Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Document and Entity Information [Abstract] | |
Document Type | 20-F |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Registrant Name | Vitru Ltd |
Document Period End Date | Dec. 31, 2020 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2020 |
Entity Central Index Key | 0001805012 |
Current Fiscal Year End Date | --12-31 |
Amendment Flag | false |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Common Stock, Shares Outstanding | 23,058,053 |
Entity Shell Company | false |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Interactive Data Current | Yes |
ICFR Auditor Attestation Flag | false |
Consolidated statements of fina
Consolidated statements of financial position - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS | ||
Cash and cash equivalents | R$ 85930 | R$ 2457 |
Short-term investments | 515,201 | 72,321 |
Trade receivables | 115,115 | 88,130 |
Income taxes recoverable | 2,240 | 4,711 |
Prepaid expenses | 10,223 | 8,938 |
Other current assets | 3,081 | 1,858 |
Total current assets, other than assets classified as held for sale | 731,790 | 178,415 |
Assets classified as held for sale | 36,433 | |
TOTAL CURRENT ASSETS | 731,790 | 214,848 |
NON-CURRENT ASSETS | ||
Trade receivables | 6,924 | 3,786 |
Indemnification assets | 9,191 | 14,801 |
Deferred tax assets | 50,775 | 37,146 |
Other non-current assets | 3,625 | 1,359 |
Right-of-use assets | 127,921 | 88,534 |
Property and equipment | 96,669 | 70,033 |
Intangible assets | 660,950 | 658,170 |
TOTAL NON-CURRENT ASSETS | 956,055 | 873,829 |
TOTAL ASSETS | 1,687,845 | 1,088,677 |
CURRENT LIABILITIES | ||
Trade payables | 32,240 | 29,978 |
Loans and financing | 151,757 | |
Lease liabilities | 23,365 | 17,265 |
Labor and social obligations | 26,785 | 16,784 |
Taxes payable | 2,404 | 1,657 |
Prepayments from customers | 9,657 | 3,186 |
Accounts payable from acquisition of subsidiaries | 134,988 | 128,888 |
Other current liabilities | 1,364 | 349 |
Total current liabilities, other than liabilities directly associated with assets classified as held for sale | 382,560 | 198,107 |
Liabilities directly associated with assets classified as held for sale | 23,284 | |
TOTAL CURRENT LIABILITIES | 382,560 | 221,391 |
NON-CURRENT | ||
Lease liabilities | 125,988 | 85,923 |
Share-based compensation | 46,260 | 34,950 |
Accounts payable from acquisition of subsidiaries | 139,873 | 250,652 |
Provisions for contingencies | 14,439 | 18,403 |
Deferred tax liabilities | 24,958 | |
Other non-current liabilities | 777 | 1,067 |
TOTAL NON-CURRENT LIABILITIES | 327,337 | 415,953 |
TOTAL LIABILITIES | 709,897 | 637,344 |
EQUITY | ||
Share capital | 6 | 548,380 |
Capital reserves | 1,022,056 | (1,248) |
Revenue reserves | 429 | |
Accumulated losses | (44,114) | (96,228) |
TOTAL EQUITY | 977,948 | 451,333 |
TOTAL LIABILITIES AND EQUITY | R$ 1687845 | R$ 1088677 |
Consolidated statements of prof
Consolidated statements of profit or loss and other comprehensive income - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Consolidated statements of profit or loss and other comprehensive income | ||||
NET REVENUE | R$ 519179 | R$ 461067 | R$ 383449 | |
Cost of services rendered | (221,452) | (211,547) | (184,161) | |
GROSS PROFIT | 297,727 | 249,520 | 199,288 | |
General and administrative expenses | (73,852) | (125,344) | (90,667) | |
Selling expenses | (86,604) | (100,949) | (70,646) | |
Net impairment losses on financial assets | (76,840) | (58,178) | (44,578) | |
Other income (expenses), net | 512 | (905) | (1,041) | |
Operating expenses | (236,784) | (285,376) | (206,932) | |
OPERATING PROFIT | 60,943 | (35,856) | (7,644) | |
Financial income | 36,558 | 19,194 | 22,026 | |
Financial expenses | (64,418) | (60,390) | (64,597) | |
Financial results | (27,860) | (41,196) | (42,571) | |
PROFIT (LOSS) BEFORE TAXES | 33,083 | (77,052) | (50,215) | |
Current income taxes | (19,556) | (14,813) | (10,640) | |
Deferred income tax income | 38,587 | 25,705 | 15,651 | |
Income taxes | 19,031 | 10,892 | 5,011 | |
PROFIT (LOSS) FOR THE YEAR | 52,114 | (66,160) | (45,204) | |
TOTAL COMPREHENSIVE INCOME (LOSS) | R$ 52114 | R$ 66160 | R$ 45204 | |
Basic earnings per share (R$) | [1] | R$ 2.79 | R$ 3.93 | R$ 2.78 |
Diluted earnings per share (R$) | [1] | R$ 2.68 | R$ 3.93 | R$ 2.78 |
[1] | The basic and diluted earnings per common share are in effect with the reverse share split occurred on September 2, 2020. |
Consolidated statement of chang
Consolidated statement of changes in equity - BRL (R$) R$ in Thousands | Share Capital | Additional paid-in capital | Treasury Shares | Reserve for Share-based compensation | Revenue reserves | Accumulated losses | Total |
Equity at beginning of period at Dec. 31, 2017 | R$ 434000 | R$ 1927 | R$ 15639 | R$ 451566 | |||
Profit or Loss for the year | (45,204) | (45,204) | |||||
Transfer to revenue reserves | R$ 429 | (429) | |||||
Dividends | (74) | (74) | |||||
Value of employee services | 596 | 596 | |||||
Issue of shares to employees | 1,455 | 1,455 | |||||
Issuance of common shares in initial public offering (Note 1.1) | 111,054 | 111,054 | |||||
Equity at end of period at Dec. 31, 2018 | 546,509 | 2,523 | 429 | (30,068) | 519,393 | ||
Profit or Loss for the year | (66,160) | (66,160) | |||||
Value of employee services | (1,927) | (1,927) | |||||
Issue of shares to employees | 1,871 | (1,844) | 27 | ||||
Share repurchase | R$ 2238 | 2,238 | |||||
Equity at end of period at Dec. 31, 2019 | 548,380 | (2,238) | 990 | 429 | (96,228) | 451,333 | |
Profit or Loss for the year | 52,114 | 52,114 | |||||
Value of employee services | 525 | 525 | |||||
Corporate reorganization (Note 1.1) | (548,376) | R$ 546567 | R$ 2238 | R$ 429 | |||
Issuance of common shares in initial public offering (Note 1.1) | 2 | 521,556 | 521,558 | ||||
Share issuance costs (Note 1.1) | (47,582) | (47,582) | |||||
Equity at end of period at Dec. 31, 2020 | R$ 6 | R$ 1020541 | R$ 1515 | R$ 44114 | R$ 977948 |
Consolidated statement of cash
Consolidated statement of cash flows - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities | |||
Profit (loss) before taxes | R$ 33083 | R$ 77052 | R$ 50215 |
Adjustments to reconcile income before taxes to cash provided on operating activities | |||
Depreciation and amortization | 51,474 | 62,445 | 56,284 |
Impairment of non-current assets | 51,022 | 33,537 | |
Net impairment losses on financial assets | 76,840 | 58,178 | 44,578 |
Provision for revenue cancellation | (2,076) | (443) | 234 |
Provision for contingencies | 3,695 | 3,781 | 3,384 |
Accrued interests | 34,189 | 45,018 | 49,577 |
Share-based compensation | 11,823 | 26,372 | 7,450 |
Modification of lease contracts | (935) | ||
Rent concessions | (2,046) | ||
Loss on sale or disposal of non-current assets | 45 | 2 | 1,330 |
Trade receivables | (79,548) | (79,969) | (54,831) |
Prepayments | (1,113) | (1,939) | (1,224) |
Other assets | (294) | (875) | (40) |
Trade payables | 1,283 | 13,906 | 926 |
Labor and social obligations | 7,306 | 3,427 | 801 |
Other taxes payable | 747 | (1,636) | (4,586) |
Prepayments from customers | 6,359 | 2,104 | (1,940) |
Other payables | 725 | (6,350) | 2,767 |
Cash from operations | 141,557 | 97,991 | 88,032 |
Income tax paid | (18,736) | (12,697) | (9,444) |
Interest paid | (41,774) | (27,543) | (23,201) |
Contingencies paid | (5,134) | (1,702) | (5,237) |
Net cash provided by operating activities | 75,913 | 56,049 | 50,150 |
Cash flows from investing activities | |||
Purchase of property and equipment | (25,544) | (28,470) | (23,191) |
Purchase and capitalization of intangible assets | (30,919) | (16,266) | (11,769) |
Payments for the acquisition of interests in subsidiaries | (117,248) | (107,988) | (117,247) |
Sale (acquisition of) short-term investments, net | (436,584) | 103,227 | (6,595) |
Net cash used in investing activities | (610,295) | (49,497) | (158,802) |
Cash flows from financing activities | |||
Payments of lease liabilities | (6,121) | (6,103) | (3,793) |
Proceeds from loans and financing | 150,000 | ||
Proceeds from initial public offering, net of share issuance costs | 473,976 | ||
Capital contributions | 1,871 | 112,509 | |
Share repurchase | (2,238) | ||
Net cash provided by (used in) financing activities | 617,855 | (6,470) | 108,716 |
Net increase in cash and cash equivalents | 83,473 | 82 | 64 |
Cash and cash equivalents at the beginning of the year | 2,457 | 2,375 | 2,311 |
Cash and cash equivalents at the end of the year | R$ 85930 | R$ 2457 | R$ 2375 |
Corporate information
Corporate information | 12 Months Ended |
Dec. 31, 2020 | |
Corporate information | |
Corporate information | 1. Corporate information Vitru Limited ("Vitru") and its subsidiaries (collectively, the "Company") is a holding company incorporated under the laws of the Cayman Islands on March 05, 2020 and whose shares are publicly traded on the National Association of Securities Dealers Automated Quotations Payments exchange (NASDAQ) under the ticker symbol "VTRU". Vitru became the parent company of Vitru Brasil Empreendimentos, Participações e Comércio S.A. (hereafter referred to as "Vitru Brazil") formerly denominated Treviso Empreendimentos, Participações e Comércio S.A., through the completion of the corporate reorganization described below. Until the contribution of Vitru Brazil shares to Vitru Limited, in September 2020, Vitru Limited did not have commenced operations and had only nominal assets and liabilities and no material contingent liabilities or commitments. Accordingly, Vitru Limited’s consolidated financial information substantially reflect the operations of Vitru Brazil after the corporate reorganization. Vitru is a holding company jointly controlled by Vinci Partners, through the investments funds “Vinci Capital Partners II FIP Multiestratégia”, “Agresti Investments LLC”, “Botticelli Investments LLC”, Raffaello Investments LLC”, and the Carlyle Group, through the investment funds “Mundi Holdings I LLC” and “Mundi Holdings Ii LLC” The Company is principally engaged in providing educational services in Brazil, mainly undergraduate and continuing education courses, presentially through its eight campuses in two states, or via distance learning, through 709 (December 31, 2019 – 526) learning centers (“hubs”) across the country. These consolidated financial statements were authorized for issue by the Board of Directors on March 29th, 2021. 1.1. Corporate reorganization and initial public offering On March 5, 2020, Vitru was incorporated in the Cayman Islands, for the purposes of its initial public offering (“IPO”). On September 2, 2020, each of Vitru Brazil ́s shareholders had agreed to contribute their respective shares on Vitru Brazil to Vitru Limited, exchanging thirty-one common shares into one ordinary share of Vitru Limited. As a result of this exchange, a reverse share split has been applied retrospectively to all figures in the historical financial statements regarding number of shares (Note 21) and per share data as if the reverse share split had been in effect for all periods presented. On September 17, 2020, Vitru Limited priced its initial public offering (“IPO”) of 6,000,000 Class A common shares, which began trading on the Nasdaq Global Select Market (“NASDAQ”) on September 18, 2020 under the symbol “VTRU”. The initial offering price was US$ 16.00 per Class A common share. On September 22, 2020, the share capital of Vitru Limited was increased by 6,000,000 Class A shares through the proceeds received as a result of the IPO of US$ 96,000 thousand (or R$ 521,558). The net proceeds from the IPO were US$ 90,672 thousand (or R$ 492,612), after deducting US$ 5,328 thousand (or R$ 28,946) in underwriting discounts and commissions and other offering expenses totaled US$ 3,430 thousand (or R$ 18,636). The share issuance costs totaled R$ 47,582. 1.2. Coronavirus pandemic The Company is closely monitoring the situation of the 2019 novel coronavirus, or Covid-19, and taking the necessary measures for the safety and well-being of employees, students, associates and partners. The global impact of the outbreak has been rapidly evolving, and the outbreak presents material uncertainty and risk with respect to the Company´s future performance and financial results. In particular and in the interest of public health and safety, state and local governments in Brazil have required mandatory school closures, which has resulted in the closure of on-campus learning facilities and hubs. In response to the outbreak, the Company has efficiently implemented several measures aimed at safeguarding the health of employees, students and hub partners and the stability of operations, including: (1) creating a crisis management committee and a financial committee to discuss the action plan for the Company to address the challenges posed by the Covid-19 pandemic; (2) temporarily replacing in-person weekly meetings at the hubs with online meetings between students and tutors across all units, as a result of which since March 30, 2020 all students have had real-time meetings with their tutors; (3) training teachers and tutors to support students in this new format; (4) remote support to deliver high-quality content to students and maintain high levels of engagement and a superior learning experience; (5) making no changes to the course schedule or curriculum; (6) putting in place remote emotional and psychological support to students and employees, provided by the Company´s psychology department; and (7) making home office available for all the employees. As of December 31, 2020, there has been no material impact on the Company’s operations, as most of the Company’s services are already delivered remotely (Distance learning undergraduate courses and most of continuing education courses) or capable of being delivered remotely (some of Continuing education courses and On-campus undergraduate courses). In addition, based on preliminary information available until the approval of these consolidated financial statements: · There was no relevant impact on net revenue for the year ended December 31, 2020, which was slightly below the expected for the year but presented a growth 13% when compared to prior year. Student defaults have remained within the expected levels and the engagement of students, compared to 2019, deteriorated very slightly. · The provision for expected credit losses increased as result of the methodology used which captures the increase in historical losses with receivables during 2020, which, as a consequence, already reflects the incurred impacts of Covid-19 pandemic. · The Company assessed the existence of potential impairment indicators and the possible impacts on the key assumptions and projections caused by the pandemic on the recoverability of long-lived assets (impairment tests) and concluded that no additional provision for impairment of long-lived assets needed to be recorded in the financial statements. · The Company has obtained rent concessions on lease contracts due to the temporary suspension of classes in the on-campus learning facilities and hubs caused by the mandatory school closures during the pandemic. A gain of R$ 2,046 was recognized as Other income (expenses), net, in the statement of profit and loss. Except for these concessions, there were no changes to contractual obligations regarding leased buildings and there were no changes in the expected useful life and residual amount of properties and equipment as a result of Covid-19. · No changes in the provision for contingencies against the Company were identified as a result of Covid-19. · As an incentive for the students to keep the payment of tuition fees up to the due date, the Company has granted an additional discount of 5% to all the students that paid their tuitions fees up to the due date in April and May 2020. The amounts of additional discounts granted was of R$ 4,005. · The Company currently has sufficient working capital and other undrawn financing facilities to service its operating activities and ongoing investments. · The Company has also taken benefit of the Emergency employment and income preservation benefit program by the federal government: The Brazilian federal government offered the option of either reducing workload and salary payment for up to three months or suspending employment contracts for up to two months in exchange for the guarantee of maintaining the employee after the suspension for the same period as the contract is effectively suspended. The Company has suspended 195 employment contracts from May to September 2020. Due to the ongoing populational inoculation the Company is ready to resume on-campus unit’s classes with the necessary measures for the safety and well-being of students as soon as the state and local governments in Brazil authorize the schools reopening. |
Significant accounting policies
Significant accounting policies | 12 Months Ended |
Dec. 31, 2020 | |
Significant accounting policies | |
Significant accounting policies | 2. Significant accounting policies The main accounting policies applied in the preparation of these consolidated financial statements of the Company are set out below. These policies have been consistently applied to all periods presented, unless otherwise stated. The financial statements are for the group consisting of Vitru and its subsidiaries. 2.1. Basis of preparation The consolidated financial statements of the Company have been prepared in accordance with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”), and disclose all (and only) the applicable significant information related to the financial statements, which is consistent with the information utilized by Management in the performance of its duties. The financial statements have been prepared under the historical cost convention, except for share-based compensation, which are adjusted to reflect fair value measurement. The preparation of financial statements requires the use of certain critical accounting estimates. It also requires Management to exercise its judgment in the process of applying the Company's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3. Actual results may differ from estimates. All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousand currency units unless otherwise stated. 2.2. Basis of consolidation The consolidated financial statements comprise the financial statements of the Company for the years ended December 31, 2020 and 2019. The table below list the Company’s subsidiaries: Direct and indirect Investment interest Name Main activities Location type 2020 2019 (i) Vitru Brasil Empreendimentos, Participações e Comércio S.A Continuing education courses Florianópolis - SC Subsidiary 100 % 100 % UNIASSELVI - Sociedade Educacional Leonardo da Vinci S/S Ltda Distance learning, on-campus undergraduate and continuing education courses Indaial - SC Subsidiary 100 % 100 % FAMEG - Sociedade Educacional do Vale do Itapocu S/S Ltda. On-campus undergraduate and continuing education courses Guaramirim - SC Subsidiary 100 % 100 % FAIR Educacional Ltda. On-campus undergraduate and continuing education courses Rondonópolis - MT Subsidiary 100 % 100 % FAC Educacional Ltda. On-campus undergraduate and continuing education courses Cuiabá - MS Subsidiary 100 % 100 % (i) The comparative numbers presented in these financial statements from the Company contemplates 100% of direct and indirect interest of the subsidiaries listed above as the interest was not changed by the corporate reorganization described in Note 1.1. The Company consolidates the financial information for all entities it controls. Control is achieved when the Company is exposed to, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. a) Subsidiaries Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and it ceases when the Company loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Company gains control until the date the Company ceases to control the subsidiary. When necessary, adjustments are made to the financial statements of subsidiaries in order to bring their accounting policies in line with the Company’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions are eliminated in full on consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Company loses control over a subsidiary, it derecognized the related assets (including goodwill), liabilities, non-controlling interest and other components of equity, while any resulting gain or loss is recognized in the statement of profit or loss. b) Joint arrangements Investments in joint arrangements are classified as either joint operations or joint ventures, depending on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Company has only joint operations. Joint operations The Company recognizes its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the financial statements under the appropriate headings. Details of the joint operation are set out in Note 2.5.p. 2.3. Functional and presentation currency The items included in the consolidated financial statements are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The financial statements are presented in Brazilian Reais (R$), which is the Company’s functional currency and the Company’s presentation currency. 2.4. Current versus non-current classification The Company presents assets and liabilities in the statement of financial position based on current/non- current classification. An asset is current when it is: · Expected to be realized or intended to be sold or consumed in the normal operating cycle; · Held primarily for the purpose of trading; · Expected to be realized within twelve months after the reporting period; or · Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current. A liability is current when: · It is expected to be settled in the normal operating cycle; · It is held primarily for the purpose of trading; · It is due to be settled within twelve months after the reporting period; or · There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period. The Company classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities. 2.5. Summary of accounting policies a) Fair value measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: (i) in the principal market for the asset or liability; or (ii) in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by the Company. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: · Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities. · Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable. · Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. For assets and liabilities that are recognized in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re- assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. At each reporting date, the Company analyzes the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Company’s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents. The Company also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable. For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy, as explained above. b) Financial instruments—initial recognition and measurement A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. i. Financial assets Initial recognition and measurement The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Company’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortized cost or fair value through other comprehensive income (“OCI”), it needs to give rise to cash flows that are “solely payments of principal and interest (SPPI)” on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Company’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset. Subsequent measurement For purposes of subsequent measurement, financial assets are classified as: financial assets at amortized cost or financial assets at fair value through profit or loss. Financial assets at amortized cost The Company measures financial assets at amortized cost if both of the following conditions are met: · The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows, and · The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortized cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognized in the statement of profit or loss when the asset is derecognized, modified or impaired. The Company’s financial assets at amortized cost mainly includes ‘Cash and cash equivalents’, ‘Short-term investments’ and ‘Trade receivables’. The Company reclassifies financial assets only when its business approach for managing those assets changes. Financial assets at fair value through profit or loss Financial assets at fair value through profit and loss (“FVPL”) include held for trading financial assets designated upon initial recognition at FVPL, or financial assets mandatorily required to be measured at fair value. At the balance sheet date there are no financial assets measured at FVPL. Financial assets are classified as fair value through profit and loss if they either fail the contractual cash flow test or in the Company’s business model are acquired for the purpose of selling or repurchasing in the near term. Financial assets may be designated at FVPL on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch. Financial assets at FVPL are carried in the statement of financial position at fair value with net changes in fair value recognized in the statement of income. The net gain or loss recognized in the statement of income includes any dividend or interest earned on the financial asset. At the balance sheet date there are no financial assets measured at FVPL. Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e., removed from the Company’s statement of financial position) when: · The rights to receive cash flows from the asset have expired; or · The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of its continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay. Impairment of financial assets Further disclosures relating to impairment of financial assets are also provided in the following notes: · Significant accounting estimates and assumptions — Note 3. · Trade receivables — Note 9. The Company recognizes an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and the cash flows the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms. For trade receivables, the Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track changes in credit risk, but instead recognizes an allowance for credit losses based on lifetime ECLs at each reporting date. The Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The Company considers a financial asset in default when contractual payments are 365 days past due. In certain cases, the Company may also consider a financial asset to be in default when internal or external information indicates that the Company is unlikely to receive the outstanding contractual amounts in full before considering any credit enhancements held by the Company. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. ii. Financial liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or amortized cost, as appropriate. All financial liabilities are recognized initially at fair value and, in the case of amortized cost, net of directly attributable transaction costs. The Company’s financial liabilities include trade payables, loans and financing lease liabilities, prepayments from customers, accounts payable from acquisition of subsidiaries and share-based compensation. Subsequent measurement The measurement of financial liabilities depends on their classification, as described below: Financial liabilities at fair value through profit or loss Financial liabilities at FVPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at FVPL. Financial liabilities are considered as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes financial instruments entered by the Company that are not designated as hedging instruments in hedge relationships as defined by IFRS 9 — Financial Instruments. Gains or losses on liabilities at fair value through PL are recognized in the statement of profit or loss. Financial liabilities designated upon initial recognition at FVPL are designated at the initial date of recognition, and only if the criteria in IFRS 9 — Financial Instruments are satisfied. The Company has designated its financial liability related to share-based compensation as at FVPL. Amortized cost After initial recognition, interest-bearing financial liabilities are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in the statement of profit or loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by considering any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as financial expenses in the statement of profit or loss. The Company’s financial liabilities at amortized cost include trade payables, loans and financing, lease liabilities, prepayments from costumers and accounts payable from acquisition of subsidiaries. Derecognition A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit or loss. c) Cash and cash equivalents Cash and cash equivalents in the statement of financial position comprise cash at banks and on hand, and short-term financial investments with an original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the purpose of the statement of cash flows, cash and cash equivalents consist of cash, bank deposits and short-term highly liquid financial investments, as they are readily convertible to known amounts of cash, subject to an insignificant risk of changes in value and considered an integral part of the Company’s cash management. d) Prepaid expenses Prepaid expenses are recognized as an asset in the statement of financial position. These expenditures include prepaid software licenses, insurance premiums and prepaid vacations to employees. e) Indemnification assets When the selling shareholders of acquired entities have contractually agreed to indemnify the Company for amounts that may become payable in respect of lawsuits pertaining to the period under their responsibility, indemnification assets are recorded to the proportion of the respective provision. Subsequent changes in the amount recognized for the indemnification asset may occur in relation to the provision for contingencies, according to changes in the range of outcomes or the assumptions used to develop the estimate of the liability at the time of the acquisition. f) Leases The group leases offices, buildings and equipment. Rental contracts are typically made for fixed periods of 1 to 20 years but may have extension options. Contracts may contain both lease and non-lease components. The group allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices. However, for leases of real estate for which the group is a lessee, it has elected not to separate lease and non-lease components and instead accounts for these as a single lease component. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes. Lease liabilities At the commencement date of the lease, the Company recognizes lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating a lease, if the lease term reflects the Company exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are recognized as expense in the period on which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. To determine the incremental borrowing rate, the Company: · where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received. · uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk when the individual lessee does not have recent third-party financing; and · makes adjustments specific to the lease, e.g. term, country, currency and security. The group is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Short-term leases and leases of low-value assets The Company applies the short-term lease recognition exemption to its short-term leases of properties (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases that are considered of low value. Lease payments on short-term leases and leases of low-value assets are recognized as expense on a straight-line basis over the lease term. Right-of-use assets The Company recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Unless the Company is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognized right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of use assets are subject to impairment. g) Non-current assets (or disposal groups) held for sale Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, which are specifically exempt from this requirement. An impairment loss is recognized for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs to sell. A gain is recognized for any subsequent increases in fair value less costs to sell of an asset (or disposal group), but not in excess of any cumulative impairment loss previously recognized. A gain or loss not previously recognized by the date of the sale of the non- current asset (or disposal group) is recognized at the date of derecognition. Non-current assets (including those that are part of a disposal group) are not depreciated or amortized while they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be recognized. Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet. The group has no disposal groups that are component classified as held for sale and representing a separate major line of business or geographical area of operations that qualify as a discontinued operation. h) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation. Historical cost includes acquisition, formation or construction cost. Historical cost also includes financial expenses related to the acquisition of qualifying assets. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with these costs will flow to the Company and they can be measured reliably. The carrying amount of the replaced items or parts is derecognized. All other repairs and maintenance are charged to the statement of profit or loss during the financial period in which they are incurred. Land is not depreciated. Depreciation of other assets is calculated using the straight-line method to reduce their cost to their residual value over their estimated useful lives, as follows: Annual average rate Buildings IT equipment Furniture, fittings and facilities Leasehold improvements 4% - 10% Library An asset’s carrying amount is immediately written down to the recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing the amounts of sales with the carrying amounts and are recognized within “Other operating income (expenses)” in the statement of profit or loss. The Company annually reviews the useful lives and residual value of its assets. Based on review completed for December 31, 2019, the Company concluded that the depreciation rates used are consistent with its operations and that there are no changes to residual value of assets. i) Business combinations The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the: · fair values of the assets transferred; · liabilities incurred to the former owners of the acquired business; · equity interests issued by the Company; · fair value of any asset or liability resulting from a contingent consideration arrangement; and · fair value of any pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. Acquisition-related costs are expensed as incurred. The excess of the · consideration transferred or to be transferred; · amount of any non-controlling interest in the acquired entity; and · acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase. Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions. Contingent consideration, when applicable, is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognized in profit or loss. j) Intangible assets Computer programs (software) and internal project development Computer software licenses are capitalized and amortized under the straight-line method over their useful lives. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the Company are recognized as intangible assets when the following criteria are met: · It is technically feasible to complete the software/project so that it will be available for use or sale; · Management intends to complete the software/project and to use it or sell it; · The software/project may be sold or used; · Future benefits associated with the software can be demonstrated; · Adequate technical, financial and other resources are available to complete the design, and for the use or sale of the software/project; and · The expenses attributable to the software/project during its development can be measured reliably. Directly attributable costs that are capitalized as part of the software/project product include the software/project development employee costs and an appropriate portion of relevant overheads. Other development expenditures that do not meet these criteria are recognized as an expense as incurred. Development costs previously recorded as an expense are not recognized as an asset in a subsequent period. Computer software and project development costs recognized as assets are amortized using the straight-line method over their estimated us |
