Anima Holding SA
BOVESPA:ANIM3
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Anima Holding SA
Earnings Call Analysis
Summary
Q3-2023
The company has been successful in increasing its EBITDA margins, boasting a 24.6% year-over-year increase and improving leverage with a significant reduction in net debt from 3.9 to 3.4 times. The focus on disciplined capital management, effective working capital use, and strategic balance between student base growth and revenue has proven to be effective. The company anticipates better results by year-end and maintains a confident view on the trajectory of reducing leverage. Moreover, Q3 results have surpassed those of the same quarter from the previous year, demonstrating an underlying trend of improving financial health and operational efficiency.
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Marcelo, our Founder and CEO, has the floor to start this call.
Good morning, everyone, and good morning, everyone. It's a pleasure to be here next to Marina, Botafogo, Átila and Guilherme, all this wonderful team, enabling our earnings call. It's a sunny Friday in São Paulo here. I'd like to thank you once again. I'd like to thank, first of all, [ Ricardo ], [ Gonzalo ], the whole team, considering had a serious problem that has been overcome. Everybody that has supported me in the implement -- for implementing this relentless plan of reducing net debt and hard work.
I'd like to thank everyone that have been laid off from Ânima at a difficult time, not only for Ânima but Brazil is a whole, and a hard line for families that trusted us that renegotiated their contracts, the people that have had to leave our ecosystem. And my word is of gratitude to all of you, our investors, stakeholders, analysts, that have trusted Ânima that have gone through this moment that has been so difficult to mankind. But particularly, this moment that the company has gone through.
I believe it is important for us to have clarity that until last night, just on myself, I'm CEO, could say, considering questionings of covenant and our solvency capability. [ Massimo ], I can say that since we founded the company, we never delayed rent payments or salary bags. It wouldn't be now that we would not accomplish what we do today. We can say this is part of the past. The covenant of 3.5, that should be changed as a limit at the end of the year. It's 3.44 now. So with this, I'd like to thank all this wonderful team that has managed to carry out this work and move on in our presentation. But reinstating our gratitude to each and everyone of you considering everything I've said.
Well, moving into the presentation, it is important to start with the message that we actually are increasingly more disciplined, implementing a discipline that is unrelenting of reducing net debt and leverage. We see the results here, BRL 234 million in net debt. I clearly said many times that we would reduce net debt. So leverage at 3.4x, well below the last report and below our covenant for this year. Important in terms of the improvement of the EBITDA margin. And the old-fashioned adjusted EBITDA, BRL 236 million, plus 24.6%, 2.2 percent points of gains of expansion.
And it's very important for cash generation, very important, of BRL 321 million times compared to BRL 127 million in Q3 '22. These -- as to a solid student base with ticket expansion. It's important to talk about this because there's a lot of speculation, opposition. And in quality, it is most important for the company. We will always seek this positioning because we genuinely believe in it. Quality is again a gain to all of us, and we believe in this way, and you all are very aware of it. So our ticket to growth and student base, find an optimum point between the growth of student base and ticket. That is revenue.
With this, I turn over to our partner, our CFO, Átila, so that he can move on with the presentation.
Great. But we have a change. I'm kind enough to turn over to Bota because Botafogo loves presenting this chart because this is his child. And then you turn the floor back to me.
As Marcelo said and Átila was saying, it is with great smooth and serenity, that is very humbly, we know there is a lot to be done. We want to deliver much better results over the next years, the forthcoming years and periods.
At the same time, it is with great satisfaction and great pride that we present these results. We have 7 consecutive quarters of the EBITDA margin ex IFRS, the old-fashioned way, after paying rent, last 12 months, when you get a result of one quarter of semester, you have a lot of intrinsic volatility. When you take a longer series of last 12 months and you do the rolling basis and you see how the business is behaving, and there are 7 consecutive quarters of improvement in profitability. And we have 5 quarters beating or reaching a record quarter-over-quarter of the greatest EBITDA ex IFRS adjusted in the past 5 years.
