Vasta Announces Fourth Quarter 2022 Results

Vasta Platform Limited (NASDAQ: VSTA) – “Vasta” or the “Company” announces today its financial and operating results for the fourth quarter of 2022 (4Q22) ended December 31, 2022. Financial results are expressed in Brazilian Reais and are presented in accordance with International Financial Reporting Standards (IFRS).

HIGHLIGHTS

  • The Annual Contract Value (ACV) for the 2023 sales cycle totaled R$1,230 million, which represents an organic growth of 20% over the subscription revenue for the 2022 sales cycle (from 4Q21 to 3Q22). Nearly 100% of our new sales have come from traditional learning systems and complementary solutions, with a higher growth observed in our premium brands and complementary solutions. Traditional learning system ACV grew 20% in 2023 compared to 2022, while complementary solutions ACV grew 39% in comparison to 2022.
  • Vasta’s accumulated subscription revenue during the 2022 fiscal year totaled R$1,121 million, a 39.5% increase compared to the 2021 fiscal year. Subscription revenue, excluding our hybrid subscription textbook products (PAR), increased 46% and total net revenue increased 33.4%.
  • In the fourth quarter, subscription revenue grew 28% compared to 4Q21, representing 36.1% of the 2023 ACV, compared to 33.9% of the 2022 ACV in 4Q21. This growth in subscription revenue was mainly driven by (i) the growth in our complementary solutions portfolio (with more participating schools, and more solutions per school), (ii) increased participation of premium labels in the ACV mix and (iii) migration from PAR to subscription revenue. We intend to continue to seek ACV and revenue growth based on these factors.
  • As guidance for 1Q23, we expect a net revenue from R$ 395 million to R$ 415 million, to be comprised of R$ 350 million to R$ 360 million from subscription products (29% of 2023 ACV) and R$ 45 million to R$55 million from non-subscription products. We expect the 2023 sales cycle to be slightly less concentrated in the first two quarters in 2023 (expected 65% in the mid-range) than in the previous year (66.5%), due to the different seasonality and mix of our products.
  • In the 2022 fiscal year, Adjusted EBITDA grew 106%, to R$375 million, with a margin increase of 10.5 p.p., to 29.7%. In 4Q22, Adjusted EBITDA totaled R$200 million, a 25% increase compared to R$161 million in 4Q21. This increase was mainly driven by gains in operating efficiency, cost savings and a sales mix that benefited from the growth of subscription products. The Adjusted EBITDA and Adjusted Net Profit were negatively impacted by the R$15.0 million in provisions for doubtful accounts (PDA), relating to the entirety of Vasta’s receivables for products in inventories of a large retail company undergoing judicial recovery.
  • Vasta recorded Adjusted Net Profit of R$39 million in 2022, compared to an Adjusted Net Loss of R$10 million in 2021. This increase in our Adjusted Net Profit was partially offset by the R$15.0 million in provisions for doubtful accounts (PDA), relating to the entirety of Vasta’s receivables for products in inventories of a large retail company undergoing judicial recovery.
  • Free cash flow (FCF) totaled R$92million in 2022 (or R$112 million on a normalized basis), a R$206 million increase from negative R$94 million in 2021.
  • In 2022, we took the decision to promote effective and innovative bilingual education through a unique solution that uses our existing products to combine two elements in high demand: bilingual education and performance in entrance exams. In the first quarter of 2023 we became partners of Start-Anglo, a school focused on promoting bilingual education with high performance, which will be a model institution for the franchise project that we expect to launch in the first semester of 2023 to partner with Anglo in responding to an increasingly strong demand from families and students for academic excellence, bilingual education and innovation.
  • Vasta also announces today the transition period of its chief executive officer. With 36 years dedicated to education, as a teacher, entrepreneur, and executive, Mr. Mario Ghio has chosen to step down from his executive role at the company. Mr. Guilherme Mélega, current chief operating officer of the company, will assume as CEO after Mr. Ghio’s departure on April 30, 2023. Mr. Ghio will assist Mr. Mélega in the transition of the CEO role until April 30, 2023 and will continue to act as a member of the company's Management Board and play a role in the company's long-term strategy. Mr. Ghio will also continue to represent Vasta as President of Abraspe, the Brazilian Association of Education Systems and Platforms, an entity that brings together the main companies in the sector.
  • Since 2Q22, Vasta has reported updates on its ESG standards, including a panel of key ESG indicators aligned with the topics identified during materiality review process. The highlights include: (i) the Afro Internship Program, which created exclusive internship positions for black people in the organization; (ii) the launch of the first Greenhouse Gas (GHG) Emissions Compensation Program for its operations and the increased use of renewable energy sources in our day-to-day activities; and (iii) the achievement of targets for diversity in leadership and board of directors. Furthermore, in December, Vasta signed the ten principles of the UN Global Compact on human rights, labor, environment and anti-corruption. The movement reinforces the Company's commitment to sustainable development and the best ESG practices.

MESSAGE FROM MANAGEMENT

The fourth quarter of 2022 continues to show a positive trend after strong results in the last quarter when we concluded the 2022 sales cycle (4Q21 to 3Q22), exceeding our 2022 ACV guidance of R$1.0 billion by 2.4%. Vasta’s accumulated subscription revenue during the 2022 fiscal year totaled R$1,121 million, a 39.5% increase compared to the 2021 fiscal year.

The fourth quarter of 2022 sales cycle represents the first quarter of the 2023 sales cycle, where subscription revenue grew 28% compared to 4Q21, or 8% above the ACV guidance. This growth in subscription revenue was mainly driven by (i) the growth in our complementary solutions portfolio (with more participating schools, and more solutions per school), (ii) increased participation of premium labels in the ACV mix and (iii) migration from PAR to subscription revenue. We intend to continue to seek ACV and revenue growth based on these factors. We expect the 2023 sales cycle to be slightly less concentrated in the first two quarters in 2023 (expected 65.1%) than in the previous year (66.5%), due to the different seasonality of new products and lower PAR revenue.

The 2023 ACV totaled R$1,230 million, representing an organic growth of 20% over the subscription revenue for the 2022 cycle, which comprised a more varied mix in sources of revenue as we had higher growth in our premium brands such as Anglo, Eleva and Mackenzie. We continue to believe that quality and reputation remain decisive in our business. Consistently with our strategy, we continue to invest in the migration from paper-based products (PAR) to digital subscription products (Textbook as a Service platform) offered on a fee-per-student basis. Complementary solutions is expected to have the highest growth rate among our business segments in 2023 (with a 39% increase compared to 2022 cycle subscription revenue) continuing its trend of increasing adoption by our client base. Traditional learning systems (including Textbook as a Service platform) are expected to grow 18% in 2023 compared to the 2022 cycle subscription revenue, driven by upsell & cross sell and price adjustments.