Significant accounting estimate
Significant accounting estimates and assumptions | 12 Months Ended |
Dec. 31, 2020 | |
Significant accounting estimates and assumptions | |
Significant accounting estimates and assumptions | 3. Significant accounting estimates and assumptions The preparation of the Company’s consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Accounting estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are recognized prospectively. Other disclosures relating to the Company’s exposure to risks and uncertainties includes: · Capital management — Note 7 · Financial instruments risk management and policies — Note 5.4 · Sensitivity analyses disclosures — Note 5.4.1 Estimates and assumptions: The key assumptions about the future and other key sources of estimated uncertainty as of the reporting date that include a significant risk of a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances that arise and that are beyond the Company’s control. Such changes are reflected in the assumptions where they occur. a) Impairment of non-financial assets Impairment exists when the carrying value of an asset or cash generating unit (“CGU”) or group of CGUs exceeds its recoverable amount, defined as the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on data available from binding sales transactions, conducted at arm’s length, for similar assets or observable market prices less incremental costs of disposing of the asset. The value in use calculation is based on a discounted cash flow model (“DCF” model). The cash flows are derived from the budget for the next five years and do not include restructuring activities to which the Company has not yet committed or significant future investments that will enhance the performance of the assets of the CGU being tested. The recoverable amount is sensitive to the discount rate used for the DCF model as well as to expected future cash- inflows and the growth rate used for extrapolation purposes. These estimates are most relevant to goodwill and indefinite lived intangible assets recognized by the Company. The key assumptions used to determine the recoverable amount for each CGU, including a sensitivity analysis, are disclosed and further explained in Note 15. b) Fair value measurement of financial instruments When the fair values of financial assets and financial liabilities recorded in the statement of financial position cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques. The inputs into these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required to estimate fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions relating to these factors could affect the reported fair value of financial instruments. See Note 5 for further disclosures. c) Credit losses on trade receivables The Company recognizes an allowance for expected credit losses (ECLs) for trade receivables applying a simplified approach in calculating ECLs. As a result, the Company does not track changes in credit risk, but rather recognizes an allowance for doubtful accounts based on lifetime ECLs at each reporting date. The Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The Company considers a trade receivable to be in default when contractual payments are 365 days past due. In certain cases, however, the Company may also consider a financial asset to be in default when internal or external information indicates that the Company is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Company. A trade receivable is written off when there is no reasonable expectation of recovering the contractual cash flows. The information about the allowance for expected credit losses is disclosed in Note 9. d) Provision for contingencies The Company is party to proceedings at judicial and administrative levels, as disclosed in Note 19. The provision for legal proceedings is set up for all proceedings assessed as probable losses. The likelihood of loss is assessed based on available evidence, the hierarchy of laws, case law, most recent court decisions and their relevance within the legal system, and the assessment made by the outside legal counsel. Provisions are reviewed and adjusted to take into account changes in circumstances, such as statute of limitations, additional exposures identified based on new matters or court decisions. e) Lease term of contracts with renewal options The Company determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Company has the option, under some of its leases to lease the assets for additional terms. The Company applies judgement in evaluating whether it is reasonably certain to exercise the option to renew. That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal. After the commencement date, the Company reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew (e.g., a change in business strategy). f) Incremental lease rate The Company is unable to determine the implicit discount rate to be applied to its lease agreements. Therefore, the incremental rate on the lessee’s loan is used to calculate the present value of the lease liabilities at the initial registration of the lease. The lessee’s incremental loan rate is the interest rate that the lessee would have to pay when borrowing funds for the acquisition of an asset similar to the asset object of the lease, for a similar term and with a similar guarantee, the funds required to obtain the asset with a value similar to the right of use asset in a similar economic environment. Obtaining this rate involves a high degree of judgment and should be a function of the lessee’s credit risk, the term of the lease, the nature and quality of the collateral offered and the economic environment in which the transaction takes place. The rate calculation process preferably uses readily observable information from which to make the necessary adjustments to arrive at its incremental lending rate. The IFRS 16 allows the incremental rate to be determined for a grouping of contracts, since this choice is associated with the validation that the grouped contracts have similar characteristics. The Company has adopted the aforementioned practical method of determining groupings for its scope lease agreements as it understands that the effects of their application do not materially differ from the application to individual leases. The size and composition of the portfolios were defined according to the following assumptions: (a) assets of a similar nature and (b) remaining maturities with respect to the similar initial application date. g) Share-based compensation Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model and underlying assumptions, which depends on the terms and conditions of the grant and the information available at the grant date and at each reporting period, for the liability portion on cash-settled transactions. The Company uses certain methodologies to estimate fair value which include the following: · estimation of fair value based on equity transactions with third parties close to the grant date; · other valuation techniques including option pricing models such as Black-Scholes. These estimates also require determination of the most appropriate inputs to the valuation models including assumptions regarding the expected life of a share option, expected volatility of the price of the Company’s shares and expected dividend yield. |
Segment reporting
Segment reporting | 12 Months Ended |
Dec. 31, 2020 | |
Segment reporting | |
Segment reporting | 4. Segment reporting Segment information is presented consistently with the internal reports provided to the Senior management team, consisting of the chief executive officer, the chief financial officer and other executives, and which is the Chief Operating Decision Maker (CODM) and is responsible for allocating resources, assessing the performance of the Company’s operating segments, and making the Company’s strategic decisions. In reviewing the operational performance of the Company and allocating resources, the CODM reviews selected items of the statement of profit or loss and of comprehensive income, based on relevant financial data for each of the Company’s operating segments, represented by the Company’s main lines of service from which it generates revenue, as follows: · Distance learning undergraduate courses · Continuing education courses · On-campus undergraduate courses Segment performance is primarily evaluated based on net revenue and on adjusted earnings before interest, tax, depreciation and amortization (Adjusted EBITDA). The Adjusted EBITDA is calculated as operating profit plus depreciation and amortization plus interest received on late payments of monthly tuition fees and adjusted by the elimination of effects from share-based compensation plus/ minus exceptional expenses. General and administrative expenses (except for intangible assets’ amortization and impairment expenses), finance results (other than interest on tuition fees paid in arrears) and income taxes are managed on a Company’s consolidated basis and are not allocated to operating segments. There were no inter-segment revenues in the year ended December 31, 2020 and 2019. There were no adjustments or eliminations in the profit or loss between segments. The CODM do not make strategic decisions or evaluate performance based on geographic regions. Currently, the Company operates solely in Brazil and all the assets, liabilities and results are allocated in Brazil a) Measures of performance Distance learning Continuing On-campus undergraduate education undergraduate courses courses courses Total allocated 2020 Net revenue 423,035 40,589 55,555 519,179 Adjusted EBITDA 156,089 27,045 16,848 199,982 % Adjusted EBITDA margin 36.90 % 66.63 % 30.33 % 38.52 % 2019 Net revenue 336,317 47,103 77,647 461,067 Adjusted EBITDA 112,919 33,335 20,871 167,125 % Adjusted EBITDA margin 33.58 % 70.77 % 26.88 % 36.25 % 2018 Net revenue 259,591 33,044 90,814 383,449 Adjusted EBITDA 93,427 21,175 28,374 142,976 % Adjusted EBITDA margin 35.99 % 64.08 % 31.24 % 37.29 % The total of the reportable segments’ net revenues represents the Company’s net revenue. A reconciliation of the Company’s loss before taxes to the allocated Adjusted EBITDA is shown below: 2020 2019 2018 Income before taxes 33,083 (77,052) (50,215) (+) Financial result 27,860 41,196 42,571 (+) Depreciation and amortization 51,474 62,445 56,284 (+) Interest on tuition fees paid in arrears 15,715 8,265 8,887 (+) Impairment of non-current assets — 51,022 33,537 (+) Share-based compensation plan 11,823 26,372 7,450 (+) Other income (expenses), net (512) 905 1,041 (+) Restructuring expenses 4,780 4,484 2,231 (+) M&A and Offering Expenses 2,391 — 6,000 (+) Other operational expenses unallocated 53,368 49,488 35,190 Adjusted EBITDA allocated to segments 199,982 167,125 142,976 b) Other profit and loss disclosure Distance learning Continuing On-campus undergraduate education undergraduate courses courses courses Unallocated Total 2020 Net impairment losses on financial assets 61,257 5,917 9,666 — 76,840 Depreciation and amortization 34,431 1,972 8,919 6,152 51,474 Interest on tuition fees paid in arrears 11,706 585 3,424 — 15,715 2019 Net impairment losses on financial assets 43,701 3,958 10,519 — 58,178 Depreciation and amortization 38,402 4,085 14,259 5,699 62,445 Impairment of non-current assets — — 51,022 — 51,022 Interest on tuition fees paid in arrears 7,106 16 1,143 — 8,265 2018 Net impairment losses on financial assets 31,934 3,672 8,972 — 44,578 Depreciation and amortization 31,981 3,927 15,969 4,407 56,284 Impairment of non-current assets — — 33,537 — 33,537 Interest on tuition fees paid in arrears 7,641 17 1,229 — 8,887 |
Financial assets and financial
Financial assets and financial liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Financial assets and financial liabilities | |
Financial assets and financial liabilities | 5. Financial assets and financial liabilities 5.1. Financial assets 2020 2019 At amortized cost Cash and cash equivalents 85,930 2,457 Short-term investments 515,201 72,321 Trade receivables 122,039 91,916 Total 723,170 166,694 Current 716,246 162,908 Non-current 6,924 3,786 5.2. Financial Liabilities 2020 2019 At amortized cost Trade payables 32,240 29,978 Loans and financing 151,757 — Lease liabilities 149,353 103,188 Prepayments from customers 9,657 3,186 Accounts payable from acquisition of subsidiaries 274,861 379,540 At FVPL Share-based compensation 46,260 34,950 Total 664,128 550,842 Current 352,007 179,317 Non-current 312,121 371,525 5.3. Fair Values The Company assessed that the fair values of cash and cash equivalents, short-term investments, current trade receivables, trade payables, loans and financing and prepayments from customers approximate their carrying amounts largely due to the short-term maturities of these instruments. Non-current trade receivables, lease liabilities and the accounts payable from acquisition of subsidiaries have their carrying amount discounted by their respective effective interest rate in order to be presented as close as possible to its fair value. Share-based compensation is measured at FVPL. 5.4. Financial instruments risk management objectives and policies The Company’s principal financial liabilities comprise accounts payable from acquisition of subsidiaries, loans and financing, trade payables, prepayments from customers, lease liabilities and share-based compensation. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include trade receivables, short-term investments and cash and cash equivalents that derive directly from its operations. The Company is exposed to market risk, credit risk and liquidity risk. The Company monitors market, credit and operational risks in line with the objectives in capital management and counts with the support, monitoring and oversight of the Board of Directors in decisions related to capital management and its alignment with the objectives and risks. The Company’s policy is that no trading of derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below. 5.4.1. Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company’s exposure to market risk is related to interest rate risk and exchange rate risk. The sensitivity analysis in the following sections relate to the position as at December 31, 2020. Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s short-term investments, PEP - special installment payment trade receivables (Note 9), loans and financing, lease liabilities and accounts payable from acquisition of subsidiaries, subject in each case to variable interest rates, principally the Brazilian interbank deposit ( Certificado de Depósito Interbancário ), or CDI rate, the General Market Price Index ( Índice Geral de Preços do Mercado ), or IGP-M, and the Broad National Consumer Price Index ( Índice nacional de Preços ao Consumidor Amplo ), or IPCA inflation rate. Sensitivity analysis The following table demonstrates the sensitivity to a reasonably possible change in interest rates on short-term investments, trade receivables, loans and financing, lease liabilities and accounts payable from acquisition of subsidiaries. With all variables held constant, the Company’s income before income taxes is affected through the impact on floating interest rate, as follows: Increase / decrease in interest rate Balance as Possible Remote of Probable scenario scenario 12/31/2020 Index – % per year scenario Risk 25% 75% Short-term investments 515,201 144,64% CDI – 3,99 % 20,557 Decrease 15,417 5,139 Trade receivables 12,029 IPCA - 4,51 % 543 Decrease 678 949 Loans and financing 151,757 CDI + 3.6% p.a. - 6,36 % 9,652 Increase 12,065 16,891 Lease liabilities 149,353 IGP-M - 25,31 % 37,801 Increase 47,252 66,152 Accounts payable from acquisition of subsidiaries 274,861 IPCA – 4,51 % 12,396 Increase 15,495 21,693 Probable scenario reflects the closing rates of the fixed interest yield and inflation indexes at year-end. The possible scenario projects a variation of 25 percent in these rates and, the remote scenario, a variation of 75 percent, both rise and fall, being considered the largest losses resulting by risk factor. Exchange rate risk Exchange rate risk relates to potentially adverse results that the Company may face from fluctuations in foreign currency exchange rates from economic crisis, sovereign monetary policy alterations, or market movements. The Company's exposure to the risk of changes in foreign currency exchange rates relates to some of the Company's cash and cash equivalents. Sensitivity analysis The following table demonstrates the sensitivity to a reasonably possible change in exchange rates on cash and cash equivalents. With all variables held constant, the Company's income before income taxes is affected through the impact on floating exchange rate, as follows: Depreciation of exchange rate Possible Remote Probable scenario - scenario - scenario exchange exchange Balance Current VaR 99% rate rate as of exchange C.L. 1 day variation variation 12/31/2020 Currency rate (i) 25% 75% Cash and cash equivalents 10,586 USD 51,967 217 2,647 7,940 (i) Value at risk (VaR) is a measure of the risk of loss for investments. It estimates how much a set of investments might lose (with a given Confidence Level - C.L.), given normal market conditions, in a set time period such as a day. 5.4.2. Credit risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk arises from the Company’s exposure to third parties, including cash and cash equivalents and short-term investments, as well as from its operating activities, primarily related to trade receivables from customers. Customer credit risk is managed by the Company based on the established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored. See Note 9 for additional information on the Company’s trade receivables. Credit risk from balances with banks and financial institutions is managed by the Company's treasury department in accordance with the Company’s policy. Investments of surplus funds are made only with approved counterparties and within limits assigned to each counterparty. The Company’s maximum exposure to credit risk for the components of the statement of financial position at December 31, 2020 and 2019 is the carrying amounts of its financial assets. 5.4.3. Liquidity risk The Company’s Management has responsibility for monitor liquidity risk. In order to achieve the Company’s objective, Management regularly reviews the risk and maintains appropriate reserves, including bank credit facilities with first tier financial institutions. Management also continuously monitors projected and actual cash flows and the combination of the maturity profiles of the financial assets and liabilities. The main requirements for financial resources used by the Company arise from the need to make payments for suppliers, operating expenses, labor and social obligations and accounts payable from acquisition of subsidiaries. The tables below summarize the maturity profile of the Company’s financial liabilities based on contractual undiscounted amounts: Less than More than As of December 31, 2020 1 year 1 to 3 years 3 to 5 years 5 years Total Trade payables 32,240 — — — 32,240 Loans and financing 151,757 — — — 151,757 Lease liabilities 24,734 48,222 46,165 124,076 243,197 Other leases (i) 2,930 1,465 1,085 420 5,900 Prepayments from customers 9,657 — — — 9,657 Accounts payable from acquisition of subsidiaries 139,488 139,488 — — 278,976 Share-based compensation — — 51,172 36,881 88,053 Total 360,806 189,175 98,422 161,377 809,780 Less than More than As of December 31, 2019 1 year 1 to 3 years 3 to 5 years 5 years Total Trade payables 29,978 — — — 29,978 Lease liabilities 21,999 39,218 38,430 93,373 193,020 Other leases (i) 2,804 1,402 1,038 402 5,646 Prepayments from customers 3,186 — — — 3,186 Accounts payable from acquisition of subsidiaries 135,233 281,022 — — 416,255 Share-based compensation — — — 78,455 78,455 Total 193,200 321,642 39,468 172,230 726,540 (i) Refer to commitments from lease agreements that fall into the exemptions of short-term leases and low-value assets and therefore not recognized in lease liabilities. |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Measurement | |
Fair Value Measurement | 6. Fair Value Measurement As of December 31, 2020, the Company have only Share-based compensation liabilities measured at fair value, in the amount of R$ 46,260, (2019 – R$ 34,950) which are classified in Level 3 of fair value measurement hierarchy given significant unobservable inputs used. There were no transfers between Levels during the year ended on December 31, 2020. The following table presents the changes in level 3 items for the year ended on December 31, 2020, and 2019 for recurring fair value measurements: Share-based compensation 2020 2019 2018 Opening balance at January 1 34,950 7,045 191 Issue of shares to employees — 1,844 — Settlement in cash — (2,238) — Reclassification from (to) equity (513) 7,299 2,225 Expenses recognized – general and administrative 11,823 21,000 4,629 Balance at December 31 46,260 34,950 7,045 The Company assessed that the fair values of financial instruments at amortized cost such as cash and cash equivalents, short-term investments, current trade receivables, trade payables and prepayments from customers approximate their carrying amounts largely due to the short-term maturities of these instruments. Non-current trade receivables, lease liabilities, accounts payable from acquisition of subsidiaries and loans and financing have their carrying amount adjusted by their respective effective interest rate in order to be presented as close as possible to its fair value. The following table summarizes the quantitative information about the significant inputs used in level 3 fair value measurements: Weighted average inputs Relationship with of unobservable Unobservable inputs 2020 2019 2018 inputs to fair value Net operating revenue growth rate (i) 2020: Increased growth rate (+200 basis points (bps)) and lower discount rate (-100 bps) would increase FV by R$ 586; lower growth rate (-200 bps) and higher discount rate (+100 bps) would decrease FV by R$ 519. Pre-tax discount rate (ii) 2019: Increased growth rate (+200 basis points (bps)) and lower discount rate (-100 bps) would increase FV by R$ 291; lower growth rate (-200 bps) and higher discount rate (+100 bps) would decrease FV by R$ 874 (i) The growth rate of net operating revenue is based on the historical growth of the student base and management’s expectations of market development. (ii) Pre-tax discount rate reflects specific risks relating to the segment and country in which the Company operates. |
Capital management
Capital management | 12 Months Ended |
Dec. 31, 2020 | |
Capital management | |
Capital management | 7. Capital management The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to provide returns for stockholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital, maximizing the return to stockholders. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and to maintain and adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. At December 31, 2020, the Company had a capital structure designed to enable its growth strategy, either organically or through acquisitions. Investment decisions take into consideration the expected return potential. No changes were made in the objectives, policies or processes for managing capital during the years ended December 31, 2020 and 2019. Capital is managed considering the consolidated position. The Company has no transaction subjected to any financial covenant |
Cash and cash equivalents and s
Cash and cash equivalents and short-term investments | 12 Months Ended |
Dec. 31, 2020 | |
Cash and cash equivalents and short-term investments | |
Cash and cash equivalents and short-term investments | 8. Cash and cash equivalents and short-term investments December 31, December 31, 2020 2019 Cash equivalents and bank deposits in foreign currency (i) 10,586 — Cash equivalents (ii) 75,344 2,457 Cash and cash equivalents 85,930 2,457 Investment funds (iii) 515,201 72,321 (i) Short-term deposits (mainly proceeds from the IPO) maintained in U.S. dollar. (ii) Cash equivalents are comprised of short-term deposits with a maturity of three months or less, which are subject to an insignificant risk of changes in value, readily convertible into cash. (iii) Short-term investments, increased by the proceeds from the IPO, correspond to financial investments in Investment Funds, with highly rated financial institutions. As of December 31, 2020, the average interest on these Investment Funds are 3.99% p.a., corresponding to 144.64% of CDI (December 31, 2019 - 5.81% p.a. – 99.10% of CDI). Despite the fact these investments have high liquidity and have insignificant risk of changes in value, they do not qualify as cash equivalents given the nature of investment portfolio and their maturity. Due to the short-term nature of these investments, their carrying amount is considered to be the same as their fair value. |
Trade receivables
Trade receivables | 12 Months Ended |
Dec. 31, 2020 | |
Trade Receivables | |
Trade receivables | 9. Trade receivables 2020 2019 Tuition fees 206,107 161,049 FIES and UNIEDU Guaranteed Credits 4,041 7,196 PEP – Special Installment Payment (i) 17,155 8,542 Provision for revenue cancellation (3,136) (5,212) Allowance for expected credit losses of trade receivables (102,128) (79,659) Total trade receivables 122,039 91,916 Current 115,115 88,130 Non-current 6,924 3,786 (i) In 2015, a special private installment payment program (PEP) was introduced to facilitate the entry of students who could not qualify for FIES, due to changes occurred to the program at the time. These receivables bear interests of 1.34% and, given the long term of the installments, they have been discounted at an interbank rate of 2.76%. The aging list of trade receivables is as follows: 2020 2019 Receivables falling due 70,216 72,647 Receivables past due From 1 to 30 days 24,990 22,322 From 31 to 60 days 21,176 15,135 From 61 to 90 days 17,697 13,473 From 91 to 180 days 30,771 27,968 From 181 to 365 days 62,453 25,242 Provision for revenue cancellation (3,136) (5,212) Allowance for estimated credit losses (102,128) (79,659) 122,039 91,916 Cancellations consist of deductions of the revenue to adjust it to the extension it is probable that it will not be reversed, generally related to students that have not attended classes and do not recognize the service provided or are dissatisfied with the services being provided. A provision for cancellation is estimated using the expected value method, which considers accumulated experience and is updated at the end of each period for changes in expectations. Changes in the Company's revenue cancellation provision are as follows: 2020 2019 2018 At the beginning of the year (5,212) (5,655) (5,421) Additions (16,527) (20,890) (16,283) Write-off 14,764 21,333 16,049 Reversals 3,839 — — At the end of the year (3,136) (5,212) (5,655) The Company records the allowance for expected credit losses of trade receivables on a monthly basis by analyzing the amounts invoiced in the month, the monthly volume of receivables and the respective outstanding amounts by late payment range, calculating the recovery performance. Under this methodology, the monthly billed amount and each late payment range is assigned a percentage of probability of loss that is accrued for on a recurring basis. When the delay exceeds 365 days, the receivable is written down. Even for written-off receivables, collection efforts continue, and their receipt is recognized directly in the statement of profit or loss, when incurred, as recovery of losses. Changes in the Company’s allowance for expected credit losses are as follows: 2020 2019 2018 At the beginning of the year (79,659) (66,199) (55,649) Write-off of uncollectible receivables 59,704 39,385 34,028 Reversal 23,752 20,739 22,469 Reclassified to (from) held for sale (5,333) 5,333 — Allowance for expected credit losses (100,592) (78,917) (67,047) At the end of the year (102,128) (79,659) (66,199) |
Current and deferred income tax
Current and deferred income tax | 12 Months Ended |
Dec. 31, 2020 | |
Current and deferred income tax | |