Consequently, it's a period that Marcelo here as CEO, implementing this very strong discipline of purpose, quality and education and generating attractive return to shareholders, will leave this huge balance of delivering quality education that will actually transform people's lives through employability, income generation and tangible social mobility and transformation as well as providing returns to shareholders. So we communicate these results. A great joy.
Thank you, Botafogo. Thank you for your introduction. This chart is consistent with -- sorry. So I wanted to turn back the floor to you. Well, this is a table, not a chart. These results, as Marcelo said, is the result of the work of thousands of educators at Ânima. Many of them are attending this call, and I congratulate them, and I thank for having taken this journey with us that is, in fact, challenging, but it presents results. We are committed when we disclosed the results of quarter 2 to an action plan, better efficiency, faculty austerity and the management of expenses and the maintenance of the initiatives of administrative personnel reduction.
Three months later, we see that our statement shows that it confirms our commitment. This earnings results call has this symbol or sign. We are here. We recognize the result that was below what we understand the company does also have. We committed to an action plan. Three months later, we are back here showing that it has actually been achieved. This is very important.
These items and numbers, we don't want to go into details and you know that you all have much more detailed information in our release. There are clear evidence of the quality of our results in addition to having improved almost 25% on EBITDA year-over-year, we have gained 400 basis points in the EBITDA. Old-fashioned way, it's very great quality. There is nothing of gains in provisions. It's an EBITDA that actually goes to the cash of the company. This to us is extremely important.
And I'd like to connect this importance to the next chart, which is evolution of our debt. In addition to those commitments, we committed ourselves to care and pay attention and great diligence in the use of working capital, especially in accounts receivable. And the evolution that we see today in terms of relevant reduction of the debt is also resulting also in addition to what we've seen in the previous chart, consistent improvement of results plus an improvement that is significant in the use of accounts receivable of the company.
We had great discipline in working capital. We had great discipline in CapEx. And we highlight to you what have been portfolios that we have transformed into cash that they had been generated in the previous quarter, so that everybody have the exact dimension of the impact of the past and the current working capital management. And the result of it all is that we managed to reduce BRL 234 million for our net debt.
It's, to us, a reason for great accomplishment. We know the difficulty it is to reduce net debt with the interest rates at the way they are. We know how difficult it is. So as we reduce that, we understand that this is great merit of all Ânima educators who have accomplished it.
And we are excited, Marcelo, because we see from now on lower interest rates, the pressure consistently reducing. We see that in our results, our financial results. But that's just the beginning of what we understand the new cycle of drop in interest rates that will improve along with the improvement of results of the company and the care of making the revenue to be received. This care, along with management, debt and improvement of results, we believe, in a very sound way with great consistency, that we would -- are beginning a reduction and trajectory of reduction of leverage of the company. We've reduced from 3.9 to 3.4.
Next quarter, we will further reduce it. And then further and further, and we are very confident that the work that we show here takes us towards this direction. And in the conversation of partners, if you do the math, our ROE, you see a structural trend of growing ROE and cost of debt that is actually reducing. Very important to be observed, Marcelo, as we have a lower debt with a trend of flexibility, unlocking value is something that is very much boosted. It's a new boost in value generation.
In these releases, we actually wanted to clarify and we privilege several things. Well, we have showed very -- lots of things in our presentations. The summary, as we conclude this results call, we are delivering what we have promised consistently. We are paying attention to what was the core point of concern of everybody looking at Ânima, which was leverage. We are diligent, very much so, in the front of expenses and as diligent in the caring for the education of our accounts receivable. So that revenue can be revenue to be receivable, so that EBITDA can be cash.
These are the main messages. Our units keep on being robust. We have Guilherme, who can answer on Inspirali. Marina also following us and honoring us to answer questions on regular topics, academic or future of education. We have [ Fernando ] and [ Ester ], whom I publicly thank for the long nights for us to have these results presented at a lower timing. In addition to that, we have this -- that in the release, we actually made it 3 days earlier regarding what we have always published. We continue in the trajectory of reducing this time line.