Moreover, we continue to see the normalization of the company’s profitability and cash flow generation. In 4Q22, Adjusted EBITDA totaled R$200 million, a 25% increase compared to R$161 million in 4Q21. We attribute this increase to the normalization of our business and improvement in gross margin due to a greater participation of premium products in our sales mix, increased sales of complementary solutions and cost dilutions combined with lower commercial and G&A expenses following operating efficiency gains and cost savings implemented in 2022. In the 2022 fiscal year, Adjusted EBITDA has grown 106%, to R$375 million, with a margin increase of 10.5 p.p. to 29.7%. Both Adjusted EBITDA and Adjusted Net Profit were partially offset by the R$15.0 million in provisions for doubtful accounts (PDA), relating to the entirety of Vasta’s receivables for products in inventories of a large retail company undergoing judicial recovery.

Vasta’s operating cash flow in 2022 totaled R$ 92 million, or R$ 112 million excluding the early payment of royalties (R$20 million) to content providers, from a negative R$94 million in the same period of 2021. This increase in operating cash flow reduced the net debt/adjusted EBITDA ratio to 2.78x, which maintained a downward trend for the fourth consecutive quarter.

During the 2022 fiscal year, we have announced the acquisition of a minority interest in Educbank, the first financial ecosystem dedicated to K-12 schools, which delivers to educational institutions services such as management and financial support by providing payment guaranty for tuitions. We have also announced the acquisition of Phidelis, a complete enterprise resource planning (ERP) software for K-12 schools with both academic and managerial features. The combination of Educbank and Phidelis, our academic and financial ERPs, proved a powerful tool to provide schools the critical information they need to be more efficient, adding key advantages to our platform as a service for K-12 schools. Since its acquisition, Educbank has increased its student-base 4.5x, totaling 62 thousand students as of December 31, 2022. Educbank delivers a frictionless business model and has a Net Promoter Score (NPS) of 85 out of 100. Educbank was the only representative from Latin America at the SXSW Innovation Awards, one of the main international innovation awards, during which Educbank became the first Brazilian company to receive the People's Choice Awards. Other awards and recognitions of Educbank include its selection for Endeavor's Scale-Up acceleration program and its TOP 3 ranking in the Education category of CNN’s 2022 Brazil Notable Awards.

Following our practice in past quarters, we have dedicated a section of our earnings release for Environmental, Social and Governance (ESG) matters, including a panel of key indicators that will be updated on a quarterly basis, reinforcing our commitment to the highest ESG standards.

Finally, we have announced Vasta´s CEO transition plan. Mr. Guilherme Mélega, the Company’s current chief operating officer, will assume the CEO role and Mr. Mario Ghio, who has chosen to step down from his executive role with the Company, will continue to serve as a member of the Company's Board of Directors and play a role in the Company's long-term strategy. Mr. Ghio will also continue to represent the Company in his role as the President of ABRASPE, the Brazilian Association of Education Systems and Education Platforms, an organization of leading companies in the sector. Mr. Ghio and Mr. Mélega have worked very closely in recent years, which is expected to promote a smooth transition in leadership and continuity in the management of Vasta.

2023 ACV COMPOSITION

The Annual Contract Value (ACV) for the 2023 sales cycle totaled R$1,230 million, which represents growth of 20% over the subscription revenue of the 2022 cycle (“2022 subscription revenue”, collected from the fourth quarter of 2021 to the third quarter of 2022). Complementary solutions has had the highest growth rate among our business segments (with a 39% increase compared to 2022 cycle subscription revenue). Traditional learning systems (including the Textbook as a Service platform) grew 20% compared to the 2022 subscription revenue cycle, driven by upsell & cross sell and price adjustments. PAR paper-based ACV declined 1% compared to 2022 subscription revenue, in line with the Company strategy in focusing in Traditional learning systems.

Values in R$ Million

2023 ACV

 

2022 Subscription

Revenue(1)

 

% Y/Y

Learning system & Platform

968

 

804

 

20%

PAR paper-based

 

109

 

110

 

-1%

Complementary solutions

153

 

110

 

39%

Total ACV (organic)

 

1,230

 

1,024

 

20%

(1) Revenue from subscription products collected from 4Q21 to 3Q22.

As in previous years, a combination of new clients, cross-sell/up-sell and price adjustments were key drivers of the growth in ACV. New clients represented 9% of the ACV growth, which offset the 9% increase in the rate of lost clients (or churn). The combined effect of cross-sell/up-sell and price adjustments contributed to a 20% growth in ACV (with the price adjustments above consumer price inflation (IPCA) of the last twelve months ended in December 31, 2022).

The churn rate was 1 p.p. higher than in previous years. While the churn rate of our premium brands remained low, there was an upward trend in the churn rate in the mainstream segment and PAR clients, both likely affected by unfavorable macroeconomic conditions.

% Change Y/Y

 

2023 ACV

New clients

9%

Cross-sell/up-sell + Price readjustment

20%

Churn

 

(9%)

Total ACV growth (organic)

 

20%

ACV change calculated over revenue from subscription products collected from 4Q21 to 3Q22.

OPERATING PERFORMANCE

Student base – subscription models

2023

 

2022

 

% Y/Y

 

2021

 

% Y/Y

Partner schools - Core content

5,157

 

5,351

 

-3.6%

 

4,508

 

18.7%

Partner schools – Complementary solutions

1,548

 

1,304

 

18.7%

 

1,114

 

17.1%

Students - Core content

1,557,503

 

1,589,224

 

-2.0%

 

1,335,152

 

19.0%

Students - Complementary content

452,693

 

400,192

 

13.1%

 

307,941

 

30.0%

Note: Students enrolled in partner schools

The fourth quarter of 2022 marks the beginning of the 2023 business cycle for Vasta. It is in this quarter that the first deliveries of content to students and partner schools regarding the 2023 ACV are made.

Overall, we observed a stability in the number of partner schools and students in core content. Aligned with the company´s strategy to focus on improving our client base in 2023 through a better mix of schools and growth in premium education systems (Anglo, PH and Fibonacci), brands with higher average ticket, lower defaults, greater adoption of complementary solutions and longer-term relationships. On the other hand, the reduction of our client base was concentrated on the low-end segment and PAR (paper-based), which have higher number of students on average, and a lower margin. Average ticket price of schools that remain in our client base in 2023 is 11% higher than that of schools that are no longer our clients.