Current and deferred income tax | 10. Current and deferred income tax a) Reconciliation of income tax in the statement of profit or loss Income tax differ from the theoretical amount that would have been obtained by using the nominal income tax rates applicable to the income of the Company entities, as follows: 2020 2019 2018 Earnings (losses) before taxes 33,083 (77,052) (50,215) Combined income tax rate in Brazil - % (i) 34 % 34 % 34 % Income tax at statutory rates (11,248) 26,198 17,073 Income exempt from taxation - ProUni benefit (ii) 25,307 19,106 14,844 Unrecognized deferred tax asset on tax losses (iii) (2,192) (32,505) (26,873) Previously unrecognized tax losses used to reduce deferred tax (iii) 10,632 — — Previously unrecognized temporary differences (iii) 12,219 — — Income from entities not subject to taxation (12,069) — — Non-deductible expenses (6,148) (1,902) - Other 2,530 (5) (33) Total income tax and social contribution 19,031 10,892 5,011 Effective tax rate - % (58) % 14 % 10 % Current income tax expense (19,556) (14,813) (10,640) Deferred income tax income 38,587 25,705 15,651 (i) Considering that the Company is domiciled in Cayman and there is no income tax in that jurisdiction, the combined tax rate of 34% demonstrated above is the current rate applied to all Company's subsidiaries, operating entities in Brazil. (ii) The University for All Program — ProUni, establishes, through Law 11,096, dated January 13, 2005, exemption from certain federal taxes for higher education institutions that provide full and partial scholarships to low-income students enrolled in traditional undergraduate and technological undergraduate programs. The Company’s higher education companies are included in this program. (iii) The Company has unused tax loss carryforwards and temporary differences previously unrecognized. Given the continuous growth in Continuing Education activities for the last two years and recent changes to the structure of its operations, the Company reviewed previously unrecognized tax losses and temporary differences, determining that it is now probable that taxable profits will be available against which the tax losses can be utilized and temporary differences can be realized, and that are now expected to be used and realized until 2022. During 2020 the Company already used R$3,208 of tax loss carryforwards. b) Deferred income tax Balance sheet Profit or loss 2020 2019 2020 2019 2018 Tax loss carryforward 7,424 — 7,424 — — Intangible assets on business combinations (20,004) (24,958) 4,954 18,483 12,667 Allowance for expected credit losses 48,758 27,362 21,396 5,138 3,587 Labor provisions 2,707 — 2,707 — — Lease contracts 7,088 6,043 1,045 1,311 1,296 Provision for revenue cancellation 1,066 1,772 (706) (151) 79 Provision for contingencies 1,983 1,225 758 697 (617) Other provisions 1,753 744 1,009 452 (1,361) Total 50,775 12,188 38,587 25,930 15,651 Deferred tax assets 50,775 37,146 Deferred tax liabilities — (24,958) The above deferred taxes were recorded at the nominal rate of 34%. Under Brazilian tax law, temporary differences and tax losses can be carried forward indefinitely, however tax loss carryforwards can only be used to offset up to 30% of taxable profit for the year. |
Prepaid expenses
Prepaid expenses | 12 Months Ended |
Dec. 31, 2020 | |
Prepaid expenses | |
Prepaid expenses | 11. Prepaid expenses 2020 2019 Prepayments to employees 3,605 2,513 Prepayments to suppliers 3,539 4,219 Prepayments to hub partners 1,709 905 Software licensing 533 502 Insurance 177 239 Others 660 560 Prepaid expenses 10,223 8,938 |
Assets and liabilities held for
Assets and liabilities held for sale | 12 Months Ended |
Dec. 31, 2020 | |
Assets and liabilities held for sale | |
Assets and liabilities held for sale | 12. Assets and liabilities held for sale In December 2019, the Company has decided to sell its subsidiaries FAC/FAMAT and FAIR, and for the UNIASSELVI’s undergraduate operation in the campuses Assevim and Famesul. The transaction consists of (i) the sale of the operations from the following campuses located in Brazil in the cities of: Brusque-SC and Rio do Sul-SC, as well as all related assets and liabilities, including the “ASSEVIM” and “FAMESUL” trademarks and (ii) the sale of 100% of the shares issued by the entities “FAC/FAMAT” and “FAIR”, its campuses and trademarks. The Company decided on the sale of these specific assets, that are a portion of the on-campus undergraduate courses segment, in order to raise funds to invest in the distance learning undergraduate courses segment expansion. In September 2020, the Company decided that due to the proceeds received from the IPO there was no further reason to sell these assets. 2019 Assets classified as held for sale Trade receivables Income taxes recoverable 207 Prepaid expenses 172 Other taxes recoverable 195 Other assets 122 Right-of-use assets 16,090 Property and equipment 11,704 Intangible assets 8 Total of assets disposal group held for sale 36,433 Liabilities directly associated with assets classified as held for sale Trade payables 979 Lease liabilities 19,210 Taxes payable 181 Labor and social obligations 2,695 Prepayments from customers 112 Provisions for contingencies 107 Total liabilities of disposal group held for sale 23,284 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Leases | 13. Leases Set out below, are the carrying amounts of the Company’s right-of-use assets related to buildings used as offices and hubs and lease liabilities and the movements during the year: Right-of-use assets Lease Liabilities 2020 2019 2018 2020 2019 2018 As of January 1st 88,534 74,822 51,534 103,188 88,739 61,639 New contracts 43,733 36,021 29,335 43,733 36,021 29,335 Re-measurement by index (i) 8,258 3,741 1,558 8,258 3,741 1,558 Lease modification (ii) (15,934) — — (16,869) — — Depreciation expense (iii) (12,760) (9,960) (7,605) — — — Reclassification from (to) assets held for sale 16,090 (16,090) — 19,210 (19,210) — Accrued interest — — — 15,086 12,393 10,778 Payment of principal — — — (6,121) (6,103) (3,793) Rent concession (iv) — — — (2,046) — — Payment of interest — — — (15,086) (12,393) (10,778) As of December 31 127,921 88,534 74,822 149,353 103,188 88,739 Current — — — 23,365 17,265 15,397 Non-current 127,921 88,534 74,822 125,988 85,923 73,342 (i) Lease liabilities and right-of-use assets were incremented with respect to variable lease payments that depend on an index or a rate, as a result of annual rental prices contractually adjusted by market inflation rate General Market Price Index ( Índice Geral de Preços do Mercado ), or IGP-M. (ii) During the year ended in December 31, 2020, the Company partially reduced the scope of a lease contract with a corresponding liability in the amount of R$1,967, and early terminated other seven lease contracts with a corresponding liability in the amount of R$14,902. As a result, a gain of R$1,006 was recognized as Other income (expenses), net, in the statement of profit and loss. (iii) In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$615 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. (iv) The Company has received Covid-19 related rent concessions and has applied the practical expedient introduced by the amendments made to IFRS 16 in May 2020, applied to all qualifying rent concessions. As a result, gains of R$2,046 arising from rent concessions were recognized as Other income (expenses), net, in the statement of profit and loss. The Company recognized rent expense from short-term leases and low-value assets of R$ 2,929 for the year ended December 31, 2020 (2019 - R$ 3,796), mainly represented by leased equipment. |
Property and equipment
Property and equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property and equipment | |
Property and equipment | 14. Property and equipment Furniture, IT equipment Library Leasehold Construction equipment and facilities books improvements in progress (i) TOTAL At December 31, 2017 Net book value 4,701 12,316 9,779 20,866 2,668 50,330 Cost 13,125 29,896 20,949 28,376 2,668 95,014 Accumulated depreciation (8,424) (17,580) (11,170) (7,510) — (44,684) Purchases 3,915 8,750 10 2,216 8,300 23,191 Transfers — 90 — 1,269 (1,359) — Disposals (112) (1,217) — (1) — (1,330) Depreciation (2,141) (2,790) (1,933) (1,899) — (8,763) At December 31, 2018 Net book value 6,363 17,149 7,856 22,451 9,609 63,428 Cost 15,357 35,772 20,959 31,860 9,609 113,557 Accumulated depreciation (8,994) (18,623) (13,103) (9,409) — (50,129) Purchases 5,261 9,520 36 4,636 9,017 28,470 Transfers — — — 17,132 (17,132) — Disposals — (2) — — — (2) Transfer to held for sale (84) (3,249) (1,192) (7,111) (68) (11,704) Depreciation (2,565) (3,245) (1,630) (2,719) — (10,159) At December 31, 2019 Net book value 8,975 20,173 5,070 34,389 1,426 70,033 Cost 19,174 37,521 17,789 44,107 1,426 120,017 Accumulated depreciation (10,199) (17,348) (12,719) (9,718) — (49,984) Purchases 3,905 7,271 — 8,862 5,506 25,544 Transfers — — — 6,972 (6,972) — Disposals (30) (15) — — — (45) Transfer from held for sale 84 3,249 1,192 7,111 68 11,704 Depreciation (ii) (3,050) (3,105) (1,730) (2,682) — (10,567) At December 31, 2020 Net book value 9,884 27,573 4,532 54,652 28 96,669 Cost 24,484 52,541 20,994 69,462 28 167,509 Accumulated depreciation (14,600) (24,968) (16,462) (14,810) — (70,840) (i) These refer to construction in progress for improvements to the facilities used by the Company, related to the accessibility and modernization of facilities. (ii) In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$815 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. |
Intangible assets
Intangible assets | 12 Months Ended |
Dec. 31, 2020 | |
Intangible assets | |
Intangible assets | 15. Intangible assets Operation Teaching/ Internal licenses for learning project distance Non-compete Customer material - Software development Trademarks (i) learning agreements relationship TLM Goodwill TOTAL At December 31, 2017 Net book value 23,909 4,904 77,728 245,721 7,142 60,621 4,651 372,268 796,944 Cost 35,701 4,905 85,163 245,721 10,826 100,695 7,344 372,268 862,623 Accumulated amortization and impairment (11,792) (1) (7,435) — (3,684) (40,074) (2,693) — (65,679) Purchase and capitalization 1,561 10,208 — — — — — — 11,769 Transfers 2,619 (2,619) — — — — — — — Amortization (6,882) (478) (4,055) — (2,165) (24,867) (1,469) — (39,916) Impairment losses — — — — — — — (33,537) (33,537) At December 31, 2018 Net book value 21,207 12,015 73,673 245,721 4,977 35,754 3,182 338,731 735,260 Cost 39,881 12,494 85,163 245,721 10,826 100,695 7,344 372,268 874,392 Accumulated amortization and impairment (18,674) (479) (11,490) — (5,849) (64,941) (4,162) (33,537) (139,132) Purchase and capitalization 3,449 12,817 — — — — — — 16,266 Transfers 3,071 (3,071) — — — — — — — Transfer to held for sale (8) — — — — — — — (8) Amortization (7,675) (2,094) (4,056) — (2,165) (24,868) (1,468) — (42,326) Impairment losses — — (8,515) — (769) (7,635) (187) (33,916) (51,022) At December 31, 2019 Net book value 20,044 19,667 61,102 245,721 2,043 3,251 1,527 304,815 658,170 Cost 46,123 22,240 85,163 245,721 10,826 100,695 7,344 372,268 890,380 Accumulated amortization and impairment (26,079) (2,573) (24,061) — (8,783) (97,444) (5,817) (67,453) (232,210) Purchase and capitalization 9,790 21,129 — — — — — — 30,919 Transfers 5,848 (5,848) — — — — — — — Transfer from held for sale 8 — — — — — — — 8 Amortization (ii) (11,131) (7,146) (3,559) — (1,751) (3,251) (1,309) — (28,147) Impairment losses — — — — — — — — — At December 31, 2020 Net book value 24,559 27,802 57,543 245,721 292 — 218 304,815 660,950 Cost 62,039 37,521 85,163 245,721 10,826 100,695 7,344 372,268 921,577 Accumulated amortization and impairment (37,480) (9,719) (27,620) — (10,534) (100,695) (7,126) (67,453) (260,627) (i) The group has the rights of many trademarks, such as Assevim, FAC, FAIR, FAMESUL and others, but Uniasselvi is the only trademark recognized as an intangible asset, as a result of business combination. Its estimated useful life is 21 years, with a remaining amortization period of 15 years. (ii) In September 2020 was recognized the amortization expenses from the first eight months of the year in the amount of R$2 due to the reclassification from assets held for sale regarding amortization that would have been recognized had the assets not been classified as held for sale. Impairment tests of intangible assets with indefinite useful life Goodwill and operation licenses for distance learning were allocated to the Cash-generating units (CGUs), which are identified at the level of Company’s operating segments identified in Note 4. The operating segment-level summary of the goodwill and intangible assets allocation and the key assumptions for those CGUs that have significant goodwill allocated to them are presented below: Distance learning Continuing education On-campus undergraduate undergraduate courses courses courses Segment Level 2020 2019 2020 2019 2020 2019 Allocation of carrying amount: Goodwill 285,826 285,826 18,989 18,989 — 33,916 Intangible assets with indefinite useful life 213,406 213,406 32,315 32,315 — — Other intangible assets 8,090 55,893 4,979 5,547 11,959 29,072 Impairment losses — — — — — 51,022 Key assumptions: Net operating revenue growth rate (i) 22.9 % 20.3 % 24.4 % 22.3 % — (6.5) % Pre-tax discount rate (ii) 11.4 % 13.6 % 11.4 % 13.6 % — 13.6 % Long-term growth rate (iii) 3.2 % 3.5 % 3.2 % 3.5 % — 3.5 % Gross margin (iv) 66.2 % 69.8 % 86.1 % 86.8 % — 60.2 % (i) The growth rate of net operating revenue is based on the historical growth of the student base and management’s expectations of market development. (ii) Pre-tax discount rate reflects specific risks relating to the segment and country in which the Company operates. (iii) The long-term growth rate does not exceed the long-term average growth rate for the education sector in which the CGU operates and is mostly comprised by expected inflation. (iv) Gross margin is the average margin as a percentage of revenue over the five-year forecast period. It is based on the current sales margin levels and is in line with the Company’s operating history and management’s expectations for the future performance. Based on the recent changes to legislation and growth of the distance learning market in Brazil, Management expects to have strong growth in the distance learning undergraduate courses, mainly based from the increase of hubs. In addition to the investments with new hubs, Management also considers investment for improvements to expand their existing units. For the 2020 and 2019, the recoverable amount of the cash-generating units (CGUs) was determined based on value-in-use calculations which require the use of assumptions. The calculations use cash flow projections based on financial budgets approved by management covering a five-year period. Cash flows beyond the five-year period are extrapolated using the estimated long-term growth rates stated above. The recoverable amount of the distance learning undergraduate courses segment is estimated to exceed the carrying amount of the segment level as of December 31, 2020 by R$ 3,659,152 (2019 — R$ 903,369). The recoverable amount of the continuing education courses segment is estimated to exceed the carrying amount of the segment level as of December 31, 2020 by R$ 353,773 (2019 — R$ 341,243). There was no goodwill impairment for the year ended December 31, 2020. The test performed by Management on December 31, 2019 showed an impairment loss of R$ 51,022 (2018 – R$ 33,537) on the on-campus undergraduate courses segment, mainly due to decrease in the average monthly tuition fee per student observed in 2019 and increase in the number of students that are migrating to distance learning courses. In 2020, there was a change in the Brazilian educational legislation which allowed on-campus undergraduate courses to have 40% of its content as distance learning. In addition, new undergraduate law classes were allowed by the Brazilian educational authorities, which are only permitted as on-campus undergraduate courses. The impairment losses have been recognized in the statement of profit or loss (Note 25) for the excess of the segment’s carrying amount over its respective recoverable amount, firstly allocated to segment’s goodwill and the remainder proportionally allocated to other intangible assets. Impact of possible changes in key assumptions A decrease of 120 basis points in management estimated gross margin used in the value-in-use calculation for the distance learning undergraduate courses CGU as of December 31, 2020 (65.0% instead of 66.2%), would have not resulted in the recognition of an impairment of goodwill. Also, the Company performed the same sensitivity analysis for the continuing education courses (84.9% instead of 86.1%) and concluded it would have not resulted in the recognition of an impairment of goodwill. In addition to the test above reducing gross margin, an increase of 120 basis points in management’s estimated discount rate applied to the cash flow projections for the two CGUs for the year ended December 31, 2020 (12.6% instead of 11.4%), would have not resulted in the recognition of an impairment of goodwill. Management have considered and assessed reasonably possible changes for other key assumptions and have not identified any instances that could cause the carrying amount of the distance learning undergraduate courses and continuing education segments to exceed its recoverable amount. |
Loans and financing
Loans and financing | 12 Months Ended |
Dec. 31, 2020 | |
Loans and financing | |
Loans and financing | 16. Loans and financing a) Breakdown December 31, December 31, Type Interest rate Maturity 2020 2019 Standby Letter of Credit CDI + 3.6% p.a. 2021 151,757 — b) Variation Loans and financing As of December 31, 2019 — Proceeds from loans and financing (i) 150,000 Accrued interest 6,205 Payment of interest (4,448) As of December 31, 2020 151,757 (i) Seeking to guarantee the same rates and conditions that would be available in a scenario without the Coronavirus pandemic, on April 16, 2020, the Company entered into a loan agreement of R$ 150,000, with no financial covenants or guarantees anticipating a loan to settle the accounts payable from acquisition of subsidiaries due in December 2020. The loan accrues interest at the Brazilian interbank deposit ( Certificado de Depósito Interbancário ), or CDI rate +3.6% per annum and its interests are repayable in five quarterly installments starting on July 16, 2020 and the principal in one installment on October 18, 2021. |
Labor and social obligations
Labor and social obligations | 12 Months Ended |
Dec. 31, 2020 | |
Labor and social obligations | |
Labor and social obligations | 17. Labor and social obligations 2020 2019 Salaries payable 7,489 4,235 Social charges payable (i) 8,103 5,906 Accrued vacation 3,675 1,972 Accrual for bonus 7,408 4,668 Other 110 3 Total 26,785 16,784 (i) Comprised of contributions to Social Security (“INSS”) and to Government Severance Indemnity Fund for Employees (“FGTS”) as well as withholding income tax (“IRRF”) over salaries. |
Accounts payable from acquisiti
Accounts payable from acquisition of subsidiaries | 12 Months Ended |
Dec. 31, 2020 | |
Account payable from acquisition of subsidiaries | |
Accounts payable from acquisition of subsidiaries | 18. Accounts payable from acquisition of subsidiaries 2020 2019 2018 As at January 1, 379,540 458,535 534,914 Accrued Interest 34,809 44,143 53,291 Payment of principal (117,248) (107,988) (117,247) Payment of interests (22,240) (15,150) (12,423) As at December 31, 274,861 379,540 458,535 Current 134,988 128,888 123,310 Non-current 139,873 250,652 335,225 On February 28, 2016, the Company completed the acquisition of 100% of Uniasselvi and the amount of R$ 400,000 was paid on the act, R$ 119,159 was paid in December 2018, R$ 112,301 was paid in December 2019 and R$128,162ks was paid in December 2020, and the remaining amounts are payable in two equal installments, payable on December 31, 2021 and December 31, 2022 and adjusted by the IPCA inflation rate. On August 31, 2016, the Company completed the acquisition of 100% of FAC and FAIR and the amounts of R$10,511 was paid in December 2018, R$10,837 was paid in December 2019 and R$128,162 was paid in December 2020, and the remaining amounts are payable in two equal installments, payable on December 31, 2021 and December 31, 2022 and adjusted by the IPCA inflation rate. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Contingencies | |
Contingencies | 19. Contingencies a) Provision for contingencies The provisions related to labor and civil proceedings whose likelihood of loss is assessed as probable are as follows: Liabilities Civil Labor Total At December 31, 2017 2,356 20,641 22,997 Additions 3,305 4,750 8,055 Accrued interest 59 581 640 Payments (390) (5,126) (5,516) Reversals (3,477) (4,665) (8,142) At December 31, 2018 1,853 16,181 18,034 Additions 2,924 6,770 9,694 Accrued interest 71 481 552 Payments (834) (2,257) (3,091) Reversals (42) (6,637) (6,679) Classified as held for sale (32) (75) (107) At December 31, 2019 3,940 14,463 18,403 Additions 454 5,207 5,661 Accrued interest 109 399 508 Payments (1,552) (3,582) (5,134) Reversals (933) (4,173) (5,106) Classified from held for sale 32 75 107 At December 31, 2020 2,050 12,389 14,439 The Company’s subsidiaries are parties to legal and administrative proceedings. These proceedings generally refer to legal and administrative disputes involving unions, employees, suppliers and students. Provisions are recorded for legal proceedings that represent probable loss. The assessment of the likelihood of loss includes an analysis of available evidence, including the opinion of internal and external legal counsel. Management believes that the provisions are sufficient and properly stated in the financial statements. b) Indemnification assets Pursuant to the terms and conditions of the purchase and sale agreement described in note 1.1, the periods of responsibility for each party in relation to such claims, value limits, notification criteria and reciprocal indemnity were defined. The rights generated by the purchase and sale agreement are as follows: Assets Civil Labor Total At December 31, 2017 2,210 17,418 19,628 Additions 2,840 3,580 6,420 Accrued interest 56 546 602 Realized (33) (246) (279) Reversals (3,379) (6,512) (9,891) At December 31, 2018 1,694 14,786 16,480 Additions 131 4,760 4,891 Accrued interest 55 421 476 Realized (77) (1,312) (1,389) Reversals (735) (4,922) (5,657) At December 31, 2019 1,068 13,733 14,801 Additions — 85 85 Accrued interest 29 379 408 Realized (86) (2,792) (2,878) Reversals (212) (3,013) (3,225) At December 31, 2020 799 8,392 9,191 c) Possible losses, not provided for in the balance sheet No provision has been recorded for proceedings classified as possible losses, based on the opinion of the Company’s legal counsel. The breakdown of existing contingencies as of December 31, 2020 and 2019 is as follows: 2020 2019 Civil 8,106 11,263 Labor 17,385 15,460 Tax 31,674 30,491 Total 57,165 57,214 Civil proceedings classified as possible loss As of December 31, 2020, the Company’s subsidiaries were subject to 521 civil claims. Most of the lawsuits are related to consumer claims, including discussions regarding undue collection of tuition fees and rates, delay in the issuance of certificates and diplomas, undue collection of tuition fees for students that have been grated scholarships and public financing and denial of enrollment in courses, among others. Labor proceedings classified as possible loss As of December 31, 2020, the Company’s subsidiaries were subject to 149 labor claims. Most of these claims are related to overtime, salary equalization, vacation payments and/or non-enjoyment of vacation periods, severance payments and termination fees, and indemnities based on Brazilian labor laws. Tax proceedings classified as possible loss At December 31, 2020, the Company has an outstanding tax administrative proceeding related to Tax Infraction Notice No. 000204.00/2017, issued by the Porto Alegre City Hall Municipal Finance Department, in the total amount of R$ 28,024, corresponding to alleged Service Tax (ISS) debt, plus a 150% fine and late payment interest, for the period from January 2012 to June 2017. The interpretation of the Porto Alegre City Hall Tax Authorities is that the educational services provided at a distance by the Company, from its headquarters in Indaial/SC, would be subject to ISS taxation in the City of Porto Alegre, where it maintains a distance learning center. This interpretation is contested at an administrative level by the Company’s external law firm. Liability for any payment of such debt shall be in accordance with the liability periods defined in accordance with the terms and conditions of the purchase and sale agreement described in note 18, and Sellers shall be liable for any debts relating to the period prior to the closing date of the acquisition (February 29, 2016). |
Equity
Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity | |
Equity | 20. Equity a) Authorized capital The Company is authorized to increase capital up to the limit of 1 billion shares, subject to approval of the Administration. b) Share capital As described in Note 1, on September 2, 2020, each of Vitru’s shareholders had agreed to contribute their respective shares on Vitru Brazil to Vitru Limited, exchanging thirty-one common shares into one ordinary share of Vitru Limited. As a consequence of this reverse share split, the share capital previously represented by 522,315,196 common shares, was reduced to 17,058,053 common shares. As a result of the share split, the Company’s historical financial statements have been revised to reflect number of shares and per share data as if the share split had been in effect for all periods presented. Additionally, on September 22, 2020, the share capital of the Company was increased by 6,000,000 Class A shares through the proceeds received as a result of the IPO of US$ 96,000 thousand (or R$ 521,558). The net proceeds from the IPO were US$ 90,672 thousand (or R$ 492,612), after deducting share issuance costs amounting R$ 47,582. As of December 31, 2020, the Company’s share capital is represented by 23,058,053 common shares of par value of US$ 0.00005 each. The Company has issued only common shares, entitled to one vote per share. c) Capital reserve Additional paid-in capital The additional paid-in capital refers to the difference between the purchase price that the shareholders pay for the shares and their par value. Under Cayman Law, the amount in this type of account may be applied by the Company to pay distributions or dividends to members, pay up unissued shares to be issued as fully paid, for redemptions and repurchases of own shares, for writing off preliminary expenses, recognized expenses, commissions or for other reasons. All distributions are subject to the Cayman Solvency Test which addresses the Company’s ability to pay debts as they fall due in the ordinary course of business. Share based compensation The capital reserve is represented by reserve for share-based compensation programs classified as equity-settled, as detailed in Note 22. The share-based payments reserve is used to recognize: · the grant date fair value of options issued to employees but not exercised. · the grant date fair value of shares issued to employees upon exercise of options. d) Dividends The Company currently intend to retain all available funds and any future earnings, if any, to fund the development and expansion of the business and did not pay any cash dividends in the year ended December 31, 2020, and do not anticipate paying any in the foreseeable future. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings per share | |
Earnings per share | 21. Earnings per share 21.1. Basic Basic earnings per share is calculated by dividing the net income attributable to the holders of Company’s common shares by the weighted average number of common shares held by stockholders during the year. The following table contains the earnings (loss) per share of the Company for year ended December 31, 2020, 2019 and 2018 (in thousands except per share amounts): Basic earnings per share 2020 2019 2018 Net income (loss) attributable to the shareholders of the Company 52,114 (66,160) (45,204) Weighted average number of outstanding common shares (thousands) 18,702 16,849 16,287 Basic earnings (losses) per common share (R$) 2.79 (3.93) (2.78) 21.2. Diluted As of December 31, 2020, the Company had outstanding and unexercised options to purchase 763 thousand (2019 - 797 thousand and 2018 - 788 thousand) common shares which are included in diluted earnings per share calculation. In 2019 and 2018, outstanding options were all anti-dilutive. Diluted earnings per share 2020 2019 2018 Net income (loss) attributable to the shareholders of the Company 52,114 (66,160) (45,204) Weighted average number of outstanding common shares (thousands) 19,465 16,849 16,287 Diluted earnings (losses) per common share (R$) 2.68 (3.93) (2.78) The number of common shares outstanding was retrospectively adjusted due to the reverse share split of shares occurred in the corporate reorganization, described in Note 1.1. |
Share-based compensation
Share-based compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based compensation | |