We closed an important step, Marcelo. I have reported to you. I report to everyone the integration of Oracle, a first step, that will build the final turn in the 2nd of January automation. The process of accounts receivable closed automatic, everything right, with no mismatch in the first minute of November. That will help us reduce even more these time lines so that we can increasingly have information that is reliable, fast, showing good numbers to all of you. I think it's important.
Before we go to the Q&A, I think it's important I should say this about Botafogo. At every 10th conversations, well, 9.5 is leverage. The invitation from now on is that we can go back to talking about systems integration, 19 to 6 integration of RP, academic quality. And as Átila said brilliantly, we've come this far. Me as a CEO, I could say many times, I cannot count with drop of inflation, interest rates. But we should reinforce and restate that we have, well, drop in interest rates. Well, with the meetings of Copo, this happens as a Brazilian. I do hope to have a recovery of the economics, of employment, and then our positioning quality will be increasingly more prepared for this scenario. We should change our agenda from now on, and then we should talk about things that are very important that we've had to not talk and thank everyone.
I think our Board of Directors have supported us. It's been renewed. We have new Board members arriving now. I'd like to thank publicly for the support they have given us to this project. Now let's move on to our Q&A. Samuel, would you like to start the queue?
Sure. I have 2 questions on my side. The first is on FGTS, if you could perhaps quantify or give more qualitative color of the improvement in retention of [ GMPS ] for the third quarter, if you see more color of retention for the fourth quarter?
On second question on CapEx. There's been a major decrease, 50% year-over-year, quarter-over-quarter, without going to guidance here. But can we expect a pattern of investment that is more conservative in this line from now on? That's it. Congratulations on the improvements you've shown.
Samuel, I just hear that I would never answer questions on FGTS. But I keep on answering them even so. Well, this pattern of Q3 is consistent to what we've seen in the previous quarter. We fortunately had on the first -- I think it was published on the 3rd of November, the lot with a new [ CADE ] cap, and we expect this produces effects as of the Q4. So that's what we're working on.
And from CapEx, we understand that our CapEx is being looked at very much. Discipline. We're not doing anything that actually impacts the quality of teaching for students, and I say this very proudly. In the past 2 weeks, we had all our rounds of conversation with students and the problems that we saw in the past, when we've been pressed by the services we've been providing from the standpoint of enrollment and payments, tuition, invoices, our CapEx is very educated and disciplined.
Of course, in Q3, we have a bit less in terms of works, et cetera. We were impacted early this year for the changes in terms of campus. This has weighed a bit. We felt that in our releases, and that was part of the past. And we understand that actually, we are moving towards a new pattern of CapEx, more educated, more consistent. In light of all CapEx we've invested in the past years, we are completing the integration of ERP. That has consumed a lot of CapEx that will no longer take it. That is an item that we understand that in the next quarters should be very well educated. On FGTS, Átila?
Well, since nobody asks me anything, let me say something. We should remember that on the 1st of November, the law was published [ 14719 ] that implemented, as of November, a ceiling of [ 27.5 ]. It is not -- we're not happy with that. We've been talking a lot about this, right, Marcelo? This is a conversation that is happening in Brasilia, and I have the opportunity of acting on behalf of several associations. All this framework of rules that has been created through FGTS implies a lot of obligations to cash economic of [ Itaú ] and then fund managers' obligations that cannot be attained.
We are confident enough to contribute to a fund whose delinquency level is real in our portfolio. We know that we have an audience that within the industry, we have an advantage in this sense. We know the profile of our portfolio, but this is not happening because the government agencies are not doing their part. So this discussion continues because the efficiency in collection care, all these instruments of payroll discount, et cetera, and this should happen and should be effective according to our portfolio that we know what it is.
Very good. Very well complemented, Marina. Thank you, Marina, Átila. Hello, [ Luka ].
Congratulations on your presentation. We have 2 on our side. First, in terms of improving the receivable, the organic part, 7 days. If you can comment from now on how much you have to improve, if there are new initiatives in addition to these, if they would be continued. If you could give some color as to how you can improve working capital, first part.
Second part. In terms of average ticket, especially on digital, we see that some players saying that there have been some pressures if they have been more aggressive. If you can comment on price and the [ mic ] intake for distance learning, it will help a lot.
