Como a Cogna planeja dominar o setor educacional com IA

Summary

In this insightful interview at the CEO Conference in New York, Roberto Valério, CEO of Cógna Educação, discusses the company’s impressive first-quarter results, its strategic outlook for the year, and the strong growth in its higher education business, including its successful summer university entrance exam results. Valério also highlights the company’s financial stability, reduced leverage, and focus on shareholder returns through dividends and stock buybacks. He elaborates on Cógna's expansion into bilingual schools and government education solutions, as well as the potential of artificial intelligence to enhance educational productivity. The conversation touches on the possibility of mergers and acquisitions, with a focus on the company's long-term growth strategy.

Takeaways

• 😀 The CEO of Cogna, Roberto Valério, highlights the strong performance of the company in the first quarter of 2025, with growth in revenue (6%) and EBITDA (12%), along with a significant turnaround from a loss in 2024 to a profit of 95 million reais.
• 😀 Cogna's core business, which is primarily focused on higher education through the Kroton operation, performed well with a 6.5% increase in student enrollment and a 23% increase in revenue from this segment's annual recruitment cycle.
• 😀 The company is focused on maintaining growth with solid fundamentals, particularly through the strength of its higher education business, which contributes 60% of its revenue.
• 😀 Cogna's educational systems and government solutions have significant growth potential, with strong opportunities in language school franchises and educational products for the public sector, such as materials for improving student performance in national evaluations.
• 😀 The company has made strides in improving its financial position, reducing its net debt by 400 million reais and returning value to shareholders through stock buybacks and dividend distribution (120 million reais).
• 😀 Cogna is actively managing its debt to reduce financial costs, aiming to achieve optimal leverage near 1.3 times EBITDA, a significant improvement from 3.5 times in 2020.
• 😀 Cogna's growth strategy includes small acquisitions aimed at expanding into new education sectors, such as bilingual schools and artificial intelligence-driven solutions for educational content creation and process improvement.
• 😀 The company has identified artificial intelligence as a key tool for increasing productivity and personalization in education, with over 120 AI projects underway to enhance content creation, improve student engagement, and optimize teaching materials.
• 😀 The CEO mentions the potential for growth in the medical education segment, although this represents a smaller portion (10%) of Cogna's overall business. The company is focused on increasing the desirability of its medical schools and improving content and infrastructure.
• 😀 Valério addresses speculation about a potential merger with Idux, acknowledging that while conversations do happen in the sector, Cogna remains focused on its own growth and creating value for shareholders, with any future mergers or acquisitions being considered only if they align strategically.

Q & A

What was the general market reaction to Cogna's first-quarter results?

The market reacted positively to Cogna's first-quarter results, showing enthusiasm and optimism. Despite some concerns about the economic environment, the results demonstrated strong revenue growth, higher margins, and a significant turnaround in net profit.

What were the key performance highlights for Cogna in the first quarter?

Cogna experienced a 6% revenue growth, a 12% increase in EBITDA, and a 2 percentage point improvement in EBITDA margin. Most notably, the company reversed a loss of almost 10 million reais in Q1 2024 to a profit of 95 million reais. Additionally, cash generation was strong, with a liquid cash flow of 150 million reais for the quarter.

How does the performance of Cogna’s higher education business (Cróton) influence the company's outlook for the year?

Cogna’s higher education business, which constitutes 60% of its operations, had a very successful first quarter. The company saw a 6.5% growth in student enrollment and a 23% increase in revenue from the new student intake. This strong performance early in the year sets a positive tone for the rest of the year.

What other areas of Cogna's business are expected to perform well in the coming quarters?

Cogna’s other segments, such as its educational solutions business and government sales, are expected to perform well in the upcoming quarters. These businesses are influenced by seasonal factors, with government contracts and other projects ramping up in the second half of the year.

How does the current macroeconomic environment affect Cogna's business strategy?

Despite challenges such as rising interest rates and inflation, Cogna’s strategy is benefiting from strong household income levels, which have increased demand for face-to-face courses. Additionally, the company’s debt reduction and operational cash flow improvements help mitigate the negative impacts of higher interest rates.

What is Cogna’s stance on its current leverage, and what goals do they have for it?

Cogna is comfortable with its current leverage of 1.23 times EBITDA, which is an improvement from 1.8 times a year ago. The company aims to maintain an optimal leverage ratio around 1.3 times and plans to further reduce it to minimize financial expenses. They also aim to continue using their operational cash flow for share buybacks, dividend distributions, and strategic acquisitions.

How does Cogna approach the use of artificial intelligence in its operations?

Cogna is actively investing in artificial intelligence across several areas. This includes improving process automation, enhancing content creation, and offering personalized learning experiences. They are using AI to assist teachers in content creation, lesson planning, and assessment, which is expected to improve student outcomes and increase the company’s scalability.

What is the potential of Cogna's bilingual school franchise and its impact on the business?

Cogna's bilingual school franchise has significant growth potential. The company has already signed 42 contracts and generated 12 million reais in revenue from this segment last year. This business model involves providing a bilingual curriculum and management system to school owners and investors, allowing for rapid expansion and tapping into the growing demand for bilingual education.

What is the status of Cogna’s government solutions business and its growth prospects?

Cogna’s government solutions business, which focuses on educational materials for public schools, has experienced impressive growth, increasing its revenue from 40 million reais in 2021 to over 300 million reais in the past year. The company provides learning reinforcement materials to help schools improve their rankings in national education assessments, and there is considerable room for further expansion in this market.

What is Cogna’s position on potential mergers and acquisitions, particularly with regard to its discussions with Idux?

Cogna acknowledges that discussions about potential mergers and acquisitions, including with Idux, are natural in the sector. However, the company is currently focused on its growth and operational improvements. While mergers may offer value through synergies, Cogna’s strategy remains centered on organic growth, increasing profitability, and improving cash flow. They will consider transformational M&A opportunities if they arise, but the priority is the company’s current business trajectory.