Anima Holding SA

BOVESPA:ANIM3

Earnings Call Analysis

Earnings Call Transcript 2024-Q2

[Marina Gelman, executive]

So good morning, everyone, again. Welcome. This is the earnings presentation for Anima Educacao for the Second Quarter of 2024 as well as for the first half of 2024. Here, we have Marcelo Bueno; Paula Harraca; Atila Simoes; Guilherme Soarez; and Marina Gelman, me. And we're going to make a presentation. Questions will be made at the end. And many of you are used are already raising your hands. You may do that. And in the end, we are -- open the microphones so that people can ask their questions directly. Also, if you need the translation, the interpretation button on the bottom of the screen, you can click there and listen to the simultaneous interpretation into English.

Having said that, I now turn the floor over to our CEO, Paula Harraca. Welcome to your first presentation of earnings. We wish you a lot of success, and that's it. The floor is yours.

[Paula Harraca, executive]

Thank you, Marina. Thank you, everyone. Good morning, everyone, who is present. I'm very happy to be with you in such an important moment when it's time to share our earnings. I've been sitting on this chair that Marcelo used to sit in and watching this process and becoming more and more in love with Anima. And it's important to show the fruit of the work of this wonderful team.

I would like to make a point that this earnings to be presented by Marcelo because this is still part of his management. So nothing better than having him present this quarter's results. So Marcelo, you have the floor to share the earnings. There are amazing results for this quarter.

[Marcelo Bueno, executive]

Thank you, Paula. Good morning, everyone. Marina from Texas. Good morning and good morning, everyone. It's a cold and rainy morning here in Sao Paulo, but we feel warm with so much energy and love here at Anima.

I would like to quickly say that I'm very happy about this moment. There's a lot of energy from the partners, sell side, buy side analysts and our team and Anima ecosystem. We've been through and excelled and faced -- succeeded in so many things. The troubles with [ FIES ], pandemic, changes in the economic scenario. Silica interest rates went from 2% to 14% without precedence and this agenda, new agendas, and we faced a unique moment in terms of value generation. And with the acquisition of the assets of Laureate. We went in the end of December, with 19 systems, and then much more in January when we woke up in the beginning of the year.

And we did everything carefully, with a very highly professional system. And I used to occupy the seat of CEO of the company. And now we're honored to have Paula taking over the CEO position. It's great to have a brilliant woman leading. She is forged on steel, and so it's a very special moment. And I must mention that, and I really would like to thank you all. I do this on behalf of my partners, Ricardo Cancado, and my Executive Vice President, Atila, as well. Thank you very much. And I would like to thank all of you from the company, from the Investor Relations team, and Paula. I didn't do it alone, we all did it. So thank you very much. And let's continue with our presentation, because this gives us a lot of joy.

As Marina said, we're very proud to communicate these robust results after difficult times. And we want to be here for a long time. Education is priceless and it has a lot of value. So we went to 2.76x in an organic way, and we reduced our net debt even more, generating cash in a very robust way. We have encouraged and invested in this cash generation process. We see revenue going up by 4.3% -- and 4.3% growth in revenue. Our brands have value, and students recognize our value proposition. As Paula will improve even more our agenda to continue with our efficiency gains, increasing our margins -- in the last, we increased our margin in the last 12 months, generated a net income.

And with that, I render accounts on behalf of everyone, and I'm very proud of it. But mainly, we once again ended one cycle that's materialized with the arrival of Paula. It's a new -- a third wave, a top line wave, that will focus even more on the ticket, on generating value, on our value proposition, increasing our operational efficiency.

It's very important for us. It's always been a dream of us. For the first time, we have exceeded BRL 1 billion. So that's -- the figures speak for themselves. So with that, I turn the floor over to Atila, my friend.

[Átila da Cunha, executive]

Thank you, Marcelo. Okay, I'll start. Before talking about numbers, Marcelo, I would like to thank you. Thank you so much. You've been a warrior, a fighter. All of you have seen what we've been through in this last years. And a pandemic, acquisition of Laureate, interest going from 2% to 13%. I'm sorry to be emotional, but we are human, it's been -- we've been through quite a while, and a lot. And you've been a great captain in these difficult times we've been through, and now we succeeded, as the reports that have been disclosed can witness. Okay, just a break of the protocol here.