Right, [ Luka ], the working capital part. Well, it is together with a set of policies and processes that aim at making receivables faster, some policies that encourage higher rates for longer financing terms, so that students only use them if they need up to operational aspects. We have selection robots that once the tuition fees mature, they can get in touch with those 2, then they can make an agreement via WhatsApp with no human interaction. So this is a broad set of measures that make us improve the conversion of revenue into cash.
Having said that, we understand that Q3, the odd-numbered quarters are better for accounts receivable. That's when we have the renegotiations. So we understand that we've been able to give a good level of education to our accounts receivable. From now onwards, our expectation is that we maintain this level of education. It may change slightly to be improved in the odd-numbered quarters and a bit worse for even-numbered quarters. It should grow consistently when we grow our revenue and a bit below slightly as these actions are more consistent over time.
So I understand that we did a lot of work. From now on, it's to continue maintaining so that it can actually break progressive evolution but not as relevant as we -- those that we see now. And as to distance learning, well, there are several factors from the growth in marketplaces where we have consolidated brands that we've grown with corresponding tickets to the value of our brands up to certain moves that aim at balancing what we call tripod: volume, ticket and working capital. Volume, ticket and taste to have revenue turned into cash. All of this together is our challenge to balance. We should not only look at volume, not only to ticket, and not only to -- not fail to look when the revenue goes into the cash of the company.
I believe this movement of ticket in distance learning is healthy, offset in that for smaller volume. But what is important, [ Luka ], to understand that intake of distance learning happens continuously. Not necessarily do we have great impacts in a quarter that are structural. It is better for us to look over this semester. So based on this semester, we are confident in volume growth. We're still confident in ticket growth and even more so of making this being turned into cash quickly.
Super clear, Átila. Thank you, [ Luka ]. Nagano, you have the floor.
Two questions. First is on marketing. We have an increase of about 2 points in these lead providers. The question is if this is going to continue in the next quarter. Second question, sorry, it's a bit longer. It's not -- well, it's actually the reduction of faculty and business sustainability. You've been doing very efficient work on varied fronts. And in this quarter, there's an improvement in the payroll of faculty.
At the same time, there is some kind of attrition in the retention and intake. How can you do that? Minimizing impact per student, not only thinking about the short-term action plan, de-leverage and covenants, thinking about intake for the next cycle and sustainability?
Thank you, Nagano. I'm going to start with the second. I think it's important I mentioned in the previous call, first call. We moved from '21 to '22 with 19 systems to 6. We -- on the 31st of December, we had 19 systems in the company. We woke up with 6. So we made the implementation of the large machines, the Laureate and Anhembi Morumbi, in fact. And in addition to all of that, there was the return of in-person on campus. So that generated a lot of stress and the solution -- one of the solution was to, well, let's increase the hours to more activities, give more freedom, so that we can suit the situation.
I said that. And we resumed the previous pattern in the turn of the last semester that is reflecting this quarter. It's not a matter of moving professors that are going to generate problems to quality. We're not talking about this. We're simply, again, putting the student hours that should at the levels that should be always. This is very clear. It's been mentioned before, and we're just delivering what we had promised.
Well, Marcelo -- well, Nagano, starting with the last one to me, it's the most important. I've been here for 20 years, and I intend to continue in the next 20. And we cannot ever compromise our future with what we do in the present. Quite on the contrary, we had to strengthen the future with what we do in the present. What we've done in this quarter reflects this. We needed to give more efficiency to the company or we mobilize the company in this direction.
So well, we are going to care for it ahead. 80% of my time is in our units. Well, be it in our Paulista campus, in the campus of Belo Horizonte, [ BHI ], I go in the elevator with students. I have a -- I have my coffee with students in the canteen. Marcelo has his nephew study at São Judas. I shortly will have my children studying here. But [ Tiago ], our CFO, [ Vince Pirani ], was just enrolling his daughter to study physiotherapy at Anhembi Morumbi. So we trust our schools and our children's study in them. So we consume what we produce. This to us is absolutely relevant to answer your second question.