FINANCIAL PERFORMANCE

Net revenue

Values in R$ ‘000

4Q22

 

4Q21

 

% Y/Y

 

2022

 

2021

 

% Y/Y

Subscription

443,950

 

346,842

 

28.0%

 

1,121,158

 

803,702

 

39.5%

Subscription ex-PAR

377,376

 

280,883

 

34.4%

 

994,479

 

680,559

 

46.1%

Traditional learning systems

 

284,465

 

223,151

 

27.5%

 

848,531

 

588,168

 

44.3%

Complementary solutions

 

92,911

 

57,732

 

60.9%

 

145,948

 

92,390

 

58.0%

PAR

66,574

 

65,959

 

0.9%

 

126,679

 

123,143

 

2.9%

Non-subscription

61,069

 

51,416

 

18.8%

 

143,121

 

143,717

 

-0.4%

Total net revenue

505,019

 

398,258

 

26.8%

 

1,264,280

 

947,419

 

33.4%

 

 

 

 

 

 

 

 

 

 

 

 

 

% ACV

 

36.1%

 

33.9%

 

2.2

 

n.m

 

n.m

 

n.m

% Subscription

 

88%

 

87%

 

0.8 p.p

 

89%

 

85%

 

3.95 p.p

In the fourth quarter of 2022, net revenue increased 27% year-on-year, to R$505 million. Subscription revenue grew 28%, driven by the recognition of 36% of 2023 ACV in 4Q22, mainly driven by the increase in traditional learning systems, complementary solutions, and textbook subscription products (“PAR”). As guidance for 1Q23, we expect a net revenue from R$ 395 million to R$ 415 million, to be comprised of R$ 350 million to R$ 360 million from subscription products (29% of 2023 ACV) and R$ 45 million to R$55 million from non-subscription products. We expect the 2023 sales cycle to be slightly less concentrated in the first two quarters in 2023 (expected 65.1%) than in the previous year (66.5%), due to the different seasonality and mix of our products.

EBITDA

Values in R$ ‘000

4Q22

 

4Q21

 

% Y/Y

 

2022

 

2021

 

% Y/Y

Net revenue

 

505,019

 

398,260

 

26.8%

 

1,264,280

 

947,419

 

33.4%

Cost of goods sold and services

 

(172,077)

 

(135,919)

 

26.6%

 

(473,135)

 

(396,829)

 

19.2%

General and administrative expenses

 

(119,888)

 

(126,071)

 

-4.9%

 

(471,626)

 

(430,279)

 

9.6%

Commercial expenses

 

(50,205)

 

(45,400)

 

10.6%

 

(194,043)

 

(164,439)

 

18.0%

Other operating income

 

(1,921)

 

3,352

 

-157.3%

 

1,020

 

5,554

 

-81.6%

(Loss) profit of equity-accounted investees

 

(2,362)

 

-

 

0.0%

 

(4,512)

 

-

 

0.0%

Impairment losses on trade receivables

 

(28,773)

 

(10,728)

 

168.2%

 

(45,904)

 

(32,726)

 

40.3%

Profit before financial income and taxes

 

129,793

 

83,495

 

55.4%

 

76,080

 

(71,300)

 

-206.7%

(+) Depreciation and amortization

 

69,694

 

61,664

 

13.0%

 

268,540

 

211,156

 

27.2%

EBITDA

 

199,487

 

145,159

 

37.4%

 

344,621

 

139,856

 

146.4%

EBITDA Margin

 

39.5%

 

36.4%

 

3.1

 

27.3%

 

14.8%

 

12.5

(+) Layoff related to internal restructuring

 

608

 

9,411

 

-93.5%

 

3,323

 

15,735

 

-78.9%

(+) Share-based compensation plan

 

107

 

6,119

 

-98.3%

 

27,364

 

26,677

 

2.6%

Adjusted EBITDA

200,202

 

160,690

 

24.6%

 

375,308

 

182,269

 

105.9%

Adjusted EBITDA Margin

39.6%

 

40.3%

 

(0.7)

 

29.7%

 

19.2%

 

10.4

Note: n.m.: not meaningful

In the fourth quarter, Adjusted EBITDA totaled R$200 million, a 25% increase compared to R$161 million in 4Q21. This increase was mainly driven by operating efficiency gains, cost savings and sales mix that benefited from the growth of subscription products. In the 2022 fiscal year, Adjusted EBITDA has grown 106%, to R$375 million, with a margin increase of 10.5 p.p. to 29.7%.

(%) Net Revenue

4Q22

 

4Q21

 

Y/Y (p.p.)

 

2022

 

2021

 

Y/Y (p.p.)

Gross margin

 

65.9%

 

65.9%

 

0.1

 

62.6%

 

58.1%

 

4.5

Adjusted cash G&A expenses(1)

 

-10.6%

 

-11.4%

 

0.8

 

-13.9%

 

-18.1%

 

4.2

Commercial expenses

 

-9.9%

 

-11.4%

 

1.5

 

-15.3%

 

-17.4%

 

2.0

Impairment on trade receivables

 

-5.7%

 

-2.7%

 

(3.0)

 

-3.6%

 

-3.5%

 

(0.2)

Adjusted EBITDA margin

 

39.6%

 

40.3%

 

(0.7)

 

29.7%

 

19.2%

 

10.4

(1) Sum of general and administrative expenses, other operating income and profit (loss) of equity-accounted investees, less: depreciation and amortization, layoffs related to internal restructuring and share-based compensation plan.

Consistent with the trend observed in our net revenue, gross margin grew from 58.1% in 2021 to 62.6% in 2022, a 4.5 p.p. increase resulting from the consistent implementation of our business strategy, which includes: (i) expansion of complementary solutions offered to our partner schools; (ii) migration of customers from non-subscription to subscription products, which affords greater loyalty, profitability and results predictability; and (iii) sale of upgrades to premium education systems, to partner schools within our existing client base.

Moreover, adjusted G&A expenses and commercial expenses decreased 4.2 p.p. and 2.0 p.p. respectively, driven by workforce optimization and budgetary discipline. We believe that the reduction in expenses highlight the operational scalability of Vasta's educational solutions business model and digital platform.