This is Anima. This is what I like. Anima means soul. And we have soul. We are company with soul. I'm speaking from my heart here. Okay, so this is what's going on here live that the Former CEO crying. This is an important moment for the company. I also was also moved by your report. All of us are part of this trajectory and everything below, all these figures are a consequence of this great path, this journey we've been through. So it's really genuine. And that's it. We've built this together. Yes, Inspirali as well -- Inspirali, very good. We are made of steel, but we do have a heart.

So going back to the presentation, this quarter has crowned a cycle of 4 consecutive quarters, a year of a journey in which we show solid results. Paula mentioned -- said something in the morning to our teams that really moved me. We must be motivated and disciplined, because motivation alone won't do it, because there are days in which we wake up and we're not so inspired, but we once again wake up, get out of bed, and then after we get out of bed, motivation is there. So we are disciplined. We have been very strictly methodic and strictly disciplined in delivering results, consistent results for 4 quarters. And we, Paola made the brave decision to face issues to hold the ticket and show the value of our brands.

We've been successful in that. And once again, in this quarter, we show the resilience of this strategy. So if we grew 3.8% in the first quarter, the resilience of the strategy caused us to grow a bit more in the second quarter. So we developed even further in this quarter when compared to the previous one. And Botafogo, my team continues at the top. As Marcelo said, we're very proud to reach BRL 1 billion for the first time, as the EBITDA go -- growth in margins, that shows the -- how solid our project is.

Many of you know Fernando, or [ Fernandon, ] as we called him, also forged on steel again with [ Estella, Tiago and Karina ] the team that supports us, they're brilliant. So we continue with our path in increasing cash generation. Our concern with the quality revenue, with the consistency of our figures, is translated in this chart. A robust conversion of EBITDA in cash, and that materializes a consistent path of growth and execution.

With that, we were able to reduce our leverage for 1 more quarter, reaching 2.76x. We went from 3.91x year ago to 2.76x. This is a significant reduction. He said growth, but I said reduction. Oh, yes, it's a reduction in the leverage, but growth in the company, that's it. It's been significant. And it's worth highlighting that in this quarter we had cash generation, how much we used in working capital, CapEx and interest on debt. We are in an absolutely consistent trajectory. And this has been a very good quarter.

Okay. Again, on the next slide, we delivered consistent growth. All the lines that are green had no major concern there, including marketing. It's even those that are red, because they're very low rates. The first quarter showed a significant growth rate, and we said that this figure would be balanced around 7.5% and 8% in the quarter, and that happened. So this shows our confidence and our commitment to results.

Our investments are concentrated on odd-numbered quarters. And so here we see the results of what has been mentioned in the previous quarter. And so in every segment we've been able to attain improvement in results, improving margins, growth in tickets. This growth in ticket offsets the loss of the base in the core. That shows the resilience and strength of our brand, because we are -- we've been able to grow our ticket in adverse scenario. Estella and Fernando always start with a slide of the map of Brazil. I'm always very happy to see that slide, because we -- Brazil has so many quality brands of our Group and we are very proud of that.

In every segment we see the development of this company, which shows the commitment of all the teachers of our company. And I thank you all for one more quarter of successive evolution. So these are the results in each of the segments.

And now continuing, I turn the floor over to Guilherme, the CEO of Inspirali.

[Guilherme Colin Soarez, executive]

Thank you, Atila, in talking about the earnings, I must thank you for your trust and recognize the leadership of Marcelo in creating Inspirali. Inspirali is one of the main -- the competitive differentiators of Inspirali is to make part of Anima system. And now, with the leaders under the leadership of Paula, we will be even -- will boost even more our potential. The stronger Inspirali is, the stronger Anima is. So it's a privilege to make part of this history and of this journey. Thank you for trusting me.