To answer your first question, Nagano, I think there has been increasing this price of leads this quarter. I think we should close the year very consistently in terms of the closing Q2 last year with a slight adjustment with inflation. This quarter, there was greater effort, greater investment and effort considering the intake cycle. But I don't believe this is something that will continue in this intensity, much on the contrary.
Prof. Marcelo Santos, you have the floor.
I also have 2. The first is -- well, if you could make some remarks on competitive environment. I know you like to talk about overcoming. You have your eyes -- you have on the -- you are on the front line, and your vision is very useful to us. Second question is to Marina. Well, Marina, there is a question for you, indeed. If you could make some consideration on the regulatory environment for distance learning.
Marcelo, for the competitive environment, it's very difficult to talk about competitive environment because there are many. There are various environments. And they are multiple. Sometimes, you have a marketplace that is doing very well. Another one that is doing very poorly. I'd rather talk about the industry as a whole. I was very excited, Marcelo, with the census that was published recently, where we see the changing in trend of the curve of new entrants in on-campus students.
The curve was very much in line with what we believe. So the balance between digital, on-campus, hybrid is extremely important. And on-campus shows again its value also in these numbers of the census to us. It is a very important factor that we wanted to highlight, and it reinforces our trust in our project. We are pioneers in introducing hybrid learning. We believe in the purpose of quality education. So we are very happy with that turn in the curve. That is the most important point, right, [ Angela ]? So quality, distance learning growing. It has to have quality. This is the demand. We're a regional brand power, so that's unbeatable. So quality will be important, increasingly more important. That is our positioning, and Ânima is prepared to make a difference at all modalities increasingly more.
Let me say something that when we talk about quality and we hear from you, analysts and investors, sometimes, that is best. Less tangible when we talk about quality proposal. Actually, it's not. It's the academic quality that will bring employability, income, social mobility. So transforming lives, quality and education, all of this is connected with the side -- in the side of purpose and the business in a very direct way because the image Brazilians that we have, the ability of appropriately pricing our tuition fees depends on the quality perception to students. And quality perception cannot be built in 1, 2, 3 years, something you build over decades.
A young student that is in middle school that see a doctor graduated in Anhembi Morumbi, and wishes to study at that school. The student that sees the lawyer from São Judas that has a successful career, they want to study in that college. That is built over many years, and the quality that outlines all of this is reflected in the business of profitability as we have seen.
On distance learning, Marcelo, thank you for the question. And Marcelo Bueno almost answered it. We realized or we noticed a great concern of the Ministry of Education with quality, something we should actually celebrate, I mean, for Ânima. Most of you followed in 2017 all the discussion we had at the moment of flexibilization. At the time, we had the opportunity of sitting at the table discussing, bringing their ideas. At the time, not everything could be implemented the way we felt at the time should be with criteria that would be better in terms of quality and control.
And then some years later in this management, the Minister of Education faces a volume that scares it, especially knowing the low-level control and surveillance that the Ministry has on distance learning. All of this is something we should celebrate. This care in looking at quality should be celebrated. The care we have to take always evidently is turning that into something radical because when things are turned radical, they do not help. They hinder. They do not take us where we want to get to. We have been interacting with the Ministry of Education. This has been Ânima. And our presence in some associations, we're being acting towards moderating so that we're not radical.
Distance learning is very important. There are several municipalities in Brazil that are only served through distance learning. Many people can be in the big cities, but it is a mother that has a baby, an athlete of high performance that need distance learning to have their education and training. We must help the Ministry to understand that the quality agenda is essential. There are many instruments to care for that without turning it into a radical thing and turning this into a huge ban or witch hunt. That actually, we can be a main part of the discourse, which is quality. So we are following this closely. We will be able to share with all of you. We have public consultation that everybody has the opportunity of voicing their opinions. And we believe there is a path of quality viewpoint that is positive and a way of acting that deserves, say, some trimming to attain the major goal, which is quality improvement.
Very clear. Thank you for your answers. Thank you, Marcelo. Mirela?