Reported provisions for doubtful accounts (PDA) has no significant variation between the years 2022 and 2021, however, it grew 3 p.p. in 4Q22 compared to 4Q21. This increase in PDA was due to the provisioning of 100% of accounts receivable from retail companies undergoing judicial recovery, in the amount of R$ 15.0 million. Excluding this factor, the participation of PDA in relation to Vasta's Net Revenue remains stable between 4Q21 and 4Q22 (2.7% in both quarters) and reduced by 1 p.p. as between the years 2021 and 2022 (3,5% to 2.5%).

Finance Results

Values in R$ ‘000

 

4Q22

 

4Q21

 

% Y/Y

 

2022

 

2021

 

% Y/Y

Finance income

32,218

 

13,847

 

132.7%

 

88,557

 

35,640

 

148.5%

Finance costs

(74,033)

 

(51,009)

 

45.1%

 

(270,324)

 

(120,183)

 

124.9%

Total

 

(41,814)

 

(37,162)

 

12.5%

 

(181,766)

 

(84,543)

 

115.0%

In the fourth quarter of 2022, finance income totaled R$32 million, from R$13 million in 4Q21, mainly due to the impact of higher interest rates on financial investments and marketable securities. In the 2022 fiscal year, finance income increased 149% to R$89 million. Finance costs in 4Q22 increased 45% (quarter-on-quarter), to R$74 million, driven by higher interest rates applicable to bonds and financings, accounts payable on business combination and provision for tax, civil and labor losses. In the 2022 fiscal year, finance costs increased 125% to R$270 million.

Net profit (loss)

Values in R$ ‘000

 

4Q22

 

4Q21

 

% Y/Y

 

2022

 

2021

 

% Y/Y

Net profit (loss)

75,862

 

19,781

 

283.5%

 

(54,573)

 

(118,754)

 

-54.0%

(+) Layoffs related to internal restructuring

608

 

9,411

 

-93.5%

 

3,323

 

15,735

 

-78.9%

(+) Share-based compensation plan

 

107

 

6,121

 

-98.3%

 

27,364

 

26,677

 

2.6%

(+) Amortization of intangible assets(1)

39,232

 

35,956

 

9.1%

 

155,481

 

122,460

 

27.0%

(-) Income tax contingencies reversal

 

(29,715)

 

-

 

0.0%

 

(29,715)

 

-

 

0.0%

(-) Tax shield(2)

(13,582)

 

(17,506)

 

-22.4%

 

(63,297)

 

(56,056)

 

12.9%

Adjusted net profit (loss)

72,512

 

53,763

 

34.9%

 

38,583

 

(9,938)

 

-488.2%

Adjusted net margin

14.4%

 

13.5%

 

0.9

 

3.1%

 

-1.0%

 

4.1

Note: n.m.: not meaningful; (1) From business combinations. (2) Tax shield (34%) generated by the expenses that are being deducted as net (loss) profit adjustments.

In the fourth quarter of 2022, adjusted net profit totaled R$72.5 million, a 35% increase compared to R$ 53.7 in 4Q21. In the 2022 fiscal year, adjusted net profit reached R$ 38.5 million, from a loss of R$ 10 million in 2021.

Accounts receivable and PDA

Values in R$ ‘000

4Q22

 

4Q21

 

% Y/Y

 

3Q22

 

% Q/Q

Gross accounts receivable

728,035

 

552,014

 

31.9%

 

378,587

 

92.3%

Provision for doubtful accounts (PDA)

(69,481)

 

(46,500)

 

49.4%

 

(49,250)

 

41.1%

Coverage index

 

9.5%

 

8.4%

 

1.1

 

13.0%

 

(3.5)

Net accounts receivable

 

658,554

 

505,514

 

30.3%

 

329,337

 

100.0%

Average days of accounts receivable(1)

187

 

192

 

(5)

 

102

 

85

(1) Balance of net accounts receivable divided by the last-twelve-month net revenue, multiplied by 360.

The average payment term of Vasta’s accounts receivable portfolio was 187 days in the 4Q22, 5 days lower than the same quarter of the previous year.

Free cash flow

Values in R$ ‘000

 

4Q22

 

4Q21

 

% Y/Y

 

2022

 

2021

 

% Y/Y

Cash from operating activities(1)

6,396

 

(37,373)

 

-117.1%

 

291,531

 

21,372

 

1264.1%

(-) Income tax and social contribution paid

(4,417)

 

-

 

0.0%

 

(7,153)

 

(1,167)

 

512.9%

(-) Payment of provision for tax, civil and labor losses

 

(55)

 

(113)

 

-51.2%

 

(1,363)

 

(628)

 

117.2%

(-) Interest lease liabilities paid

 

(4,128)

 

(3,128)

 

32.0%

 

(14,941)

 

(14,692)

 

1.7%

(-) Acquisition of property, plant, and equipment

(10,541)

 

(11,458)

 

-8.0%

 

(61,143)

 

(20,910)

 

192.4%

(-) Additions of intangible assets

(20,543)

 

(19,115)

 

7.5%

 

(87,362)

 

(55,878)

 

56.3%

(-) Lease liabilities paid

(6,594)

 

(6,690)

 

-1.4%

 

(27,003)

 

(21,998)

 

22.8%

Free cash flow (FCF)

 

(39,882)

 

(77,875)

 

-48.8%

 

92,566

 

(93,900)

 

-198.6%

FCF/Adjusted EBITDA

-19.9%

 

-48.5%

 

28.5

 

24.7%

 

-51.5%

 

76.2

(1) Net (loss) profit less non-cash items less and changes in working capital. Note: n.m.: not meaningful

In 4Q22, Free Cash Flow (FCF) totaled negative R$ 39 million, compared to a negative R$78 million FCF in 4Q21. In the 2022 fiscal year, FCF totaled R$ 92 million, or R$ 112 million excluding the early payment of royalties (R$20 million) to content providers, up from a negative R$94 million in the same period of 2021.

Financial leverage

Values in R$ ‘000

 

4Q22

 

3Q22

 

2Q22

 

1Q22

 

4Q21

Financial debt

 

842,996

 

811,612

 

844,778

 

817,517

 

831,226

Accounts payable from business combinations

 

625,277

 

647,466

 

585,503

 

570,660

 

532,313

Total debt

 

1,468,273

 

1,459,078

 

1,430,281

 

1,388,177

 

1,363,539

Cash and cash equivalents

 

45,765

 

44,343

 

147,762

 

145,998

 

309,893

Marketable securities

 

380,514

 

433,805

 

417,768

 

303,675

 

166,349

Net debt

 

1,041,994

 

980,930

 

864,751

 

938,504

 

887,297

Net debt/LTM adjusted EBITDA(1)

 

2.78

 

2.92

 

3.04

 

3.67

 

4.87

(1) LTM adjusted EBITDA includes Eleva. Eleva’s LTM adjusted EBITDA prior to November 2021 may not reflect Vasta’s accounting standards.