Inspirali continues its path. We present results in this semester that normalizes things that happen due to FIES, as mentioned in some reports, and shows the resilience and the capacity to attract students that want to study medicine that's reflected in the ticket as well as in the occupancy rates and the profitability of Inspirali's operation.

Also, we must mention the arrival of 1 more unit, UNA de Tucurui in Para. We were anxiously awaiting for this unit to be opened, and we are now in the process of attracting students from Para, from the region. It's a wonderful campus with a great faculty, and we are very proud that UNA has this first medical school. That's very symbolic for us.

And I must also mention the increase in places of AGES. And AGES is Professor Wilson, AGES Jacobina. That was the first school of Mais Medicos to be accredited. Congratulations. And then Sao Judas, Cubatao were at rate 5 as well as us, and so we are very proud that we are doing things right. It's a robust project, focused on quality, and we scored 5. And with a differentiated ecosystem and network to inspire students.

Now I turn the floor over to Atila.

[Átila da Cunha, executive]

Guilherme, when we look at Inspirali, we see how robust our dream is. Marcelo was here. And looking back in 2018, Marcelo, we only had one medical school. Shortly after that, we are so big and so strong, thanks to everyone's work, a thousand hands work. This is the result of believing in a dream. In 6 years, we built all that. So congratulations to the entire Inspirali team.

Now, going back to our numbers here. Again, we've shown a very healthy cash generation, with a very robust liquidity position. We ended the quarter with cash, enough to make amortizations. Until 2027, we have enough cash, so this places in a comfort position, comfortable position, to balance all the agendas that a company should sustain growth, the agenda of return to shareholders, investment in our own business. And that has also given us the opportunity to continue with our liability management work in a very assertive way.

So during this half of the year, especially this quarter, we've been able to reduce from 2.4% to 1.9% the spread. So we're able to gain 0.5 point in the spread. We don't know about the future, but we have to be prepared for the future. So we had a reduction of 0.5 percentage point. And the extension of the debt is very important as well, because we're paying less and less interest. So reducing our financial cost and focusing on generating cash. This allowed us to have the Board of Directors resolved -- on resuming the return to shareholders. So the payment of dividends was announced yesterday. Our leverage was significantly reduced in the last 12 months.

And our solid liquidity position and the consistent growth in generation of cash made it possible to make such a decision. And this is part of an agenda of balancing all the agendas that are important for a company, including the return to shareholders.

Now, going to our final remarks, Marcelo, I turn the floor over to you.

[Marcelo Bueno, executive]

Thank you. I could go through this, but we already mentioned most of it. So we'd just conclude with 3 remarks. He talked about Botafogo and people who are no longer part of our ecosystem, who've been through here, but had to leave because on our agenda of efficiency. So I would like to thank all of you who have been through, who have been with us, but are no longer with us.

And my second remark, this mention of this growth of Inspirali is very important. At the height of the pandemic, we had a lot of money in cash and the use of procedures. We made acquisitions, and we are desperate. What should we do? The world will end, and I looked at the income, and we saw that medical -- medicine would not suffer. So we created Inspirali. We did an M&A that could never be done. So Inspirali became even more robust. And that's very interesting. So adversity brings opportunity. Yes.

So what Atila said about dividends, as a CEO in transition now, I was part of the meetings of the Board of Directors, and there were 2 remarks made by 2 brilliant people.

First, Antonoaldo Neves. Antonoaldo, he has been in the Board for a long time, and he's even younger than many of us. Antonoaldo said, "Well, we have to discuss these funds, whether we'll start a repurchase or -- open for repurchase or pay dividends. And we decided to place these funds in the hands of shareholders, and they will decide what to do. This is much better." That's interesting.

And the other comment by our dear CFO, [ Gabriel Ralston, ] my partner, that said, "The 4 consecutive quarters of gain in profitability and generation of cash, we resumed the right to pay dividends and to look at shareholders." So this is an important agenda. So adding these 2 long remarks, and Marina agrees with me, someone -- one of the partners that I admire the most said to me, we have to go back to paying dividends, and it's good to take this opportunity to do this. So this crowns this moment and makes us very happy and optimistic about the future now led by my dear friend Paula.

