE
FT CEULM
ULBRA
FSDB IAES FOM MATERDEI
40% 16% 12% 7% 6% 6% 4% 3% 2% 1%
Mkt
Share
1% 1% 1% 0% 0% 0% 0%
Share in New Enrollments (Entrants)

4. 4
• Located in Manaus
• Controlling Institution : Centro De Assistência Ao
Desenvolvimento De Formação Profissional Unicel Ltda.
• Higher Education Institution : Faculdade Literatus - FAL
• For-profit institution (limited company)
• 4,300 students
• 22 undergraduate courses
• 2 in Engineering
• 2 in Management
• 9 Technological
• 6 in Health
• 3 Teaching Certificates (Licenciaturas)
• 25 graduate courses
The Company
MEC
Campus
Figure 1: Main Campus (Constantino Unit)
Figure 2: New Campus (Djalma Batista Unit)
Literatus
At-a-glance
Index Grade Year
CI - Institutional Concept 3 2010
IGC - General Course Index 3 2012
Continuous IGC 2,44 2012

5. 5
Literatus
Operational Information
66%
100%
76% 76%
55%
Gestão Engenharia Tecnólogo Licenciatura Saúde
Idleness by Subject Area
4.317
9.853
Total Seats
Matrículas (2014/01) Vagas Ociosas
Regulatory
Courses
Annual
Seats
Total
Seats
ENADE CPC CC
#Students
2014.1
Idleness
Business Administration 300 1,200 2 3 4 673 44%
Biomedicine 200 800 SC SC 4 297 63%
Biology (bachelor’s degree) 200 800 - - 3 249 69%
Biology (teaching certificate)) 100 350 - - 4 0 100%
Accounting 240 960 - - 4 53 94%
Nursing 200 1,000 SC SC 4 1,069 -7%
Farmácia 100 500 - - 3 222 56%
HR Management 220 440 - - - 272 38%
Logistics 220 440 - - - 212 52%
Nutrition 200 800 SC SC 4 266 67%
Pedagogy 150 600 - - 4 291 52%
Radiology 300 900 3 3 4 263 71%
Workplace Safety 200 600 - - 4 142 76%
Social Service 200 700 - - 3 231 67%
Quality Management 200 400 - - - 30 93%
Financial Management 200 400 - - - 0 100%
Marketing 200 400 - - - 0 100%
Production Engineering 120 600 - - - 0 100%
Civil Engineering 120 600 - - 4 0 100%
Physical Education (bachelor’s degree) 120 480 - - - 47 90%
Physical Education (teaching certificate) 200 600 - - 4 0 100%
Aesthetics 200 600 - - 4 0 100%
Total 4,190 14,170 4,317 70%
Mgmt Engineering Technological Teaching
Certificate
Health
Idle SeatsEnrollments (14.1)

6. 6
Literatus
Strategic Rationale
Strategic Rationale
“Paint the Map”
- Priority target #1 in our list of cities where we still did not operate. Manaus is the main economic hub of Brazil’s North region and the
7th most populated city in the country. 41% of its inhabitants are between 18 and 39 years old.
Location - The institution is well-located in an important commercial area, close to one of the city’s main avenues.
Infrastructure
- Currently has 2 campuses, with 101 classrooms, 03 computer labs, 23 specific labs and 03 libraries.
- Possible fast and low-cost expansion to a new campus with 49 additional classrooms.
- Possible expansion to the parking lot in the main campus.
Recently authorized
courses
- 8 new authorized courses still maturing (Production Engineering, Civil Engineering, Physical Education, Accounting, Marketing,
Financial Management, Quality Management and Aesthetics).
Idleness
- 70% of total seats are idle.
- Most of these seats are from Business Administration, Biology, Pharmacy, Nutrition, Radiology and Workplace Safety, which have a
combined idleness of 28% (more than 3,800 seats), besides the recently authorized courses described above.
Growth Case - CAGR (08-12) of enrolled students: 49%.
Pronatec - Literatus adhered to Pronatec and received authorization to offer 600 seats in 2014.1.