As of the end of the 2022 fiscal year, Vasta had a net debt position of R$1,042 million, higher than 3Q22, mainly due to the impacts of higher financial leverage and higher interest rates. The net debt/LTM adjusted EBITDA of 2.78x as of 4Q22, shows a downward trend for the fourth consecutive quarter. In comparison to 4Q21, the net debt position increase amounted to R$ 155 million, owing to higher interest rates and the investment made in the minority-stake acquisitions of Educbank (in July 2022) and Phidellis (in February 2022), both of which partially offset by the positive operating cash flow (OCF).

ESG

Since 2Q22, Vasta reports updates about its ESG standards, including a panel of key ESG indicators, in line with the topics identified in the materiality process. Information about 2021 can be found in Vasta’s Sustainability Report, which can be found here.

Check below the main highlights of ESG in the fourth quarter of 2022.

Global Compact

In December, Vasta signed the ten principles of the UN Global Compact on human rights, labor, environment, and anti-corruption. The movement reinforces the Company's commitment to sustainable development and the best ESG practices.

Corporate Sustainability Assessment – S&P

Vasta was ranked 6th globally by S&P Global’ s Corporate Sustainability Assessment in Consumer Services category - being a pioneer among peers. It is important to highlight that it was the first year that the questionnaire was answered by the Company, already in a prominent position.

Key Indicators

ENVIRONMENT

SDGs

GRI

Water withdrawn by source2 (m³)

Unit

1Q22

2Q22

3Q22

4Q22

6

303-3

Ground water

1,786

2,674

3,438

2,771

Utility supply

840

187

127

0

Total

2,626

2,861

3,565

2,771

SDGs

GRI

Internal energy consumption

Unit

1Q22

2Q22

3Q22

4Q22

12 and 13

302-1

Total energy consumed

GJ

1,569

1,348

1,523

1,934

Percentage of energy from renewable sources3

%

92%

97%

98%

98%

  • 98% of the energy used by the Company comes from renewable sources.
  • 100% of the energy used in our largest distribution center in São José dos Campos, comes from renewable sources; and
  • 100% of our suppliers are FSC certified, which guarantees sustainable handling in the paper chain of custody. We also have maintained the certification since 2008.

SOCIAL

SDGs

GRI

Diversity in the work force by functional category

Unit

1Q22

2Q22

3Q22

4Q22

5

405-1

C-level - Women

% of people

20%

20%

25%

25%

C-level - Men

% of people

80%

80%

75%

75%

Total - C-level4

No. of people

5

5

4

4

Leaders - Women (≥ management level)

% of people

45%

47%

48%

47%

Leaders - Men (≥ management level)

% of people

55%

53%

52%

53%

Total - Leaders (≥ management level)5

No. of people

130

131

134

134

Academic faculty - Women

% of people

14%

31%

80%

19%

Academic faculty - Men

% of people

86%

69%

20%

81%

Total - Academic faculty6

No. of people

71

100

84

83

Coordinators and Administrative - Women

% of people

56%

57%

57%

56%

Coordinators and Administrative - Men

% of people

44%

43%

43%

46%

Total - Coordinators and Administrative7

No. of people

1,576

1,521

1,539

1.516

Total - Women

% of people

53%

54%

54%

54%

Total - Men

% of people

47%

46%

46%

46%

Total - Employees

No. of people

1,782

1,757

1,761

1.737

SDGs

GRI

Indirect economic impact

Unit

1Q22

2Q22

3Q22

4Q22

11

-

Scholarship holders in Somos Futuro program

373

371

365

349

SDGs

GRI

Occupational Health and Safety

Unit

1Q22

2Q22

3Q22

4Q22

3

403-5,

403-9

% of units covered by the Environmental Risk Prevention Program

%

100%

100%

100%

100%

Total employees trained in health and safety8

No. of people

90

110

346

710

Total number of hours training in health and safety

No.

491

2,871

375

618

Average number of hours training in health and safety per participant9

No.

5.5

4.4

1.1

1,2

Total number of hours of on-site training for fire brigade

No.

248

408

56

0

Average number of hours of on-site training for fire brigade per participant9

No.

7.7

8.0

8

0

Employees - Injury frequency rate10

rate

0.92

3.75

4.06

3,89

Employees - High-consequence injuries rate11

rate

0.00

0.00

0,00

0,00

Employees - Recordable injuries rate12

rate

0.92

0.94

3.04

0,00

Employees - Fatality rate13

rate

0.00

0.00

0.00

0,00

Diversity

47% of leaders (management level and above) and 19% of the teaching faculty at Vasta are women. We are also committed to other measures that promote diversity and inclusion, such as the Somos Futuro project, from the Instituto Somos, to accelerate talents from public schools, in which almost 40% of the participants are black or of mixed race.

Indirect Economic Impact

The Somos Futuro Program, maintained by Vasta’s social arm, Instituto SOMOS, is an acceleration initiative for public school students, who receive full study scholarships for secondary education in Vasta partnering private schools. The participants also receive educational and para-educational materials, online tutoring, mentoring and access to the entire program support network, which includes psychological counseling. 349 students are enrolled in the current edition of the program – which has benefited almost 600 people since it began in 2018.

Health and Safety

Vasta invested in enhancing controls and communication on occupational health and safety for employees. This contributed to an increase in accident reporting rates, boosting the accuracy of control and management systems

GOVERNANCE

SDGs

GRI

Ethical behavior

Unit

1Q22

2Q22

3Q22

4Q22

8, 16

205-1

205-2,

205-3

Employees trained in anti-corruption policies and procedures

% of people

100%

100%

100%

100%

Operations submitted to corruption-related risk assessment

% of operations

100%

100%

100%

100%

Number of confirmed cases of corruption

No. of cases

0

0

0

0

SDGs

GRI

Data privacy and infrastructure

Unit

1Q22

2Q22

3Q22

4Q22

16

418-1

Substantiated complaints received from outside parties

No.

6

28

20

17

Substantiated complaints received from regulatory bodies

No.