Paula was chosen by Anima, but she chose Anima as well. And this is where the magic lies. So with that, I thank you all once again. And in this, we started a new cycle, and we will have a great agenda in the top line. Resumption of growth in the next quarters. And I wish that Anima to become even more a benchmark in what -- in terms of what we want to do and what Brazil deserves. And I wish our country to have a strong agenda for education and a state policy regarding that. And we can make a better Brazil, a better country, and we are doing our share.

So thank you again. I turn the floor over to Paula and she will continue with the Q&A.

[Paula Harraca, executive]

Yes. I'll take this opportunity to officially receive from you the leadership, and you talk about the symposium of the professors, yesterday we had at [ Espidali. ] So this is the third energy -- energetic wave will be the third cycle of the company. We had the first cycle led by Castanho, then Marcelo, and this is the third cycle, but it's a group effort. It's important to recognize for everybody who's participating from the market, our team, to recognize the power of the ecosystem and the teachers and professors who believe that it's worth waking up and going to work to make this happen. And I would like to say that gratitude is an important word.

Thank you for not giving up, because only you who have been through that know how hard it was when you were in the middle of a turmoil. You can't see ahead, but you continue, you persevere, you trust, you just do it and keep going. And the value of that is reflected on those numbers of our earnings. And I received from you -- I'm an athlete, so I received the shirt at the top at the high level. And I take this position with, I'm highly committed and I trust this team that's very committed, very competent, that's making this transformation through education for -- beautifully for 21 years.

Thank you. Thank you.

[Marcelo Bueno, executive]

I think in Japan, people said, "Oh, he's turning a mission at a -- it's the hard mission in Japan." That's a great honor to receive a mission at a high level, to raise the bar when you, you convey that.

[Marina Gelman, executive]

Okay, now, thank you for your presentation. It's very inspiring. And let's start with the Q&A session.

The first is Marcelo Santos from JP Morgan.

[Marcelo Santos, analyst]

I would like to start with the top line. Now it's a top line wave. In this new chapter with this focus, what are the initiatives to accelerate? Do you think about growing the top line, I believe the student base must grow in addition to the ticket, right? So what are you doing regarding that?

And the second question is now that leverage is at interesting levels, what is your view on using cash? You're you going to pay high dividends now? Do you have an appetite for M&A? Or what are the potential projects for using the cash?

[Paula Harraca, executive]

I'm going to answer. This is an agenda that's been on an ongoing agenda. It's a repositioning to look at the strength of our brands. I'd say that today, I'm working with 3 dimensions, very short term. This is what's happening on an everyday basis, short term. At the next quarter, they were planning and executing. And the third mention that we sometimes say long term. But yes, is the sustainable perineum view of the business.

And this second quarter are -- this is a student that comes from -- it's a different type of student, but although they are different students, we still believe because they have a different background, but we continue to sustain the strategy of adding value to brands, bringing value attributes. And now we are doing this on a granular view looking brand-to-brand, [ campi-a-campi, ] program-by-program because Anima has this beauty, we have the power of several brands and each one has a different color has a different accent. So this is the movement that's gaining strength now. It's like lower inflation and causing the country to grow.

Our challenge is to maintain a quality of revenue that bring students that will continue in the -- in school and with lower default rates that will be translated in higher profitability. That's also important for a company that's profitable, competitive and efficient.

So considering the 3 dimensions, immediate term, short term, good improvements made in our strategy to increase our positioning. And also growth in the medium and long term, that is being accomplished.

[Marcelo Bueno, executive]

So the second question, Marcelo. I say that I'm supporting this transition to Paola, but I also support this organic deleveraging agenda. In addition to that, we made so many M&As in Brazil. We've seen a lot, and there are times in which the market is closed. Like a subprime, we opened the market in BH. It happened in after FIES, we opened the market once again and it happened again. The market was closed to M&A due to this distortion that happened. So a few M&As happened or options, opportunities happened, but we declined them.

And Inspirali, there is a session -- there is a chance to make movements there, but we are very diligent. If we are to make an M&A or to be part of an M&A, it must be done well. There are several signs we have to pay attention to, and this is what we believe in.

