The presentation will be done by the CEO, and then Q&A with the directors that are here with us. The slides of the presentation are being transmitted in our website, www.yduqs.com.br, and we are doing the simultaneous translation for the best governance, and the translation will be in English. If you have any questions, please type asterisk nine. The disclaimer is that the company's financial information is presented based on consolidated numbers, Brazilian real in accordance with Brazilian law and accounting practices adopted by Brazil. We are doing the presentation based on information that is available to us as of now. Now, I will give the word to Eduardo Parente. He will start the presentation.
Thank you, Tostes. Good morning, everyone. Thank you for being here. I hope that everybody is doing fine. It's interesting. For 2020, it's been a long time since we did this earnings call. The big change is that at these times that we are suffering, we are all suffering, we can look inside. Looking at the first quarter, then we can talk about other things. We can look inside and we can see the robustness of the company that we built. It's a great deal of you invested in this company. We have a situation that is not trivial. We had the issues with the FIES financing. Since we faced a lot of challenges before, I am certain that, in absolute terms, we will leave this crisis even stronger than when it started. I'm going to start by page 3 in your presentation, talking about the COVID-19 pandemic.
We've worked a lot even before the crisis to assure that from the standpoint of our students, the people, the health of people, and also the cash flow from the cash flow operate standpoint and the operations, we go through this period with the smallest impact possible. Here are a few examples. Page 3, we can see on the side of the students what in one week we could get everybody studying at home, getting classes broadcasted live. We had the same teachers as well. This was a battle that we trailed and we prevailed. We already had that technological background in our company, so it was easier, maybe easier for us to implement this than maybe the competition. We once again have 15,000 classes per week. Here, that was on-campus transferring. The distance learning, of course, no impact on classes.
We have now more classes than before, and more students than before. In medicine, we also continue with the higher standards of the theoretical classes in the virtual environment. Also, we have, if you've seen a lot of things that we have from the technological standpoint, applications for sharing of information. Over 95% of our students are participating in the classes, 95% engagement. We have practical classes. Some we can get a virtual solution through high-tech tools, and those that we cannot, they're being accumulated, so when we come back to the on-campus at the end of May, June, then we can replenish this curriculum once again. Here is the perspective that no students, I repeat, no students are going to lose the timeline for their graduation dates. This time is being well used, the time that we are all staying at home.
Here, community. We see a lot of things that we can talk about. We have the Resolvemos team, the initiative. We had the Christ Redeemer with the physicians. I do not know if you remember paying homage to the physicians. We were part of that. We are helping. The Resolvemos team is an idea that we had right at the beginning of the pandemic during the quarantine when we announced that the ENEM exam was not going to take place. We had a high percentage of our students that are Estácio students. They come from the public learning context. There are a few opportunities here to implement technology to inform these students, and this is a very good tool. It is an initiative to support the public school students for the Enem and the entrance exams.
We are used to talking to all socioeconomic strata, but we want to help people that need aid. The public schools, sometimes they do not have a lot of resources. We had a platform that we recognize, and actually it is recognized from abroad, and we have a lot of content. So we talked to our partners, and we got the content of Yduqs, our partners, and in 30 weeks, we gathered, we amounted, we amassed the content, which is basically the content for ENEM that is available for the distance learning, that is available for all the public high school students for free, this content to study for the ENEM. We had over 200,000 accesses, 10,000 users using this tool Resolvemos. This will translate to, " Yes, we can solve it."
Now, from the standpoint of the company itself, I think that it is very interesting that we are talking about the financial help that we give to people that lose their jobs. We want to help the students to accelerate. We want to cover all the students from the educational insurance standpoint up to six months. Also, we have an overview that is very pinpoint. When the pandemic really gathered strength in Europe, we anticipated, and we wanted to do the correct closing of our accounts. We really had all the numbers well closed. We captured everything, and we are going to talk about that up ahead.
