Auna S.A. Class A ((AUNA)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Auna S.A. Class A recently held its earnings call, presenting a balanced outlook with both achievements and challenges. The company reported notable growth in consolidated FX-neutral EBITDA, particularly in Peru and Mexico. However, it also acknowledged hurdles such as decreased capacity utilization and market softness in Mexico, alongside flat revenue in Colombia.
Consolidated FX-neutral EBITDA Growth
Auna reported a 5% growth in consolidated FX-neutral EBITDA during the second quarter, with significant contributions from its operations in Mexico, Colombia, and Peru. This growth highlights the company’s ability to leverage its diverse geographical presence to drive financial performance.
Peru’s Performance in Healthcare and Oncology
In Peru, Auna’s healthcare services experienced a 5% revenue increase, fueled by higher surgery volumes and strategic price adjustments. The OncoSalud division also delivered impressive results, achieving solid revenue and EBITDA growth, alongside a record low oncology MLR.
Mexico’s Revenue Growth
Despite facing market softness, Mexico’s revenue grew by 5% year-over-year. This growth was driven by higher average tickets for surgeries and emergency treatments, showcasing the effectiveness of Auna’s pricing strategies in the region.
Colombia’s Improved EBITDA and Margin
Colombia saw a 9% increase in EBITDA and a margin expansion of 1.4 percentage points year-over-year. This improvement was attributed to a more profitable mix of payers and enhanced payment flows, demonstrating Auna’s focus on optimizing its financial operations.
Stable Financial Position
Auna maintained a robust financial position by refinancing over $62 million of short-term debt, thereby improving its maturity profile. This strategic move underscores the company’s commitment to sustaining a healthy debt structure.
Capacity Utilization Decline
The company experienced a 2.5 percentage point decline in total capacity utilization, bringing it down to 64%. This decrease was primarily due to intentional growth slowing in Colombia, reflecting Auna’s strategic focus on quality over quantity.
Market Softness in Mexico
Market conditions in Mexico remained challenging due to tariff uncertainty, impacting formal employment and leading to a decline in surgery volumes and emergency visits. This softness poses a challenge for Auna’s growth ambitions in the region.
Revenue Flat in Colombia
Colombia’s revenue remained flat year-over-year as Auna concentrated on risk mitigation and enhancing cash conversion cycles. This focus on financial stability is crucial for maintaining long-term growth prospects.
Forward-Looking Guidance
Looking ahead, Auna anticipates continued growth with a 5% increase in consolidated FX-neutral EBITDA, driven by performance improvements across Mexico, Colombia, and Peru. The company is committed to reducing leverage to 3x net debt to EBITDA, despite a 13% decrease in cash position. Auna’s strategic focus on effective financial management and positive FX variances is expected to support its growth trajectory.
In summary, Auna’s earnings call reflected a balanced sentiment with significant achievements in EBITDA growth and regional performance, particularly in Peru and Mexico. However, challenges such as decreased capacity utilization and market softness in Mexico were also highlighted. The company’s forward-looking guidance suggests continued growth and strategic financial management, positioning Auna for sustained success in the future.