[Marina Gelman, executive]

The next question comes from Lucca Marquezini from Itau BBA.

[Marcelo Bueno, executive]

You're in the camera. Feel free. We are among friends here.

[Paula Harraca, executive]

I wish I could see Marcelo's face on. Marcelo had a picture, but Lucca doesn't. We're putting you on the spot here, Lucca.

[Lucca Marquezini, analyst]

I'm sorry. The system doesn't allow that. Yes, maybe in the next call we'll attain that. I'm trying, but I can't.

Okay, great. It's more about cash generation. You show a reduction in the net debt, and you still pay dividends. So our idea is to understand, do you see some cash generation or some leverage for additional cash in the second half of the year that enabled you to pay dividends? Or should we adopt. Should we adopt this payout level for the future?

[Átila da Cunha, executive]

Thank you for your question, Lucca. We don't talk about the future. We talk about what we do and what we did. It is our understanding that our results are solid, consistent, and they give the company security to make this decision. And this decision reflects the fact that we believe it's important to resume the agenda of return to shareholders.

The company is focused on cash generation, on growing its EBITDA. That would be at the top. And therefore, we created the conditions for this decision to be made, and we believe we are in a solid path that will give us conditions with consistency and discipline for the Board to make decisions such as these, if it finds appropriate.

[Marina Gelman, executive]

The next person is Lucas Nagano from Morgan Stanley.

[Lucas Nagano, analyst]

Congratulations to Marcelo for your work, and success to you, Paula, Atila, and Guilherme and Marina. I have 2 questions about Inspirali. You've seen a trend in drop in the margin. You said that it would be normalized. When do you think that the margin will become stable?

And the second is about this new places approved and the existing ones. What do you see in terms of new candidates, applicants for the Mais Medicos that were authorized.

[Guilherme Colin Soarez, executive]

Thank you, Lucas. Well, with regard to your first question about profitability, you can look at trend of stability shown in the second quarter. As widely discussed in previous conference calls, this is a result of the maturity of our programs. As students increase and reach this third cycle, which is the practice cycle of interns, and that matures, there is a stabilization and accommodation of margins. This is well expected and planned for, as the company matures. And we believe that these levels are now more stable and will maintain those levels.

As for your second question, the curriculum of UNA was approved. And in the timing that's closely linked to students that joined in the second semester that for medical students, the major intake in a medical school is in the first half of the year. So yes, we are working, but the main movement will be in '25 cycle.

[Marina Gelman, executive]

The next question comes from Mirela Oliveira from Bank of America.

[Mirela Rodrigues de Oliveira, analyst]

I have 2. First, regarding the renewal indexes, since we're entering the second half of the year, could you comment on the renewals so that we can understand what you expect in terms of sustainability of core ticket onward?

And second is about the margin leverage for the second half of the year. What do you see are the opportunities or challenges?

[Átila da Cunha, executive]

Thank you for your questions. Mirela. Well, the renewal of enrollments that started from '23 to '24, we've been very pleased with that. We've been very strict with our renegotiation process, policies; and with discipline, we are removing scholarships from students who do not fulfill the contract requirements because we want our students to recognize the value of continue to study with us. So it's a recognition from the academic point of view. That's what matters. At the end of the day, we are delivering good value propositions.

As for the margin leverages, I particularly like to use soccer metaphors because they are always easy to be understood in Brazil. As at this third quarter, we are in a new league because we go from a comparison of weaker quarters and now start to compare ourselves to stronger quarters. Now we have a strong team, very strong team. And I'm sure that in this new league we are ready to win. Of course, if we used to face second division teams and we would score 6 to 0 and win the games now it's harder to win by such a high score, but I'm sure that this team is ready to win the game as well.

If you look at rental, for example, lines, they are lower on a nominal basis than they used to be in the quarters of the end of last year. In the administrative payroll, we're better -- doing better as well, nominally. And so we have a frantic search for gains in efficiency, looking for better opportunities in that area. And from the consistency point of view, this agenda that has been led by Paula to strengthen our brands will provide a new look to the growth of margins that comes from the top line and the discipline in improving tickets. So this will boost us to win the games in this new league?