Share-based compensation | 22. Share-based compensation First Share Option Plan The Company offers to its managers and executives a Share Option Plan with general conditions for the granting of share options issued by the Company to the participants appointed by the Board of Directors who, at its discretion, fulfill the conditions for participation, thereby aligning the interests of the participants to the interests of its stockholders, so as to maximize the Company’s results and increase the economic value of its shares, thus generating benefits for the participants and other stockholders. It also provides participants with a long-term incentive, increasing their motivation and enabling the Company to retain quality human capital. The Share Option Plan was approved on June 8, 2017 and comprises the granting of up to 25,471,110 (after reverse share split 821,649) common share options with no par value, representing up to approximately five percent (5%) of the number of Company-issued common shares on the Plan’s approval date. The Plan is administered and managed by the Company’s Board of Directors and the SOP Management Committee. In the event of any change in the number of common shares issued by the Company resulting from any split, reverse split, amortization, repurchase, cancellation or exchange of shares, the Share Options limit stated in the heading shall be automatically adjusted to reflect any new number of Share Options, regardless of the approval of any amendment to this Plan. The Share Option Plan initially issued by Vitru Brazil and then transferred to the Company upon the corporate reorganization described in Note 1. The transfer did not result in any changes on the Plan nor its balances in the consolidated financial statements. The amount of options granted by the Company was reduced from 22,218 thousand to 715 thousand as a result of the reverse share split of the corporate reorganization described in Note 1. The original purchase and selling value of each option, as determined in the Share Option Plan, was multiplied by the reverse share split denominator in order to maintain the fair value as it was before the corporate reorganization. Each share option grants its holder the right to purchase one (1) Company share, strictly under the terms and conditions set forth in that plan. Options are not entitled to dividends on the underlying shares. In order to satisfy the exercise of share options granted under the plan, the Company may, at the discretion of the Board of Directors issue new shares within the Company’s authorized capital limit or may even sell treasury shares. The share options granted to a participant are subject to a vesting period so that they are exercisable, subject to the applicable rules set forth in each grant program, in accordance with the schedule (as from each schedule date a given lot of share options shall be exercisable, a “Vesting Date”), where each year, twenty percent (20%) of the share options granted may be exercised. When exercised, the vested options are settled in shares issued by Company which can be sold by the employee along with controlling shareholders on exit events or hold by the employee until the end of the plan in exchange for cash consideration by selling shares back to the Company. This represents a compound instrument, thus the expense is recognized with an increase in liability, to the limit of its fair value, derived from a formula based on the Company’s performance and remeasured at each reporting date, and any residual difference between the fair value of the compound instrument and the liability as of each reporting date will be attributed to the equity component of the instrument. Participants have the right to turn all vested options into shares upon payment in cash, paying the Option Exercise Price as defined in the respective program that each participant is associated. The difference between the stipulated price in the program and the fair value of the share at the measurement date is recorded as equity. Upon an exit event, which may be either a transfer of control of the Company or secondary public offerings of Company-issued shares on the Brazilian or international publicly traded market, all options may become fully vested and may be fully or partially exercised by the participants. Participants also shall have the right to require the Company to acquire all shares under its ownership to be held in treasury or for cancellation, upon payment, in cash, of the Put Option Exercise Price, for a given period as from the last Vesting Date, provided that no exit event has occurred up to the end of said period. When all conditions applicable to the buyback of shares provided for in applicable laws and/or regulations are met, the Company shall pay the Participant the price equivalent to a certain amount of multiples of the Company’s EBITDA minus the Net Debt, as set forth in each grant program, recorded as a liability. a) Set out below are summaries of the number and weighted average exercise prices ("WAEP") of options granted under the plan: 2020 2019 2018 Number of WAEP Number of WAEP Number of WAEP options per option options per option options per option As of January 1 733,136 46.19 640,763 35.96 599,864 30.07 Granted during the year — — 167,972 63.86 176,813 53.94 Exercised during the year (209,179) 37.23 (59,165) 31.62 (47,989) 30.38 Forfeited during the year (17,681) 17.36 (16,435) 31.62 (87,925) 31.00 As of December 31 506,276 37.95 733,136 46.19 640,763 35.96 Exercisable at December 31 415,462 42.01 544,291 41.54 450,206 33.17 Repurchased during the year (ii) — — 37.82 (i) The number of options and WAEP per option were also retrospectively adjusted due to the reverse share split in the corporate reorganization described in Note 1.1. (ii) Represent shares repurchased upon termination of employee. No options expired during the years ended December 31, 2020 and 2019. b) Share options outstanding at the end of the year have the following remaining periods and prices: December 31, 2020 December 31, 2019 Weighted average remaining vesting period 1,3 years 2,3 years Weighted average remaining expiring period 3,3 years 4,3 years Purchase option exercise price range R$33.76 – R$100.69 R$1.05 – R$3.13 Weighted average remaining selling period 5,3 years 6,3 years Expected selling / repurchase price R$ 90.72 R$3.41 Due to the reverse share split of the corporate reorganization described in Note 1, original purchase and selling value of each option, as determined in the Share Option Plan, was multiplied by the reverse share split denominator in order to maintain the fair value of the total options granted as it was before the corporate reorganization. c) Options granted: No new options from the first Stock Option Plan were granted during the year ended December 31, 2020. The model inputs for options granted during the year ended December 31, 2019 included: December 31, 2019 Grant date September 1, 2019 Expiry date March 1, 2025 Share price at grant date R$ 3.02 Exercise price R$ 3.12 Expected price volatility 406 % Risk-free interest rate 52 % Model used Black-Scholes Given the fact that Company’s shares were not publicly traded, the expected price volatility is based on the historical volatility of similar listed entities in the same industry following comparable periods for the remaining life of the options. d) The expense recognized for employee services received during the year is as follows: Expense arising from share-based payment transactions 2020 2019 2018 Equity-settled — 5,372 2,821 Cash-settled 11,823 21,000 4,629 11,823 26,372 7,450 The fair value of cash-settled transactions were calculated based on discounted cash flows. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs (Note 6). Second Share Option Plan The Company offers to its managers and executives a Share Option Plan with general conditions for the granting of share options issued by the Company to the participants appointed by the Board of Directors who, at its discretion, fulfill the conditions for participation, thereby aligning the interests of the participants to the interests of its stockholders, so as to maximize the Company's results and increase the economic value of its shares, thus generating benefits for the participants and other stockholders. It also provides participants with a long-term incentive, increasing their motivation and enabling the Company to retain quality human capital. The Second Share Option Plan was approved on November 19, 2020 and comprises the granting of common share options with no par value, representing up to approximately five percent (5%) of the number of Company-issued common shares on the Plan’s approval date. The Plan is administered and managed by the Company's Board of Directors. In order to maintain the economic rights of the Participants, if the number of shares that make up the Company's capital is increased or decreased, including due to the split or reverse share split, the Board of Directors must make the appropriate adjustments to the number of shares to be issued according to the Options that were exercised and those that have not been exercised, except if the change in the number of shares that make up the Company's capital is due to the issuance of new shares due to capital increases or capital reduction and/or repurchase of shares, when no adjustments will be made to the number of shares to be issued in accordance with the Options. No fraction of Shares will be issued under the Plan or due to any of the adjustments provided for in this Section. Each share option grants its holder the right to purchase one (1) Company share, strictly under the terms and conditions set forth in that plan. Options are not entitled to dividends on the underlying shares. The share options granted to a participant are subject to a vesting period so that they are exercisable, subject to the applicable rules set forth in each grant program, in accordance with the schedule (as from each schedule date a given lot of share options shall be exercisable, a "Vesting Date"), where each year, a proportion of the share options granted may be exercised. Participants have the right to turn all vested options into shares upon payment in cash, paying the Option Exercise Price as defined in the respective program that each participant is associated. The difference between the stipulated price in the program and the fair value of the share at the measurement date is recorded as equity. In the event of a Material Transaction, Relevant Corporate Reorganization or Dissolution occurs and the Participant is Terminated as from such event, the Vesting Period of the Option held by the Terminated Participant will be fully anticipated, so that the Participant must exercise the Options within 60 (sixty) days as of the date of Termination. a) 2020 Number of WAEP per options option As of January 1 — — Granted during the year 874,888 0.54 As of December 31 874,888 0.54 Exercisable at December 31 — — No options expired during the year ended December 31, 2020. b) December 31, 2020 Weighted average remaining vesting period 3,0 years Weighted average remaining expiring period 5,7 years Purchase option exercise price range R$83.14 c) December 31, 2020 Grant date December 11, 2020 Expiry date September 9, 2026 Share price at grant date USD 14,34 Exercise price USD 16,00 Expected price volatility 50.65 % Risk-free interest rate 5.01 % Model used Black-Scholes The expense arising from share-based payment transactions from the Second Stock Options Plan in 2020 was R$ 525 |
Key management compensation and
Key management compensation and related parties | 12 Months Ended |
Dec. 31, 2020 | |
Key management compensation and related parties | |
Key management compensation and related parties | 23. Key management compensation and related parties a) Key management compensation Key management includes professionals selected at the sole discretion of the Board of Directors from among the Company’s managers and executives. The total compensation expense with key management for their services is shown below: 2020 2019 Salaries and related charges 6,769 5,967 Variable compensation (i) 2,901 1,732 Share-based compensation 11,823 26,372 Total 21,493 34,071 (i) Variable compensation as defined by the Board of Directors in an agreement with Group executives. b) Related parties The Company holds quotas of investments funds managed by Vinci Partners, an insurance policy issued by Austral Seguradora S/A and uses the services of the lawyer firm Kloch Advocacia. All the companies are an indirect related party. Balance sheet Profit or loss 2020 2019 2020 2019 2018 FI Vinci Renda Fixa Credito Privado Short-term investments 39,216 38,493 — — — Financial income — — 851 2,136 36,556 Austral Seguradora S/A Prepaid expenses 455 758 — — — General and administrative expenses — — (303) (151) — Kloch Advocacia General and administrative expenses — — (217) (214) (178) |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Revenue | 24. Revenue 2020 2019 2018 Gross revenue 673,872 598,344 497,850 (-) Cancellation (14,764) (20,890) (16,283) (-) Discounts (24,128) (19,104) (16,997) (-) ProUni scholarships (i) (98,289) (82,132) (68,008) (-) Taxes and contributions on revenue (17,512) (15,151) (13,113) Net revenue 519,179 461,067 383,449 Timing of revenue recognition Transferred over time 517,950 459,658 382,589 Transferred at a point in time (ii) 1,229 1,409 860 Net revenue 519,179 461,067 383,449 (i) Scholarships granted by the federal government to students under the ProUni program as described in Note 2.5.s (ii) Revenue recognized at a point in time relates to revenue from student fees and certain education-related activities. The Company`s revenues from contracts with customers are all provided in Brazil. In the year ended December 31, 2020, the amounts billed to students for the portion to be transferred to the hub partner, in respect to the joint operation, is R$ 153,776 (2019 R$ 110,411 - 2018 R$ 75,206). As of December 31, 2020, the balance payable to the hub partner is R$ 21,881 (December 31, 2019 - R$ 6,697, December 31, 2018 — R$ 21,537). |
Costs and expenses by nature
Costs and expenses by nature | 12 Months Ended |
Dec. 31, 2020 | |
Costs and expenses by nature | |
Costs and expenses by nature | 25. Costs and expenses by nature 2020 2019 2018 Payroll (i) 207,511 212,683 159,428 Sales and marketing 67,532 54,212 36,804 Depreciation and amortization (ii) 51,475 62,445 56,284 Material 13,023 17,911 16,911 Consulting and advisory services 14,732 11,927 16,843 Maintenance 8,909 6,420 5,644 Utilities, cleaning and security 6,269 7,085 7,013 Contingencies 4,763 3,707 317 Leases 2,929 3,796 6,170 Taxes 2,075 1,705 1,235 Impairment losses (iii) — 51,022 33,537 Other expenses 2,690 4,927 5,288 Total 381,908 437,840 345,474 Costs of services 221,452 211,547 184,161 General and administrative expenses 73,852 125,344 90,667 Selling expenses 86,604 100,949 70,646 Total 381,908 437,840 345,474 (i) Payroll expenses include for the year ended December 31, 2020 R$195,688 (2019 - R$ 186,311, 2018 — R$ 151,978) related to salaries, bonuses, short-term benefits, related social charges and other employee related expenses, and R$ 11,823 (2019 R$ 26,372, 2018 R$ 7,450) related to share-based compensation. (ii) From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. (iii) The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses. |
Other income (expenses), net
Other income (expenses), net | 12 Months Ended |
Dec. 31, 2020 | |
Other income (expenses), net | |
Other income (expenses), net | 26. Other income (expenses), net 2020 2019 2018 Deductible donations (300) (300) (300) Contractual indemnities (85) (647) (712) Modification of lease contracts - Note 13 3,052 — — Other revenues 743 437 332 Other expenses (2,898) (395) (361) Total 512 (905) (1,041) |
Financial results
Financial results | 12 Months Ended |
Dec. 31, 2020 | |
Financial results | |
Financial results | 27. Financial results 2020 2019 2018 Financial income Interest on tuition fees paid in arrears 15,715 8,265 8,887 Financial investment yield 6,296 10,726 12,635 Foreign exchange gain (i) 13,550 — — Other 997 203 504 Total 36,558 19,194 22,026 Financial expenses Interest on accounts payable from acquisition of subsidiaries (34,980) (44,258) (51,739) Interest on lease (15,085) (12,393) (10,778) Interest on loans and financing (6,205) — — Foreign exchange loss (2,714) — — Other (5,434) (3,739) (2,080) Total (64,418) (60,390) (64,597) Financial results (27,860) (41,196) (42,571) (i) Gain of R$12,966 due to exchange rate increase over the proceeds from the initial public offering while cash not partially transferred to operations in Brazil. |
Other disclosures on cash flows
Other disclosures on cash flows | 12 Months Ended |
Dec. 31, 2020 | |
Other disclosures on cash flows | |
Other disclosures on cash flows | 28. Other disclosures on cash flows Non-cash transactions In the year ended December 31, 2020: · The amount of R$ 51,991 (2019 - R$ 39,762) regarding additions on right-of-use assets, was also added in the lease liabilities line item. · The amount of R$15,934 (2019 – R$0) regarding lease modifications that reduced lease liabilities, was also reduced in the right-of-use assets line item. · The amount of R$ 2,878 (2019 - R$1,389) regarding provision for contingencies of responsibility of the sellers of subsidiaries acquired in prior years, was reversed to the indemnification assets line item in non-current assets. |
Significant accounting polici_2
Significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Significant accounting policies | |
Basis of preparation | 2.1. Basis of preparation The consolidated financial statements of the Company have been prepared in accordance with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”), and disclose all (and only) the applicable significant information related to the financial statements, which is consistent with the information utilized by Management in the performance of its duties. The financial statements have been prepared under the historical cost convention, except for share-based compensation, which are adjusted to reflect fair value measurement. The preparation of financial statements requires the use of certain critical accounting estimates. It also requires Management to exercise its judgment in the process of applying the Company's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3. Actual results may differ from estimates. All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousand currency units unless otherwise stated. |
Basis of consolidation | 2.2. Basis of consolidation The consolidated financial statements comprise the financial statements of the Company for the years ended December 31, 2020 and 2019. The table below list the Company’s subsidiaries: Direct and indirect Investment interest Name Main activities Location type 2020 2019 (i) Vitru Brasil Empreendimentos, Participações e Comércio S.A Continuing education courses Florianópolis - SC Subsidiary 100 % 100 % UNIASSELVI - Sociedade Educacional Leonardo da Vinci S/S Ltda Distance learning, on-campus undergraduate and continuing education courses Indaial - SC Subsidiary 100 % 100 % FAMEG - Sociedade Educacional do Vale do Itapocu S/S Ltda. On-campus undergraduate and continuing education courses Guaramirim - SC Subsidiary 100 % 100 % FAIR Educacional Ltda. On-campus undergraduate and continuing education courses Rondonópolis - MT Subsidiary 100 % 100 % FAC Educacional Ltda. On-campus undergraduate and continuing education courses Cuiabá - MS Subsidiary 100 % 100 % (i) The comparative numbers presented in these financial statements from the Company contemplates 100% of direct and indirect interest of the subsidiaries listed above as the interest was not changed by the corporate reorganization described in Note 1.1. The Company consolidates the financial information for all entities it controls. Control is achieved when the Company is exposed to, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. a) Subsidiaries Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and it ceases when the Company loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Company gains control until the date the Company ceases to control the subsidiary. When necessary, adjustments are made to the financial statements of subsidiaries in order to bring their accounting policies in line with the Company’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions are eliminated in full on consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Company loses control over a subsidiary, it derecognized the related assets (including goodwill), liabilities, non-controlling interest and other components of equity, while any resulting gain or loss is recognized in the statement of profit or loss. b) Joint arrangements Investments in joint arrangements are classified as either joint operations or joint ventures, depending on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Company has only joint operations. Joint operations The Company recognizes its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the financial statements under the appropriate headings. Details of the joint operation are set out in Note 2.5.p. |
Functional and presentation currency | 2.3. Functional and presentation currency The items included in the consolidated financial statements are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The financial statements are presented in Brazilian Reais (R$), which is the Company’s functional currency and the Company’s presentation currency. |
Current versus non-current classification | 2.4. Current versus non-current classification The Company presents assets and liabilities in the statement of financial position based on current/non- current classification. An asset is current when it is: · Expected to be realized or intended to be sold or consumed in the normal operating cycle; · Held primarily for the purpose of trading; · Expected to be realized within twelve months after the reporting period; or · Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current. A liability is current when: · It is expected to be settled in the normal operating cycle; · It is held primarily for the purpose of trading; · It is due to be settled within twelve months after the reporting period; or · There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period. The Company classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities. |
Fair value measurement | a) Fair value measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: (i) in the principal market for the asset or liability; or (ii) in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by the Company. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: · Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities. · Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable. · Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. For assets and liabilities that are recognized in the financial statements at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re- assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. At each reporting date, the Company analyzes the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Company’s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents. The Company also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable. For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy, as explained above. |
Financial instruments - initial recognition and measurement | b) Financial instruments—initial recognition and measurement A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. i. Financial assets Initial recognition and measurement The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Company’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortized cost or fair value through other comprehensive income (“OCI”), it needs to give rise to cash flows that are “solely payments of principal and interest (SPPI)” on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Company’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset. Subsequent measurement For purposes of subsequent measurement, financial assets are classified as: financial assets at amortized cost or financial assets at fair value through profit or loss. Financial assets at amortized cost The Company measures financial assets at amortized cost if both of the following conditions are met: · The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows, and · The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortized cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognized in the statement of profit or loss when the asset is derecognized, modified or impaired. The Company’s financial assets at amortized cost mainly includes ‘Cash and cash equivalents’, ‘Short-term investments’ and ‘Trade receivables’. The Company reclassifies financial assets only when its business approach for managing those assets changes. Financial assets at fair value through profit or loss Financial assets at fair value through profit and loss (“FVPL”) include held for trading financial assets designated upon initial recognition at FVPL, or financial assets mandatorily required to be measured at fair value. At the balance sheet date there are no financial assets measured at FVPL. Financial assets are classified as fair value through profit and loss if they either fail the contractual cash flow test or in the Company’s business model are acquired for the purpose of selling or repurchasing in the near term. Financial assets may be designated at FVPL on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch. Financial assets at FVPL are carried in the statement of financial position at fair value with net changes in fair value recognized in the statement of income. The net gain or loss recognized in the statement of income includes any dividend or interest earned on the financial asset. At the balance sheet date there are no financial assets measured at FVPL. Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e., removed from the Company’s statement of financial position) when: · The rights to receive cash flows from the asset have expired; or · The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of its continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay. Impairment of financial assets Further disclosures relating to impairment of financial assets are also provided in the following notes: · Significant accounting estimates and assumptions — Note 3. · Trade receivables — Note 9. The Company recognizes an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and the cash flows the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms. For trade receivables, the Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track changes in credit risk, but instead recognizes an allowance for credit losses based on lifetime ECLs at each reporting date. The Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The Company considers a financial asset in default when contractual payments are 365 days past due. In certain cases, the Company may also consider a financial asset to be in default when internal or external information indicates that the Company is unlikely to receive the outstanding contractual amounts in full before considering any credit enhancements held by the Company. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. ii. Financial liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or amortized cost, as appropriate. All financial liabilities are recognized initially at fair value and, in the case of amortized cost, net of directly attributable transaction costs. The Company’s financial liabilities include trade payables, loans and financing lease liabilities, prepayments from customers, accounts payable from acquisition of subsidiaries and share-based compensation. Subsequent measurement The measurement of financial liabilities depends on their classification, as described below: Financial liabilities at fair value through profit or loss Financial liabilities at FVPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as at FVPL. Financial liabilities are considered as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes financial instruments entered by the Company that are not designated as hedging instruments in hedge relationships as defined by IFRS 9 — Financial Instruments. Gains or losses on liabilities at fair value through PL are recognized in the statement of profit or loss. Financial liabilities designated upon initial recognition at FVPL are designated at the initial date of recognition, and only if the criteria in IFRS 9 — Financial Instruments are satisfied. The Company has designated its financial liability related to share-based compensation as at FVPL. Amortized cost After initial recognition, interest-bearing financial liabilities are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in the statement of profit or loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by considering any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as financial expenses in the statement of profit or loss. The Company’s financial liabilities at amortized cost include trade payables, loans and financing, lease liabilities, prepayments from costumers and accounts payable from acquisition of subsidiaries. Derecognition A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit or loss. |
Cash and cash equivalents | c) Cash and cash equivalents Cash and cash equivalents in the statement of financial position comprise cash at banks and on hand, and short-term financial investments with an original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the purpose of the statement of cash flows, cash and cash equivalents consist of cash, bank deposits and short-term highly liquid financial investments, as they are readily convertible to known amounts of cash, subject to an insignificant risk of changes in value and considered an integral part of the Company’s cash management. |
Prepaid expenses | d) Prepaid expenses Prepaid expenses are recognized as an asset in the statement of financial position. These expenditures include prepaid software licenses, insurance premiums and prepaid vacations to employees. |
Indemnification assets | e) Indemnification assets When the selling shareholders of acquired entities have contractually agreed to indemnify the Company for amounts that may become payable in respect of lawsuits pertaining to the period under their responsibility, indemnification assets are recorded to the proportion of the respective provision. Subsequent changes in the amount recognized for the indemnification asset may occur in relation to the provision for contingencies, according to changes in the range of outcomes or the assumptions used to develop the estimate of the liability at the time of the acquisition. |
Leases | f) Leases The group leases offices, buildings and equipment. Rental contracts are typically made for fixed periods of 1 to 20 years but may have extension options. Contracts may contain both lease and non-lease components. The group allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices. However, for leases of real estate for which the group is a lessee, it has elected not to separate lease and non-lease components and instead accounts for these as a single lease component. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes. Lease liabilities At the commencement date of the lease, the Company recognizes lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating a lease, if the lease term reflects the Company exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are recognized as expense in the period on which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. To determine the incremental borrowing rate, the Company: · where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received. · uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk when the individual lessee does not have recent third-party financing; and · makes adjustments specific to the lease, e.g. term, country, currency and security. The group is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Short-term leases and leases of low-value assets The Company applies the short-term lease recognition exemption to its short-term leases of properties (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases that are considered of low value. Lease payments on short-term leases and leases of low-value assets are recognized as expense on a straight-line basis over the lease term. Right-of-use assets The Company recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Unless the Company is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognized right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of use assets are subject to impairment. |
Non-current assets (or disposal groups) held for sale | g) Non-current assets (or disposal groups) held for sale Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, which are specifically exempt from this requirement. An impairment loss is recognized for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs to sell. A gain is recognized for any subsequent increases in fair value less costs to sell of an asset (or disposal group), but not in excess of any cumulative impairment loss previously recognized. A gain or loss not previously recognized by the date of the sale of the non- current asset (or disposal group) is recognized at the date of derecognition. Non-current assets (including those that are part of a disposal group) are not depreciated or amortized while they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be recognized. Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet. The group has no disposal groups that are component classified as held for sale and representing a separate major line of business or geographical area of operations that qualify as a discontinued operation. |
Property and equipment | h) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation. Historical cost includes acquisition, formation or construction cost. Historical cost also includes financial expenses related to the acquisition of qualifying assets. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with these costs will flow to the Company and they can be measured reliably. The carrying amount of the replaced items or parts is derecognized. All other repairs and maintenance are charged to the statement of profit or loss during the financial period in which they are incurred. Land is not depreciated. Depreciation of other assets is calculated using the straight-line method to reduce their cost to their residual value over their estimated useful lives, as follows: Annual average rate Buildings IT equipment Furniture, fittings and facilities Leasehold improvements 4% - 10% Library An asset’s carrying amount is immediately written down to the recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing the amounts of sales with the carrying amounts and are recognized within “Other operating income (expenses)” in the statement of profit or loss. The Company annually reviews the useful lives and residual value of its assets. Based on review completed for December 31, 2019, the Company concluded that the depreciation rates used are consistent with its operations and that there are no changes to residual value of assets. |
Business combinations | i) Business combinations The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the: · fair values of the assets transferred; · liabilities incurred to the former owners of the acquired business; · equity interests issued by the Company; · fair value of any asset or liability resulting from a contingent consideration arrangement; and · fair value of any pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. Acquisition-related costs are expensed as incurred. The excess of the · consideration transferred or to be transferred; · amount of any non-controlling interest in the acquired entity; and · acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase. Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions. Contingent consideration, when applicable, is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognized in profit or loss. |