0

0

0

0

Identified leaks, thefts, or losses of customer data

No.

0

0

0

0

 

 

 

SDGs

GRI

Diversity in the Board of Directors

Unit

1Q22

2Q22

3Q22

4Q22

5

405-1

Women

% of people

29%

29%

29%

29%

Men

% of people

71%

71%

71%

71%

Total

nº of people

7

7

7

7

Data Privacy

Contacts relating to data privacy issues, such as correction, access, confirmation and/or exclusion and portability of data, are received by our Privacy Portal. Vasta received no substantiated complaints related to leaks or loss of data.

 

FOOTNOTES:

SDG

Sustainable Development Goal. Indicates goal to which the actions monitored contribute.

GRI

Global Reporting Initiative. Lists the GRI standard indicators related to the data monitored.

NA

Indicator discontinued or not measured in the quarter.

1

Quarterly monitoring of a selection of material indicators. For further information, consult our Sustainability Report, available here.

2

Based on invoices from sanitation concessionaires.

3

Acquired from the free energy market.

4

CEO, vice presidents reporting directly to the CEO and all directors.

5

Management, senior management and leadership positions not reporting directly to the CEO (regional directors, unit directors and vice presidents).

6

Course coordinators, teachers, and tutors.

7

Corporate coordination, academic coordination, specialists, adjuncts, assistants, and analysts.

8

All the employees undergoing training in the period.

9

Total hours of training/employees trained.

10

Total accidents (with and without leave)/ Total man/hours worked (MHW) x 1,000,000.

11

Work-related injury (excluding fatalities) from which the worker cannot recover fully to pre-injury health status within 6 months. Formula: Number of injuries/MHW x 1.000.000.

12

(Accidents with leave + Fatalities)/ MHT x 1,000,000.

13

Fatalities/ MHW x 1,000,000.

CONFERENCE CALL INFORMATION

Vasta will discuss its fourth quarter 2022 results on March 23, 2023, via a conference call at 5:00 p.m. Eastern Time. To access the call [(ID: 3871721), please dial: +1 (888) 660-6819 or +1 (929) 203-1989]. A live and archived webcast of the call will be available on the Investor Relations section of the Company’s website at https://ir.vastaplatform.com.

ABOUT VASTA

Vasta is a leading, high-growth education company in Brazil powered by technology, providing end-to-end educational and digital solutions that cater to all needs of private schools operating in the K-12 educational segment, ultimately benefiting all of Vasta’s stakeholders, including students, parents, educators, administrators, and private school owners. Vasta’s mission is to help private K-12 schools to be better and more profitable, supporting their digital transformation. Vasta believes it is uniquely positioned to help schools in Brazil undergo the process of digital transformation and bring their education skill set to the 21st century. Vasta promotes the unified use of technology in K-12 education with enhanced data and actionable insight for educators, increased collaboration among support staff and improvements in production, efficiency and quality. For more information, please visit ir.vastaplatform.com.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements that can be identified by the use of forward-looking words such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,” “intend,” “estimate” and “potential,” among others. Forward-looking statements appear in a number of places in this press release and include, but are not limited to, statements regarding our intent, belief or current expectations. Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to of various factors, including (i) general economic, financial, political, demographic and business conditions in Brazil, as well as any other countries we may serve in the future and their impact on our business; (ii) fluctuations in interest, inflation and exchange rates in Brazil and any other countries we may serve in the future; (iii) our ability to implement our business strategy and expand our portfolio of products and services; (iv) our ability to adapt to technological changes in the educational sector; (v) the availability of government authorizations on terms and conditions and within periods acceptable to us; (vi) our ability to continue attracting and retaining new partner schools and students; (vii) our ability to maintain the academic quality of our programs; (viii) the availability of qualified personnel and the ability to retain such personnel; (ix) changes in the financial condition of the students enrolling in our programs in general and in the competitive conditions in the education industry; (x) our capitalization and level of indebtedness; (xi) the interests of our controlling shareholder; (xii) changes in government regulations applicable to the education industry in Brazil; (xiii) government interventions in education industry programs, that affect the economic or tax regime, the collection of tuition fees or the regulatory framework applicable to educational institutions; (xiv) cancellations of contracts within the solutions we characterize as subscription arrangements or limitations on our ability to increase the rates we charge for the services we characterize as subscription arrangements; (xv) our ability to compete and conduct our business in the future; (xvi) our ability to anticipate changes in the business, changes in regulation or the materialization of existing and potential new risks; (xvii) the success of operating initiatives, including advertising and promotional efforts and new product, service and concept development by us and our competitors; (xviii) changes in consumer demands and preferences and technological advances, and our ability to innovate to respond to such changes; (xix) changes in labor, distribution and other operating costs; our compliance with, and changes to, government laws, regulations and tax matters that currently apply to us; (xx) the effectiveness of our risk management policies and procedures, including our internal control over financial reporting; (xxi) health crises, including due to pandemics such as the COVID-19 pandemic and government measures taken in response thereto; (xxii) other factors that may affect our financial condition, liquidity and results of operations; and (xxiii) other risk factors discussed under “Risk Factors.” Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated events.

NON-GAAP FINANCIAL MEASURES

This press release presents our EBITDA, Adjusted EBITDA and Adjusted net (loss) profit and Free cash flow (FCF), which is information provided for the convenience of investors. EBITDA and Adjusted EBITDA are among the key performance indicators used by us to measure financial operating performance. Our management believes that these Non-GAAP financial measures provide useful information to investors and shareholders. We also use these measures internally to establish budgets and operational goals to manage and monitor our business, evaluate our underlying historical performance and business strategies and to report our results to the board of directors.

We calculate EBITDA as net (loss) profit for the period/year plus income taxes and social contribution plus/minus net finance result plus depreciation and amortization. The EBITDA measure provides useful information to assess our operational performance.

We calculate Adjusted EBITDA as EBITDA plus/minus: (a) income tax and social contribution; (b) net finance result; (c) depreciation and amortization; (d) share-based compensation expenses, mainly due to the grant of additional shares to Somos’ employees in connection with the change of control of Somos to Cogna (for further information refer to note 23 to the audited consolidated financial statements); (e) provision for risks of tax, civil and labor losses regarding penalties, related to income tax positions taken by the Predecessor Somos – Anglo and Vasta in connection with a corporate reorganization carried out by the Predecessor Somos – Anglo; (f) Bonus IPO, which refers to bonus paid to certain executives and employees based on restricted share units; and (g) expenses with contractual termination of employees due to organizational restructuring. We understand that such adjustments are relevant and should be considered when calculating our Adjusted EBITDA, which is a practical measure to assess our operational performance that allows us to compare it with other companies that operates in the same segment.