In this world, post-pandemic, we have a low leverage, 1.1 times the net debt over the EBITDA, and the extended net debt amortization is on schedule. We are going to talk about that later. We also have 100 actions to improve working capital and reduce the impact of delinquency. We are ready to do this, and the big focus here is to make sure that on the medium long term, we want to keep the students enrolled, and this is one of our main goals. We need to have a strong cash flow to keep the capacity and bring whatever is necessary. We want to regain the growth, also in medicine and in the other areas.
Let us go to page 4, please. You can see some numbers on the responses to the implemented actions on the pandemic. Let's remember, March 13th, we started the official quarantine in the state of Rio de Janeiro. It was right around that time in the state of São Paulo as well, and right around that week, between 13th and the 23rd, all the classes, except a few, all the states, except a few, started the quarantine. We are using Microsoft tools, Teams. We are using it to provide a class that has a lot of things that we have idea of that we're going to implement when we come back to the on-site.
Obviously, we have here 50% of attendance once we started with the virtual classes. We started to build up the operations. We had some students with hardware issues. We have the partnerships with our students. We want to offer special conditions for those that did not have it. Something that was very interesting, we have the teachers, and I see this in my class. The people at the beginning, at the first class, people had difficulties accessing this new digital environment. Now today, everybody is basically digitally fluent. This curve we got last week to 70% attendance on the live broadcast of the classes. We record these classes. A lot of people that have difficulties accessing the class in real-time with a lower broadband, they can see the recording of the live class.
Once again, 81% of the people are watching the classes in real time. This is marginally good, but it's practically the same as we had in the normal operation on the on-site. Now we are really expecting that the students are focusing on the content, and they're watching it from the comfort of their homes. Here's an interesting phenomena. If you look here in the northern part of Brazil, we had internet issues as well. We have some of the students watching the classes together, and people are gathering to watch the classes.
Once again, the dropout rates are marginally the same, practically the same as last year. We can see April year-to-date, 3.6% in 2019, 3.9% in 2020. Here we gather all the executive directors, and we discuss this issue, and we look at the previous numbers. Obviously, nobody has a crystal ball here, and it's been a couple weeks and two months of everything that is happening, and we are looking at the best-case scenario, really, of our projections. Going down here, we can see the cash. There is a reduced impact on collection if you compare April 20th of 2020, if you compare it to April of 2019.
We have a series of actions here to reduce or delay the cash outflow. We're paying bonuses, dividends, CapEx. All of that is scheduled for the future. Some contract renegotiations as well. Some are permanent, some are only for periods of time, but all the contracts are being renegotiated. We are applying the MP 936. No teacher that has their, the teachers are working. We are really presenting. We're keeping 99% of our employees at home, and the workforce is in home office routine. Let's go to page 5. We can stay here within what was in range. We are a little bit disappointed here with the on-campus. We had an expectation of having more students, and on March 13th, really everything stopped. It grinded to a halt.
We had an expectation of going over 10% of getting the intake, more intake of students, and that didn't happen. Here, that 82% is the stage of completion that we showed of intake expectations. Once again, digital learning is the big highlight. An interesting point is here, the intake in the first semester in the digital was higher than the two previous semesters. What happened on the on-campus at the moment that we had the startup of the crisis, the pandemic, I think it was 13th- 16th of March, the intake continued very strong. The intake was still maintaining good numbers until the lockdown.
Here, the big message of the highlights of the quarter. Those of you that follow us up ahead, we know that we have a big battle to fight. The less relevant year, we gathered over BRL 1 billion from. We lost BRL 1 billion with the FIES financing. So our plan was always to let's fight the FIES issues, reducing costs, and that's what we were doing, and we are still doing. What's outside of our plan and our expectation are a few of the impacts of the COVID-19 pandemic. The first 5,000 additional students that we didn't get with the intake. Our renewal was worse with also people. The end of the intake and the renewal was worse than the previous year. We have in these, I think it was March, we had an impact, really important impact.