Intangible assets | j) Intangible assets Computer programs (software) and internal project development Computer software licenses are capitalized and amortized under the straight-line method over their useful lives. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the Company are recognized as intangible assets when the following criteria are met: · It is technically feasible to complete the software/project so that it will be available for use or sale; · Management intends to complete the software/project and to use it or sell it; · The software/project may be sold or used; · Future benefits associated with the software can be demonstrated; · Adequate technical, financial and other resources are available to complete the design, and for the use or sale of the software/project; and · The expenses attributable to the software/project during its development can be measured reliably. Directly attributable costs that are capitalized as part of the software/project product include the software/project development employee costs and an appropriate portion of relevant overheads. Other development expenditures that do not meet these criteria are recognized as an expense as incurred. Development costs previously recorded as an expense are not recognized as an asset in a subsequent period. Computer software and project development costs recognized as assets are amortized using the straight-line method over their estimated useful lives. The average estimated useful lives of the software is 5 years and project development costs is 4 years. Trademarks and licenses Trademarks and licenses acquired in a business combination are recognized at fair value at the acquisition date. Subsequently, trademarks and licenses with a finite useful life are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method to allocate the cost over their estimated useful lives. Goodwill Goodwill is measured as the positive difference between the amount paid or payable and the net fair value of the acquiree’s assets and liabilities and other equity instruments that are acquired/ exchanged. In the case of a bargain purchase, the excess of the net fair value of acquiree’s assets and liabilities over the purchase price is recognized in the statement of profit or loss at the acquisition date. Goodwill is tested annually or more frequently if events or changes in circumstances indicate a potential impairment and carried at cost less accumulated impairment losses, which are not reversed. Gains and losses on disposal of an entity include the carrying amount of the goodwill on the entity disposed of. Contractual customer relationships Contractual customer relationships acquired in a business combination are recognized at fair value at the acquisition date. The contractual customer relations have a finite useful life and are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method over the expected life of the customer relationship, estimated at 4 years. Operation licenses for distance learning Distance learning licenses correspond to the right to operate distance learning in a given municipality, with authorization from the Ministry of Education, and in order to obtain such rights, an institution must meet a number of requirements, where the academic and physical infrastructure is assessed. Accordingly, this has been identified and allocated to the Company’s business combination and was assessed as having an indefinite useful life, since as from the time such a license is granted the likelihood of losing it is virtually nil. Operation licenses for distance learning are tested annually or more frequently if events or changes in circumstances indicate a potential impairment and carried at cost less accumulated impairment losses, which are not reversed. Teaching/learning materials — TLM TLMs acquired in a business combination are recognized at fair value at the acquisition date. The TLMs have a finite useful life and are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method over the expected life of the use of the TLM at classes, estimated at 5 years. Non-compete agreements Non-compete agreements acquired in a business combination are recognized at fair value at the acquisition date. The non-compete agreements have a finite useful life and are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method over the expected life of the non-compete agreement, estimated at 5 years. |
Impairment of non-financial assets | k) Impairment of non-financial assets The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators. The Company bases its impairment calculation on detailed budgets and forecast calculations, which are prepared separately for each of the Company’s CGUs to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of five years. A long-term growth rate is calculated and applied to project future cash flows after the fifth year. Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination and licenses with indefinite useful lives in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, being the operating segments. Impairment losses of continuing operations are recognized in the statement of profit or loss in expense categories consistent with the function of the impaired asset. For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognized impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset’s or CGU’s recoverable amount. A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognized. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the statement of profit or loss. Goodwill is tested for impairment annually as at December 31 and when circumstances indicate that the carrying value may be impaired. Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognized. Impairment losses relating to goodwill cannot be reversed in future periods. Intangible assets with indefinite useful lives are tested for impairment annually as at December 31 at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired. |
Trade payables | l) Trade payables Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business also includes amounts related to tuition fees to be transferred to hub partners as described in note 2.5.p. |
Provision for contingencies | m) Provision for contingencies Provisions for losses related to legal and administrative proceedings involving labor, tax and civil matters are recognized when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the liability, and the amount can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the liability, using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the time elapsed is recognized as interest expense. |
Labor and social obligations | n) Labor and social obligations Labor and social obligations are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. |
Share-based payments | o) Share-based payments The Company offers its managers and executives employee share schemes for the granting of share options issued by the Company, which can be settled either by delivering equity instruments (equity- settled transactions) or by payments in cash (cash-settled transactions). Equity-settled transactions The cost of equity-settled transactions with employees is measured by the fair value at the date options are granted by using an appropriate valuation model. Cost is recognized as an employee benefits expense, with a corresponding increase in equity (other capital reserves) The total expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. Service and non-market performance conditions are not taken into account when determining the grant date fair value of options, but the likelihood of the conditions being met is assessed as part of the Company’s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. Any other conditions attached to an option, but without an associated service requirement, are considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an option and lead to an immediate expensing of an option unless there are also service and/or performance conditions. No expense is recognized for options that do not ultimately vest because non-market performance and/or service conditions have not been met. Where options include a market or non-vesting condition, the transactions are treated as vested irrespective of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied. The relevant services period may commence prior to the grant date. In this situation, the Company estimates the grant date fair value of the equity instruments for the purposes of recognizing the services received during the period between service commencement date and grant date. Once the grant date has been established, the entity revises the earlier estimate so that the amounts recognized for services received is ultimately based on the grant date fair value of the equity instruments. Any proceeds received as a result of an exercise price, net of any directly attributable transaction costs, are credited directly to equity, as a capital increase for the issuance of new shares of the Company or a deduction of treasury shares when available. Cash-settled transactions A liability is recognized for the fair value of cash-settled transactions. The fair value is measured initially and at each reporting date up to and including the settlement date, with changes in fair value recognized as an employee benefits expense. The fair value is expensed over the period until the vesting date with recognition of a corresponding liability. The fair value is determined using an appropriate valuation model. The approach used to account for vesting conditions when measuring equity-settled transactions also applies to cash-settled transactions. At the balance sheet date, the Company revises its estimates of liability fair value (for the cash-settled transactions) and of the number of options whose rights are to be vested based on the established non- market vesting and service conditions (for both equity and cash-settled transactions). The impact of revising initial estimates, if any, is recognized in the statement of profit or loss prospectively. The significant judgments, estimates and assumptions regarding share-based payments are described further in Note 3. Refer to Note 22 for detailed information relating to these share schemes. |
Revenue from contracts with customers | p) Revenue from contracts with customers The Company’s revenue consists primarily of tuition fees charged for distance learning undergraduate courses, on-campus undergraduate courses and continuing education courses. The Company also generates revenue from student fees and certain education-related activities. Revenue from tuitions are recognized over time when services are rendered to the customer and the Company satisfies its performance obligation under the contract at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services. Revenues from tuitions are recognized net of scholarships from government programs (Note 2.5.s), cancelations (Note 9) and other discounts, refunds and taxes Other revenues are recognized at a point in time when the service is rendered to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for the service. Other revenues are presented net of the corresponding discounts, returns and taxes. Trade receivables Trade receivables represent the Company’s right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due). Refer to accounting policies of financial assets in Financial instruments—initial recognition and subsequent measurement. Prepayments from customers Prepayments from customers (a contract liability) are the obligation to transfer services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer, as a result of pre-paid tuition received from students and is recognized separately in current liabilities, when the payment is received. Prepayments from customers are recognized as revenue when the Company performs all obligations related to the contract, generally in the following month. Joint operations with hub partners A hub is a local operating unit that can be owned by the Company or third parties (hub partners) and has the responsibility for offering to students the necessary structure in terms of audiovisual resources, library and information technology, to support the distance learning courses. The contractual agreement between the Company and each hub partner is a joint operation and establishes the rights of each hub partner on the related revenues and obligations for the related expenses. In this sense, the revenue from distance learning and related accounts receivable are recognized only to the portion of the Company’s right to the jointly revenue. As a result, when the Company receives the student’s monthly tuition fee in whole, an obligation to the hub partner is accrued under trade payables. |
Financial results | q) Financial results Financial income is recognized based on the time elapsed, using the effective interest rate method. When a loss is identified in relation to trade receivables, the carrying amount is reduced to its recoverable amount, which corresponds to the estimated future cash flows, discounted at the original effective interest rate of the instrument. Subsequently, as time elapses, interest rates are incorporated into trade receivables, matched against financial income. This financial income is calculated by the same effective interest rate used to calculate the recoverable amount, i.e., the original rate of trade receivables. Financial expenses include interest expenses on financial liabilities, such as interests accrued on loans and financing, accounts payable from acquisition of subsidiaries and lease liabilities. Financial results also includes gains and losses associated with transactions denominated in foreign currencies. |
Earnings per share | r) Earnings per share Basic earnings per share is calculated by dividing: · the profit attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares · by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year and excluding treasury shares (note 21). Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account: · the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and · the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares. |
Taxes | s) Taxes Cayman Islands laws currently levy no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty or withholding tax applicable to the Company or to any holder of ordinary shares. Therefore, taxes are comprised of taxation over operations in Brazil, as follows: Tax incentives The higher education companies maintained by the Company are part of the University for All Program — ProUni, which establishes, through Law 11,096, dated January 13, 2005, exemption from certain federal taxes for post-secondary education institutions that provide in exchange full and partial scholarships to a certain number of low-income students enrolled in traditional undergraduate and technological undergraduate programs. The following federal taxes are included in the exemption: · Income taxes: Corporate Income Tax (“IRPJ”) and Social Contribution on Net Income (“CSLL”) · Contributions on revenue: Social Integration Program tax ( Programa de Integração Social or “PIS”) and the Social Contribution on Revenues tax ( Contribuição para o Financiamento da Seguridade Social , or “COFINS”) Current income taxes Income taxes in Brazil are comprised of IRPJ and CSLL. According to Brazilian tax law, income taxes and social contribution are assessed and paid by each legal entity and not on a consolidated basis. Income tax of each entity is calculated based on income, adjusted to taxable income by the additions and exclusions provided for in legislation. Current income taxes were calculated based on the criteria established by the Normative Instruction of the Brazilian Internal Revenue Service, specifically regarding the PROUNI program, which allows exemption of these taxes from traditional and technological graduation activities. The ProUni program benefit for income taxes is based on a fixed percentage of approved scholarships granted by the federal government to students upon each student's request and is deducted from tuition gross revenue during the entire duration of such student's undergraduate studies (regardless of the tuition fee set out in the service contract) and as long as the student continues to comply with the scholarship requirements imposed by the government for each semester during the undergraduate course. The Company recognizes the economic benefits from the ProUni scholarships as tax deductions, as applicable. Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. Deferred income taxes Deferred income tax and social contribution are recognized, using the liability method, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred taxes are not accounted for if they arise from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects either accounting nor taxable profit or loss. Deferred tax assets are recognized only to the extent it is probable that future taxable profit will be available against which the temporary differences and/or tax losses can be utilized. In accordance with the Brazilian tax legislation, loss carryforwards can be used to offset up to 30% of taxable profit for the year and do not expire. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except for a deferred tax liability where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets and liabilities are presented net in the statement of financial position when there is a legally enforceable right and the intention to offset them upon the calculation of current taxes, generally when related to the same legal entity and the same jurisdiction. Accordingly, deferred tax assets and liabilities in different entities or in different countries are generally presented separately, and not on a net basis. Sales and other taxes Revenues, expenses and assets are recognized net of sales tax, except: · When the sales taxes incurred on the purchase of goods or services are not recoverable from tax authorities, in which case the sales tax is recognized as part of the cost of acquiring the asset or expense item, as applicable. · When the amounts receivable or payable are stated with the amount of sales taxes included. The net amount of sales taxes, recoverable or payable to the tax authority, is included as part of receivables or payables in the statement of financial position, and net of corresponding revenue or cost / expense, in the statement of profit or loss. Sales revenues in Brazil are subject to taxes and contributions, at the following statutory rates: PIS and COFINS are contributions levied by the Brazilian Federal government on gross revenues. These amounts are invoiced to and collected from the Company’s customers and recognized as deductions to gross revenue against tax liabilities, as we are acting as tax withholding agents on behalf of the tax authorities. PIS and COFINS paid on certain purchases may be claimed back as tax credits to offset PIS and COFINS payable. These amounts are recognized as Recoverable taxes and are offset on a monthly basis against Taxes payable and presented net, as the amounts are due to the same tax authority. PIS and COFINS are contributions calculated on two different regimes according to Brazilian tax legislation: cumulative method and non-cumulative method. The regulation of PROUNI defines that the revenue from traditional and technological under- graduation courses are exempt from PIS and COFINS. For income from other teaching activities, PIS and COFINS are charged based on the cumulative method at rates of 0.65% and 3.00%, respectively, and for non-teaching activities, PIS and COFINS are charged based on the non-cumulative method at rate of 1.65% and 7.6%, respectively. ISS is a tax levied by municipalities on revenues from the provision of services. ISS tax is added to amounts invoiced to the Company’s customers for the services the Company renders. These are recognized as deductions to gross revenue against tax liabilities, as the Company acts as agent collecting these taxes on behalf of municipal governments. The rates may vary from 2.00% to 5.00%. INSS is a social security charge levied on wages paid to employees |
Changes in accounting policies and disclosures | 2.6. Changes in accounting policies and disclosures New standards, interpretations and amendments adopted by the Group. The Group has applied the following standards and amendments for the first time for their annual reporting period commencing 1 January 2020: · Definition of Material – Amendments to IAS 1 and IAS 8 · Definition of a Business – Amendments to IFRS 3 · Interest Rate Benchmark Reform – Amendments to IFRS 7, IFRS 9 and IAS 39 · Revised Conceptual Framework for Financial Reporting · Annual Improvements to IFRS Standards 2015 – 2017 Cycle The Company also elected to early adopt the amendments to IFRS 16 with respect to rent concessions, which have been granted to lessees as a result of the Covid-19 pandemic. Such concessions might take a variety of forms, including payment holidays and deferral of lease payments. In May 2020, the IASB made an amendment to IFRS 16 Leases which provides lessees with an option to treat qualifying rent concessions in the same way as they would if they were not lease modifications. In many cases, this will result in accounting for the concessions as variable lease payments in the period in which they are granted. Entities applying the practical expedients must disclose this fact, whether the expedient has been applied to all qualifying rent concessions or, if not, information about the nature of the contracts to which it has been applied, as well as the amount recognized in profit or loss arising from the rent concessions. Details on the rent concessions received by the Company are described in Note 13. Except for the rent concessions, the amendments listed above did not have any impact on the amounts recognized in prior periods and are not expected to significantly affect the current or future periods. New standards and interpretations not yet adopted. The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these new and amended standards and interpretations, if applicable, when they become effective. · Classification of Liabilities as Current or Non-current – Amendments to IAS 1 · Property, Plant and Equipment: Proceeds before intended use – Amendments to IAS 16 · Reference to the Conceptual Framework – Amendments to IFRS 3 · Onerous Contracts – Cost of Fulfilling a Contract Amendments to IAS 37 · Annual Improvements to IFRS Standards 2018–2020 · Sale or contribution of assets between an investor and its associate or joint venture – Amendments to IFRS 10 and IAS 28 These standards are not expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions. |
Significant accounting polici_3
Significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Significant accounting policies | |
Schedule of the Company's subsidiaries | The table below list the Company’s subsidiaries: Direct and indirect Investment interest Name Main activities Location type 2020 2019 (i) Vitru Brasil Empreendimentos, Participações e Comércio S.A Continuing education courses Florianópolis - SC Subsidiary 100 % 100 % UNIASSELVI - Sociedade Educacional Leonardo da Vinci S/S Ltda Distance learning, on-campus undergraduate and continuing education courses Indaial - SC Subsidiary 100 % 100 % FAMEG - Sociedade Educacional do Vale do Itapocu S/S Ltda. On-campus undergraduate and continuing education courses Guaramirim - SC Subsidiary 100 % 100 % FAIR Educacional Ltda. On-campus undergraduate and continuing education courses Rondonópolis - MT Subsidiary 100 % 100 % FAC Educacional Ltda. On-campus undergraduate and continuing education courses Cuiabá - MS Subsidiary 100 % 100 % (i) The comparative numbers presented in these financial statements from the Company contemplates 100% of direct and indirect interest of the subsidiaries listed above as the interest was not changed by the corporate reorganization described in Note 1.1. |
Schedule of annual average rate of depreciation | Depreciation of other assets is calculated using the straight-line method to reduce their cost to their residual value over their estimated useful lives, as follows: Annual average rate Buildings IT equipment Furniture, fittings and facilities Leasehold improvements 4% - 10% Library |
Segment reporting (Tables)
Segment reporting (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment reporting | |
Schedule of measures of performance and other profit and loss disclosure | a) Measures of performance Distance learning Continuing On-campus undergraduate education undergraduate courses courses courses Total allocated 2020 Net revenue 423,035 40,589 55,555 519,179 Adjusted EBITDA 156,089 27,045 16,848 199,982 % Adjusted EBITDA margin 36.90 % 66.63 % 30.33 % 38.52 % 2019 Net revenue 336,317 47,103 77,647 461,067 Adjusted EBITDA 112,919 33,335 20,871 167,125 % Adjusted EBITDA margin 33.58 % 70.77 % 26.88 % 36.25 % 2018 Net revenue 259,591 33,044 90,814 383,449 Adjusted EBITDA 93,427 21,175 28,374 142,976 % Adjusted EBITDA margin 35.99 % 64.08 % 31.24 % 37.29 % The total of the reportable segments’ net revenues represents the Company’s net revenue. A reconciliation of the Company’s loss before taxes to the allocated Adjusted EBITDA is shown below: 2020 2019 2018 Income before taxes 33,083 (77,052) (50,215) (+) Financial result 27,860 41,196 42,571 (+) Depreciation and amortization 51,474 62,445 56,284 (+) Interest on tuition fees paid in arrears 15,715 8,265 8,887 (+) Impairment of non-current assets — 51,022 33,537 (+) Share-based compensation plan 11,823 26,372 7,450 (+) Other income (expenses), net (512) 905 1,041 (+) Restructuring expenses 4,780 4,484 2,231 (+) M&A and Offering Expenses 2,391 — 6,000 (+) Other operational expenses unallocated 53,368 49,488 35,190 Adjusted EBITDA allocated to segments 199,982 167,125 142,976 b) Other profit and loss disclosure Distance learning Continuing On-campus undergraduate education undergraduate courses courses courses Unallocated Total 2020 Net impairment losses on financial assets 61,257 5,917 9,666 — 76,840 Depreciation and amortization 34,431 1,972 8,919 6,152 51,474 Interest on tuition fees paid in arrears 11,706 585 3,424 — 15,715 2019 Net impairment losses on financial assets 43,701 3,958 10,519 — 58,178 Depreciation and amortization 38,402 4,085 14,259 5,699 62,445 Impairment of non-current assets — — 51,022 — 51,022 Interest on tuition fees paid in arrears 7,106 16 1,143 — 8,265 2018 Net impairment losses on financial assets 31,934 3,672 8,972 — 44,578 Depreciation and amortization 31,981 3,927 15,969 4,407 56,284 Impairment of non-current assets — — 33,537 — 33,537 Interest on tuition fees paid in arrears 7,641 17 1,229 — 8,887 |
Financial assets and financia_2
Financial assets and financial liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure of detailed information about financial instruments [line items] | |
Schedule of financial assets | 2020 2019 At amortized cost Cash and cash equivalents 85,930 2,457 Short-term investments 515,201 72,321 Trade receivables 122,039 91,916 Total 723,170 166,694 Current 716,246 162,908 Non-current 6,924 3,786 |
Schedule of financial liabilities | 2020 2019 At amortized cost Trade payables 32,240 29,978 Loans and financing 151,757 — Lease liabilities 149,353 103,188 Prepayments from customers 9,657 3,186 Accounts payable from acquisition of subsidiaries 274,861 379,540 At FVPL Share-based compensation 46,260 34,950 Total 664,128 550,842 Current 352,007 179,317 Non-current 312,121 371,525 |
Schedule of sensitivity analysis | The following table demonstrates the sensitivity to a reasonably possible change in exchange rates on cash and cash equivalents. With all variables held constant, the Company's income before income taxes is affected through the impact on floating exchange rate, as follows: Depreciation of exchange rate Possible Remote Probable scenario - scenario - scenario exchange exchange Balance Current VaR 99% rate rate as of exchange C.L. 1 day variation variation 12/31/2020 Currency rate (i) 25% 75% Cash and cash equivalents 10,586 USD 51,967 217 2,647 7,940 Value at risk (VaR) is a measure of the risk of loss for investments. It estimates how much a set of investments might lose (with a given Confidence Level - C.L.), given normal market conditions, in a set time period such as a day. |
Schedule of maturity profile of the financial liabilities based on contractual undiscounted amounts | The tables below summarize the maturity profile of the Company’s financial liabilities based on contractual undiscounted amounts: Less than More than As of December 31, 2020 1 year 1 to 3 years 3 to 5 years 5 years Total Trade payables 32,240 — — — 32,240 Loans and financing 151,757 — — — 151,757 Lease liabilities 24,734 48,222 46,165 124,076 243,197 Other leases (i) 2,930 1,465 1,085 420 5,900 Prepayments from customers 9,657 — — — 9,657 Accounts payable from acquisition of subsidiaries 139,488 139,488 — — 278,976 Share-based compensation — — 51,172 36,881 88,053 Total 360,806 189,175 98,422 161,377 809,780 Less than More than As of December 31, 2019 1 year 1 to 3 years 3 to 5 years 5 years Total Trade payables 29,978 — — — 29,978 Lease liabilities 21,999 39,218 38,430 93,373 193,020 Other leases (i) 2,804 1,402 1,038 402 5,646 Prepayments from customers 3,186 — — — 3,186 Accounts payable from acquisition of subsidiaries 135,233 281,022 — — 416,255 Share-based compensation — — — 78,455 78,455 Total 193,200 321,642 39,468 172,230 726,540 (i) Refer to commitments from lease agreements that fall into the exemptions of short-term leases and low-value assets and therefore not recognized in lease liabilities. |
Interest rate risk | |
Disclosure of detailed information about financial instruments [line items] | |
Schedule of sensitivity analysis | The following table demonstrates the sensitivity to a reasonably possible change in interest rates on short-term investments, trade receivables, loans and financing, lease liabilities and accounts payable from acquisition of subsidiaries. With all variables held constant, the Company’s income before income taxes is affected through the impact on floating interest rate, as follows: Increase / decrease in interest rate Balance as Possible Remote of Probable scenario scenario 12/31/2020 Index – % per year scenario Risk 25% 75% Short-term investments 515,201 144,64% CDI – 3,99 % 20,557 Decrease 15,417 5,139 Trade receivables 12,029 IPCA - 4,51 % 543 Decrease 678 949 Loans and financing 151,757 CDI + 3.6% p.a. - 6,36 % 9,652 Increase 12,065 16,891 Lease liabilities 149,353 IGP-M - 25,31 % 37,801 Increase 47,252 66,152 Accounts payable from acquisition of subsidiaries 274,861 IPCA – 4,51 % 12,396 Increase 15,495 21,693 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Measurement | |
Schedule of changes in level 3 items for recurring fair value measurements | The following table presents the changes in level 3 items for the year ended on December 31, 2020, and 2019 for recurring fair value measurements: Share-based compensation 2020 2019 2018 Opening balance at January 1 34,950 7,045 191 Issue of shares to employees — 1,844 — Settlement in cash — (2,238) — Reclassification from (to) equity (513) 7,299 2,225 Expenses recognized – general and administrative 11,823 21,000 4,629 Balance at December 31 46,260 34,950 7,045 |
Schedule of the quantitative information about the significant inputs used in level 3 fair value measurements | The following table summarizes the quantitative information about the significant inputs used in level 3 fair value measurements: Weighted average inputs Relationship with of unobservable Unobservable inputs 2020 2019 2018 inputs to fair value Net operating revenue growth rate (i) 2020: Increased growth rate (+200 basis points (bps)) and lower discount rate (-100 bps) would increase FV by R$ 586; lower growth rate (-200 bps) and higher discount rate (+100 bps) would decrease FV by R$ 519. Pre-tax discount rate (ii) 2019: Increased growth rate (+200 basis points (bps)) and lower discount rate (-100 bps) would increase FV by R$ 291; lower growth rate (-200 bps) and higher discount rate (+100 bps) would decrease FV by R$ 874 (i) The growth rate of net operating revenue is based on the historical growth of the student base and management’s expectations of market development. (ii) Pre-tax discount rate reflects specific risks relating to the segment and country in which the Company operates. |
Cash and cash equivalents and_2
Cash and cash equivalents and short-term investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Cash and cash equivalents and short-term investments | |
Schedule of short-term investments | December 31, December 31, 2020 2019 Cash equivalents and bank deposits in foreign currency (i) 10,586 — Cash equivalents (ii) 75,344 2,457 Cash and cash equivalents 85,930 2,457 Investment funds (iii) 515,201 72,321 (i) Short-term deposits (mainly proceeds from the IPO) maintained in U.S. dollar. (ii) Cash equivalents are comprised of short-term deposits with a maturity of three months or less, which are subject to an insignificant risk of changes in value, readily convertible into cash. (iii) Short-term investments, increased by the proceeds from the IPO, correspond to financial investments in Investment Funds, with highly rated financial institutions. As of December 31, 2020, the average interest on these Investment Funds are 3.99% p.a., corresponding to 144.64% of CDI (December 31, 2019 - 5.81% p.a. – 99.10% of CDI). Despite the fact these investments have high liquidity and have insignificant risk of changes in value, they do not qualify as cash equivalents given the nature of investment portfolio and their maturity. Due to the short-term nature of these investments, their carrying amount is considered to be the same as their fair value. |