[Paula Harraca, executive]

Yes, Atila. And if I can add to that, we are considering that we have a beautiful product, but we are revisiting our academic project because there is room for improvement. We are listening to the students making improvements and this is a continuing dynamics process, as Atila said, to strengthen the brand. But look, making customer satisfaction, student satisfaction polls and looking at the faculty, because the NPS recourse reflects that classes, students, faculty. And it's important to highlight that we are working on profitability, Mirela, on looking our academic offer, data-driven because at the end, it's not a holding that operates, it's a company, it's an ecosystem that operates. Because I don't believe in a silver bullet.

The company comes from a strong path of opportunities when it gains strength, speed and consistency, especially now that the company is able to look at this agenda of growth based on the previous pillars that were built. So it's a set of actions talking about how we do business here.

[Marina Gelman, executive]

Now the next question is Samuel from BTG. Samuel Alves.

[Samuel Alves, analyst]

There are 3 topics I would like to address. The first 2, and I'm sorry to insist on this topic of dividends. The first question is to understand the rationale of the amount that was approved. BRL 178 million is 0.2x the company LTM. If it's on pro forma, the company would be close to 3x of the covenant. So I would like to understand the rationale behind this payout amount.

And the second topic, also on dividends. The second question, also on the topic of dividends. Should we see this announcement as a company that expects to work with high payout levels from now on, so -- as the company is able to have higher profit. The idea is to return this profit to paying to shareholders?

And the third question is if you could talk about the thermometer of intakes or funding for the next -- our new students for the next quarter?

[Marcelo Bueno, executive]

Okay. The Board of directors of the company resumed this conversation we had in the past. Gabriel, Castanho, and major shareholders we admire. We have -- making such reflections for a long time. Paula also agrees with that, that we have to improve the system for Brazil, for shareholders, for students, and looking back, Anima should pay more attention to shareholders.

So this is a rule that is being enforced. It's right here. And the amount is related to this moment of what to do. Should we repurchase or open for repurchase or give return to shareholders? So taxation. Several things that were deeply discussed. But this must be a company that has disciplined regular practices and results, so that us shareholders can have peace of mind that we are being compensated and that Anima can access the market better and better to fulfill its goals.

[Átila da Cunha, executive]

Yes. And from the technical point of view, Samuel. As shown on the slide, we see a company that has achieved a successful trajectory of generating cash and having good results. If we look at the even quarters is what we generate in cash is 3x higher than the [ debt ] service. Even considering CapEx and working capital. These are significant figures. So technical studies were delivered to the Board of Directors and the Board made resolved that based on technical studies.

About the new students. As you know, we start again using soccer terms. We started, the second half of the game starts on Monday when we return to classes. When classes of the second half of the year start. And the tactic system is the same. Communication is about repetition, Marcelo, I was so happy to hear you talk about [ PVCVC. ] That's a technical system, 5.542. This is how we work.

Okay. So the tactics remain the same. And again, as you repeat it, you improve the tactics. So that's the vibe in which we face this incoming enrollments for the second half of the year. And now we're leaving and starting the game with a new coach. And she is an athlete, actually. And I would like to learn new metaphors with you, Paula.

[Paula Harraca, executive]

We went to this locker room. We had this locker room conversation morning. Yes. So taking the temperatures. Yes, the formula is given, the tactics, the system. The tactics is on the field. And we know that the second half is the key because we're talking about a different type of student that we know already. But this is the dynamics of the year with sustaining a strategy of differentiated positioning is challenging. It's not a common grain. So we are separating here. So this is the revenue -- the rep -- what we can do for profitability.

Now, you gave me the mission to use a sports metaphor, so I'll bring the metaphor of Bernardinho, the volleyball coach, he said, "The willingness to train, to practice has to be stronger than the willingness -- the will to win." So we're working on the process and we'll focus on the process so the results will be achieved.

[Átila da Cunha, executive]

Great. We work together as a team here.

[Samuel Alves, analyst]

Okay. Thank you.