Everything that I'm trying to show here in this slide, that this has an impact on costs. Up until the time, it's not less than what we expected. I think that the big message here is that even though we had a loss here in comparison to the previous year, the adjusted EBITDA, a loss of 9%, we have a very strong focus on, once again, distant learning. We had good numbers. The on-campus and the FIES was growing more. The revenue was growing. One thing that we think that was important, and it's important to look at the sector six months before and now more, we are looking at a 91% cash conversion. It's a low level of indebtedness. Here, an important highlight. It's important to mention that we had the approval, finally, from CADE, C-A-D-E, finalizing without any restriction.
The CADE didn't question any part of the operation, and now we have Adtalem integrated with a cash position of BRL 1.5 billion. Please go to slide 7. What do we have here on resilience in a challenging scenario? Looking at on-campus student base, we have a drop in 1%, obviously. What is important here is that we have the FIES, well, issues that we've had them for a few quarters, those issues. We had last year a record intake with 7% if you compare it to the same period of last year of 2019. Here, the FIES base was less and less relevant. As you can see in the quarter projections, our base here is 9% of students, and this is a new FIES student in terms of behavior that is very much like the other students.
Here this year, that loss that the FIES base represents every quarter for us, it will not take place from 2021 onwards. Another important thing in our financing, we had 16,000 students on the first quarter of 2019 and 9,000 students in the first quarter of 2020 for the PAR students. Now, we can see the retention rates. There is a loss in the average ticket if you do not count on the FIES. We are talking about BRL 758 in the first quarter of 2019 to BRL 739 in the first quarter of 2020. Digital learning. Let's see the expansion across the board. Here, the new intake record. The base of the digital learning really grew 31%. It's very robust. We had a strong base. It was a base of 10,000 students that grew substantially. The number of DL centers we had last year, we had 635.
Now we have over 1,000 DL centers with a good retention rate and a loss in the renewal, the retention rate of the DL. We can see 82.8%- 81.8%. We see the DL net revenues growing 27% and the EBITDA growing 29% if you compare it to the same period last year. Let's go to page 9, medicine. Great opportunity ahead. The student base grew 16%. The average ticket also grew 10%. Net revenues 30%. We had an expansion, well, in the paying base, we see the expansion in Mais Médicos, one unit. Our new unit in Città America. It's a great success. A lot of people are seeking, and really hospitals that are referenced are looking for our students that graduate from the Città center. We can see. Oh, did I have a drop? Okay.
So we had by 2021, we had 15 campi in operation. By 2021, we have over 10,000 students by 2024 in medicine. We also have in our PhD, well, in the context of Estácio, we are investing very strongly in the expansion here. Along with Adtalem, we have a preparation for residency, and we are evolving in this value chain. Well, there is an operations expansion through the medicine value chain with the SJT Med, the medical education.
Hi. Well, now I'm going to talk about net revenues. The slide number 10, position for growth. Let's start by the net revenues of the former FIES. Over the last two years, we had an increase of 21%, also 8% if you compare it to the previous year. In the lower graph, we can see a drop of the FIES base in our effect as a whole. It was 27% in 2018, and in this first quarter of 2020, 10%.
In terms of numbers, let's see. Our net revenues reported in the first quarter of last year, BRL 933 million. In this quarter, we had lost BRL 70 million in FIES base. We have a growth in distance learning and a growth in the delta of medicine. So that loss actually is being. We have a compensation of the losses of FIES. From next year onwards, when this loss is almost zero, none, we will have an increment that is robust in our revenue. On slide 11, I'm sorry. Looking at cost and expenses, short-term pressure. We have a growth in cost and expenses of 6%. This is due to the M&As and the restructuring of the group.
