Good morning. I am Rogério Tostes . Welcome to the teleconference of results of the second quarter of 2019. The presentation will be done by our CEO, Eduardo Parente, and the CFO, Gustavo Zeno . We also have the directorship of the company, and at the end, we will be available for Q&A. The audio and the slides will be transmitted on our RI website, www.estacio.br/ri. I inform that the teleconference is being translated into English, therefore keeping with the corporate governance and avoiding any asymmetry of the information that is passed on to our stakeholders. Should you need anything, you can type asterisk zero two. This teleconference might contain some predictions about future events that are subjected to risks and uncertainty. Should those things do not take place, they might substantially differ from what we expected.
These are only opinions issued on the date that they were actually done and performed, and the company is not obliged to update them. Therefore, I give the word to our CEO, Eduardo Parente.
Thank you, Tostes. Well, good morning, everyone. It's a pleasure to receive you here at our second quarter conference. What we're going to start today is a sequence of what we have found over the last conferences in terms of results and how we see things up ahead. I start on page three. We're going to be 50 years next year. So in those 50 years, we build a brand, a national brand, a very strong brand, very recognized. As you can see, we have 93 campuses, 110 DL courses, 710 DL centers, 700 cities, eight schools of medicine, and 97% of courses with a satisfactory grade.
Now, as we have been evaluated, 84% of them had a grade of four and above five. So we have a view of reaching out to the student. We're a company, an educational institution that is very strong. We need to move up ahead. What do I mean? We need to get even closer to our students, broadening the scope, going farther, going to other niches. Now, we thought that to bring this would give us more flexibility to partner with Y-D-U-Q-S, as it's said in Portuguese. In this way, we can have a different position in the market, and we can develop, therefore, new businesses and providing services for other institutions, teaching institutions. Anyway, YDUQS was born with being the new name for the company, the overall company, Estácio, and it's a new way to start with an umbrella of companies.
During the presentation, I'm going to refer back to that once I talk about distance learning and medicine, which are, as you know, very important parts of our vision. We are focused on businesses that maybe as a whole might not seem so big, but they're growing. We need, well, to adapt our structure, and this will facilitate things. Now, I'm going to page four. These are the highlights for the second quarter of 2019. I think that on the left you can see the student base, the tickets, the average ticket, and the cost reduction. These three boxes, well, we have a very difficult economy, as you know, rebuilding the country, and these are results that we're very proud of. We think that it creates a very strong base for growth. We're talking about using this regaining of the economic growth in our favor.
Now, 3% of the growth in the student base. If we get the biases out, we basically have a growth of 10%. This is the biggest base that we ever had at Estácio. This is reflected upon the quality of the teaching and the process that we are repeating to become more granular and focused. Looking at the lifetime value of the student. We have an increase in 1% in increase in the retention rate in both the DL and on campus vs the second quarter of 2018. This is a record in growth. This is a historical record. Talking about the average ticket. We grow, as you can see, 3% average. We basically move, not sideways, but we are growing in parallel.
We have a growth in the medical student base, as you can see, 7%, and we have done different pricing. We applied this very competently in the first quarter. Once again, very granular application here, and this is very positive. The cost reduction. We really mentioned that in regards to the previous year, second quarter. We still had the entire year to capture a complete year of these initiatives. The results are, you can see 5% reduction in the cost per student, and this makes the right side of the page very solid, very consistent with what we've been showing as a potential. This cost reduction has really helped us to fight the loss of the FIES that we knew that it was going to be significant, the student funding FIES. We had the gross margins, 58.4%.
We have an ex IFRS 16, 57.7%, a margin of 36% of EBITDA, and a cash conversion of 66.5%. Student base in detail. As I mentioned, I'm sorry, page 5. It's a little bit of what I already mentioned, student base, very relevant loss in numbers of the students that were funded by the FIES. It was a loss of 37% of our base. We knew that we were going to lose those students. We think that up until the end of the year, we are still going to lose another 19,000 getting to a standard of 30,000 FIES students. There's something up ahead, but we start to see FIES as maybe as a side. We are in the new reality of FIES, and we believe that this is a very solid benefit of the program for society.