[Átila da Cunha, executive]

Thank you. Samuel. Yes. You're now provoking this athlete. It's friends with Bernardinho to use metaphors.

[Marina Gelman, executive]

We have 4 minutes left and we still have 2 minutes to ask. Leandro Bastos from Citi.

[Leandro Bastos, analyst]

I have 2 questions. The first about dividends. In the recent past, the company focused on deleveraging. And you mentioned that you were looking at inorganic initiatives as well. How can we -- should we read this announcement? Does it increase the need for inorganic needs? Or now the company changed. It's in a new phase and this is no longer needed? How should we interpret that based on the previous policy?

The second you also announced a dividend payout from Inspirali along with Anima. Could you explain a bit the policy -- the dividend policy from Inspirali? What should we expect towards the future, so that we could understand the cash a bit better?

[Marcelo Bueno, executive]

Okay. Now, as a Board member of Inspirali, I can speak, and also as someone who's taking care of the inorganic agenda. We've made several deals and several M&As. As I have said previously, we need in the liability management that was perfectly conducted. So the liability management of Inspirali, of Anima. So placing the company in a role that it doesn't need to be, is not something we do. We must do things well. This is the rationale behind all the deals and M&As that we've done. So we are discussing, and we are still working on inorganic -- or organic deleveraging. I'm sorry, organic deleveraging. We still have time for that. So that's the message.

We are looking at opportunities, and as a shareholder, the lower the leverage, the better. And we're confident about the future. And that's how the Board resolved. As a Board member of Inspirali, we continue to discuss with our partners. Say, hi to all the partners. The company is well, generating cash, with cash to make an M&A. But as I said in the question, number one, the market is closed now. We looked at some M&As, and we declined. So as for the payout of dividend, I discussed with [ Tayan. ] He showed the spreadsheets to us, and he showed that the full dividend payout will not change M&A decisions. Actually the opposite. So this was the background for such a resolution.

If there are 2 or 3, or 4 M&As to be made, we will look into them. And then, our opportunities if we need to make them, in such a wonderful asset, such as Inspirali.

[Marina Gelman, executive]

The last question comes from Caio Moscardini from Santander.

[Caio Moscardini, analyst]

My question is about the brand strategy of Inspirali. When we look at the Mais Medicos market, the potential is it's smaller towns that will have a hard time attracting students in the future. So it seems that having a national brand that's able to attract students to these smaller towns seems to make sense. I would like to understand, what is your thought on that.

[Guilherme Colin Soarez, executive]

Thank you for your question, Caio. We've named Inspirali as Inspirali in January 2020. Only we had AGES [ Irece, ] and we were in the transition phase with UNISUL. So we celebrate. We now celebrated 5 years since Inspirali was created or rather named Inspirali. And as Marcelo said, this is a good issue to have. We have the privilege in the Anima ecosystem to have great brands, such as UNIFACS, IBH, [ Portuguada, ] Anhembi Morumbi and several others, AGES. And as we create and consolidate Inspirali brand, this opens new opportunities. We're open, working with discipline and consistency, to be able to place Inspirali brand at the service of this project.

[Marina Gelman, executive]

Thank you for 190 people who attended this call. And now I turn the floor back to you for your final remarks. And thank you all very much, and I wish you all a great day of work.

[Paula Harraca, executive]

Well, here in Sao Paulo, I'll let you -- invite you, Marcelo to bring whenever you want to bring news and support our team, but you are leaving a great legacy. And the main word is gratitude. I think Anima is being regenerated, is reborn for the future in a place of union, strength, power, and having people who really believe in this project of transforming the country through education.

And we are now the leading characters in this process. We want the company to be part of the debates. Sometimes we discuss at the bar, whether you're on the left or right wing, of course, but when you look at 4 years, but Anima, when we look at all these brands of their ecosystems, we look at 800 years in the history of Brazilian history. So this team of partners who really believed in this process 21 years ago, could not imagine back then that Anima would be so big, and we can't even think of what we will have in the future. So thank you. Gratitude for all of you -- to all of you. Great.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]