A few points. Let's talk about the expenses that we commented. The expenses related to the COVID-19 contingency plan, getting the classes online broadcast so the students would not lose the semester. This is an additional cost. Second point. We are talking about, here, the bad debt. Even though the quarantine started at the end of March, it had some effect. Also, what we have to talk about, the earnings. We can see the non-renewal. There is going to be an adjustment for that. Also, it is important to highlight that this is a mix of the increase of the bad debt. When you reduce the percentage of the FIES in student, then you have the mix that does not have the FIES financing, of course, the bad debt increases.
The third point. It is important to mention, on the graph on the right, lower, you can see here the advertising costs. It grew 15% in comparison to the first quarter of 2019. I commented in the fourth quarter that that increment that you perceived of 2019 against 2018 and 2020, the expectation of the number itself, it was in absolute terms, almost the same as 2019. This growth that we can see in this quarter is more of a formality of costs and t he trend is that over the next quarters, we will converge so that the absolute numbers in the slide are aligned with the numbers presented in 2019. Let us go to slide 12. As we commented, the EBITDA, it suffered. We had about 9% drop. Adjustments, of course, because of the M&A.
Here, the main impact in the slide, there is an increase here in the non-recurring items. I also reported the advertisement costs. Here, the important point to highlight was the generation of cash flow. If you look at the accounting number, the generation of the cash flow is 121% of the accounted EBITDA. We do an adjustment and 136 of receivables. We had the reported cash conversion of 121%, cash adjusted by BRL 136 million due to the delay of the FIES transfer in December of 2019. The cash conversion, we had 81%, which should be one of the biggest ones in the sector.
Another point that we should mention again, which was mentioned before. We can see that the cash conversion, we had the non-recurring impacts, and it was lower impact than required in comparison to 2019. So the solid cash position after the acquisitions. We ended post-payment of the acquisition of Adtalem. We started BRL 1.5 billion below the budget. So the first quarter in March, everything that was captured in April. Here, the payment from the payment of Adtalem was BRL 2.2 billion with the cash that we received due to the acquisition.
Remember one thing, in terms of value, we paid at the end of the day. When we acquired, it was BRL 1.9 billion. Once we acquired by the value of the firm. When we concluded, because of the mechanisms, the effective payment was BRL 1.8 billion. In terms of costs, it is important to mention that even with an increase of cost we had over the last capturing here, the cost of the company is very low. Even with all the debt, the new debt, it is the CDI rate plus 1.5%. Let us go back to Eduardo Parente.
Let us go to page 14, the Adtalem acquisition being concluded. We already explained this. We had the closing in the April 24th. We received a cash with an operation of BRL 389 million, the net debt cash. The enterprise value is BRL 1.8 billion. In terms of financial performance with the Adtalem management in IFRS 16, we can see here the net revenue is BRL 653 million, and this is going to show in terms of our results. In regards to the synergies, the ones that we identified, a few things that we can mention. Well, this has been easier than we expected. We had predicted a very difficult time.
Nonetheless, we are seeing that there is a lot of culture values, and the passion for the student, we can perceive that very well in the M&A, and there are additional good things, and we are very excited about this. We can see the leadership of the market. We can see the niche students are much higher. We use the new brands, Estácio, Martha Falcão, all the ones that you know. There is the issue of IT, which is always very interesting for us. This is very positive here as well because of how easy it was to do the integration and introduce the digital content, for example, to Wyden on the on-campus courses. Units operating in an easier way. It is easier to integrate some units of the course portfolio between institutions. It was easy to integrate the thousands of students.
In synergy, we went up beyond what we expected. The preliminary data indicates synergies above BRL 80 million. The most obvious here is the online teaching and the on-site. This is very important, and we have technologies that are being implemented here to facilitate that. Obviously, this is a big economy that is being displayed in the details of the budget here on the revenue. In pricing, how do you do the market testing and research? We have a structure, even though the origin, the structure is much more flexible, much more technological. We identified a lot of actions that now in the intake, we have a great expectation in those results. The cross-selling as well, mainly medicine and law. We have the bases here and other themes here.