There are 2 follow-ups regarding leverage. We know that Q3 is more challenging in terms of cash generation. Even so, it doesn't make sense for us to think about reducing leverage towards the end of the year. Another follow-up of the previous question on distance learning regulation. Looking at the public situations, Ministry has been indicating for a new regulation for teaching or academic training. Do you have any specific questions regarding them?
Mirela, thank you for your question. I'm going to answer the first, and I turn to Marina. Marina, you thought there wouldn't be questions.
Mirela, what we see in the results we present now is that we have growing trajectory of efficiency. Q3 is better than Q3 last year. And I have no doubt that Q4 will be better than Q4 last year. The initiatives we've taken are consistent, sound. They deliver both improvements in the denominator and the numerator of this. And we start in this quarter consistent trajectory of reducing leverage. Q4 consumes working capital. But even having this quarter ahead, we are confident that the trajectory of reducing leverage is present.
Regarding academic training, Mirela, this is a vicious circle that is very complicated. In the labor market, we know basic education, public education people are being very poorly paid. This does not attract the interest of many people with this kind of course. And then you have a lack of demand for the courses, and all of that generates a very bad cycle that must be interrupted. But it requires a lot of public policy to be interrupted.
We've said it many times. You've most heard of Daniel Castanho saying that, in our view, the academic trend should be a cost similar to the care that we have to medicine, to medical schools. We should have sort of full-time need for practical experience. We are training teachers for the country. So this viewpoint of the Ministry of Education, specifically to those courses, comes in the same line that we talked a while ago on the final goal of raising the bar of education in the country.
It's something we celebrate and that we've been talking a lot with the Ministry of Education, providing solutions. We have the Ânima Institute. We have an intense program of basic education, teacher training. We set up a partnership. I think it was 4, 5 years ago with Finland, with Stanford, with the Lemann staff in Stanford. So we have 2 programs at the Ânima for future training -- teacher training. There are teachers that are ready teachers, but we have been able to contribute a lot to that through the Institute because at the end of the day, that's what we need. To improve quality of basic education, we should train teachers. The country need -- requires serious policies to reduce dropout middle school. That's our raw material. We can make the transformation when students can get there. So we are very optimistic regarding this concern, this bright light now that the Ministry creates on academic training. And we're encouraged and excited to be able to do and to be here. Perhaps, a gateway for the entrance of better teachers in the country.
Perfect. Thank you, everyone. Thank you, Mirela. Renan Prata from Citi?
Congratulations on your results. I think it is just a question -- well, I think the colleagues have covered a lot and the presentation is quite clear. So well, to understand the Inspirali dividend payout, if it's recurring policy. Just to understand the recurrence or not of this dividend payout.
Okay. Ânima, I will talk about that, and then we can talk about Inspirali. Well, actually, what happens today, we haven't had all the M&As that could have happened there. And this company is, as Guilherme will say, is very profitable, generating a lot of cash, and it was down there. It could go to partners, to Ânima, it goes to the parent company. It's good that actually, it encourages the cash of the parent company to minority partners.
We are very proud to have as partner, DNA Capital. They get the dividends. That's the entitlement of the parent's money that is not ours. It's the partner's. It doesn't change anything in terms of content, our leverage and the credit risk to creditors. It's just framing more than content because within the consolidation of 100%, as we pay dividends, you have a leakage of the system of 100% integration, meaning the consolidation in terms for the leverage calculation. Apart from that, there's no impact.
We made a point very proactively to put in our release, although it's a subsequent event to Q3. We have the payout of dividend reduces cash slightly for the cash reductions for being conservative. [ Excess care ], if we were to calculate how much the net debt it -- even so, if you include the leakage in the net debt, our leverage would be 3.47. We make it very clear in the release.
So this is something that happened this year because we did not have this faster inorganic growth in addition to everything that has been broadly published. This is the effect that we have in our statements in Ânima. Well, let's let Guilherme talk a bit about Inspirali. That's what matters here.