Trade receivables (Tables)
Trade receivables (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Trade Receivabless [line items] | |
Schedule of trade receivables | 2020 2019 Tuition fees 206,107 161,049 FIES and UNIEDU Guaranteed Credits 4,041 7,196 PEP – Special Installment Payment (i) 17,155 8,542 Provision for revenue cancellation (3,136) (5,212) Allowance for expected credit losses of trade receivables (102,128) (79,659) Total trade receivables 122,039 91,916 Current 115,115 88,130 Non-current 6,924 3,786 (i) In 2015, a special private installment payment program (PEP) was introduced to facilitate the entry of students who could not qualify for FIES, due to changes occurred to the program at the time. These receivables bear interests of 1.34% and, given the long term of the installments, they have been discounted at an interbank rate of 2.76%. |
Schedule of aging of trade receivables | The aging list of trade receivables is as follows: 2020 2019 Receivables falling due 70,216 72,647 Receivables past due From 1 to 30 days 24,990 22,322 From 31 to 60 days 21,176 15,135 From 61 to 90 days 17,697 13,473 From 91 to 180 days 30,771 27,968 From 181 to 365 days 62,453 25,242 Provision for revenue cancellation (3,136) (5,212) Allowance for estimated credit losses (102,128) (79,659) 122,039 91,916 |
Schedule of provision for revenue cancellation | Changes in the Company's revenue cancellation provision are as follows: 2020 2019 2018 At the beginning of the year (5,212) (5,655) (5,421) Additions (16,527) (20,890) (16,283) Write-off 14,764 21,333 16,049 Reversals 3,839 — — At the end of the year (3,136) (5,212) (5,655) |
Trade receivable | |
Trade Receivabless [line items] | |
Schedule of changes in the allowance for expected credit losses | Changes in the Company’s allowance for expected credit losses are as follows: 2020 2019 2018 At the beginning of the year (79,659) (66,199) (55,649) Write-off of uncollectible receivables 59,704 39,385 34,028 Reversal 23,752 20,739 22,469 Reclassified to (from) held for sale (5,333) 5,333 — Allowance for expected credit losses (100,592) (78,917) (67,047) At the end of the year (102,128) (79,659) (66,199) |
Current and deferred income t_2
Current and deferred income tax (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Current and deferred income tax | |
Reconciliation of income tax in the statement of profit or loss | a) Reconciliation of income tax in the statement of profit or loss Income tax differ from the theoretical amount that would have been obtained by using the nominal income tax rates applicable to the income of the Company entities, as follows: 2020 2019 2018 Earnings (losses) before taxes 33,083 (77,052) (50,215) Combined income tax rate in Brazil - % (i) 34 % 34 % 34 % Income tax at statutory rates (11,248) 26,198 17,073 Income exempt from taxation - ProUni benefit (ii) 25,307 19,106 14,844 Unrecognized deferred tax asset on tax losses (iii) (2,192) (32,505) (26,873) Previously unrecognized tax losses used to reduce deferred tax (iii) 10,632 — — Previously unrecognized temporary differences (iii) 12,219 — — Income from entities not subject to taxation (12,069) — — Non-deductible expenses (6,148) (1,902) - Other 2,530 (5) (33) Total income tax and social contribution 19,031 10,892 5,011 Effective tax rate - % (58) % 14 % 10 % Current income tax expense (19,556) (14,813) (10,640) Deferred income tax income 38,587 25,705 15,651 (i) Considering that the Company is domiciled in Cayman and there is no income tax in that jurisdiction, the combined tax rate of 34% demonstrated above is the current rate applied to all Company's subsidiaries, operating entities in Brazil. (ii) The University for All Program — ProUni, establishes, through Law 11,096, dated January 13, 2005, exemption from certain federal taxes for higher education institutions that provide full and partial scholarships to low-income students enrolled in traditional undergraduate and technological undergraduate programs. The Company’s higher education companies are included in this program. (iii) The Company has unused tax loss carryforwards and temporary differences previously unrecognized. Given the continuous growth in Continuing Education activities for the last two years and recent changes to the structure of its operations, the Company reviewed previously unrecognized tax losses and temporary differences, determining that it is now probable that taxable profits will be available against which the tax losses can be utilized and temporary differences can be realized, and that are now expected to be used and realized until 2022. During 2020 the Company already used R$3,208 of tax loss carryforwards. b) Deferred income tax Balance sheet Profit or loss 2020 2019 2020 2019 2018 Tax loss carryforward 7,424 — 7,424 — — Intangible assets on business combinations (20,004) (24,958) 4,954 18,483 12,667 Allowance for expected credit losses 48,758 27,362 21,396 5,138 3,587 Labor provisions 2,707 — 2,707 — — Lease contracts 7,088 6,043 1,045 1,311 1,296 Provision for revenue cancellation 1,066 1,772 (706) (151) 79 Provision for contingencies 1,983 1,225 758 697 (617) Other provisions 1,753 744 1,009 452 (1,361) Total 50,775 12,188 38,587 25,930 15,651 Deferred tax assets 50,775 37,146 Deferred tax liabilities — (24,958) |
Prepaid expenses (Tables)
Prepaid expenses (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Prepaid expenses | |
Schedule of prepaid expenses | 2020 2019 Prepayments to employees 3,605 2,513 Prepayments to suppliers 3,539 4,219 Prepayments to hub partners 1,709 905 Software licensing 533 502 Insurance 177 239 Others 660 560 Prepaid expenses 10,223 8,938 |
Assets and liabilities held f_2
Assets and liabilities held for sale (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Assets and liabilities held for sale | |
Liabilities directly associated with assets classified as held for sale | In September 2020, the Company decided that due to the proceeds received from the IPO there was no further reason to sell these assets. 2019 Assets classified as held for sale Trade receivables Income taxes recoverable 207 Prepaid expenses 172 Other taxes recoverable 195 Other assets 122 Right-of-use assets 16,090 Property and equipment 11,704 Intangible assets 8 Total of assets disposal group held for sale 36,433 Liabilities directly associated with assets classified as held for sale Trade payables 979 Lease liabilities 19,210 Taxes payable 181 Labor and social obligations 2,695 Prepayments from customers 112 Provisions for contingencies 107 Total liabilities of disposal group held for sale 23,284 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Carrying amounts of the Group's right of uses assets and lease liabilities | Set out below, are the carrying amounts of the Company’s right-of-use assets related to buildings used as offices and hubs and lease liabilities and the movements during the year: Right-of-use assets Lease Liabilities 2020 2019 2018 2020 2019 2018 As of January 1st 88,534 74,822 51,534 103,188 88,739 61,639 New contracts 43,733 36,021 29,335 43,733 36,021 29,335 Re-measurement by index (i) 8,258 3,741 1,558 8,258 3,741 1,558 Lease modification (ii) (15,934) — — (16,869) — — Depreciation expense (iii) (12,760) (9,960) (7,605) — — — Reclassification from (to) assets held for sale 16,090 (16,090) — 19,210 (19,210) — Accrued interest — — — 15,086 12,393 10,778 Payment of principal — — — (6,121) (6,103) (3,793) Rent concession (iv) — — — (2,046) — — Payment of interest — — — (15,086) (12,393) (10,778) As of December 31 127,921 88,534 74,822 149,353 103,188 88,739 Current — — — 23,365 17,265 15,397 Non-current 127,921 88,534 74,822 125,988 85,923 73,342 (i) Lease liabilities and right-of-use assets were incremented with respect to variable lease payments that depend on an index or a rate, as a result of annual rental prices contractually adjusted by market inflation rate General Market Price Index ( Índice Geral de Preços do Mercado ), or IGP-M. (ii) During the year ended in December 31, 2020, the Company partially reduced the scope of a lease contract with a corresponding liability in the amount of R$1,967, and early terminated other seven lease contracts with a corresponding liability in the amount of R$14,902. As a result, a gain of R$1,006 was recognized as Other income (expenses), net, in the statement of profit and loss. (iii) In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$615 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. (iv) The Company has received Covid-19 related rent concessions and has applied the practical expedient introduced by the amendments made to IFRS 16 in May 2020, applied to all qualifying rent concessions. As a result, gains of R$2,046 arising from rent concessions were recognized as Other income (expenses), net, in the statement of profit and loss. |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property and equipment | |
Changes in property and equipment | Furniture, IT equipment Library Leasehold Construction equipment and facilities books improvements in progress (i) TOTAL At December 31, 2017 Net book value 4,701 12,316 9,779 20,866 2,668 50,330 Cost 13,125 29,896 20,949 28,376 2,668 95,014 Accumulated depreciation (8,424) (17,580) (11,170) (7,510) — (44,684) Purchases 3,915 8,750 10 2,216 8,300 23,191 Transfers — 90 — 1,269 (1,359) — Disposals (112) (1,217) — (1) — (1,330) Depreciation (2,141) (2,790) (1,933) (1,899) — (8,763) At December 31, 2018 Net book value 6,363 17,149 7,856 22,451 9,609 63,428 Cost 15,357 35,772 20,959 31,860 9,609 113,557 Accumulated depreciation (8,994) (18,623) (13,103) (9,409) — (50,129) Purchases 5,261 9,520 36 4,636 9,017 28,470 Transfers — — — 17,132 (17,132) — Disposals — (2) — — — (2) Transfer to held for sale (84) (3,249) (1,192) (7,111) (68) (11,704) Depreciation (2,565) (3,245) (1,630) (2,719) — (10,159) At December 31, 2019 Net book value 8,975 20,173 5,070 34,389 1,426 70,033 Cost 19,174 37,521 17,789 44,107 1,426 120,017 Accumulated depreciation (10,199) (17,348) (12,719) (9,718) — (49,984) Purchases 3,905 7,271 — 8,862 5,506 25,544 Transfers — — — 6,972 (6,972) — Disposals (30) (15) — — — (45) Transfer from held for sale 84 3,249 1,192 7,111 68 11,704 Depreciation (ii) (3,050) (3,105) (1,730) (2,682) — (10,567) At December 31, 2020 Net book value 9,884 27,573 4,532 54,652 28 96,669 Cost 24,484 52,541 20,994 69,462 28 167,509 Accumulated depreciation (14,600) (24,968) (16,462) (14,810) — (70,840) (i) These refer to construction in progress for improvements to the facilities used by the Company, related to the accessibility and modernization of facilities. (ii) In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$815 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. |
Intangible assets (Tables)
Intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Intangible assets | |
Changes in intangible assets | Operation Teaching/ Internal licenses for learning project distance Non-compete Customer material - Software development Trademarks (i) learning agreements relationship TLM Goodwill TOTAL At December 31, 2017 Net book value 23,909 4,904 77,728 245,721 7,142 60,621 4,651 372,268 796,944 Cost 35,701 4,905 85,163 245,721 10,826 100,695 7,344 372,268 862,623 Accumulated amortization and impairment (11,792) (1) (7,435) — (3,684) (40,074) (2,693) — (65,679) Purchase and capitalization 1,561 10,208 — — — — — — 11,769 Transfers 2,619 (2,619) — — — — — — — Amortization (6,882) (478) (4,055) — (2,165) (24,867) (1,469) — (39,916) Impairment losses — — — — — — — (33,537) (33,537) At December 31, 2018 Net book value 21,207 12,015 73,673 245,721 4,977 35,754 3,182 338,731 735,260 Cost 39,881 12,494 85,163 245,721 10,826 100,695 7,344 372,268 874,392 Accumulated amortization and impairment (18,674) (479) (11,490) — (5,849) (64,941) (4,162) (33,537) (139,132) Purchase and capitalization 3,449 12,817 — — — — — — 16,266 Transfers 3,071 (3,071) — — — — — — — Transfer to held for sale (8) — — — — — — — (8) Amortization (7,675) (2,094) (4,056) — (2,165) (24,868) (1,468) — (42,326) Impairment losses — — (8,515) — (769) (7,635) (187) (33,916) (51,022) At December 31, 2019 Net book value 20,044 19,667 61,102 245,721 2,043 3,251 1,527 304,815 658,170 Cost 46,123 22,240 85,163 245,721 10,826 100,695 7,344 372,268 890,380 Accumulated amortization and impairment (26,079) (2,573) (24,061) — (8,783) (97,444) (5,817) (67,453) (232,210) Purchase and capitalization 9,790 21,129 — — — — — — 30,919 Transfers 5,848 (5,848) — — — — — — — Transfer from held for sale 8 — — — — — — — 8 Amortization (ii) (11,131) (7,146) (3,559) — (1,751) (3,251) (1,309) — (28,147) Impairment losses — — — — — — — — — At December 31, 2020 Net book value 24,559 27,802 57,543 245,721 292 — 218 304,815 660,950 Cost 62,039 37,521 85,163 245,721 10,826 100,695 7,344 372,268 921,577 Accumulated amortization and impairment (37,480) (9,719) (27,620) — (10,534) (100,695) (7,126) (67,453) (260,627) (i) The group has the rights of many trademarks, such as Assevim, FAC, FAIR, FAMESUL and others, but Uniasselvi is the only trademark recognized as an intangible asset, as a result of business combination. Its estimated useful life is 21 years, with a remaining amortization period of 15 years. (ii) In September 2020 was recognized the amortization expenses from the first eight months of the year in the amount of R$2 due to the reclassification from assets held for sale regarding amortization that would have been recognized had the assets not been classified as held for sale. |
Impairment test of intangible assets | The operating segment-level summary of the goodwill and intangible assets allocation and the key assumptions for those CGUs that have significant goodwill allocated to them are presented below: Distance learning Continuing education On-campus undergraduate undergraduate courses courses courses Segment Level 2020 2019 2020 2019 2020 2019 Allocation of carrying amount: Goodwill 285,826 285,826 18,989 18,989 — 33,916 Intangible assets with indefinite useful life 213,406 213,406 32,315 32,315 — — Other intangible assets 8,090 55,893 4,979 5,547 11,959 29,072 Impairment losses — — — — — 51,022 Key assumptions: Net operating revenue growth rate (i) 22.9 % 20.3 % 24.4 % 22.3 % — (6.5) % Pre-tax discount rate (ii) 11.4 % 13.6 % 11.4 % 13.6 % — 13.6 % Long-term growth rate (iii) 3.2 % 3.5 % 3.2 % 3.5 % — 3.5 % Gross margin (iv) 66.2 % 69.8 % 86.1 % 86.8 % — 60.2 % (i) The growth rate of net operating revenue is based on the historical growth of the student base and management’s expectations of market development. (ii) Pre-tax discount rate reflects specific risks relating to the segment and country in which the Company operates. (iii) The long-term growth rate does not exceed the long-term average growth rate for the education sector in which the CGU operates and is mostly comprised by expected inflation. (iv) Gross margin is the average margin as a percentage of revenue over the five-year forecast period. It is based on the current sales margin levels and is in line with the Company’s operating history and management’s expectations for the future performance. |
Loans and financing (Tables)
Loans and financing (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Loans and financing | |
Schedule of loans and financing breakdown | December 31, December 31, Type Interest rate Maturity 2020 2019 Standby Letter of Credit CDI + 3.6% p.a. 2021 151,757 — |
Schedule of loans and financing variation | Loans and financing As of December 31, 2019 — Proceeds from loans and financing (i) 150,000 Accrued interest 6,205 Payment of interest (4,448) As of December 31, 2020 151,757 (i) Seeking to guarantee the same rates and conditions that would be available in a scenario without the Coronavirus pandemic, on April 16, 2020, the Company entered into a loan agreement of R$ 150,000, with no financial covenants or guarantees anticipating a loan to settle the accounts payable from acquisition of subsidiaries due in December 2020. The loan accrues interest at the Brazilian interbank deposit ( Certificado de Depósito Interbancário ), or CDI rate +3.6% per annum and its interests are repayable in five quarterly installments starting on July 16, 2020 and the principal in one installment on October 18, 2021. |
Labor and social obligations (T
Labor and social obligations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Labor and social obligations | |
Components of labor and social obligations | 2020 2019 Salaries payable 7,489 4,235 Social charges payable (i) 8,103 5,906 Accrued vacation 3,675 1,972 Accrual for bonus 7,408 4,668 Other 110 3 Total 26,785 16,784 (i) Comprised of contributions to Social Security (“INSS”) and to Government Severance Indemnity Fund for Employees (“FGTS”) as well as withholding income tax (“IRRF”) over salaries. |
Accounts payable from acquisi_2
Accounts payable from acquisition of subsidiaries (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Account payable from acquisition of subsidiaries | |
Changes in accounts payable from acquisition of subsidiaries | 2020 2019 2018 As at January 1, 379,540 458,535 534,914 Accrued Interest 34,809 44,143 53,291 Payment of principal (117,248) (107,988) (117,247) Payment of interests (22,240) (15,150) (12,423) As at December 31, 274,861 379,540 458,535 Current 134,988 128,888 123,310 Non-current 139,873 250,652 335,225 |
Contingencies (Tables)
Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Contingencies | |
Changes in provision for contingencies | The provisions related to labor and civil proceedings whose likelihood of loss is assessed as probable are as follows: Liabilities Civil Labor Total At December 31, 2017 2,356 20,641 22,997 Additions 3,305 4,750 8,055 Accrued interest 59 581 640 Payments (390) (5,126) (5,516) Reversals (3,477) (4,665) (8,142) At December 31, 2018 1,853 16,181 18,034 Additions 2,924 6,770 9,694 Accrued interest 71 481 552 Payments (834) (2,257) (3,091) Reversals (42) (6,637) (6,679) Classified as held for sale (32) (75) (107) At December 31, 2019 3,940 14,463 18,403 Additions 454 5,207 5,661 Accrued interest 109 399 508 Payments (1,552) (3,582) (5,134) Reversals (933) (4,173) (5,106) Classified from held for sale 32 75 107 At December 31, 2020 2,050 12,389 14,439 |
Changes in indemnification assets | The rights generated by the purchase and sale agreement are as follows: Assets Civil Labor Total At December 31, 2017 2,210 17,418 19,628 Additions 2,840 3,580 6,420 Accrued interest 56 546 602 Realized (33) (246) (279) Reversals (3,379) (6,512) (9,891) At December 31, 2018 1,694 14,786 16,480 Additions 131 4,760 4,891 Accrued interest 55 421 476 Realized (77) (1,312) (1,389) Reversals (735) (4,922) (5,657) At December 31, 2019 1,068 13,733 14,801 Additions — 85 85 Accrued interest 29 379 408 Realized (86) (2,792) (2,878) Reversals (212) (3,013) (3,225) At December 31, 2020 799 8,392 9,191 |
Contingent liabilities | The breakdown of existing contingencies as of December 31, 2020 and 2019 is as follows: 2020 2019 Civil 8,106 11,263 Labor 17,385 15,460 Tax 31,674 30,491 Total 57,165 57,214 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings per share | |
Schedule of basic and diluted earnings per share | The following table contains the earnings (loss) per share of the Company for year ended December 31, 2020, 2019 and 2018 (in thousands except per share amounts): Basic earnings per share 2020 2019 2018 Net income (loss) attributable to the shareholders of the Company 52,114 (66,160) (45,204) Weighted average number of outstanding common shares (thousands) 18,702 16,849 16,287 Basic earnings (losses) per common share (R$) 2.79 (3.93) (2.78) As of December 31, 2020, the Company had outstanding and unexercised options to purchase 763 thousand (2019 - 797 thousand and 2018 - 788 thousand) common shares which are included in diluted earnings per share calculation. In 2019 and 2018, outstanding options were all anti-dilutive. Diluted earnings per share 2020 2019 2018 Net income (loss) attributable to the shareholders of the Company 52,114 (66,160) (45,204) Weighted average number of outstanding common shares (thousands) 19,465 16,849 16,287 Diluted earnings (losses) per common share (R$) 2.68 (3.93) (2.78) |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
First Share Option Plan | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Schedule of summaries of the number and weighted average exercise prices ("WAEP") of options granted | Set out below are summaries of the number and weighted average exercise prices ("WAEP") of options granted under the plan: 2020 2019 2018 Number of WAEP Number of WAEP Number of WAEP options per option options per option options per option As of January 1 733,136 46.19 640,763 35.96 599,864 30.07 Granted during the year — — 167,972 63.86 176,813 53.94 Exercised during the year (209,179) 37.23 (59,165) 31.62 (47,989) 30.38 Forfeited during the year (17,681) 17.36 (16,435) 31.62 (87,925) 31.00 As of December 31 506,276 37.95 733,136 46.19 640,763 35.96 Exercisable at December 31 415,462 42.01 544,291 41.54 450,206 33.17 Repurchased during the year (ii) — — 37.82 (i) The number of options and WAEP per option were also retrospectively adjusted due to the reverse share split in the corporate reorganization described in Note 1.1. Represent shares repurchased upon termination of employee. |
Schedule of share options outstanding at the end of the year, remaining periods and prices | Share options outstanding at the end of the year have the following remaining periods and prices: December 31, 2020 December 31, 2019 Weighted average remaining vesting period 1,3 years 2,3 years Weighted average remaining expiring period 3,3 years 4,3 years Purchase option exercise price range R$33.76 – R$100.69 R$1.05 – R$3.13 Weighted average remaining selling period 5,3 years 6,3 years Expected selling / repurchase price R$ 90.72 R$3.41 |
Schedule of model inputs for options granted | The model inputs for options granted during the year ended December 31, 2019 included: December 31, 2019 Grant date September 1, 2019 Expiry date March 1, 2025 Share price at grant date R$ 3.02 Exercise price R$ 3.12 Expected price volatility 406 % Risk-free interest rate 52 % Model used Black-Scholes |
Schedule of expense recognized for employee services received during the year | d) The expense recognized for employee services received during the year is as follows: Expense arising from share-based payment transactions 2020 2019 2018 Equity-settled — 5,372 2,821 Cash-settled 11,823 21,000 4,629 11,823 26,372 7,450 |
Second Share Option Plan | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Schedule of summaries of the number and weighted average exercise prices ("WAEP") of options granted | Set out below are summaries of the number and weighted average exercise prices ("WAEP") of options granted under the plan: 2020 Number of WAEP per options option As of January 1 — — Granted during the year 874,888 0.54 As of December 31 874,888 0.54 Exercisable at December 31 — — |
Schedule of share options outstanding at the end of the year, remaining periods and prices | Share options outstanding at the end of the year have the following remaining periods and prices: December 31, 2020 Weighted average remaining vesting period 3,0 years Weighted average remaining expiring period 5,7 years Purchase option exercise price range R$83.14 |
Schedule of model inputs for options granted | Options granted during the year ended December 31, 2020 December 31, 2020 Grant date December 11, 2020 Expiry date September 9, 2026 Share price at grant date USD 14,34 Exercise price USD 16,00 Expected price volatility 50.65 % Risk-free interest rate 5.01 % Model used Black-Scholes |
Key management compensation a_2
Key management compensation and related parties (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Key management compensation and related parties | |
Schedule of total compensation expense with key management | The total compensation expense with key management for their services is shown below: 2020 2019 Salaries and related charges 6,769 5,967 Variable compensation (i) 2,901 1,732 Share-based compensation 11,823 26,372 Total 21,493 34,071 Variable compensation as defined by the Board of Directors in an agreement with Group executives. |
Schedule of transactions between related parties | The Company holds quotas of investments funds managed by Vinci Partners, an insurance policy issued by Austral Seguradora S/A and uses the services of the lawyer firm Kloch Advocacia. All the companies are an indirect related party. Balance sheet Profit or loss 2020 2019 2020 2019 2018 FI Vinci Renda Fixa Credito Privado Short-term investments 39,216 38,493 — — — Financial income — — 851 2,136 36,556 Austral Seguradora S/A Prepaid expenses 455 758 — — — General and administrative expenses — — (303) (151) — Kloch Advocacia General and administrative expenses — — (217) (214) (178) |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Schedule of revenues | 2020 2019 2018 Gross revenue 673,872 598,344 497,850 (-) Cancellation (14,764) (20,890) (16,283) (-) Discounts (24,128) (19,104) (16,997) (-) ProUni scholarships (i) (98,289) (82,132) (68,008) (-) Taxes and contributions on revenue (17,512) (15,151) (13,113) Net revenue 519,179 461,067 383,449 Timing of revenue recognition Transferred over time 517,950 459,658 382,589 Transferred at a point in time (ii) 1,229 1,409 860 Net revenue 519,179 461,067 383,449 (i) Scholarships granted by the federal government to students under the ProUni program as described in Note 2.5.s (ii) Revenue recognized at a point in time relates to revenue from student fees and certain education-related activities. |
Costs and expenses by nature (T
Costs and expenses by nature (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Costs and expenses by nature | |
Schedule of Costs and expenses by nature | 2020 2019 2018 Payroll (i) 207,511 212,683 159,428 Sales and marketing 67,532 54,212 36,804 Depreciation and amortization (ii) 51,475 62,445 56,284 Material 13,023 17,911 16,911 Consulting and advisory services 14,732 11,927 16,843 Maintenance 8,909 6,420 5,644 Utilities, cleaning and security 6,269 7,085 7,013 Contingencies 4,763 3,707 317 Leases 2,929 3,796 6,170 Taxes 2,075 1,705 1,235 Impairment losses (iii) — 51,022 33,537 Other expenses 2,690 4,927 5,288 Total 381,908 437,840 345,474 Costs of services 221,452 211,547 184,161 General and administrative expenses 73,852 125,344 90,667 Selling expenses 86,604 100,949 70,646 Total 381,908 437,840 345,474 (i) Payroll expenses include for the year ended December 31, 2020 R$195,688 (2019 - R$ 186,311, 2018 — R$ 151,978) related to salaries, bonuses, short-term benefits, related social charges and other employee related expenses, and R$ 11,823 (2019 R$ 26,372, 2018 R$ 7,450) related to share-based compensation. (ii) From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. (iii) The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses. |
Other income (expenses), net (T
Other income (expenses), net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other income (expenses), net | |
Schedule of other income (expenses), net | 2020 2019 2018 Deductible donations (300) (300) (300) Contractual indemnities (85) (647) (712) Modification of lease contracts - Note 13 3,052 — — Other revenues 743 437 332 Other expenses (2,898) (395) (361) Total 512 (905) (1,041) |
Financial results (Tables)
Financial results (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Financial results | |
Schedule of financial results | 2020 2019 2018 Financial income Interest on tuition fees paid in arrears 15,715 8,265 8,887 Financial investment yield 6,296 10,726 12,635 Foreign exchange gain (i) 13,550 — — Other 997 203 504 Total 36,558 19,194 22,026 Financial expenses Interest on accounts payable from acquisition of subsidiaries (34,980) (44,258) (51,739) Interest on lease (15,085) (12,393) (10,778) Interest on loans and financing (6,205) — — Foreign exchange loss (2,714) — — Other (5,434) (3,739) (2,080) Total (64,418) (60,390) (64,597) Financial results (27,860) (41,196) (42,571) (i) Gain of R$12,966 due to exchange rate increase over the proceeds from the initial public offering while cash not partially transferred to operations in Brazil. |
Corporate information - Narrati
Corporate information - Narrative (Details) | 12 Months Ended | |
Dec. 31, 2020stateCentercompany | Dec. 31, 2019Center | |
Corporate information | ||
Number of campuses in which the company operates | company | 8 | |
Number of states in which the company operates | state | 2 | |
Number of learning centers | Center | 709 | 526 |
Corporate information - Corpora
Corporate information - Corporate reorganization and initial public offering (Details) R$ / shares in Units, R$ in Thousands, $ in Thousands | Sep. 22, 2020USD ($)shares | Sep. 22, 2020BRL (R$)shares | Sep. 18, 2020R$ / sharesshares | Sep. 02, 2020 |
Disclosure of classes of share capital [line items] | ||||
Reverse share split ratio | 0.03226 | |||
Class A common shares | Initial public offering | ||||
Disclosure of classes of share capital [line items] | ||||
Number of shares issued | shares | 6,000,000 | 6,000,000 | 6,000,000 | |
Initial offering price | R$ / shares | R$ 16.00 | |||
Gross proceeds received as a result of IPO | $ 96,000 | R$ 521558 | ||
Net proceeds from the IPO | 90,672 | 492,612 | ||
Underwriting discounts and commissions | 5,328 | 28,946 | ||
Other offering expenses | $ 3,430 | 18,636 | ||
Share issuance costs | R$ | R$ 47582 |
Corporate information - Coronav
Corporate information - Coronavirus pandemic (Details) R$ in Thousands | 5 Months Ended | 12 Months Ended |
Sep. 30, 2020item | Dec. 31, 2020BRL (R$) | |
Corporate information | ||
Growth rate | 13.00% | |
Additional provision for impairment of long-lived assets | R$ 0 | |
Rent concessions | R$ 2046 | |
Additional discount to students that paid their tuitions fees before due date (as a percent) | 5.00% | |
Additional discount to students that paid their tuitions fees before due date | R$ 4005 | |
Period for reducing workload and salary payment | 3 months | |
Period for suspending employment contracts | 2 months | |
Number of employment contracts suspended | item | 195 |
Significant accounting polici_4
Significant accounting policies - Subsidiaries (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Vitru Brasil | ||
Disclosure of subsidiaries [line items] | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Uniasselvi | ||
Disclosure of subsidiaries [line items] | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Fameg | ||
Disclosure of subsidiaries [line items] | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
FAIR | ||
Disclosure of subsidiaries [line items] | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
FAC/FAMAT | ||
Disclosure of subsidiaries [line items] | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Significant accounting polici_5
Significant accounting policies - Leases (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Bottom of range | |
Disclosure of quantitative information about right-of-use assets [line items] | |
Lease term | 1 year |
Top of range | |
Disclosure of quantitative information about right-of-use assets [line items] | |
Lease term | 20 years |
Significant accounting polici_6
Significant accounting policies - Property and equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Buildings | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 4.00% |
IT Equipment | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 20.00% |
Furniture, fittings and facilities | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 10.00% |
Leasehold improvements | Bottom of range | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 4.00% |
Leasehold improvements | Top of range | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 10.00% |
Library | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Annual average rate | 10.00% |
Significant accounting polici_7
Significant accounting policies - Intangible assets (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 21 years |
Software | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 5 years |
Internal project development | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 4 years |
Customer relationship | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 4 years |
Teaching/learning materials - TLM | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 5 years |
Non-compete agreements | |
Disclosure of detailed information about intangible assets [line items] | |
Estimated useful life | 5 years |
Significant accounting polici_8
Significant accounting policies - Income taxes (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Income taxes [line items] | |