The fact is that BRL 1.8 billion that we talked about, the enterprise value, is 9x the EBITDA that we had recently, and our expectation is that over the next days, the range of the synergies that we already mentioned and identified of above BRL 80 million, that the preliminary data indicates, shows that all the initiatives were identified and each of them are being implemented. As a reflection of that, we expected good synergies for 2020. We can see the numbers for this year.
Let's go to page 15 to conclude. Conclusions and perspectives for 2020. I think that the EBITDA in this quarter, below of what we expected, despite the slowdown, but we have a solid base of students here. The numbers are growing. To keep the operation running, we think that we are a benchmark in the market. Not only in the market, but it is a benchmark of the market that services all of the market, not only the classes C and D. Small universities that have 13,000 students, we are delivering in comparison to them. We are delivering to the student at their home. The quality is far superior than the competition. We are convinced that the fundamentals are here. They are still solid, as we mentioned. The cash flow generation is still good. It is still solid in the balance sheet.
Here, the numbers are a bit worse than last year because of the COVID-19 pandemic. Now once we leave the situation in two, three months, with the cash generation and the operation that is robust, the base here, we are starting to look at this with a lot of It is a solid position, even more than what we mentioned and talked to you, and the expectation for 2023. Our expectations for 2023 have not changed internally.
Last but not least, we always talk about, if you look at here, we had the distance learning that was 22% in the past, and now it grew a lot. We also have the three growth leverages, which is medicine and the M&A, and we are going to emerge even stronger after this crisis. A lot of people that we talk to, they are going through difficult times, of course, and it will be a difficult time for everybody, but we have an expectation to run a good business with responsibility, looking towards the future. I think that really we are going to come out stronger in the distance learning. People are getting more used to working digitally in the digital context, and they understand more and more how to stay home, what to do at home, and I think that is really very positive for this digital market.
To summarize and conclude, we are alert. We are looking every day at the signs of improvement or worsening of the situation. We every day are thinking about how can we assure that the operation is robust. But we are looking at the future. We are looking at the post-pandemic crisis. We inform our students that we are looking to the future and how can we use our strengths to really regain growth in the moment of post-crisis. Thank you very much.
Thank you, Eduardo Haiama . Let us go to the Q&A session.
And just remember to type asterisk nine if you have any questions. Those of you that are in the webcast, you can just ask the questions and we can answer your questions. The first question comes from Mr. Marcelo Santos. Mr. Marcelo, please.
Good morning, everyone. Thank you for accepting my question for this earnings call. I just wanted to ask you a question about what we see that smaller companies that do not have an online structure as good as yours, and they do not have the agility to do the transition to the virtual learning. Do you think that in the second half of the year, that is going to give you an advantage in regards to the competition? Maybe you are going to offset a lot of the impact of the lockdown, getting the students from those competitors that did not adapt it.
The second question is, can you talk about the opportunities of M&A? There are companies doing M&As. Do you see an opportunity to do an M&A, or the idea is to wait and see? If you can comment on those future opportunities for M&A, please.
Well, I am sorry. I pressed a button, and I think that I just turned everybody here out. Well, I agree with the numbers. I think that this intake of 2022, we are getting ready for it, even more in the details than we had before. So, external transference, we increased the number of courses. We have over 80% of our students thinking that the digital solution that we have is good or very good. The on-site, they are saying that about the digital learning, but more so. I think that this is the moment of truth for the sector. If you think about this, three, four years ago, the situation was that the students came, and they had the capacity to finance themselves, mainly with the FIES financing.
With the end of the FIES financing, the conditions were less attractive for the students, and now the financing is coming out of the pocket of the students. In the end, now you are seeing those students that really can pay for an education. We can see also those service providers, us, that can provide a quality service for the students that can fit the pockets of the students, let us just say, that makes it easier for the students to pay. We are strong in that sense. Those that cannot adapt to the pockets of the students, the size of the pocket of the students, are going to become weaker.
