Anima S A : Earnings Release

São Paulo, March 27, 2023 - Anima Holding S.A. (B3: ANIM3) announces its results for Q4 2022 (4Q22) and 2022. The consolidated financial statements were prepared in accordance with accounting practices adopted in Brazil and with international accounting standards (IFRS) issued by the International Accounting Standards Board (IASB).

R$ million

2022

2021

(except in %)

Net Revenue Gross Profit

3,563.2

2,650.8

2,275.3

1,660.3

Gross Margin Operating Result

63.9%

62.6%

1,465.9

1,103.6

Operating Margin Adjusted EBITDA

41.1%

41.6%

1,073.0

802.7

Adjusted EBITDA Margin Adjusted Net Income¹

30.1%

30.3%

250.6

111.8

Adjusted Net Margin Operating Cash Flow

7.0%

4.2%

1,075.6

702.4

Free Cash Flow excl. Divestitures

604.7

466.9

Operating Results

Total Student Base²

Academic Education Student Base²

Ânima Core Average Ticket (R$/month)

Distance Learning Average Ticket (R$/month)

Inspirali Average Ticket (R$/month) On-Campus Undergraduate Dropout²

Operational Highlights 2022:

•  Total student base ³ (Academic Education + Lifelong Learning) reaches more than 395,000;

•  Student base³ of Academic Education grows 4% and reaches more than 333,000, with emphasis on advance of 42% in Distance Learning;

•  Average ticket from Ânima Core grows 8% and Inspirali 11%, both above inflation

•  Dropout rate of on-campus undergraduate is reduced by 2.4pp, reflecting improvements on retention processes.

Financial Highlights 2022:

•  Net Revenue of BRL3.6 billion, reflecting the Company's new scale;

•  Gross Profit of BRL 2.3 billion with 64% Gross Margin;

•  Adjusted EBITDA of BRL 1.1 billion, with Adjusted EBITDA Margin of 30%

•  Operating Cash Flow of BRL 1.1 billion;

•  Free Cash Flow of BRL 604,7 million, equivalent to 56% of Adjusted EBITDA.

•  Disbursement of BRL 144.5 million on initiatives to gain efficiency that should benefit future cash generation, mainly on the rent, G&A and liability management fronts.

¹ Reconciliation with accounting Net Income is shown in the "NET INCOME AND MARGIN" section of this release, on page 24. ² End of period.

For the purposes of this document, the units acquired in May 2021 that were part of Laureate Brasil will be called "units in integration June/21". As 2021 features only such units as of June, the 4Q22 vs 4Q21 results are comparable, but not those of 2022 vs 2021.

Results Webinar

March 28, 2023

10:00 AM (BRL) | 09:00 AM (NY)

To access the Webinar (Portuguese)

click here

To access the webcast (English)

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Ânima Investor [e-mail][phone]

Message from Management

May 2023: Ânima turns 20 years old. It is with great joy and a feeling that much has been accomplished that we reach the milestone of these two decades, but with even greater curiosity, focus and dedication for what we need to do to make a decisive contribution to the transformation of Brazilian society through education. With almost 400,000 students, BRL 3.6 billion in net revenue and Ebitda of BRL 1.1 billion (BRL 730 million ex-IFRS), Ânima ends 2022 with a relevant scale and always growing with quality education. We believe that education that transforms lives is that which brings social mobility, employability, income gain. We are very proud of the advances in the lives of our students and we know that there is much to be done in this 'infinite game'. And it is with this look at the short/medium term future, in 2023 and the longer term, for the coming years that we approach this moment of disclosing the 2022 results.

Focus on our key stakeholders: the annual result is a moment of reflection on how we are performing with students - the center of our education universe - but also with our team of employees and with the investors who support us in carrying out our journey. Our gaze needs to be attentive to the team that delivers academic quality so that we have the perpetuity of our impact, a perpetuity that also depends on attention to the financial market, creditors and shareholders, who expect increasingly better results from our operations. We know that the improvement has been significant on many fronts, but we are also aware that there are relevant challenges that need to be addressed: in the evolution of our profitability, returns for shareholders and the necessary deleveraging.

In the last quarter, we had commented on the encouraging trends for 2023 and how much we saw constructive aspects in terms of volume and ticket perspectives (despite the challenging macro scenario for Ânima Core), starting with the important 'summer' funding of the start of the year. Although we have not completed funding (we will talk about it in detail in the 1Q23 release) we continue to be constructive - without euphoria and great improvement (due to the 'headwind' of the macro environment) but with satisfactory results. Here it is worth mentioning that such satisfactory results do not come so much from macro improvement, but from 'micro' improvement: door-in management has been much more efficient. A year ago, during the recruitment process, we were in the first major (summer) funding after the integration of Jun/21, still with cultural adjustments of the teams, with a great challenge of integrating information systems, which brought difficulties in the provision of enrollment and student journey services.