We calculate Adjusted net (loss) profit as the (loss) profit for the period/year as presented in Statement of Profit or Loss and Other Comprehensive Income adjusted by the same Adjusted EBITDA items, however, added by (a) Amortization of intangible assets from Business Combination and (b) Tax shield of 34% generated by the aforementioned adjustments.

We calculate Operating cash flow (OCF) as the cash from operating activities as presented in the Statement of Cash Flows less (a) income tax and social contribution paid; (b) tax, civil and labor proceedings paid; (c) interest lease liabilities paid; (d) acquisition of property, plant and equipment; (e) additions to intangible assets; and (f) lease liabilities paid.

We understand that, although Adjusted net (loss) profit, EBITDA, Adjusted EBITDA, and Operating cash flow (OCF) are used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS. Additionally, our calculations of Adjusted net (loss) profit, Adjusted EBITDA, and Operating cash flow (OCF) may be different from the calculation used by other companies, including our competitors in the education services industry, and therefore, our measures may not be comparable to those of other companies.

REVENUE RECOGNITION AND SEASONALITY

Our main deliveries of printed and digital materials to our customers occur in the last quarter of each year (typically in November and December), and in the first quarter of each subsequent year (typically in February and March), and revenue is recognized when the customers obtain control over the materials. In addition, the printed and digital materials we provide in the fourth quarter are used by our customers in the following school year and, therefore, our fourth quarter results reflect the growth in the number of our students from one school year to the next, leading to higher revenue in general in our fourth quarter compared with the preceding quarters in each year. Consequently, in aggregate, the seasonality of our revenues generally produces higher revenues in the first and fourth quarters of our fiscal year. Thus, the numbers for the second quarter and third quarter are usually less relevant. In addition, we generally bill our customers during the first half of each school year (which starts in January), which generally results in a higher cash position in the first half of each year compared to the second half.

A significant part of our expenses is also seasonal. Due to the nature of our business cycle, we need significant working capital, typically in September or October of each year, to cover costs related to production and inventory accumulation, selling and marketing expenses, and delivery of our teaching materials at the end of each year in preparation for the beginning of each school year. As a result, these operating expenses are generally incurred between September and December of each year.

Purchases through our Livro Fácil e-commerce platform are also very intense during the back-to-school period, between November, when school enrollment takes place and families plan to anticipate the purchase of products and services, and February of the following year, when classes are about to start. Thus, e-commerce revenue is mainly concentrated in the first and fourth quarters of the year.

KEY BUSINESS METRICS

ACV Bookings is a non-accounting managerial metric and represents our partner schools’ commitment to pay for our solutions offerings. We believe it is a meaningful indicator of demand for our solutions. We consider ACV Bookings is a helpful metric because it is designed to show amounts that we expect to be recognized as revenue from subscription services for the 12-month period between October 1 of one fiscal year through September 30 of the following fiscal year. We define ACV Bookings as the revenue we would expect to recognize from a partner school in each school year, based on the number of students who have contracted our services, or “enrolled students,” that will access our content at such partner school in such school year. We calculate ACV Bookings by multiplying the number of enrolled students at each school with the average ticket per student per year; the related number of enrolled students and average ticket per student per year are each calculated in accordance with the terms of each contract with the related school. Although our contracts with our schools are typically for 4-year terms, we record one year of revenue under such contracts as ACV Bookings. ACV Bookings are calculated based on the sum of actual contracts signed during the sales period and assumes the historical rates of returned goods from customers for the preceding 24-month period. Since the actual rates of returned goods from sales during the period may be different from the historical average rates and the actual volume of merchandise ordered by our customers may be different from the contracted amount, the actual revenue recognized during each period of a sales cycle may be different from the ACV Bookings for the respective sales cycle. Our reported ACV Bookings are subject to risks associated with, among other things, economic conditions and the markets in which we operate, including risks that our contracts may be canceled or adjusted (including as a result of the COVID-19 pandemic).

FINANCIAL STATEMENTS

Consolidated Statements of Financial Position

Assets

December 31,

2022

 

December 31,

2021

 

 

 

Current assets

 

 

 

Cash and cash equivalents

45,765

 

309,893

Marketable securities

380,514

 

166,349

Trade receivables

649,135

 

505,514

Inventories

266,450

 

242,363

Prepayments

56,645

 

40,069

Taxes recoverable

19,120

 

24,564

Income tax and social contribution recoverable

17,746

 

8,771

Other receivables

972

 

2,105

Related parties – other receivables

1,759

 

501

Total current assets

1,438,106

 

1,300,129

 

 

 

Non-current assets

 

 

 

Judicial deposits and escrow accounts

194,859

 

178,824

Deferred income tax and social contribution

170,851

 

130,405

Related parties

-

 

-

Investments accounted for using the equity method

90,603

 

-

Other Investments and interests in entities

8,271

 

-

Property, Plant and equipment

197,688

 

185,682

Intangible assets and goodwill

5,420,213

 

5,538,367

Total non-current assets

6,082,485

 

6,033,278

 

 

 

Total Assets

7,520,591

 

7,333,407

Consolidated Statements of Financial Position (continued)

Liabilities

December 31,

2022

 

December 31,

2021

 

 

 

Current liabilities

 

 

 

Bonds and financing

93,779

 

281,491

Suppliers

250,647

 

264,787

Reverse Factoring

155,469

 

-

Lease liabilities

23,151

 

26,636

Contractual obligations and deferred income

67,134

 

46,037

Accounts payable for business combination

73,007

 

20,502

Salaries and social contributions

100,057

 

62,829

Income tax and social contribution payable

5,564

 

16,666

Other liabilities

20,347

 

20,033

Other liabilities - related parties

54

 

39,271

Total current liabilities

789,209

 

778,252

 

 

 

Non-current liabilities

 

 

 

Bonds and financing

749,217

 

549,735

Lease liabilities

117,412

 

133,906

Accounts payable for business combination

552,270

 

511,811

Provision for tax, civil and labor losses

651,252

 

646,850

Contractual obligations and deferred income

-

 

128

Other liabilities

31,551

 

47,516

Total non-current liabilities

2,101,702

 

1,889,946

 

 

 

Shareholder's Equity

 

 

 

Share Capital

4,820,815

 