The idea is to give the opportunity for those students and to give the opportunity for those that are more robust in technology and in cash flow, the companies that will take the technology to more students in the market, a bigger chunk of the market. So I think that our competition is going to have difficulties in the intake of students. Some will not survive. I think that the pandemic tends to accelerate the adjustment of the market.
In regards to the M&A, I do not think things change in a relevant way. I think they accelerate a few processes. A month ago, maybe more, we are looking at the question, "Hey, do we have cash flow?" But now for a long time, or for the time that the pandemic lasts, we start to look at all opportunities of all sizes. I think that there is a lot of things that we have to get on the table, understand, and analyze.
Thank you.
The next question, Mr. Samuel Alves, please continue.
Good morning, Parente. Pedro. Well, two questions from my side. First, in regards to the PDD, you mentioned in your question, in the comments, about the provisions. Then there is a component at the end of March, which is natural because of the deterioration of the scenario. Just to understand, was there a prospective effect in the bad debt of the quarter, or is there anything else in March? The second question is, can you comment on the issue about some class entities, which is a reduction? Did you have any issues with that? Maybe you had to solve that in the future?
Haiama here talking. About the provision for the doubtful accounts or bad debt, n o, there was no extra things here. We didn't change regardless of the impact of the COVID-19. Can you comment on that? The provision here for the bad debt since the quarantine started in the second week of March, where the intake is lower, the perspective here is, let's remember how our curve of bad debt, it accelerates with a dropout, and we didn't change the criteria. We didn't change the perspective. The perspective is the same, but it accelerated because of the dropout and non-renewal. I'm going to give the word to Parente.
Since we are doing the webcast, and I think that the question is from Maria Clara as well. There is a flexibility or a discount if there is a strong dropout. We have a strong pressure, really, and sometimes we see anxiety to help those that are in need. There was, I don't know, three, four weeks ago, some time ago, a boom of help, and we had even the public policy helping. I mean, the politicians helping to try and propose and help the students. There is a situation where there is a lot of people trying to make an effort to help people and students at this time. We anticipated that actually, too, that once we look at the people that are going through the difficult times. We had a discount of 12%. There are people that lost their jobs that cannot pay 88%.
So just from the social standpoint, it's questionable. We look at the efforts of trying to provide BRL 600 for the workers that are not registered. We have to look at the help given to the population as a whole. We had a program here, but from the business standpoint, it doesn't make sense because my intention is to help the people in need so that the people can continue studying and can continue advancing themselves. Here in Rio de Janeiro, which is our biggest base, and we had 10,000 for each month of the pandemic, where we are getting the people, we're giving them scholarships, really.
We are seeing the students that lost their jobs. We are looking at one by one of the students, seeing, we are going to have a few people that are going to lie, but we understand that it's part of the cost of the process for the scholarship process for the students. We already mentioned the 10,000 scholarships. We had an extension from the payments, and maybe once again, but that is within the tuition fee. We want to really avoid the dropout. We are seeing the second cycle that is very good, and we are taking that throughout Brazil. In all the Estácio in Brazil in this moment, we want to take it through all the other brands of Yduqs. So people need to enroll in the scholarship.
We're going to see one by one, and we're going to try and focus these resources that we have on those that need it the most. These scholarships, these concessions on the tuition, we are going to do the renewal of the students. We can work with those that want to renew their studies. We have the mechanics of the monthly fee for the tuition. All the programs, certainly, if we approve a law here and there that cancels or that gives you extra benefits to the tuition, our expectation really is where we talked to the regulators, and we are extremely sensitive to what is happening to the students. This is being recognized by the public powers, and we are working with this issue diligently. Our vision is that in the end, the good will prevail, and we will stand by our students.
Our question is from Susana Salaru. Please, ma'am, continue.