Inspirali Medical Education and Distance Learning continue to perform solidly. The discussion of macro challenges is particularly relevant for our Ânima Core (on-campus ex-medicine) with stable revenue in 4Q22. As we will discuss later, for particular reasons of each segment, both the Inspirali undergraduate degree and the distance learning undergraduate degree continue with reduced influence of the macro environment, growing 8% and 28% year on year, respectively, in 4Q22.

And for the rest of the year? A very constructive view, albeit with prudent caution. Brazil is experiencing a moment of significant uncertainty in the macroeconomic scenario and also in the education sector - from a potential design of a new FIES to the regulatory environment for medical schools. However, we are cautiously constructive due to the technical quality of the new MEC team, which allows us to expect improvements in the future.

Macro is an 'exogenous factor', we remain focused 'from the door to the inside'. We have been explicit in saying that (obviously) there is nothing we can do about the macro environment - and thus our (doubled) responsibility is to focus on very disciplined management to improve profitability and cash generation. We commented that 2022 was a year of hard work on 'less glamorous' fronts, without the large M&A transactions - but focusing on improving management. The three main fronts of potential improvement were (and still are in 2023) rents, general and administrative expenses and financing costs.

'Benign' increase in net debt: to materialize a relevant improvement trend in profitability in 2023e. It is important to point out that on all the fronts above, the 'cost' of implementing the improvements represents acash disbursement in the first instance, to then bring about an improvement in profitability quarter after quarter. This improvement usually takes around a year or more to offset the initial increase in net debt (due to the initial cash disbursement). We'll talk about this in more detail later (when talking about funding and leverage): in the increase in net debt, in 2022 we had a 'benign' increase of BRL 145 million for disbursements such as fines for early termination of rents, layoff costs and liability management (costs for issuing new debentures with lower cost; prepayment fines of the most expensive debentures; etc.) This benign increase in net debt represents 0.2x Ebitda of our current leverage of 4x Ebitda. It should be noted that in 2023e we should reap the fruits of what we already sowed in 2022 - and we still have a lot to do on these three fronts, so that the improvement trend continues in 2024e and beyond.

Total focus on organic deleveraging throughout 2023 and 2024. We know that in the current environment of high interest rates, reducing leverage has a direct positive impact on our shareholders. Accordingly, the highest priority in our fiduciary obligation to our shareholders is to reduce indebtedness. After the relevant measures mentioned above, and with continued effort to gain margins, we believe that we will not only make deleveraging visible over the coming quarters, but we will continue to work hard on these main fronts.

How was the company's financeability, in addition to the cost of financing itself? We never doubted the company's ability to roll over and extend its debts - the main challenge was the cost itself. In the current moment of severe restriction of bank credit and capital markets, especially the recent corporate events, it is worth clarifying how our financing reprofiling situation turned out with the two liability management events last year. On Mar/31/22 with the effective creation of Inspirali (and the entry of DNA Capital as a partner contributing BRL 1 billion in primary capital, for 25% of the company) we issued BRL 2 billion of debentures with a maturity of 5 years, extending the profile in a relevant way. Even so, at the end of 2022, we still had around BRL 800 million of earnings in 2023. Therefore, we issued BRL 800 million of debentures (on Dec/28/22) with two tranches: BRL 600 million bullet of 5 years and BRL 200 million in 6 and 7 years, which once again greatly elongated the duration of indebtedness. In addition, as widely discussed at the time of each event, considering the main debenture to be refinanced in each event: in the first one we had a cost reduction of 215 bps - from 475bps to 260bps of premium over Selic. In the second event, 200bps: from 375bps to 175bps premium on Selic.

And this management effort has already been reflected in concrete numbers. As we will detail later, with the pursuit of greater efficiency in leases and corporate expenses, our Ebitda LTM margin reached almost BRL 1.1 billion and a margin of 30.1%, or 20.5% ex-IFRS. The ex-IFRS margin was the highest in 4 and a half years, since 2Q18. This LTM margin was 70bps above 3Q22 and 430bps above the Ebitda LTM margin of 4Q21. There is still a lot to improve, but we are proud of the results that are beginning to be clearly visible.

Thus, we ended 2022 with a feeling of redoubled sobriety and confidence - due to the much that still needs to be done in the search for better profitability, cash generation and consequent deleveraging - and of satisfaction with the firm steps taken in building an ever stronger Ânima, which will reach the first two decades of life envisioning a great journey of transforming lives through education in the coming decades.

MANAGEMENT

Academic Quality

Macrotrends of Higher Education and directions of E2A

Education is constantly evolving, and the Ânima team is always aware of what we need to do today to be prepared for the future of Education. A great example we had that this preparation is vital was the impact that the social isolation caused by the pandemic that started in 2020 had on Education, and how the academic model of Ânima Educação, the Ânima Learning Ecosystem (E2A), allowed that in a few days after the beginning of social isolation (on Mar/13/20) all our students were studying at home with high quality teaching. Our academic model, which already incorporated technology and hybrid resources, allowed professors and students to achieve high performance - either on Ânima's campuses, or in the safety of their homes.