Maximum percentage of taxable profit for the year for that loss carryforwards can be used to offset | 30.00% |
PIS | |
Income taxes [line items] | |
Rates applied income from other teaching activities based on the cumulative method | 0.65% |
Rates applied income from other teaching activities based on the non-cumulative method | 1.65% |
COFINS | |
Income taxes [line items] | |
Rates applied income from other teaching activities based on the cumulative method | 3.00% |
Rates applied income from other teaching activities based on the non-cumulative method | 7.60% |
ISS | Bottom of range | |
Income taxes [line items] | |
Rates applied income from other teaching activities based on the cumulative method | 2.00% |
ISS | Top of range | |
Income taxes [line items] | |
Rates applied income from other teaching activities based on the cumulative method | 5.00% |
Significant accounting estima_2
Significant accounting estimates and assumptions (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Significant accounting estimates and assumptions | |
Period after which the contractual payments are past due to define a trade receivable in default | 365 days |
Segment reporting - Measures of
Segment reporting - Measures of performance (Details) - BRL (R$) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of operating segments [line items] | |||
Net revenue | R$ 519179000 | R$ 461067000 | R$ 383449000 |
Profit or Loss for the year | 52,114,000 | (66,160,000) | (45,204,000) |
Adjusted EBITDA | R$ 199982000 | R$ 167125000 | R$ 142976000 |
% Adjusted EBITDA margin | 38.52% | 36.25% | 37.29% |
Distance learning undergraduate courses | |||
Disclosure of operating segments [line items] | |||
Net revenue | R$ 423035000 | R$ 336317000 | R$ 259591000 |
Adjusted EBITDA | R$ 156089000 | R$ 112919000 | R$ 93427000 |
% Adjusted EBITDA margin | 36.90% | 33.58% | 35.99% |
Continuing education courses | |||
Disclosure of operating segments [line items] | |||
Net revenue | R$ 40589000 | R$ 47103000 | R$ 33044000 |
Adjusted EBITDA | R$ 27045000 | R$ 33335000 | R$ 21175000 |
% Adjusted EBITDA margin | 66.63% | 70.77% | 64.08% |
On-campus undergraduate courses | |||
Disclosure of operating segments [line items] | |||
Net revenue | R$ 55555000 | R$ 77647000 | R$ 90814000 |
Adjusted EBITDA | R$ 16848000 | R$ 20871000 | R$ 28374000 |
% Adjusted EBITDA margin | 30.33% | 26.88% | 31.24% |
Adjustments or eliminations | |||
Disclosure of operating segments [line items] | |||
Profit or Loss for the year | R$ 0 | R$ 0 | |
Inter-segment eliminations | |||
Disclosure of operating segments [line items] | |||
Net revenue | R$ 0 | R$ 0 |
Segment reporting - Reconciliat
Segment reporting - Reconciliation (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||||
Segment reporting | ||||||
Income before taxes | R$ 33083 | R$ 77052 | R$ 50215 | |||
Financial result | 27,860 | 41,196 | 42,571 | |||
Depreciation and amortization | 51,474 | 62,445 | [1] | 56,284 | [1] | |
Interest on tuition fees paid in arrears | 15,715 | 8,265 | 8,887 | |||
Impairment losses | [2] | 51,022 | 33,537 | |||
Share-based compensation plan | 11,823 | 26,372 | 7,450 | |||
Other income (expenses), net | (512) | 905 | 1,041 | |||
Restructuring expenses | 4,780 | 4,484 | 2,231 | |||
M&A and Offering Expenses | 2,391 | 6,000 | ||||
Other operational expenses unallocated | 53,368 | 49,488 | 35,190 | |||
Adjusted EBITDA allocated to segments | R$ 199982 | R$ 167125 | R$ 142976 | |||
[1] | From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. | |||||
[2] | The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses |
Segment reporting - Other profi
Segment reporting - Other profit and loss disclosure (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||||
Disclosure of operating segments [line items] | ||||||
Net impairment losses on financial assets | R$ 76840 | R$ 58178 | R$ 44578 | |||
Depreciation and amortization | 51,474 | 62,445 | [1] | 56,284 | [1] | |
Impairment of non-current assets | [2] | 51,022 | 33,537 | |||
Interest on tuition fees paid in arrears | 15,715 | 8,265 | 8,887 | |||
Unallocated | ||||||
Disclosure of operating segments [line items] | ||||||
Depreciation and amortization | 6,152 | 5,699 | 4,407 | |||
Operating Segments | Distance learning undergraduate courses | ||||||
Disclosure of operating segments [line items] | ||||||
Net impairment losses on financial assets | 61,257 | 43,701 | 31,934 | |||
Depreciation and amortization | 34,431 | 38,402 | 31,981 | |||
Interest on tuition fees paid in arrears | 11,706 | 7,106 | 7,641 | |||
Operating Segments | Continuing education courses | ||||||
Disclosure of operating segments [line items] | ||||||
Net impairment losses on financial assets | 5,917 | 3,958 | 3,672 | |||
Depreciation and amortization | 1,972 | 4,085 | 3,927 | |||
Interest on tuition fees paid in arrears | 585 | 16 | 17 | |||
Operating Segments | On-campus undergraduate courses | ||||||
Disclosure of operating segments [line items] | ||||||
Net impairment losses on financial assets | 9,666 | 10,519 | 8,972 | |||
Depreciation and amortization | 8,919 | 14,259 | 15,969 | |||
Impairment of non-current assets | 51,022 | 33,537 | ||||
Interest on tuition fees paid in arrears | R$ 3424 | R$ 1143 | R$ 1229 | |||
[1] | From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. | |||||
[2] | The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses |
Financial assets and financia_3
Financial assets and financial liabilities - Financial assets (Details) - At amortized cost - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of financial assets [line items] | ||
Financial assets | R$ 723170 | R$ 166694 |
Current | 716,246 | 162,908 |
Non-current | 6,924 | 3,786 |
Cash and cash equivalents | ||
Disclosure of financial assets [line items] | ||
Financial assets | 85,930 | 2,457 |
Short-term investments | ||
Disclosure of financial assets [line items] | ||
Financial assets | 515,201 | 72,321 |
Trade receivable | ||
Disclosure of financial assets [line items] | ||
Financial assets | R$ 122039 | R$ 91916 |
Financial assets and financia_4
Financial assets and financial liabilities - Financial liabilities (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of financial liabilities [line items] | ||
Financial liabilities | R$ 664128 | R$ 550842 |
Current | 352,007 | 179,317 |
Non-current | 312,121 | 371,525 |
Amortized cost Category | Trade payables | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | 32,240 | 29,978 |
Amortized cost Category | Short term loans and financing | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | 151,757 | |
Amortized cost Category | Lease liabilities Member | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | 149,353 | 103,188 |
Amortized cost Category | Prepayments from customers | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | 9,657 | 3,186 |
Amortized cost Category | Accounts payable from acquisition of subsidiaries | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | 274,861 | 379,540 |
At FVPL | Share-based compensation | ||
Disclosure of financial liabilities [line items] | ||
Financial liabilities | R$ 46260 | R$ 34950 |
Financial assets and financia_5
Financial assets and financial liabilities - Sensitivity analysis (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial liabilities | R$ 664128 | R$ 550842 |
Interest rate risk | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Percentage of variation in the rates used in sensitivity analysis for which defines possible scenario | 25.00% | |
Percentage of variation in the rates used in sensitivity analysis for which defines remote scenario | 75.00% | |
Interest rate risk | Short-term investments | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial assets | R$ 515201 | |
Percentage of CDI rate used to calculate interest rate in sensitivity analysis | 144.64% | |
Interest rate used in measuring financial assets | 3.99% | |
Probable scenario | R$ 20557 | |
Increase (decrease) In Financial Instrument In Possible Scenario | 15,417 | |
Increase (decrease) In Financial Instrument In Remote Scenario | 5,139 | |
Interest rate risk | Trade receivable | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial assets | R$ 12029 | |
Interest rate used in measuring financial assets | 4.51% | |
Probable scenario | R$ 543 | |
Increase (decrease) In Financial Instrument In Possible Scenario | 678 | |
Increase (decrease) In Financial Instrument In Remote Scenario | 949 | |
Interest rate risk | Short term loans and financing | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial liabilities | R$ 151757 | |
Percentage of CDI rate used to calculate interest rate in sensitivity analysis | 3.60% | |
Inflation rate used in measuring financial liabilities | 6.36% | |
Probable scenario | R$ 9652 | |
Increase (decrease) In Financial Instrument In Possible Scenario | 12,065 | |
Increase (decrease) In Financial Instrument In Remote Scenario | 16,891 | |
Interest rate risk | Lease liabilities Member | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial liabilities | R$ 149353 | |
Inflation rate used in measuring financial liabilities | 25.31% | |
Probable scenario | R$ 37801 | |
Increase (decrease) In Financial Instrument In Possible Scenario | 47,252 | |
Increase (decrease) In Financial Instrument In Remote Scenario | 66,152 | |
Interest rate risk | Accounts payable from acquisition of subsidiaries | ||
Disclosure of nature and extent of risks arising from financial instruments [line items] | ||
Value of financial instrument, financial liabilities | R$ 274861 | |
Inflation rate used in measuring financial liabilities | 4.51% | |
Probable scenario | R$ 12396 | |
Increase (decrease) In Financial Instrument In Possible Scenario | 15,495 | |
Increase (decrease) In Financial Instrument In Remote Scenario | R$ 21693 |
Financial assets and financia_6
Financial assets and financial liabilities - Exchange rate risk (Details) - Exchange rate risk R$ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 31, 2020BRL (R$) | |
Disclosure of financial liabilities [line items] | ||
Percentage of variation in the rates used in sensitivity analysis for which defines possible scenario | 25.00% | |
Percentage of variation in the rates used in sensitivity analysis for which defines remote scenario | 75.00% | |
Cash and cash equivalents | ||
Disclosure of financial liabilities [line items] | ||
Value of financial instrument, financial assets | R$ | R$ 10586 | |
Current exchange rate | 51,967 | 51,967 |
Probable scenario | R$ | R$ 217 | |
Possible scenario exchange rate variation | $ | $ 2,647 | |
Remote scenario exchange rate variation | $ | $ 7,940 |
Financial assets and financia_7
Financial assets and financial liabilities - Contractual undiscounted amounts (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | R$ 809780 | R$ 726540 |
Trade payables | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 32,240 | 29,978 |
Short term loans and financing | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 151,757 | |
Lease liabilities Member | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 243,197 | 193,020 |
Other leases | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 5,900 | 5,646 |
Prepayments from customers | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 9,657 | 3,186 |
Accounts payable from acquisition of subsidiaries | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 278,976 | 416,255 |
Share-based compensation | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 88,053 | 78,455 |
Less than 1 year | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 360,806 | 193,200 |
Less than 1 year | Trade payables | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 32,240 | 29,978 |
Less than 1 year | Short term loans and financing | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 151,757 | |
Less than 1 year | Lease liabilities Member | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 24,734 | 21,999 |
Less than 1 year | Other leases | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 2,930 | 2,804 |
Less than 1 year | Prepayments from customers | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 9,657 | 3,186 |
Less than 1 year | Accounts payable from acquisition of subsidiaries | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 139,488 | 135,233 |
1 to 3 years | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 189,175 | 321,642 |
1 to 3 years | Lease liabilities Member | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 48,222 | 39,218 |
1 to 3 years | Other leases | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 1,465 | 1,402 |
1 to 3 years | Accounts payable from acquisition of subsidiaries | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 139,488 | 281,022 |
3 to 5 years | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 98,422 | 39,468 |
3 to 5 years | Lease liabilities Member | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 46,165 | 38,430 |
3 to 5 years | Other leases | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 1,085 | 1,038 |
3 to 5 years | Share-based compensation | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 51,172 | |
More than 5 years | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 161,377 | 172,230 |
More than 5 years | Lease liabilities Member | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 124,076 | 93,373 |
More than 5 years | Other leases | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | 420 | 402 |
More than 5 years | Share-based compensation | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Contractual undiscounted amounts | R$ 36881 | R$ 78455 |
Fair Value Measurement - Change
Fair Value Measurement - Changes in level 3 items (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of fair value measurement of liabilities [line items] | |||
Liabilities | R$ 709897 | R$ 637344 | |
Transfers into Level 3 of fair value hierarchy, liabilities | 0 | ||
Transfers out of Level 3 of fair value hierarchy, liabilities | 0 | ||
Transfers out of Level 1 into Level 2 of fair value hierarchy, liabilities | 0 | ||
Transfers out of Level 2 into Level 1 of fair value hierarchy, liabilities | 0 | ||
Reconciliation of changes in fair value measurement, liabilities [abstract] | |||
Opening balance at January 1 | 637,344 | ||
Balance at December 31 | 709,897 | 637,344 | |
Share-based compensation | Level 3 | |||
Disclosure of fair value measurement of liabilities [line items] | |||
Liabilities | 46,260 | 34,950 | R$ 7045 |
Reconciliation of changes in fair value measurement, liabilities [abstract] | |||
Opening balance at January 1 | 34,950 | 7,045 | 191 |
Issue of shares to employees | 1,844 | ||
Settlement in cash | (2,238) | ||
Reclassification from (to) equity | (513) | 7,299 | 2,225 |
Expenses recognized - general and administrative | 11,823 | 21,000 | 4,629 |
Balance at December 31 | R$ 46260 | R$ 34950 | R$ 7045 |
Fair Value Measurement - Level
Fair Value Measurement - Level 3 fair value measurements (Details) - Share-based compensation R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020BRL (R$) | Dec. 31, 2019BRL (R$) | Dec. 31, 2018 | |
Net operating revenue growth rate | |||
Disclosure of sensitivity analysis of fair value measurement to changes in unobservable inputs, liabilities [line items] | |||
Basis points of reasonably possible increase in unobservable input | 200.00% | ||
Basis points of reasonably possible decrease in unobservable input | (200.00%) | ||
Increase in fair value measurement due to change in multiple unobservable inputs, liabilities | R$ 586 | ||
Derease in fair value measurement due to change in multiple unobservable inputs, liabilities | R$ 519 | ||
Net operating revenue growth rate | Weighted average | |||
Disclosure of sensitivity analysis of fair value measurement to changes in unobservable inputs, liabilities [line items] | |||
Unobservable inputs used in fair value measurement of liabilities | 22.5 | 20.3 | 14.1 |
Pre-tax discount rate | |||
Disclosure of sensitivity analysis of fair value measurement to changes in unobservable inputs, liabilities [line items] | |||
Basis points of reasonably possible increase in unobservable input | 200.00% | ||
Basis points of reasonably possible decrease in unobservable input | (200.00%) | ||
Increase in fair value measurement due to change in multiple unobservable inputs, liabilities | R$ 291 | ||
Derease in fair value measurement due to change in multiple unobservable inputs, liabilities | R$ 874 | ||
Pre-tax discount rate | Weighted average | |||
Disclosure of sensitivity analysis of fair value measurement to changes in unobservable inputs, liabilities [line items] | |||
Unobservable inputs used in fair value measurement of liabilities | 11.4 | 13.5 | 16.9 |
Cash and cash equivalents and_3
Cash and cash equivalents and short-term investments (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Short-term investments [line items] | ||||
Cash equivalents and bank deposits in foreign currency (i) | R$ 10586 | |||
Cash equivalents (ii) | 75,344 | R$ 2457 | ||
Cash and cash equivalents | 85,930 | 2,457 | R$ 2375 | R$ 2311 |
Short-term investments | 515,201 | 72,321 | ||
Short-term investments | ||||
Short-term investments [line items] | ||||
Short-term investments | R$ 515201 | R$ 72321 | ||
Average interest rate | 3.99% | 5.81% | ||
Average interest rate as a percent of CDI | 144.64% | 99.10% |
Trade receivables (Details)
Trade receivables (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Trade Receivabless [line items] | |||||
Provision for revenue cancellation | R$ 3136 | R$ 5212 | R$ 5655 | R$ 5421 | |
Total trade receivables | 122,039 | 91,916 | |||
Current | 115,115 | 88,130 | |||
Non-current | 6,924 | 3,786 | |||
Interest rate for Special Installment Payment receivable | 1.34% | ||||
Discount rate for Special Installment Payment receivable | 2.76% | ||||
Cost | |||||
Trade Receivabless [line items] | |||||
Tuition fees | 206,107 | 161,049 | |||
FIES and UNIEDU Guaranteed Credits | 4,041 | 7,196 | |||
PEP - Special Installment Payment | 17,155 | 8,542 | |||
Provision for revenue cancellation | (3,136) | (5,212) | |||
Total trade receivables | 70,216 | 72,647 | |||
Allowance | |||||
Trade Receivabless [line items] | |||||
Total trade receivables | R$ 102128 | R$ 79659 |
Trade receivables - Aging list
Trade receivables - Aging list (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Trade Receivabless [line items] | ||||
Trade receivables | R$ 122039 | R$ 91916 | ||
Provision for revenue cancellation | (3,136) | (5,212) | R$ 5655 | R$ 5421 |
Cost | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 70,216 | 72,647 | ||
Provision for revenue cancellation | (3,136) | (5,212) | ||
Cost | From 1 to 30 days | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 24,990 | 22,322 | ||
Cost | From 31 to 60 days | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 21,176 | 15,135 | ||
Cost | From 61 to 90 days | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 17,697 | 13,473 | ||
Cost | From 91 to 180 days | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 30,771 | 27,968 | ||
Cost | From 181 to 365 days | ||||
Trade Receivabless [line items] | ||||
Trade receivables | 62,453 | 25,242 | ||
Allowance | ||||
Trade Receivabless [line items] | ||||
Trade receivables | R$ 102128 | R$ 79659 |
Trade receivables - Revenue Can
Trade receivables - Revenue Cancellation (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Trade Receivables | |||
At the beginning of the year | R$ 5212 | R$ 5655 | R$ 5421 |
Additions | (16,527) | (20,890) | (16,283) |
Write-off | 14,764 | 21,333 | 16,049 |
Reversals | 3,839 | ||
At the end of the year | R$ 3136 | R$ 5212 | R$ 5655 |
Period after which the contractual payments are past due to define a trade receivable in default | 365 days |
Trade receivables - Allowance f
Trade receivables - Allowance for expected Credit Losses (Details) - Trade receivable - Allowance - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of reconciliation of changes in loss allowance and explanation of changes in gross carrying amount for financial instruments [line items] | |||
At the beginning of the year | R$ 79659 | R$ 66199 | R$ 55649 |
Write-off of uncollectible receivables | 59,704 | 39,385 | 34,028 |
Reversal | 23,752 | 20,739 | 22,469 |
Reclassified to (from) held for sale | (5,333) | 5,333 | |
Allowance for expected credit losses | (100,592) | (78,917) | (67,047) |
At the end of the year | R$ 102128 | R$ 79659 | R$ 66199 |
Current and deferred income t_3
Current and deferred income tax (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current and deferred income tax | |||
Earnings (losses) before taxes | R$ 33083 | R$ 77052 | R$ 50215 |
Combined income tax rate | 34.00% | 34.00% | 34.00% |
Income tax at statutory rates | R$ 11248 | R$ 26198 | R$ 17073 |
Income exempt from taxation | 25,307 | 19,106 | 14,844 |
Unrecognized deferred tax asset on tax losses | (2,192) | (32,505) | (26,873) |
Previously unrecognized tax losses used to reduce deferred tax | 10,632 | ||
Previously unrecognized temporary differences | 12,219 | ||
Income from entities not subject to taxation | (12,069) | ||
Non-deductible expenses | (6,148) | (1,902) | |
Other | 2,530 | (5) | (33) |
Income taxes | R$ 19031 | R$ 10892 | R$ 5011 |
Effective tax rate (as a percent) | (58.00%) | 14.00% | 10.00% |
Current income tax expense | R$ 19556 | R$ 14813 | R$ 10640 |
Deferred income tax income | R$ 38587 | R$ 25705 | R$ 15651 |
Period for the continuous growth in Continuing Education activities | 2 years | ||
Utilization Of Tax Loss During Period | R$ 3208 |
Current and deferred income t_4
Current and deferred income tax - Deferred income tax assets and liabilities (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | R$ 50775 | R$ 12188 | |
Deferred tax assets | 50,775 | 37,146 | |
Deferred tax liabilities | (24,958) | ||
Total Profit or Loss Deferred Income Tax | R$ 38587 | R$ 25705 | R$ 15651 |
Nominal tax rate | 34.00% | 34.00% | 34.00% |
Limitation on utilization of loss carryforward, percent of taxable profit | 30.00% | ||
Tax loss carryforwards | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | R$ 7424 | ||
Total Profit or Loss Deferred Income Tax | 7,424 | ||
Intangible assets on business combinations | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | (20,004) | R$ 24958 | |
Total Profit or Loss Deferred Income Tax | 4,954 | 18,483 | R$ 12667 |
Allowance for expected credit losses | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 48,758 | 27,362 | |
Total Profit or Loss Deferred Income Tax | 21,396 | 5,138 | 3,587 |
Labor provisions | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 2,707 | ||
Total Profit or Loss Deferred Income Tax | 2,707 | ||
Lease contracts | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 7,088 | 6,043 | |
Total Profit or Loss Deferred Income Tax | 1,045 | 1,311 | 1,296 |
Provision for revenue cancellation | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 1,066 | 1,772 | |
Total Profit or Loss Deferred Income Tax | (706) | (151) | 79 |
Provision for contingencies | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 1,983 | 1,225 | |
Total Profit or Loss Deferred Income Tax | 758 | 697 | (617) |
Other Temporary provisions | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Total Balance Sheet | 1,753 | 744 | |
Total Profit or Loss Deferred Income Tax | R$ 1009 | R$ 452 | R$ 1361 |
Prepaid expenses (Details)
Prepaid expenses (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Prepaid expenses | ||
Prepayments to employees | R$ 3605 | R$ 2513 |
Prepayments to suppliers | 3,539 | 4,219 |
Prepayments to hub partners | 1,709 | 905 |
Software licensing | 533 | 502 |
Insurance | 177 | 239 |
Others | 660 | 560 |
Prepaid expenses | R$ 10223 | R$ 8938 |
Assets and liabilities held f_3
Assets and liabilities held for sale (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Trade receivables | R$ 91916 | R$ 122039 | ||
Prepaid expenses | 8,938 | 10,223 | ||
Other assets | 1,858 | 3,081 | ||
Right-of-use assets | 88,534 | 127,921 | R$ 74822 | R$ 51534 |
Property and equipment | 70,033 | 96,669 | 63,428 | 50,330 |
Total of assets disposal group held for sale | 36,433 | |||
Lease liabilities | 103,188 | 149,353 | R$ 88739 | R$ 61639 |
Labor and social obligations | 16,784 | 26,785 | ||
Provisions for contingencies | 18,403 | R$ 14439 | ||
Total liabilities of disposal group held for sale | 23,284 | |||
Assets and liabilities classified as held for sale [member] | ||||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Trade receivables | 7,935 | |||
Income taxes recoverable | 207 | |||
Prepaid expenses | 172 | |||
Other taxes recoverable | 195 | |||
Other assets | 122 | |||
Right-of-use assets | 16,090 | |||
Property and equipment | 11,704 | |||
Intangible assets | 8 | |||
Total of assets disposal group held for sale | 36,433 | |||
Trade payables | 979 | |||
Lease liabilities | 19,210 | |||
Taxes payable | 181 | |||
Labor and social obligations | 2,695 | |||
Prepayments from customers | 112 | |||
Provisions for contingencies | 107 | |||
Total liabilities of disposal group held for sale | R$ 23284 | |||
FAC/FAMAT and FAIR and certain campuses | ||||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Percentage of shares to be disposed | 100.00% |
Leases - Right-of-use assets (D
Leases - Right-of-use assets (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Leases | |||
Balance, beginning of period | R$ 88534 | R$ 74822 | R$ 51534 |
New contracts | 43,733 | 36,021 | 29,335 |
Re-measurement by index | 8,258 | 3,741 | 1,558 |
Lease modification | (15,934) | ||
Depreciation expense | (12,760) | (9,960) | (7,605) |
Reclassification from (to) assets held for sale | 16,090 | (16,090) | |
Balance, end of period | 127,921 | 88,534 | 74,822 |
Non-current | R$ 127921 | R$ 88534 | R$ 74822 |
Leases - Lease liabilities (Det
Leases - Lease liabilities (Details) R$ in Thousands | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2020BRL (R$) | Dec. 31, 2020BRL (R$)lease | Dec. 31, 2019BRL (R$) | Dec. 31, 2018BRL (R$) | |
Leases | ||||
Balance, beginning of period | R$ 103188 | R$ 88739 | R$ 61639 | |
New contracts | 43,733 | 36,021 | 29,335 | |
Re-measurement by index | 8,258 | 3,741 | 1,558 | |
Lease modification | (16,869) | |||
Reclassification from (to) assets held for sale | 19,210 | (19,210) | ||
Accrued interest | 15,086 | 12,393 | 10,778 | |
Payment of principal | (6,121) | (6,103) | (3,793) | |
Rent concession | (2,046) | |||
Payment of interest | (15,086) | (12,393) | (10,778) | |
Balance, end of period | 149,353 | 103,188 | 88,739 | |
Lease liabilities | 23,365 | 17,265 | 15,397 | |
Lease liabilities | 125,988 | 85,923 | R$ 73342 | |
Lease modification by reducing scope of lease contract | 1,967 | |||
Lease modification by early termination of lease contracts | R$ 14902 | |||
Number of lease contracts early terminated | lease | 7 | |||
Gain on lease modification | R$ 1006 | |||
Depreciation term before the assets not been classified as held for sale for right of use assets | 8 months | |||
Depreciation before the assets not been classified as held for sale for right of use assets | R$ 615 | |||
Rent concessions | R$ 2046 | |||
Rent expense from short-term leases and low-value assets | R$ 2929 | R$ 3796 |
Property and equipment (Details
Property and equipment (Details) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | R$ 70033 | R$ 63428 | R$ 50330 | |||
Purchases | 25,544 | 28,470 | 23,191 | |||
Disposals | (45) | (2) | (1,330) | |||
Transfer (to)/from held for sale | 11,704 | (11,704) | ||||
Depreciation | (10,567) | [1] | (10,159) | (8,763) | ||
Property, plant and equipment at end of period | 96,669 | 70,033 | 63,428 | |||
Depreciation term before the assets not been classified as held for sale for property and equipment | 8 months | |||||
Depreciation before the assets not been classified as held for sale for property and equipment | R$ 815 | |||||
Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 120,017 | 113,557 | 95,014 | |||
Property, plant and equipment at end of period | 167,509 | 120,017 | 113,557 | |||
Accumulated amortization and impairment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | (49,984) | (50,129) | (44,684) | |||
Property, plant and equipment at end of period | (70,840) | (49,984) | (50,129) | |||
IT Equipment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 8,975 | 6,363 | 4,701 | |||
Purchases | 3,905 | 5,261 | 3,915 | |||
Disposals | (30) | (112) | ||||
Transfer (to)/from held for sale | 84 | (84) | ||||
Depreciation | (3,050) | [1] | (2,565) | (2,141) | ||
Property, plant and equipment at end of period | 9,884 | 8,975 | 6,363 | |||
IT Equipment | Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 19,174 | 15,357 | 13,125 | |||
Property, plant and equipment at end of period | 24,484 | 19,174 | 15,357 | |||
IT Equipment | Accumulated amortization and impairment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | (10,199) | (8,994) | (8,424) | |||
Property, plant and equipment at end of period | (14,600) | (10,199) | (8,994) | |||
Furniture, equipment and facilities | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 20,173 | 17,149 | 12,316 | |||
Purchases | 7,271 | 9,520 | 8,750 | |||
Transfers | 90 | |||||
Disposals | (15) | (2) | (1,217) | |||
Transfer (to)/from held for sale | 3,249 | (3,249) | ||||
Depreciation | (3,105) | [1] | (3,245) | (2,790) | ||
Property, plant and equipment at end of period | 27,573 | 20,173 | 17,149 | |||
Furniture, equipment and facilities | Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 37,521 | 35,772 | 29,896 | |||
Property, plant and equipment at end of period | 52,541 | 37,521 | 35,772 | |||
Furniture, equipment and facilities | Accumulated amortization and impairment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | (17,348) | (18,623) | (17,580) | |||
Property, plant and equipment at end of period | (24,968) | (17,348) | (18,623) | |||
Library books | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 5,070 | 7,856 | 9,779 | |||
Purchases | 36 | 10 | ||||
Transfer (to)/from held for sale | 1,192 | (1,192) | ||||
Depreciation | (1,730) | [1] | (1,630) | (1,933) | ||
Property, plant and equipment at end of period | 4,532 | 5,070 | 7,856 | |||
Library books | Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 17,789 | 20,959 | 20,949 | |||
Property, plant and equipment at end of period | 20,994 | 17,789 | 20,959 | |||
Library books | Accumulated amortization and impairment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | (12,719) | (13,103) | (11,170) | |||
Property, plant and equipment at end of period | (16,462) | (12,719) | (13,103) | |||
Leasehold improvements | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 34,389 | 22,451 | 20,866 | |||
Purchases | 8,862 | 4,636 | 2,216 | |||
Transfers | 6,972 | 17,132 | 1,269 | |||
Disposals | (1) | |||||
Transfer (to)/from held for sale | 7,111 | (7,111) | ||||
Depreciation | (2,682) | [1] | (2,719) | (1,899) | ||
Property, plant and equipment at end of period | 54,652 | 34,389 | 22,451 | |||
Leasehold improvements | Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | 44,107 | 31,860 | 28,376 | |||
Property, plant and equipment at end of period | 69,462 | 44,107 | 31,860 | |||
Leasehold improvements | Accumulated amortization and impairment | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | (9,718) | (9,409) | (7,510) | |||
Property, plant and equipment at end of period | (14,810) | (9,718) | (9,409) | |||
Construction in progress | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | [2] | 1,426 | 9,609 | 2,668 | ||
Purchases | [2] | 5,506 | 9,017 | 8,300 | ||
Transfers | [2] | (6,972) | (17,132) | (1,359) | ||
Transfer (to)/from held for sale | [2] | 68 | (68) | |||
Property, plant and equipment at end of period | [2] | 28 | 1,426 | 9,609 | ||
Construction in progress | Cost | ||||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||||
Property, plant and equipment at beginning of period | [2] | 1,426 | 9,609 | 2,668 | ||
Property, plant and equipment at end of period | [2] | R$ 28 | R$ 1426 | R$ 9609 | ||
[1] | In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$815 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. | |||||
[2] | These refer to construction in progress for improvements to the facilities used by the Company, related to the accessibility and modernization of facilities. |
Intangible assets (Details)
Intangible assets (Details) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | R$ 658170 | R$ 735260 | R$ 796944 | |||
Purchase and capitalization | 30,919 | 16,266 | 11,769 | |||
Transfer (to)/from held for sale | 8 | (8) | ||||
Amortization | (28,147) | [1] | (42,326) | (39,916) | ||
Impairment losses | [2] | (51,022) | (33,537) | |||
Intangible assets, end of period | R$ 660950 | 658,170 | 735,260 | |||
