Auna S.A. Earnings Call: Mixed Results and Strategic Moves

Auna S.A. Class A ((AUNA)) has held its Q3 earnings call. Read on for the main highlights of the call.

The recent earnings call for Auna S.A. Class A painted a mixed picture of the company’s performance. While there were strong performances in Peru and Colombia, and positive developments in Mexico’s oncology and cardiology services, these were counterbalanced by significant challenges in Mexico, including a decline in revenue and difficulties in system integration, as well as ongoing political and economic challenges in Colombia.

Strong Performance in Peru and Colombia

Peru and Colombia emerged as bright spots in Auna’s earnings report. Peru’s revenue grew by 9%, with an impressive 15% increase in adjusted EBITDA, and a margin increase of 1.1 percentage points to 22.7%. Similarly, Colombia saw a 5% rise in revenue and an 18% increase in adjusted EBITDA, with a margin expansion of 1.7 percentage points, highlighting robust financial health in these regions.

Successful Debt Refinancing

Auna successfully completed a $765 million debt refinancing initiative, which extended maturities, reduced financing costs, and enhanced liquidity. This included $365 million of senior secured notes and a $400 million equivalent term loan in Mexican pesos, resulting in savings of 125 basis points in interest rates, thereby strengthening the company’s financial position.

Growth in Oncology and Cardiology Services in Mexico

Despite challenges in Mexico, Auna reported significant growth in its oncology and cardiology services, with a 48% increase compared to the second quarter of 2025. These services now account for 15% of Mexico’s revenues, with Opción Oncología’s revenues increasing by 21% over the previous quarter, indicating a promising area of expansion.

Strategic Partnership with Sojitz

Auna announced a strategic partnership with Sojitz Corporation of America, aimed at accelerating growth in Mexico. This partnership is expected to leverage Sojitz’s expertise and resources, providing a potential boost to Auna’s expansion efforts in the region.

Expansion Plans in Mexico

Auna has ambitious plans to increase out-of-pocket revenue in Mexico from 8% to 20% by the end of next year, with a 15% increase already achieved in the third quarter. The company is also working on expanding its payer network and rolling out new service packages, signaling a strategic focus on growth in this market.

Decline in Revenue and EBITDA in Mexico

Mexico presented a challenging environment for Auna, with a 12% decrease in revenue and a 5% decline in total adjusted EBITDA. This was attributed to slower-than-expected recovery in volumes, issues with doctor-supplier relationships, and problems with new ERP system implementation, highlighting areas needing attention.

Capacity Utilization Challenges

Auna faced capacity utilization challenges, with a decrease of 3 percentage points to 64%. Mexico, in particular, experienced a 4.4 percentage point decrease year-over-year due to decreased surgery volumes and emergency visits, underscoring operational inefficiencies.

Impact of System Integration in Mexico

The migration to new information and ERP systems at Doctors Hospital in Mexico negatively impacted billings and resulted in delayed accounts receivable, pointing to integration issues that need resolution to improve financial performance.

Political and Economic Challenges in Colombia

Colombia’s political environment remains a concern, with potential impacts on the flow of payments and delays in improvements in the healthcare sector. These challenges could affect Auna’s operations and financial outcomes in the region.

Forward-Looking Guidance

Looking ahead, Auna anticipates a full recovery in Mexico by 2026, supported by a new leadership team and strategic partnerships like the one with Sojitz Corporation. The company aims to maintain a target leverage ratio below 3x, despite a 5% year-over-year decline in total adjusted EBITDA primarily due to weaker Mexican operations. However, with robust results in Peru and Colombia, and increased surgery volumes and service growth in Mexico, Auna remains optimistic about its future prospects.

In summary, Auna S.A. Class A’s earnings call reflected a mixed sentiment, with strong performances in Peru and Colombia and promising growth in certain Mexican services. However, challenges in Mexico and Colombia’s political environment pose hurdles. The company’s strategic initiatives and partnerships, along with its financial maneuvers, indicate a proactive approach to overcoming these challenges and driving future growth.