Thank you, Renan. Good morning, everyone. Actually, Botafogo touched this point. I believe that the results of the quarter of Inspirali reinforces some points that are very relevant. First of them, consistency and soundness of Inspirali's results, the ability of medical schools of Inspirali to recompose their student base. We know there is a sort of transition of the Inspirali curriculum. Moving into the Inspirali curriculum, we maturing the curriculum, moving from semester curriculum of the legacy before integrations.
So we have a challenge this year, especially next year, remaking the base. And the results show the power of the brands and the academic proposal of quality to attract students and retain this mark. It shows clearly the acceleration of continuous medical education or lifelong education. It's a pillar of Inspirali of serving as partners to medical career throughout their life. And that's the consolidation of medical education, along with [ IBCMED ], along with Inspirali. And without those elements, Inspirali demonstrates its ability to have cash generation. Inspirali has a situation of leverage that is very healthy.
With this, shareholders have the distribution of these funds, especially to irrigate and feed the whole system and not leave that capital stuck at Inspirali, knowing that the power of growth at Inspirali is very sound. In the past 18 months of building Inspirali, we've been acting in a very clear way in consolidating covenants, our Board committees, executive management, the strategy delivery, necessary investments to maintain our operations and our offers, compatible with the quality positioning of Inspirali, inherited from the Ânima DNA, reinstated our DNA Capital partner following us and our board members of Inspirali. Thank you, Renan, for the question and to allow me to participate a little bit. Thank you, everyone. Thanks.
Caio Moscardini?
I take the opportunity of having Marina present and her presence in Brasilia. Can I ask her about FIES? If you hear any news on this topic or if not, if things are kind of stopped, nobody talks about this anymore? And another question more geared to leverage, which was the other opportunity that you had of further reducing leverage, which is the sale leaseback. What is this process like? Is it something you're studying, considering that leverage is being reduced the way you expected? And this is no longer part of strategy for now?
No, we don't see this topic in the agenda. Since July, August, people have been asking me about that. It's interesting to notice as we don't see people talking about FIES. At the exact moment, the topic is ENEM. Well, the Ministry has another fire to put out. My impression is that this topic has cooled up a lot within the Ministry. And I think this year, I think it's very unlikely to have any news, any changes in this front.
Moscardini, on the sales back, we are always following the de-leveraging alternatives we have. In light of the cost, they break. And the marginal cost or marginal gain that you have, as you hold a bit more the alternative we have at hand, we are at a picture that is gradually drawn in terms of reduction in interest rate. And the marginal benefit has been reducing every moment, but it's still large. We understand that we're getting close to the moment of making a long-term transaction with property in more competitive rates that make sense to it. This is quite heated topic agenda, as we understand and shown in this quarter, that you're seeing alternatives of greater value generation to shareholders on that.
It doesn't mean that we have left that on the side. Much on the contrary, this is present, diligently being taken care of. But we understand that we may have another slight movement in the long-term rate towards making sense of that. Such relevant contracts, such long-term contracts be made in conditions that are more attractive than the other alternatives that we have today present on the table.
[ Vitoria ], up to you. She lowered her hand. Okay. We have a question from our investor from [ Yuri ]. Let me find his question. It's over there. He asked us to elaborate on 2 points on the improvement of leverage. The inorganic part that could have in Q4, the part of property that is not PraValer, and the other one on release of working capital and these advance receivables. If this was an important leverage to reduce net debt, if we could elaborate on the movement from now onwards.
Let me first comment that everything that happened in Q3, everything was organic. There are recurring things, day-to-day things, and other things are atypical. Everything was organic though. We did not sell any property. There was nothing inorganic. This inorganic that has -- let's have the debt bridge on the screen. It will show clearly what was actually paid on in the quarter, if you got the revenue because students paid or if you should invoice as students prefer to have installment paid on the card. The kind of thing happened in the quarter. That's cash generation. And it's on the left. That's what pulls that 3.9 of leverage down to 3.6. And then you have in this, operating cash generation. On the right-hand side, we show what's atypical even though organic, credit card anticipation, early payment. To think that we're before -- things there were hanging of receivables of clients, as we said, of revenues that were past revenues but already performed.
