Centro de Imagem Diagnosticos SA
BOVESPA:AALR3
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Centro de Imagem Diagnosticos SA
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Good afternoon, everybody, and thank you for holding. Welcome to the earnings release for the first quarter 2023 for Allianca. I am, [ Elio ] and we have today, Pedro Thompson, our CEO and the executive directors of the company. [Operator Instructions] This conference call is being recorded and will be available at the IR site of the company, where you will see the full material for this release.
Before we begin some important messages. The information contained in this presentation and the forward-looking statements made during the conference referring to business outlooks and operational perspectives are premises based on the beliefs of the management and are no guarantee of the future. These forward-looking statements involve risks and investors should understand that overall economic conditions, market conditions and other operational factors could impact the future results of the company.
I would now like to turn the floor over to Mr. Pedro Thompson to begin the presentation.
Thank you, Elio, and good afternoon to all of you, the earnings release for the first quarter of Allianca. We go on to Slide #4. We have just completed 1 year of the change of control that began in the second semester. We do have some highlights. The first at the end of last year, we set forth 5 goals as part of 5 pillars for action in such a way that we were able to simplify and adjust the structure and it has now been concluded in 2023. The budget is underway, and the goals and incentives have been drawn up for all of the employees of the company. We have brought inside the process of clinical analysis. We're focusing on attention, the regionalization of our call centers and of course, boosting revenues. We have seen a trend for growth in the main operational and financial goals, especially in our service levels and our NPS. The NPS for employees for our test and of course, the client satisfaction level.
We go on to Slide #5. Our gross revenues reached BRL 312 million, the best quarter in Allianca's history, considering same-store sales without an organic expansion. In truth, we have 2 units less. Since the second quarter of '21, we have had an adjusted EBITDA of BRL 63 million with a margin of 24%. And this increase vis-a-vis the first quarter of '22, but compared to the fourth quarter of '22, we have increased 4 points. So you see the resumption of revenue and, of course, the control of our costs.
We now go on to Slide #6 to speak about our operating highlights. We have a better commercial positioning, allowing us to readjust the average ticket in practically all types of exams. We are increasing the accreditation of our health plans. We have new list prices, and we have diversified our revenues. Now we have 15 brands and all of these have this service and the revenue has increased 4 fold with an enormous potential. This is another positive highlight of this first quarter, where we reached 13% of our production are invoicing with private tests. I just to say with revenues directly out of pocket.
Another point I would like to highlight is the increase of productivity, having an impact in all indicators, we have new time slots, a regional call center leading to an increase in bookings and of course, the quality of our attention.
Another 2 highlights referring to the quality of our services, we have the second largest brand in terms of invoicing, we received Level 3 certification, very important when it comes to quality and another level that we have attained is the evolution of NPS. Compared to the first quarter of last year, we had a growth of 7.7 percentage points.
We go on to Slide #7 to speak about clinical analysis. Now the unexplored opportunity of expansion for Allianca has always been enormous. Only 9% of our patients use the imaging services and others. Now this tended to be a structural point and became a priority for the company in 2023. And some highlights referring to clinical analysis. We have brought the process inside with a gain in unit cost of 16%, an increase of quality as well 99.6% of the exams are delivered on time. And the main brands -- the main tests are delivered in a period of 24 hours, of course, boosting our action with the main players another very important point besides quality is that the rollout of assertiveness in all of the groups, all the units have been certified to carry out clinical tests and this is restricted to 53% of the units. So until the end of the year, we will increase twofold the rollout in all of these things. We have had an increase in the brands that are in the process of rollout and units that offer CA and imaging have had an increase of revenue of 33%.
And finally, we inaugurated our first advanced technical center in the Midwest Rio Grande do Sul, delivering more exams in bio-clinics, hematology and point of care testing. Of course, this also has attracted a larger number of physicians.
We go on to Slide #8 to speak about our expansion. We continue to be focused on the asset-light expansion, which is the foundation of our growth. Now we are operational with Fonte da Saude and we are broadening our presence in Rio de Janeiro. Now this contract gives us the right of preference for a potential M&A, a new contract with Unimed Pharma in the north of the country to open up 7 greenfield units expanding our footprint. We're also very proud to share 3 new partnerships signed in this first quarter. First of all, the Center of Hematology of Sao Paulo, one of the largest and most important hematology and immunotherapy center. Another partnership that we have is with the Albert Einstein Hospital also in Sao Paulo, it is the best hospital in Latin America.
Second, in ranking in world's best hospitals, and we carry out pathological anatomy exam.
And finally, a partnership with Livance, a partnership with 14 units in Sao Paulo, Rio, Alphaville and Campinas. We will be partners for pap smears and cytological tests. We have also worked with CDB, increasing the name of the brand and have positioned it as a relevant player.