Good morning. Thank you for accepting our questions. We have two. Well, at the beginning of the discussion, Eduardo, you mentioned that you did not change any expectations for 2021 for the results and performance. We can read along the lines that in 2020 we are expecting a stronger recovery of the results. This is the first question. Secondly, in regards to the point of the discounting the tuition or the full-time 100% scholarship, is it going to be throughout Brazil? How many scholarships are you going to offer monthly for all the units in Brazil?
Hi, Susana. Great to hear you. Let's talk about this. 2020 is still very early. Something very interesting is that we have a very good overview of what might take place in two, four weeks, and a good prediction for 2021. There's a lot of variables here. In fact, we don't work right now at this moment with a lot of changes in 2021. But once again, we have Adtalem joining Yduqs. We have medicine and law growing regardless of coronavirus, and we have the end of the FIES losses. Hello? Am I here? Yes. Okay, I'm back. When we add all this, the growth of the distance learning in medicine, the joining of Adtalem, the end of the FIES-based losses. At the moment, we are still losing a lot with the FIES than what we are losing or will lose with the COVID-19 pandemic.
Once the situation is solved and we all go back to normality, we can foresee that everything is under control, and we are keeping our expectations the same for 2021. What is of a concern is not losing any opportunities and keep the student base. This is key for us so we can go through this strong winter in 2020 and emerge victorious. Well, we are expanding throughout Brazil this week on Saturday and on Monday, actually, we started to announce this, but now we have this strongly. We're expecting 50,000, 60,000 scholarships in this program. It's not for the semester, it's for this month. It's per month. We are counting three months, depending on the need. I have stories here that are really heartbreaking from the students that are people that get one, two. Hello?
The set of scholarships and the number of favored students is about 50% of the students. 50,000, 60,000 exemptions for one month. At the end of the year, 50,000, 60,000 minus.
Just a follow-up. You have that insurance. Are you going to direct the students for the insurance?
The insurance, we have it since 2015, and if you lose the scholarship and you have the conditions to receive the insurance, we are going to activate the insurance. Once again, we assembled a cell, a working group to service those students so they can get a good and fast response.
Let's talk to Mr. Vitor Gavier. Please continue.
Good morning. More along the lines of the distance learning. With everything that is happening with the quarantine lockdown, it is possible to have an impact on the student base on the on-campus. There are some small players, on the other hand, that do not have the structure to have a robust distance learning as you. That gain in market share that you might have in the distance learning can offset the impact in the student base, in the context of the student base of the on-site.
Vitor, I am going to answer the question, but if I am wrong, please ask me again. We have the expectation of distance learning to still keep the same numbers. Maybe this is the thing that we can have the same information. After the quarantine, our numbers have improved, of course. I think that those competitors that do not have distance learning, once the tide recedes, they are going to try and find different paths to compensate for the FIES losses. I think that every company has their own path to trail, and we chose the distance learning with medicine, and it allows us to generate cash to consolidate. We think that this is the winning pathway.
I talked to our director of M&A. He is on the phone. We had competitors with the difficulty keeping their costs, and now the costs are higher than their students can pay. Our ticket is very high for medicine, and the on-site has a smaller margin, and we have a big efficiency. It is very efficient. We can see small operations that do not have the online, they do not have that efficiency. Here, the big issue is that you cannot, nowadays, have costs that do not add anything to the training and the graduation of the student. Once you go to our units, you can see that everything is functional, everything is beautiful, but it is very spartan. We do not have parking lots. We work with students that have a lot of quality to deliver the content, but not necessarily they had their training with advanced research.
We have that, but it is more the exception to the rule. We have a strong online content. With all this, we see the difficulty in the small players. Of course, those that really do not have this path already established. Really, they are going to get weaker, and we can use that weakening, as Marcelo has said, use that weakening to compensate for any eventual losses that we have in our on-site.
The distance learning is still the same, right?
Correct.
Thank you.
Next question. Mr. Vinicius Ribeiro. Please, Mr. Vinicius, continue.