Nonetheless, what we see this in the government and the perspective on the medium range is of having a regrowth. Once we have this regrowth, we think that this can be good for the entire sector, and FIES is almost the upside. Anyway, we are very strongly growing with the distance learning at 26%, and the on-campus, which has formed FIES, also growing 3%. Down below to the left, we see the retention rate improving significantly year-by-year since 2017. Distance learning is getting very close to on-campus, which is very interesting. So smaller retention rates, lower retention rates in the on-campus.
While this is normal for the sector, people understand better what the DL is, and everybody is putting an effort to actually getting more technology, more content for the student in this very winning form of democratization of the studies of teaching, which is distance learning. I am going to give the word to our CFO.
Hi, good morning. Well, let us start once again at slide six. First quarter. We have the net revenues in comparison to the previous year, which is, you can see the numbers. This is a great performance, a reduction of 20,000 students from the FIES, and it was going to impact excessively the revenues. But the improvement in the mix of costs, and the increase in the DL have nulled, in part, the impact on the FIES. Now, we have a positive effect of the restructuring of personnel that happened at the end of 2018, reducing this in almost 8%. Added to that effect, an improvement in the efficiency in the subcontracted parties, third-party services, neutralizing the increase of costs in these subcontracted costs.
Basically, the third-party services, we have a drop of another 5%. On the right, as we have mentioned before, there is an evolution of the gross profit and the gross margin, which got to 58% without considering the former IFRS 16. Going to slide seven. Stability and efficiency of the expenses. We have an increase in the commercial and administrative expenses in comparison to the previous year. We have a pressure here of the bad debts over the net revenues. This is due to the anticipation of the marketing campaign. Sorry, I was mentioning the advertising over net revenues, which increased 68%. But the bad debts, there is a growth of 1% facing the previous year. The percentage here reached of the revenues, 10% above the same period of 2018.
General administrative expenses, we maintain the same efficiency, and we have the benefit of 9%. I highlight the reducing, well, we reduced the third-party services, reducing the consulting fees. There you can see the 53%. Slide eight. EBITDA and generation of cash margin. In this quarter, the EBITDA margin got to 30.1%, a standard that is above the 29.4% of last year. In absolute terms, EBITDA grew 1.6% in the same period. This comparison with 2018 excludes the impact of ex IFRS 16. In the corner here on the right, we can see an improvement in the operational cash flows and an improvement of the conversion of the EBITDA and the cash conversion.
This shows that our financial products are not big offenders to our cash generation. This quarter, we got to the conversion of 66.5% comparison to the previous margin. We have here the cash flow in the same accounting standards in IFRS 16. Last but not least, we present a net income growth in the first quarter with a growth of 3% comparison to the previous year. Investment. CapEx, we had an investment of, as you can see, that what we had an increase in investments of that grew in 59%. We have the support and the improvement, and we got to the CapEx of 6.4% vs 4% in the same period of the first semester of last year.
Now, an indication for 2019, we believe that the CapEx should be around BRL 330 million. This is due to several initiatives, which is decreasing the disparity of our services and the expansion that is associated to revenues. Now, I give the presentation back to Eduardo.
Now, I'm going to reference page 10, but before we do so, I believe that there is an issue that is very important. Let's just take a step back and talk about the concept of distance learning, EAD in Portuguese. Now, we are mentioning about two million students that study distance learning, and we see a potential of that number doubling in the next years. The market is very good. The reason for our optimism, I think that is shared with several other teaching institutions, is that the distance learning is very different here in Brazil than when you compare it to different countries, such as the United States.
When you see distance learning in the United States, it's an option for the student, and sometimes the ticket is almost the same as the on-site. It usually is. Here, it's a tool for inclusion, social inclusion. We each have a stock of over eight million people that can still study that have a high school education and do not have a bachelor's degree. The distance learning is a way of bringing a lot of these people to studying back again. Now, you're offering access to a lot of people that did not have that kind of access before because of a financial issue, because of a physical geographic issue, and a time issue as well.