Now, we now go on to Slide #9 to speak about health analytics. In this first quarter, our actions generated based on data reached more than 1 million patients at a very low cost with a high return on investment. Now we're now fostering health in a large focusing on the tracing of diseases, especially cancer and the prevention of exacerbation by offering the right care. Our health analytics has been developing algorithms and rules to focus on the early identification of patients with needs. Based on this, we gear patients for the diagnosis of colorectal, breast, uterus cancer. We also work with diabetes and obese patients and patients with dyslipidemia. We're going to use artificial intelligence to detect the incidence of cancer. We immediately carry out a biopsy in breast cancer diagnosis where the public system takes 4 months, we do this in 1 month. The issue is to identify patients, and we would like to further engage patients so they will become co-responsible for the management of their own health, their own disease and the prescribing physician. So he doesn't only wait for the patient to book a visit.
We now go on to Slide #10 to speak about our financial performance.
We go straight to Slide #11. We break down our gross revenue. Ex-COVID it grew from BRL 296 million to BRL 312 million, an additional 11 percentage points. If we consider the revenues with COVID, which last year represented 5% of total revenues and this quarter, practically 0, we had a growth of 5% during the year. The mix was quite concentrated on imaging exams, our core business with an increase in volume and average ticket, as you will see on the next slide.
In Slide #12, in the graph to the left, you will see the direct contribution of ex-COVID test, BRL 312 million, offsetting what we had in the first quarter of last year, BRL 296 million. The result is due to an increase in the volume of exams along with an increase in average ticket. All types of exams reflecting our better commercial positioning and a more effective mix of services. The exams with MRI increased 15% with the average ticket increasing 10% and the number of exams increasing 5%. These exams represent 37% of our total revenues. Now revenues outside of MRI, for example, CT and ultrasound had an increase of 2% and represents 50% of our revenues. Now these results are 100% on same sales. There has been no acquisition, organic expansion or M&A during the period. This is the result of our operating restructuring, the new focus of the company and the commitment of our team. Now this is just the beginning of our strategy, but doubtlessly, this will be sustainable and long-lasting.
We will now speak about our SG&A. We were able to maintain our cost and expenses at the same level as the first quarter of last year with an inflation of 5% during the period. The reduction of costs and expenses represented a gain of 5% in the company margins. Well, we had an increase of personnel that had been held back but this was offset with a reduction of input and medical hospital services because of our impact of verticalizing what we were doing.
We now go on to Slide 14 to speak about our adjusted EBITDA, the best EBITDA since the fourth quarter of 2021, more than double vis-a-vis the fourth quarter last year, a reversion of trend and a new level of profitability. Now some of the reasons for increasing EBITDA, 11% increase in net revenue, an increase of 32% in gross revenue, a greater dilution of general expenses even considering our expenses with personnel during the period and several initiatives to reduce costs and expenses. For example, the cancellation of contracts and renegotiation with several suppliers.
We will now go to Slide 15. Now we still have a slight increase in financial expenses because of the increase of interest rate.
We go on to Slide 16, the significant increase in company EBITDA has enabled us to stabilize our leverage. There are actions underway to reduce the leveraging. First of all, a focus on profitability, activities geared to enhancing working capital with a reduction of reception and term and, of course, measures to improve payment. On March 31, we have BRL 158 million available in cash for the company.
Final messages. We go on to Slide #18 to end the presentation before we open the floor for Q&A. As you can see, we walk the talk. The main financial and operational metrics have once again recorded growth. Our leverage is stabilized with a trend towards dropping because of the EBITDA that we already have. We do intend to grow further. These are the initial results of our operational restructuring process. We're always focusing on the deleveraging of the company. We're thinking of an expansion of clinical analysis once all of our units are working full steam, strategic partnerships based on an asset-light model. They will be implemented and will bring about results. We still have new figures to announce. This sector has low penetration and allows for a consolidation and a new presence in strategic regions where we have strong and highly acknowledged brands.
To conclude before the Q&A, the operational restructuring is still underway with a new trend towards profitability and new levels in terms of financial volume, operational volume and the focus of our managers is to continue to expand invoicing and profitability.
Thank you very much. We can now go on to the Q&A.
Thank you, Pedro, for the presentation. We will now go on to the question-and-answer session. [Operator Instructions] The first question is from [indiscernible], who asks us to speak about the debt rolling for the short-term strategy.
Thank you for the question. Most of our conversations are underway. We do have an agenda with banks for the rollout of our debt. This, of course, is a priority for the company management.
Our next question comes from Carolina, which is the magnitude of the impact that the company will have on its cost due to the change in the base salary of nursing?
This is a technical and political issue with a great deal of ongoing discussion. We have an in-house and external team negotiating with class associations to see how this will roll out. The sector so far does not have a clear positioning in terms of how to deal with this. As soon as we have a result, we will share it with you.
[Operator Instructions] Our next question comes from Eduardo Tinoco. Do you see the possibility of any other type of capitalization?
Tinoco, than you for the question. All of the efforts of the controller have been mobilized, we should have a result in the medium term. And after carrying out the [ over ] this will become a priority for the company.
As we have no further questions, I would like to return the floor to Mr. Pedro Thompson for his closing remarks.
Thank you very much for your confidence in Allianca Health. Our operational restructuring is underway. And we do hope that the company will attain a new level of profitability and operational data. Thank you all very much for attending, and we do hope to see you at our next call. Thank you very much.