Good morning, everyone. Thank you for the question. Two questions. First, can you tell us, even if it is qualitative, on how your curve of dropout and bad debt, provision for bad debt, is behaving? There was not a lot of pressure in your budget. When can we expect that you have your different products being affected at the second cycle of intake in the second semester? Do you have different products that can service a different base of students in the second semester?
Thank you, Vinicius. Provision for bad debt. The question to understand a little bit more the distance learning and on-site. Is that it? That was the question?
Exactly.
This is very interesting. During the crisis, we are learning very fast. I always saw that distance learning, these are the ones that have more difficulty. We can see that in this period of crisis, now getting into the details. Historically, for us here, the distance learning, we always had similar numbers to on-site. Post-quarantine, the collections actually improved, relatively speaking. The revenue here, the collection today, what we are living, as Parente has said, we have that lever of the distance learning giving support to all the operation. It gives us more comfort for the cash generation.
On the on-site, it is not that the on-site has worsened substantially, but in fact, the distance learning improved in terms of collections, in terms of revenue. Now, in regards to Distance Learning Premium, we tested that at UniToledo. It was our first brand that we tried the distance learning without Estácio. Being a competitor of Estácio in practice, but it was very positive results. When we sell distance learning with the Adtalem brand, we started with a pilot in Fortaleza in the Northeast. We are starting to operate with a different distance learning from Estácio, and this is the first operation with the three brands. We operate with Yduqs, Estácio, and the one in the Northeast.
Distance Learning Premium, we have extra objects for learning. For that, the quarantine really helped us. It was a big test, enormous test that we did on how the on-site students adhered to the Distance Learning Premium. Besides all the information that we have in our models for learning, we start to use the synchronous, the meetings with the teachers. We include that to, the real-time and the asynchronous classes. We include that to reach a different segment. Now, for the second semester, we can use all the other local brands that we got from the M&A. I do not know if I answered, but this is the expectation.
Thank you.
The last question comes from Mr. Caio Moscardini. Please proceed.
Hi, good morning. Two questions. One about the earnings, and the other one is provision for bad debt. Apparently, we have the tuition deadlines by May already. About the distance learning, I want to understand the difference between the monthly payment and the PAR financing. There was a drop in the PAR financing. There was a drop, and I wanted to understand what are the drivers.
In regards to provision for bad debt, PDD in Portuguese, and the revenue, it is still at the beginning. Since we are at the inception, we are seeing the same trend that we observed in April. Once again, we are still at the beginning. We have to see what is going to happen until the end of the month. Our expectation is that things are not going to change. We followed day by day, as Parente has mentioned. We have the revenue that has that relationship between the accumulated accrued and the daily. As for the provision for bad debt for the monthly payer, well, this has dropped. PAR has the amount of students that are subscribed is dropping. The trend should be that is maintained.
As to how much the situation is in regards to the monthly payer, and the first quarter is the period of intake when you have the invoicing and the students have to pay the monthly fees, the tuition up ahead in the future. At the beginning, you have a very low provision for bad debt. The provision for bad debt, the PDD is, well, when we see the dropout rates increasing and the non-renewal, that starts to impact the digital product. So it is more natural that the student starts to pay by month. When you do a negotiation that is broader, it basically, i n the months of intake, the trend is that the intake is going to be lower.
I understand. Thank you very much.
We close right now the Q&A session, and I would like to give the floor to Mr. Eduardo Parente for the final thoughts.
Well, thank you once again to you all, ladies and gentlemen. Thank you for the trust invested in us. I think that this is a very difficult time, but those of you that know us, you know that we have a very fine-tuned team that has leveraged, has worked with all of the team, and we are extremely engaged. From what I can see, over the last six weeks, we want to really educate people. We want to get things right, make things right, and certainly, we will be stronger out of this pandemic and this crisis. Thank you all.
The earnings call of Yduqs is closed. Thank you for your participation, and have a wonderful day.