7. 7
Literatus
Valuation – Investment and Sensitivity Analysis
• PV - 2023
R$29.4 million
• PV – Perpet.:
R$59.4 million
• Total EV:
R$88.7 million
• IRR: 25.3%
Result
P&L Statement 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 CAGR
Average Student Base 3.539 4.526 5.888 6.534 7.037 7.322 7.514 7.651 7.748 7.842 7.955 8.4%
YoY 27.9% 24.3% 11.0% 7.7% 4.1% 2.6% 1.8% 1.8% 1.8% 1.8%
Net Operating Revenue 16.5 17.6 26.2 31.4 36.6 41.1 45.5 49.4 53.3 57.4 61.9 14.1%
Personnel (10.8) (15.5) (15.3) (14.6) (15.4) (16.2) (17.0) (17.8) (18.7) (19.7) (20.6)
Administrative Staff (3.8) (6.1) (5.3) (4.0) (4.2) (4.4) (4.6) (4.9) (5.1) (5.3) (5.6)
Faculty (7.0) (9.4) (10.0) (10.6) (11.2) (11.8) (12.4) (13.0) (13.6) (14.3) (15.0)
Other G&A (3.8) (3.7) (4.0) (4.3) (4.6) (5.0) (5.3) (5.7) (6.2) (6.6) (7.1)
Rentals (1.3) (2.6) (3.9) (4.1) (4.3) (4.5) (4.8) (5.0) (5.3) (5.5) (5.8)
Selling and Marketing (0.8) (0.8) (1.8) (2.0) (2.4) (2.7) (3.0) (3.2) (3.5) (3.7) (4.0)
PDA 0.0 (0.7) (1.7) (2.0) (2.2) (2.3) (2.3) (2.3) (2.3) (2.3) (2.2)
EBITDA (0.2) (5.7) (0.6) 4.3 7.7 10.5 13.1 15.2 17.3 19.6 22.1
Free Cash Flow for the Firm 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
EBIT (5.7) (0.6) 4.3 7.7 10.5 13.1 15.2 17.3 19.6 22.1
Tax 0.0 0.0 (0.2) (0.4) (0.5) (0.7) (0.8) (0.9) (1.0) (1.1)
NOPAT (5.7) (0.6) 4.6 8.1 11.0 13.8 16.0 18.2 20.6 23.2
Working Capital (1.1) (0.5) (0.6) (0.7) (0.8) (0.9) (1.0) (1.1) (1.1) (1.2)
Capex (2.0) (1.7) (0.6) (0.7) (0.8) (0.9) (1.0) (1.1) (1.1) (1.2) Perp.
FCFF (8.9) (2.9) 2.9 5.9 8.3 10.6 12.5 14.3 16.3 18.5 202.5
P&L Statement 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Net Operating Revenue 100% 100% 100% 100% 100% 100% 100% 100.0% 100.0% 100.0% 100.0%
Personnel -65.7% -88.2% -58.5% -46.6% -42.1% -39.3% -37.3% -36.1% -35.1% -34.2% -33.3%
Administrative Staff -23.0% -34.6% -20.2% -12.7% -11.4% -10.7% -10.2% -9.8% -9.6% -9.3% -9.1%
Faculty -42.7% -53.6% -38.3% -33.9% -30.6% -28.6% -27.2% -26.3% -25.6% -24.9% -24.3%
Other G&A -22.9% -21.2% -15.3% -13.7% -12.6% -12.1% -11.7% -11.6% -11.6% -11.6% -11.5%
Rentals -8.2% -14.9% -15.0% -13.1% -11.8% -11.0% -10.5% -10.1% -9.9% -9.6% -9.4%
Selling and Marketing -4.6% -4.5% -7.0% -6.5% -6.5% -6.5% -6.5% -6.5% -6.5% -6.5% -6.5%
PDA 0.0% -3.9% -6.6% -6.3% -5.9% -5.5% -5.1% -4.8% -4.4% -4.0% -3.6%
EBITDA Margin -1.4% -32.7% -2.3% 13.9% 21.1% 25.6% 28.8% 30.9% 32.5% 34.1% 35.7%
Free Cash Flow for the Firm 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Working Capital (% of Net Operating Rev.) 6.3% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Capex (% of Net Operating Rev.) 11.4% 6.6% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%