Analyzing the future of education, today we see five macro trends for higher education that will guide the directions of E2A, and thus, we will be prepared for the transformations in Education.

Beyond undergraduate degree and graduation

The evolution of training and professions themselves has not been at the same intensity, nor at the same speed for all areas of knowledge in the Digital Age. However, many point to the demand for specialized training even before graduation, in a search for nanodegrees, specific skills courses and micro certifications, increasing the demand for specific education, in addition to the traditional long-term training, the graduation, the "undergraduate level", regulation, current curriculum formats. There is a relevant evolution taking place: of context, content, formats.

E2A Directions

- Strengthen the logic of integrated curricula for different training types and modalities; create challenges and also new segments of activity.

- Increase the portfolio of projects and catalogs of Ânima courses (free courses, extension, curricular units, nanodegrees).

- Ensure quality by producing the "minimum unit of the curriculum".

- Construction of the "best offer" considering efficiency, quality and students' experience through learning communities and students' environment at E2A.

- Construction of a pedagogical coordination paradigm that considers E2A in its diversity of offers.

New times and places of formation

Training exclusively organized on the physical campus, with face-to-face activities such as "the same content, at the same time, in the same place" are in sharp decline in the sphere of Global Education, with the extinction of several courses and careers. There is another development underway: that of training times and spaces.

E2A Directions

- Strengthen E2A through an integrated, hybrid, flexible curriculum, by competencies, in different times and places, based on the nature of the knowledge areas, increasing personalized learning paths: implement a digital platform that allows interaction, mediation and management of students' learning in different times and places. - Diversify the offers based on the flexibility of the ticket, package of experiences and levels of interaction, in the light of new regulations.

Expand the possibilities of courses and experiences, for students and non-students, that go beyond the Anima Ecosystem physical campus and schools, in a network perspective.

- Evolve the concept of learning communities (cultural and multiprofessional mixes) through digital products of "junctions".

- Solidify a certification system, through assessment as a methodology for validating learning and certification steps.

World of work

The world of work goes beyond "practice scenarios" of professional training and reconfigures itself into true learning laboratories. The new relationship between life/work/training will invert the logic of selecting people and will have repercussions on individual portfolios of experiences and training. It is the trajectory from the person and not only from the work.

Perhaps this is the most relevant macrotrend for our business in the visible horizon of the coming years: the growing academic insertion in the future professional life of our students. We consider 'quality education' that which impacts and transforms lives, and nothing is more relevant to this than 'employability' and 'income gain' - this is one of our greatest focuses and challenges. Thus, the Dual Curicular Units (CUs) stand out as concrete differentials of Ânima, which illustrate the priority of this strategy.In this approach, professionals from leading companies teach specific skills in teams with one or two Ânima Ecosystem educators. The number of Dual CUs has been continuously increasing and is already more than 280 - with leading companies in their segments, such as Amazon Web Services / AWS, BMW, KPMG, Siemens, XP Investimentos, etc.

In addition to the Dual CUs, there is something new which is the Dual Courses, in which the entire undergraduate course is designed together with a company, which even in the last semesters pays part of the students' monthly fees, offers internships and a percentage of classes with guaranteed optionality to work at that company after graduation. We are just starting on this front - with a dual accounting course with KPMG - but conceptually this initiative, together with the successful Dual CUs, clearly shows the focus and priority of the subject for Ânima. Concrete professional insertion, employability, income gain: it transforms lives.

E2A Directions

- Evolve Dual Education: expansion of Dual CUs; maturation of Dual courses; scalability of financing/corporate and payroll scholarships; proposition of new forms of selection with the HRs of partner companies.

- Connect the development of student competencies to Life & Career: expansion of mentoring; intelligence of personalized recommendation of vacancies based on the skills developed by the students; personalized recommendation intelligence for new courses and training.

- Expand the Extension to internal and external audiences: identify "causes", interests, passions of the different generations of students with a view to new training proposals.

- Scale the Ânima Hub (Students solve challenges sent by companies) as a generator of technological solution skills for all areas of knowledge based on local demands.

- Disseminate and expand Research at undergraduate level, in connection with stricto sensu postgraduate studies.

Learning

The value attributed to higher education begins to be perceived much more in the quality of learning and how it affects the person and the professional than in the traditional version of diplomas and degrees. Meaningful education that makes sense for life presupposes knowing the student: their interests, potential and needs and provide a true educational aid that affects the knowledge they have about themselves and their relationship with others.

E2A Directions

- Develop intelligence that allows you to know the student from the moment they enter, in socio-emotional, cognitive and socio-economic aspects.

- Monitor the development of students' learning through the results of assessments during the student's training path, creating the IDD Ânima.

- Feedback to the curriculum area on needs and demands for new courses, products and experiences

- Improve learning assessment: A1 through identity, authorship, correction and feedback technologies; A2 through production technologies, validation and item specification.

- Promote the management of the results of assessments A1, A2 and A3 by area of knowledge, CUs, schools and student, with a view to the academic quality and management ENADE indicators.