4,820,815

Capital reserve

80,531

 

61,488

Treasury shares

(23,880)

 

(23,880)

Accumulated losses

(247,787)

 

(193,214)

Total Shareholder's Equity

4,629,679

 

4,665,209

 

 

 

Total Liabilities and Shareholder's Equity

7,520,591

 

7,333,407

Consolidated Income Statement

December 31,

2022

 

December 31,

2021

 

 

 

Net revenue from sales and services

1,264,280

 

947,419

Sales

1,233,978

 

914,266

Services

30,302

 

33,153

 

 

 

Cost of goods sold and services

(473,135)

 

(396,829)

 

 

 

Gross profit

791,145

 

550,590

 

 

 

Operating income (expenses)

(710,553)

 

(621,890)

General and administrative expenses

(471,626)

 

(430,279)

Commercial expenses

(194,043)

 

(164,439)

Other operating income

1,020

 

5,554

Impairment losses on trade receivables

(45,904)

 

(32,726)

 

 

 

Share of (loss) profit of equity-accounted investees

(4,512)

 

-

 

 

 

Profit (Loss) before finance result and taxes

76,080

 

(71,300)

 

 

 

Finance result

(181,766)

 

(84,543)

Finance income

88,557

 

35,640

Finance costs

(270,323)

 

(120,183)

 

 

 

Profit (Loss) before income tax and social contribution

(105,687)

 

(155,843)

 

 

 

Income tax and social contribution

51,114

 

37,089

Current

10,668

 

(11,297)

Deferred

40,446

 

48,386

 

 

 

Net Loss for the period

(54,573)

 

(118,754)

Consolidated Statement of Cash Flows

For the year ended December 31,

2022

 

2021

 

2020

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

Loss before income tax and social contribution

(105,687)

 

(155,843)

 

(71,053)

Adjustments for:

 

 

 

 

 

Depreciation and amortization

264,135

 

211,156

 

174,088

Share of loss of equity-accounted investees

4,512

 

-

 

-

Impairment losses on trade receivables

45,904

 

32,726

 

25,015

Reversal for tax, civil and labor risks, net

(15,099)

 

(1,986)

 

(2,092)

Interest on provision for tax, civil and labor losses

42,063

 

34,300

 

13,297

Provision for obsolete inventories

40,924

 

22,117

 

4,057

Interest on bonds and financing

108,896

 

43,549

 

52,935

Interest on loans from related parties

-

 

-

 

2,922

Contractual obligations and right to returned goods

11,312

 

(1,159)

 

1,454

Interest on accounts payable for business combination

65,725

 

157

 

1,568

Imputed interest on suppliers

19,810

 

8,158

 

2,945

Share-based payment expense

19,043

 

22,526

 

39,648

Interest on lease liabilities

13,143

 

14,984

 

15,091

Interest on marketable securities incurred

(54,954)

 

(26,719)

 

(16,907)

Bank and collection fees

3,891

 

-

 

-

Other finance costs, liquid of the income finance

3,441

 

-

 

-

Cancellations of right-of-use contracts

616

 

(195)

 

-

Residual value of disposals of property and equipment and intangible assets

13,161

 

124

 

(454)

480,836

 

203,895

 

242,514

Changes in

 

 

 

 

 

Trade receivables

(189,329)

 

(25,408)

 

(123,412)

Inventories

(65,011)

 

(14,038)

 

(20,812)

Prepayments

(16,576)

 

(12,511)

 

(4,060)

Taxes recoverable

(16,566)

 

(4,914)

 

24,573

Judicial deposits and escrow accounts

(16,035)

 

(6,076)

 

184

Other receivables

1,133

 

(1,789)

 

4,516

Related parties – other receivables

(1,258)

 

-

 

-

Suppliers

121,519

 

(16,124)

 

42,620

Salaries and social charges

37,166

 

(9,890)

 

(6,693)

Tax payable

(4,039)

 

5,711

 

13,629

Contractual obligations and deferred income

9,657

 

(2,659)

 

(2,163)

Other liabilities

(10,748)

 

(670)

 

4,295

Other liabilities - related parties

(39,218)

 

(94,155)

 

117,299

Cash from operating activities

291,531

 

21,372

 

292,490

Interest lease liabilities paid

(14,941)

 

(14,692)

 

(14,675)

Payment of interest on bonds and financing

(92,500)

 

(24,922)

 

(49,404)

Payment of interest on business combinations

(603)

 

(1,572)

 

-

Income tax and social contribution paid

(7,153)

 

(1,167)

 

(5,234)

Payment of provision for tax, civil and labor losses

(1,363)

 

(627)

 

(7,716)

Net cash generated by (used in) operating activities

174,971

 

(21,608)

 

215,461

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

Acquisition of property and equipment

(61,143)

 

(20,910)

 

(1,642)

Additions of intangible assets

(87,362)

 

(55,878)

 

(42,793)

Acquisition of subsidiaries net of cash acquired

(81,043)

 

(186,218)

 

(23,147)

Proceeds from (purchase of) investment in marketable securities

(166,543)

 

351,472

 

(474,195)

Net cash (used in) generated by investing activities

(396,091)

 

88,466

 

(541,777)

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

Capital contribution

-

 

-

 

2,426

Suppliers - related parties

-

 

(1,450)

 

(207,174)

Loans from related parties

-

 

-

 

65,600

Payments of loans from related parties

(254,885)

 

(20,884)

 

(76,830)

Lease liabilities paid

(27,003)

 

(21,998)

 

(12,835)

Acquisition of treasury shares

-

 

(23,880)

 

-

Parent Company's Net Investment

-

 

-

 

(6,335)

Issuance of common shares in initial public offering

-

 

-

 

1,836,317

Transaction costs in initial public offering

-

 

-

 

(154,849)

Payments of bonds and financing

(759)

 

(477,741)

 

(852,135)

Issuance of securities with related parties net of issuance costs

250,000

 

-

 

-

Issuance of bonds net off issuance costs

1,018

 

497,000

 

-

Payments of accounts payable for business combination

(11,379)

 

(19,168)

 

-

Net cash (used in) generated by financing activities

(43,008)

 

(68,121)

 

594,185

 

 

 

 

 

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

(264,128)

 

(1,263)

 

267,869

Cash and cash equivalents at beginning of period

309,893

 

311,156

 

43,287

Cash and cash equivalents at end of period

45,765

 

309,893

 

311,156

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

(264,128)

 

(1,263)

 

267,869

 

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