Tuition fees of the first quarter this year, last quarter last year, so these are the BRL 33 million rounding up of credit card. In addition, we have the PraValer portfolio. And we had actually a material fact that has been published on that, not because of the size of the fact. This is very important for the sensitive topic of covenants, leverage, financial topic that certainly concerned investors and analysts.
The PraValer payment that should be BRL 50 million to BRL 55 million came in -- we almost had BRL 44 million in the quarter. Why don't we get it all in one? We do it IAS by IAS. We go to in FX. In the PraValer, we have all the receivables of fundings of PraValer's management in which we have a co-participation in credit risk. And we took all the receivables in FX. After pricing that, we go to UnP, then goes to [ Insu ], Anhembi Morumbi, all of them one by one. So we have, little by little, we have BRL 43 million in. We have a little to income, BRL 5 million, BRL 10 million, something like that, possibly in Q4, according to what we have commented. Most important here is to understand what is recurring of this modus operandi that has been enhanced here.
We don't want to praise Átila too much. We actually praise him when he's not present. But Átila has set a very important pace in this management that is very disciplined of receivables and cash generation. The whole company today, it's an effort that is company-wide. So the company is very much focused on this, not only finance. Finance can release this discussion. It involves marketing, commercial intake, attraction of students, where Ânima has always commented. You remember that. Of years, it doesn't matter the volume of intake. It's volume and price. We have to look into revenues. No use having good revenue or intake with prices.
So we have to have how many with the frontline teams? This has been and has recently was in the cash generation. In other words, it's not enough to have volume and ticket. But how does ticket come in? We actually have an installment put in. At what cost? What is the monthly cost of installments to make the duration to be shorter or [ underpaying ] exercise with cheap interest? Well, so we increase it to have it in fewer summits. All of that, the modus operandi that is much more effective, that's what we see in this recurring generation. And that is something we can expect for the forthcoming quarters, okay?
Thank you, Bota. I think we have another question from [ Marcelo Baus ]. Congratulation. Thank you for your question. Let me understand. Thank you, [ Marcelo Baus ], expert. Thank you for your question.
I posted yesterday on my LinkedIn. Well, so the whole team here, congratulate on your work. Well, let's say to us, well, one learning is materialization of what we said in our curricular model. So the legal is the nano courses. We are starting running that with our RP to generate new business opportunity and make it profitable. What, in our opinion, is the most difficult part to be done to have a curriculum by skills, nano certifications and hybrid legal. These nano certifications, we are packaging them in an operation to generate more value to that. This is not -- well, this is complementary to [ Vivaya ], readings to [ Marshall ] and the team. They are complementary of non-initiatives as none does not replace yet. Much on the contrary, they complement each other, okay?
Next question from [ Wagner Silva ].
Can you talk about Mais Médicos program? Guilherme, can you talk about it?
Thank you, [ Wagner ], for the question. As you well know, we have a new fee for -- or bidding process for what we call Mais Médicos 3. This program came out recently at a scale that was even greater than the whole market expected. It introduces several innovations to the model. For example, compared to the previous bidding processes, they are not cities that are being covered.
But actually, medical regions in health care and every applicant can decide where to put it. And we are very well prepared to participate in this process, looking very diligently and responsibly, but always respecting the positioning of quality and sustainability of such operations. So as Inspirali and Ânima, we are working. We have certain time lines to attain.
And this process will last -- will run over the next few months, considering the current time line, until the 8th of January. But we know that based on previous tenders, there may be discussions and more flexible time lines. We have a team dedicated to that in a diligent way. We have the possibility to analyze the whole document with a sound presence of the Ânima ecosystem throughout the Brazilian territory.
Regarding the second question on the provisional measures, you are following that. The Supreme Court has not completed its evaluation. We are still following very closely all the process regarding certain injunctions that we have.
Well, we have reached our time. We thank you all for your time. Botafogo, Marcelo, for your final remarks?
Well, thank you. I'd like to thank everyone and close -- thank you very much, and I wish you all a very good weekend. Let's keep on working. Marina, thank you for answering many more questions than I expected. And Guilherme, for your participation. Bye, everyone.
[Statements in English on this transcript were spoken by an interpreter present on the live call.]