Estimated useful life | 21 years | |||||
Remaining amortization period | 15 years | |||||
Amortization term before the assets not been classified as held for sale for intangible assets | 8 months | |||||
Amortization before the assets not been classified as held for sale for intangible assets | R$ 2 | |||||
Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | R$ 890380 | 874,392 | 862,623 | |||
Intangible assets, end of period | 921,577 | 890,380 | 874,392 | |||
Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (232,210) | (139,132) | (65,679) | |||
Intangible assets, end of period | (260,627) | (232,210) | (139,132) | |||
Software | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 20,044 | 21,207 | 23,909 | |||
Purchase and capitalization | 9,790 | 3,449 | 1,561 | |||
Transfers | 5,848 | 3,071 | 2,619 | |||
Transfer (to)/from held for sale | 8 | (8) | ||||
Amortization | (11,131) | [1] | (7,675) | (6,882) | ||
Intangible assets, end of period | 24,559 | 20,044 | 21,207 | |||
Software | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 46,123 | 39,881 | 35,701 | |||
Intangible assets, end of period | 62,039 | 46,123 | 39,881 | |||
Software | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (26,079) | (18,674) | (11,792) | |||
Intangible assets, end of period | (37,480) | (26,079) | (18,674) | |||
Internal project development | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 19,667 | 12,015 | 4,904 | |||
Purchase and capitalization | 21,129 | 12,817 | 10,208 | |||
Transfers | (5,848) | (3,071) | (2,619) | |||
Amortization | (7,146) | [1] | (2,094) | (478) | ||
Intangible assets, end of period | 27,802 | 19,667 | 12,015 | |||
Internal project development | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 22,240 | 12,494 | 4,905 | |||
Intangible assets, end of period | 37,521 | 22,240 | 12,494 | |||
Internal project development | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (2,573) | (479) | (1) | |||
Intangible assets, end of period | (9,719) | (2,573) | (479) | |||
Trademarks | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | [3] | 61,102 | 73,673 | 77,728 | ||
Amortization | [3] | (3,559) | [1] | (4,056) | (4,055) | |
Impairment losses | [3] | (8,515) | ||||
Intangible assets, end of period | [3] | 57,543 | 61,102 | 73,673 | ||
Trademarks | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | [3] | 85,163 | 85,163 | 85,163 | ||
Intangible assets, end of period | [3] | 85,163 | 85,163 | 85,163 | ||
Trademarks | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | [3] | (24,061) | (11,490) | (7,435) | ||
Intangible assets, end of period | [3] | (27,620) | (24,061) | (11,490) | ||
Operating licenses for distance learning | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 245,721 | 245,721 | 245,721 | |||
Intangible assets, end of period | 245,721 | 245,721 | 245,721 | |||
Operating licenses for distance learning | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 245,721 | 245,721 | 245,721 | |||
Intangible assets, end of period | 245,721 | 245,721 | 245,721 | |||
Non-compete agreements | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 2,043 | 4,977 | 7,142 | |||
Amortization | (1,751) | [1] | (2,165) | (2,165) | ||
Impairment losses | (769) | |||||
Intangible assets, end of period | 292 | 2,043 | 4,977 | |||
Non-compete agreements | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 10,826 | 10,826 | 10,826 | |||
Intangible assets, end of period | 10,826 | 10,826 | 10,826 | |||
Non-compete agreements | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (8,783) | (5,849) | (3,684) | |||
Intangible assets, end of period | (10,534) | (8,783) | (5,849) | |||
Customer relationship | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 3,251 | 35,754 | 60,621 | |||
Amortization | (3,251) | [1] | (24,868) | (24,867) | ||
Impairment losses | (7,635) | |||||
Intangible assets, end of period | 3,251 | 35,754 | ||||
Customer relationship | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 100,695 | 100,695 | 100,695 | |||
Intangible assets, end of period | 100,695 | 100,695 | 100,695 | |||
Customer relationship | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (97,444) | (64,941) | (40,074) | |||
Intangible assets, end of period | (100,695) | (97,444) | (64,941) | |||
Teaching/learning material-TLM | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 1,527 | 3,182 | 4,651 | |||
Amortization | (1,309) | [1] | (1,468) | (1,469) | ||
Impairment losses | (187) | |||||
Intangible assets, end of period | 218 | 1,527 | 3,182 | |||
Teaching/learning material-TLM | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 7,344 | 7,344 | 7,344 | |||
Intangible assets, end of period | 7,344 | 7,344 | 7,344 | |||
Teaching/learning material-TLM | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (5,817) | (4,162) | (2,693) | |||
Intangible assets, end of period | (7,126) | (5,817) | (4,162) | |||
Goodwill member | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 304,815 | 338,731 | 372,268 | |||
Impairment losses | (33,916) | (33,537) | ||||
Intangible assets, end of period | 304,815 | 304,815 | 338,731 | |||
Goodwill member | Cost | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | 372,268 | 372,268 | 372,268 | |||
Intangible assets, end of period | 372,268 | 372,268 | 372,268 | |||
Goodwill member | Accumulated amortization and impairment | ||||||
Disclosure of reconciliation of changes in intangible assets and goodwill [line items] | ||||||
Intangible assets, beginning of period | (67,453) | (33,537) | ||||
Intangible assets, end of period | R$ 67453 | R$ 67453 | R$ 33537 | |||
[1] | In September 2020 was recognized the depreciation expenses from the first eight months of the year in the amount of R$815 due to the reclassification from assets held for sale regarding depreciation that would have been recognized had the assets not been classified as held for sale. | |||||
[2] | The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses | |||||
[3] | The group has the rights of many trademarks, such as Assevim, FAC, FAIR, FAMESUL and others, but Uniasselvi is the only trademark recognized as an intangible asset, as a result of business combination. Its estimated useful life is 21 years, with a remaining amortization period of 15 years. |
Intangible assets - Impairment
Intangible assets - Impairment tests (Details) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2020BRL (R$)item | Dec. 31, 2019BRL (R$) | Dec. 31, 2018BRL (R$) | ||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Long-term growth rate (as a percent | 13.00% | |||
Forecast period | 5 years | |||
Goodwill impairment | R$ 0 | |||
Decrease in estimated gross margin used in the value-in-use | 1.20% | |||
Percentage that would have not resulted in the recognition of an impairment of goodwill by decrease in estimated gross margin used in the value-in-use | 12.60% | 11.40% | ||
Increase in estimated discount rate applied to the cash flow projections | 1.20% | |||
Number of CGUs | item | 2 | |||
Distance learning undergraduate courses | ||||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Goodwill | R$ 285826 | R$ 285826 | ||
Intangible assets with indefinite useful life | 213,406 | 213,406 | ||
Other intangible assets | R$ 8090 | R$ 55893 | ||
Net operating revenue growth rate (as a percent) | [1] | 22.90% | 20.30% | |
Pre-tax discount rate (as a percent) | [2] | 11.40% | 13.60% | |
Long-term growth rate (as a percent | [3] | 3.20% | 3.50% | |
Gross margin (as a percent) | [4] | 66.20% | 69.80% | |
Recoverable amount in excess of carrying amount | R$ 3659152 | R$ 903369 | ||
Percentage that would have not resulted in the recognition of an impairment of goodwill by decrease in estimated gross margin used in the value-in-use | 65.00% | 66.20% | ||
Continuing Education Courses CGU Member | ||||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Goodwill | R$ 18989 | R$ 18989 | ||
Intangible assets with indefinite useful life | 32,315 | 32,315 | ||
Other intangible assets | R$ 4979 | R$ 5547 | ||
Net operating revenue growth rate (as a percent) | [1] | 24.40% | 22.30% | |
Pre-tax discount rate (as a percent) | [2] | 11.40% | 13.60% | |
Long-term growth rate (as a percent | [3] | 3.20% | 3.50% | |
Gross margin (as a percent) | [4] | 86.10% | 86.80% | |
Recoverable amount in excess of carrying amount | R$ 353773 | R$ 341243 | ||
Percentage that would have not resulted in the recognition of an impairment of goodwill by decrease in estimated gross margin used in the value-in-use | 84.90% | 86.10% | ||
On Campus Undergraduate Courses CGU member | ||||
Disclosure of information for impairment loss recognised or reversed for individual asset or cash-generating unit [line items] | ||||
Goodwill | R$ 33916 | |||
Other intangible assets | R$ 11959 | 29,072 | ||
Impairment losses | R$ 51022 | R$ 33537 | ||
Net operating revenue growth rate (as a percent) | [1] | (6.50%) | ||
Pre-tax discount rate (as a percent) | [2] | 13.60% | ||
Long-term growth rate (as a percent | [3] | 3.50% | ||
Gross margin (as a percent) | [4] | 60.20% | ||
Percent of content as distance learning | 40.00% | |||
[1] | The growth rate of net operating revenue is based on the historical growth of the student base and management’s expectations of market development. | |||
[2] | Pre-tax discount rate reflects specific risks relating to the segment and country in which the Company operates. | |||
[3] | The long-term growth rate does not exceed the long-term average growth rate for the education sector in which the CGU operates and is mostly comprised by expected inflation. | |||
[4] | Gross margin is the average margin as a percentage of revenue over the five-year forecast period. It is based on the current sales margin levels and is in line with the Company’s operating history and management’s expectations for the future performance. |
Loans and financing - Breakdown
Loans and financing - Breakdown (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Apr. 16, 2020 |
Disclosure of detailed information about borrowings [line items] | ||
Standby Letter of Credit | R$ 151757 | |
Standby Letter of Credit | ||
Disclosure of detailed information about borrowings [line items] | ||
Interest rate | 3.60% | 3.60% |
Standby Letter of Credit | R$ 151757 |
Loans and financing - Variation
Loans and financing - Variation (Details) R$ in Thousands | Jul. 16, 2020installment | Apr. 16, 2020BRL (R$)installment | Dec. 31, 2020BRL (R$) | |
Disclosure of detailed information about borrowings [line items] | ||||
Proceeds from loans and financing (i) | R$ 150000 | |||
Accrued interest | 6,205 | |||
As of December 31, 2020 | 151,757 | |||
Standby Letter of Credit | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Proceeds from loans and financing (i) | [1] | 150,000 | ||
Accrued interest | 6,205 | |||
Payment of interest | (4,448) | |||
As of December 31, 2020 | R$ 151757 | |||
Loan amount | R$ 150000 | |||
Interest rate | 3.60% | 3.60% | ||
Number of instalments for interest payable | installment | 5 | |||
Number of instalments for principal amount | installment | 1 | |||
[1] | Seeking to guarantee the same rates and conditions that would be available in a scenario without the Coronavirus pandemic, on April 16, 2020, the Company entered into a loan agreement of R$ 150,000, with no financial covenants or guarantees anticipating a loan to settle the accounts payable from acquisition of subsidiaries due in December 2020. The loan accrues interest at the Brazilian interbank deposit (Certificado de Depósito Interbancário), or CDI rate +3.6% per annum and its interests are repayable in five quarterly installments starting on July 16, 2020 and the principal in one installment on October 18, 2021. |
Labor and social obligations (D
Labor and social obligations (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | |
Labor and social obligations | |||
Salaries payable | R$ 7489 | R$ 4235 | |
Social charges payable | [1] | 8,103 | 5,906 |
Accrued vacation. | 3,675 | 1,972 | |
Accrual for bonus | 7,408 | 4,668 | |
Other | 110 | 3 | |
Total | R$ 26785 | R$ 16784 | |
[1] | Comprised of contributions to Social Security (“INSS”) and to Government Severance Indemnity Fund for Employees (“FGTS”) as well as withholding income tax (“IRRF”) over salaries. |
Accounts payable from acquisi_3
Accounts payable from acquisition of subsidiaries (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Account payable from acquisition of subsidiaries | |||
Balance, beginning of period | R$ 379540 | R$ 458535 | R$ 534914 |
Accrued interest | 34,809 | 44,143 | 53,291 |
Payment of principal | (117,248) | (107,988) | (117,247) |
Payment of interest | (22,240) | (15,150) | (12,423) |
Balance, end of period | 274,861 | 379,540 | 458,535 |
Current | 134,988 | 128,888 | 123,310 |
Non-current | R$ 139873 | R$ 250652 | R$ 335225 |
Accounts payable from acquisi_4
Accounts payable from acquisition of subsidiaries - Consideration (Details) R$ in Thousands | Dec. 31, 2020BRL (R$)installment | Dec. 31, 2019BRL (R$) | Dec. 31, 2018BRL (R$) | Aug. 31, 2016 | Feb. 28, 2016BRL (R$) |
Uniasselvi | |||||
Disclosure of detailed information about business combination [line items] | |||||
Percentage acquired | 100.00% | ||||
Cash paid for acquisition | R$ | R$ 128162 | R$ 112301 | R$ 119159 | R$ 400000 | |
Number of remaining installments | installment | 2 | ||||
FAC and FAIR | |||||
Disclosure of detailed information about business combination [line items] | |||||
Percentage acquired | 100.00% | ||||
Cash paid for acquisition | R$ | R$ 128162 | R$ 10837 | R$ 10511 | ||
Number of remaining installments | installment | 2 |
Contingencies (Details)
Contingencies (Details) - Provision for contingent liabilities - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of changes in other provisions [abstract] | |||
Balance, beginning of period | R$ 18403 | R$ 18034 | R$ 22997 |
Additions | 5,661 | 9,694 | 8,055 |
Accrued interest | 508 | 552 | 640 |
Payments | (5,134) | (3,091) | (5,516) |
Reversals | (5,106) | (6,679) | (8,142) |
Classified as held for sale | (107) | ||
Classified from held for sale | 107 | ||
Balance, end of period | 14,439 | 18,403 | 18,034 |
Civil | |||
Reconciliation of changes in other provisions [abstract] | |||
Balance, beginning of period | 3,940 | 1,853 | 2,356 |
Additions | 454 | 2,924 | 3,305 |
Accrued interest | 109 | 71 | 59 |
Payments | (1,552) | (834) | (390) |
Reversals | (933) | (42) | (3,477) |
Classified as held for sale | (32) | ||
Classified from held for sale | 32 | ||
Balance, end of period | 2,050 | 3,940 | 1,853 |
Labor | |||
Reconciliation of changes in other provisions [abstract] | |||
Balance, beginning of period | 14,463 | 16,181 | 20,641 |
Additions | 5,207 | 6,770 | 4,750 |
Accrued interest | 399 | 481 | 581 |
Payments | (3,582) | (2,257) | (5,126) |
Reversals | (4,173) | (6,637) | (4,665) |
Classified as held for sale | (75) | ||
Classified from held for sale | 75 | ||
Balance, end of period | R$ 12389 | R$ 14463 | R$ 16181 |
Contingencies - Indemnification
Contingencies - Indemnification assets (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of nature and extent of risks arising from financial instruments [line items] | |||
Balance, beginning of period | R$ 14801 | R$ 16480 | R$ 19628 |
Additions | 85 | 4,891 | 6,420 |
Accrued interest | 408 | 476 | 602 |
Realized | (2,878) | (1,389) | (279) |
Reversals | (3,225) | (5,657) | (9,891) |
Balance, End of period | 9,191 | 14,801 | 16,480 |
Civil | |||
Disclosure of nature and extent of risks arising from financial instruments [line items] | |||
Balance, beginning of period | 1,068 | 1,694 | 2,210 |
Additions | 131 | 2,840 | |
Accrued interest | 29 | 55 | 56 |
Realized | (86) | (77) | (33) |
Reversals | (212) | (735) | (3,379) |
Balance, End of period | 799 | 1,068 | 1,694 |
Labor | |||
Disclosure of nature and extent of risks arising from financial instruments [line items] | |||
Balance, beginning of period | 13,733 | 14,786 | 17,418 |
Additions | 85 | 4,760 | 3,580 |
Accrued interest | 379 | 421 | 546 |
Realized | (2,792) | (1,312) | (246) |
Reversals | (3,013) | (4,922) | (6,512) |
Balance, End of period | R$ 8392 | R$ 13733 | R$ 14786 |
Contingencies - Indemnificati_2
Contingencies - Indemnification assets - Possible lossess (Details) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2020BRL (R$)claim | Dec. 31, 2019BRL (R$) | |
Disclosure of contingent liabilities [line items] | ||
Amount of claim not recorded | R$ 57165 | R$ 57214 |
Civil proceedings | ||
Disclosure of contingent liabilities [line items] | ||
Number of claims | claim | 521 | |
Amount of claim not recorded | R$ 8106 | 11,263 |
Labor proceedings | ||
Disclosure of contingent liabilities [line items] | ||
Number of claims | claim | 149 | |
Amount of claim not recorded | R$ 17385 | 15,460 |
Tax proceedings | ||
Disclosure of contingent liabilities [line items] | ||
Amount of claim not recorded | 31,674 | R$ 30491 |
Amount of claim not recorded corresponding to alleged service tax debt before fine and late payment interest | R$ 28024 | |
Fine (as a percent) | 150.00% |
Equity (Details)
Equity (Details) $ / shares in Units, R$ in Thousands, $ in Thousands | Sep. 22, 2020USD ($)shares | Sep. 22, 2020BRL (R$)shares | Sep. 02, 2020shares | Dec. 31, 2020Vote / shares$ / sharesshares | Sep. 01, 2020shares |
Authorized share capital (in shares) | 1,000,000,000 | ||||
Reverse share split ratio | 0.03226 | ||||
Number of shares | 17,058,053 | 522,315,196 | |||
Common Class A [Member] | |||||
Voting rights per share | Vote / shares | 1 | ||||
No par value | $ / shares | $ 0.00005 | ||||
Number of shares | 23,058,053 | ||||
Par value | $ / shares | $ 0.00005 | ||||
Vote per share | Vote / shares | 1 | ||||
Initial public offering | Common Class A [Member] | |||||
Reverse share split ratio | 0.03226 | ||||
Number of shares issued | 6,000,000 | 6,000,000 | |||
Gross proceeds received as a result of IPO | $ 96,000 | R$ 521558 | |||
Net proceeds from the IPO | $ 90,672 | 492,612 | |||
Share issuance costs | R$ | R$ 47582 |
Earnings per share (Details)
Earnings per share (Details) - BRL (R$) R$ / shares in Units, shares in Thousands, R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Earnings per share | ||||
Antidilutive shares, outstanding options | 763 | 797 | 788 | |
Basic earnings per share | ||||
Net income (loss) attributable to the shareholders of the Company | R$ 52114 | R$ 66160 | R$ 45204 | |
Weighted average number of outstanding common shares | 18,702 | 16,849 | 16,287 | |
Basic earnings (losses) per common share | [1] | R$ 2.79 | R$ 3.93 | R$ 2.78 |
Diluted earnings per share | ||||
Net income (loss) attributable to the shareholders of the Company | R$ 52114 | R$ 66160 | R$ 45204 | |
Weighted average number of outstanding common shares (thousands) | 19,465 | 16,849 | 16,287 | |
Diluted earnings (losses) per common share | [1] | R$ 2.68 | R$ 3.93 | R$ 2.78 |
[1] | The basic and diluted earnings per common share are in effect with the reverse share split occurred on September 2, 2020. |
Share-based compensation (Detai
Share-based compensation (Details) | Sep. 02, 2020Optionsshares | Sep. 01, 2020Options | Dec. 31, 2020Options | Dec. 31, 2019Options | Dec. 31, 2018Options | Nov. 19, 2020 | Jun. 08, 2017shares |
First Share Option Plan | |||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||
Maximum number of share options approved to be granted | shares | 821,649 | 25,471,110 | |||||
Maximum number of share options approved as a percent to the number of Company-issued common shares | 5.00% | ||||||
Percentage of share options vesting each year | 20.00% | ||||||
Number of shares granted | 715,000 | 22,218,000 | 167,972 | 176,813 | |||
Second Share Option Plan | |||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||
Maximum number of share options approved as a percent to the number of Company-issued common shares | 5.00% | ||||||
Number of shares granted | 874,888 |
Share-based compensation weight
Share-based compensation weighted average exercise prices (Details) | Sep. 02, 2020Options | Sep. 01, 2020Options | Dec. 31, 2020OptionsR$ / shares | Dec. 31, 2019OptionsR$ / sharesshares | Dec. 31, 2018OptionsR$ / shares | |
First Share Option Plan | ||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||||||
As of January 1, number of options | 733,136 | 640,763 | 599,864 | |||
Granted during the year, number of options | 715,000 | 22,218,000 | 167,972 | 176,813 | ||
Exercised during the year, number of options | (209,179) | (59,165) | (47,989) | |||
Forfeited during the year, number of options | (17,681) | (16,435) | (87,925) | |||
As of December 31, number of options | 506,276 | 733,136 | 640,763 | |||
Exercisable at December 31 | 415,462 | 544,291 | 450,206 | |||
Repurchased during the year, number of options | shares | [1] | (59,165) | ||||
As of January 1, WAEP per option | R$ / shares | R$ 46.19 | R$ 35.96 | R$ 30.07 | |||
Granted during the year, WAEP per option | R$ / shares | 63.86 | 53.94 | ||||
Exercised during the year, WAEP per option | R$ / shares | 37.23 | 31.62 | 30.38 | |||
Forfeited during the year, WAEP per option | R$ / shares | 17.36 | 31.62 | 31 | |||
As of December 31, WAEP per option | R$ / shares | 37.95 | 46.19 | 35.96 | |||
Exercisable at December 31, WAEP per option | R$ / shares | R$ 42.01 | 41.54 | R$ 33.17 | |||
Repurchased during the year, WAEP per option | R$ / shares | [1] | R$ 37.82 | ||||
Number of options expired, number of options | 0 | 0 | ||||
Second Share Option Plan | ||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||||||
Granted during the year, number of options | 874,888 | |||||
As of December 31, number of options | 874,888 | |||||
Granted during the year, WAEP per option | R$ / shares | R$ 0.54 | |||||
As of December 31, WAEP per option | R$ / shares | R$ 0.54 | |||||
Number of options expired, number of options | 0 | |||||
[1] | The number of options and WAEP per option were also retrospectively adjusted due to the reverse share split in the corporate reorganization described in Note 1.1.Represent shares repurchased upon termination of employee. |
Share-based compensation Share
Share-based compensation Share options outstanding (Details) - R$ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
First Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Expected selling / repurchase price | R$ 90.72 | R$ 3.41 |
Second Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Option exercise price | R$ 83.14 | |
Bottom of range | First Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Weighted average remaining vesting period | 13 years | 23 years |
Weighted average remaining expiring period | 33 years | |
Bottom of range | First Share Option Plan | R$33.76 - R$100.69 | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Option exercise price | R$ 33.76 | |
Bottom of range | First Share Option Plan | R$1.05 - R$3.13 | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Option exercise price | R$ 1.05 | |
Bottom of range | Second Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Weighted average remaining expiring period | 57 years | |
Top of range | First Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Weighted average remaining expiring period | 43 years | |
Weighted average remaining selling period | 53 years | 63 years |
Top of range | First Share Option Plan | R$33.76 - R$100.69 | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Option exercise price | R$ 100.69 | |
Top of range | First Share Option Plan | R$1.05 - R$3.13 | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Option exercise price | R$ 3.13 | |
Top of range | Second Share Option Plan | ||
Disclosure of number and weighted average remaining contractual life of outstanding share options [line items] | ||
Weighted average remaining vesting period | 30 years |
Share-based compensation Option
Share-based compensation Options granted (Details) R$ / shares in Units, R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020$ / shares | Dec. 31, 2020BRL (R$) | Dec. 31, 2019R$ / shares | |
First Share Option Plan | |||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||
Grant date | Sep. 1, 2019 | ||
Expiry date | Mar. 1, 2025 | ||
Share price at grant date | R$ / shares | R$ 3.02 | ||
Exercise price | R$ / shares | R$ 3.12 | ||
Expected price volatility | 406.00% | ||
Risk-free interest rate | 52.00% | ||
Second Share Option Plan | |||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||
Period after vesting when share options are exercisable | 60 days | ||
Expense from share-based payment transactions with employees | R$ | R$ 525 | ||
Grant date | Dec. 11, 2020 | ||
Expiry date | Sep. 9, 2026 | ||
Share price at grant date | $ / shares | $ 1,434 | ||
Exercise price | $ / shares | $ 1,600 | ||
Expected price volatility | 50.65% | ||
Risk-free interest rate | 5.01% |
Share-based compensation expens
Share-based compensation expense recognized for employee services received (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Expense arising from share-based payment transactions | |||
Total expense from equity and cash settled | R$ 11823 | R$ 26372 | R$ 7450 |
First Share Option Plan | |||
Expense arising from share-based payment transactions | |||
Equity-settled | 5,372 | 2,821 | |
Cash-settled | 11,823 | 21,000 | 4,629 |
Total expense from equity and cash settled | R$ 11823 | R$ 26372 | R$ 7450 |
Key management compensation a_3
Key management compensation and related parties - Key management compensation (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Key management compensation and related parties | |||
Salaries and related charges | R$ 6769 | R$ 5967 | |
Variable compensation (i) | [1] | 2,901 | 1,732 |
Share-based compensation | 11,823 | 26,372 | |
Total | R$ 21493 | R$ 34071 | |
[1] | Variable compensation as defined by the Board of Directors in an agreement with Group executives. |
Key management compensation a_4
Key management compensation and related parties - Related parties (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of transactions between related parties [line items] | |||
Short-term investments | R$ 515201 | R$ 72321 | |
Financial income | 36,558 | 19,194 | R$ 22026 |
Prepaid expenses | 10,223 | 8,938 | |
General and administrative expenses | 73,852 | 125,344 | 90,667 |
FI Vinci Renda Fixa Crdito Privado | |||
Disclosure of transactions between related parties [line items] | |||
Short-term investments | 39,216 | 38,493 | |
Financial income | 851 | 2,136 | 36,556 |
Austral Seguradora S/A | |||
Disclosure of transactions between related parties [line items] | |||
Prepaid expenses | 455 | 758 | |
General and administrative expenses | (303) | (151) | |
Kloch Advocacia | |||
Disclosure of transactions between related parties [line items] | |||
General and administrative expenses | R$ 217 | R$ 214 | R$ 178 |
Revenue (Details)
Revenue (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Gross revenue | R$ 673872 | R$ 598344 | R$ 497850 | |
(-) Cancellation | (14,764) | (20,890) | (16,283) | |
(-) Discounts | (24,128) | (19,104) | (16,997) | |
(-) ProUni scholarships | [1] | (98,289) | (82,132) | (68,008) |
(-) Taxes and contributions on revenue | (17,512) | (15,151) | (13,113) | |
Net revenue | 519,179 | 461,067 | 383,449 | |
Amount billed to students for the portion to be transferred to the hub partner | 153,776 | 110,411 | 75,206 | |
Revenue balance payable to the hub partner | 21,881 | 6,697 | 21,537 | |
Transferred over time | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Net revenue | 517,950 | 459,658 | 382,589 | |
Transferred at a point in time | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Net revenue | [2] | R$ 1229 | R$ 1409 | R$ 860 |
[1] | Scholarships granted by the federal government to students under the ProUni program as described in Note 2.5.s | |||
[2] | Revenue recognized at a point in time relates to revenue from student fees and certain education-related activities. |
Costs and expenses by nature (D
Costs and expenses by nature (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||||
Costs and expenses by nature | ||||||
Payroll | [1] | R$ 207511 | R$ 212683 | R$ 159428 | ||
Sales and marketing | 67,532 | 54,212 | 36,804 | |||
Depreciation and amortization | 51,474 | 62,445 | [2] | 56,284 | [2] | |
Material | 13,023 | 17,911 | 16,911 | |||
Consulting and advisory services | 14,732 | 11,927 | 16,843 | |||
Maintenance | 8,909 | 6,420 | 5,644 | |||
Utilities, cleaning and security | 6,269 | 7,085 | 7,013 | |||
Contingencies | 4,763 | 3,707 | 317 | |||
Leases | 2,929 | 3,796 | 6,170 | |||
Taxes | 2,075 | 1,705 | 1,235 | |||
Impairment losses | [3] | 51,022 | 33,537 | |||
Other expenses | 2,690 | 4,927 | 5,288 | |||
Total | 381,908 | 437,840 | 345,474 | |||
Costs of services | 221,452 | 211,547 | 184,161 | |||
General and administrative expenses | 73,852 | 125,344 | 90,667 | |||
Selling expenses | 86,604 | 100,949 | 70,646 | |||
Classes of employee benefits expense [abstract] | ||||||
Salaries, bonuses, short-term benefits, related social charges and other employee related expenses | 195,688 | 186,311 | 151,978 | |||
Share-based compensation plan | R$ 11823 | R$ 26372 | R$ 7450 | |||
[1] | Payroll expenses include for the year ended December 31, 2020 R$195,688 (2019 - R$ 186,311, 2018 — R$ 151,978) related to salaries, bonuses, short-term benefits, related social charges and other employee related expenses, and R$ 11,823 (2019 R$ 26,372, 2018 R$ 7,450) related to share-based compensation. | |||||
[2] | From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. | |||||
[3] | The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses |
Costs and expenses by nature Ad
Costs and expenses by nature Additional Information (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||||
Attribution of expenses by nature to their function [line items] | ||||||
Depreciation and amortization | R$ 51474 | R$ 62445 | [1] | R$ 56284 | [1] | |
Impairment losses | [2] | 51,022 | 33,537 | |||
Cost of services | ||||||
Attribution of expenses by nature to their function [line items] | ||||||
Depreciation and amortization | 36,757 | 24,857 | 20,472 | |||
Impairment losses | 186 | |||||
General and administrative expenses | ||||||
Attribution of expenses by nature to their function [line items] | ||||||
Depreciation and amortization | 11,463 | 12,721 | 10,945 | |||
Impairment losses | 43,200 | 33,537 | ||||
Selling expenses | ||||||
Attribution of expenses by nature to their function [line items] | ||||||
Depreciation and amortization | R$ 3255 | 24,867 | R$ 24867 | |||
Impairment losses | R$ 7636 | |||||
[1] | From the total depreciation and amortization, R$ 36,757 (2019 - R$ 24,857, 2018 — R$ 20,472) relates Cost of services, R$ 11,463 (2019 - R$ 12,721, 2018 — R$ 10,945) relates to General and administrative expenses and R$ 3,255 (2019 - R$ 24,867, 2018 — R$ 24,867) relates to Selling expenses. | |||||
[2] | The impairment losses occurred in 2019 due to the excess of the undergraduate presential segment's carrying amount over its respective recoverable amount, firstly allocated to segment's goodwill and the remainder proportionally allocated to other intangible assets. From the total impairment losses occurred in the year of 2019, R$ 186 relates to Cost of services, R$ 43,200 (2018 — R$ 33,537) relates to General and administrative expenses and R$ 7,636 relates to Selling expenses |
Other income (expenses), net (D
Other income (expenses), net (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Other income (expenses), net | |||
Deductible donations | R$ 300 | R$ 300 | R$ 300 |
Contractual indemnities | (85) | (647) | (712) |
Modification of lease contracts | 3,052 | ||
Other revenues | 743 | 437 | 332 |
Other expenses | (2,898) | (395) | (361) |
Total | R$ 512 | R$ 905 | R$ 1041 |
Financial results (Details)
Financial results (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Financial results | |||
Interest on tuition fees paid in arrears | R$ 15715 | R$ 8265 | R$ 8887 |
Financial investment yield | 6,296 | 10,726 | 12,635 |
Foreign exchange gain | 13,550 | ||
Other | 997 | 203 | 504 |
Total | 36,558 | 19,194 | 22,026 |
Interest on accounts payable from acquisition of subsidiaries | (34,980) | (44,258) | (51,739) |
Interest on lease | (15,086) | (12,393) | (10,778) |
Interest on loans and financing | (6,205) | ||
Foreign exchange loss | (2,714) | ||
Other | (5,434) | (3,739) | (2,080) |
Total | (64,418) | (60,390) | (64,597) |
Financial results | (27,860) | R$ 41196 | R$ 42571 |
Gain Due to Foreign Rate Increase Over Proceeds From IPO | R$ 12966 |
Other disclosures on cash flo_2
Other disclosures on cash flows (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other disclosures on cash flows | ||
Additions on right-of-use assets that are added in the lease liabilities | R$ 51991 | R$ 39762 |
Lease modifications | 15,934 | 0 |
Reversal of provision for contingencies to the indemnification assets | R$ 2878 | R$ 1389 |