This is a market that grows, and we can see that everybody is growing. The tickets have kept their stability, even though there is a big margin in this market. So we are foreseeing this with a lot of optimism for the years up ahead. Now, going back to here, the table. We have a growth. You can see on the left, year- by- year, every time that we talk about this, we grew 20% vs the previous year. We have a specificity here at Estácio. We grew a lot in the second semester of last year and in the first semester of this year, the growth in the polls, in the partnerships, the DL partner centers. They're still in the first intake cycle. So they still have 30- 40 students. It's something that takes a lot of time still.
We see an exponential growth once you have the second and the third intake cycle, and we are expecting for these, basically partner centers to grow with us. Now, the Flex also growing. This is very important to talk about. This Flex, it's a course, distance learning, where you have some activities where you can have a physical experience, let's just say. So, you take a test with a partner center and also on-site. They schedule a time. They have a technician with an anatomy class, with a skeleton or something that they need to do. They can schedule that, and maybe they will be alone or alongside with a group of three or four , but always with the concept of on-site physical experience associated with the distance learning. This has really improved the success, our success, because it has increased 70% of our undergrad base.
We've got to 500 cities covered, almost. I think that once again, if we see the growth in the market, and we foresee the possibilities that we have up ahead in technology, internet evolving, people getting more and more used to having success. The quality and the success that our ENADE, our E, our distance learning, the experience is very much like the on-site. Once we see this DL or EAD in Portuguese, we foresee it with a lot of optimism. Now, let's go to slide 11, talking about medicine. I wanted to highlight that in the fourth quarter of last year, we talked about medicine. No, sorry, the first quarter of this year, we talked about medicine, and we are very happy to talk about this. This is something that is the focus for the market as a whole.
So congratulations to the ones that foresaw this. We've been working for many years for this. This is a pedagogical project that is very solid. If you take a look at our eight units that offer medical education, they are all with the same pedagogical project, with the same quality. If you take a look, a great testing of the quality of the medicine course, we have a very big number of students that come from the public sector. Anyway, in this presentation here on page 11, we have some numbers. What are these numbers? We've been working with them for a long time. These bars, the blue ones, the dark blue ones, are the current units. We have eight units. Four are, let's just call them original, and four related to the Mais Médicos I expansion.
We can see here in the detail how many slots you have, seats per year you have, and the potential for growth. This is the natural expansion of these units. Many of them, five of them, have not matured. So they are in their first, second year of course. These are courses that you get the first-year students, but nobody has still reached the final year, the sixth year. The 5,800 is the maturing of the courses that we have already. Within the expansion and the operation of Mais Médicos, we have an expansion of the seats per courses. What we see here later up ahead is the expansion. What we believe will happen in the base case for 2024, and what might happen until 2024, and if you get the full potential and if all the seats are used.
Mais Médicos II, the intermediary green, we have four units that we earned, that we got. One we already started. It's intermediary, so it's going to be dark blue soon. In Camocim, it's located in the state of Ceará, and there are others that there's still a judicial dispute in regards to Mais Médicos on the expansion here. But we are sure that the potential for getting a positive result here at the course is something that will happen. So we can expand them until 2024. We still have to mature them. Given this potential for growth, I highlight once again the consolidation of a standard of margins with opportunities for growth in medicine in distance learning. On the right side of the page, we see how important this is to us.
You can see 90% of the revenues come from this. Total net revenues come from this. BRL 174 million. A growth year-to-year of 19%. This is reflected on how we are pricing this ever more carefully with a ticket that is very relevant within our universe of courses. Before we go to Q&A, I want to invite you to take a look at slide 12. On the right side, up ahead where we have our watches, I should say. We introduced them in March. In the call of the fourth quarter of last year, this is a request from you to see how we are going along with the intake season. We do not like these pie charts, let us just say that much, but we do not want to make a mistake on them. We think that they are important.
If you take a look at the pie chart on the fourth quarter and you compare it to what was announced and the results of the first quarter of this year, we have all of them basically in the middle, except intake on the distance learning that we went well beyond. We had excellent results. Once we take a look at these half watches or pie charts, when we have the on-campus intake, we are sure of these numbers. Nowadays, everything indicates that we will be going over 10%, but we still need one more month. The aggregate, the on-site, and the DL, we went over the numbers of last year, we surpassed them, and we still have one month to work, to seek more people. What we have here, once again.
The pricing project has given us a lot of results in the price, but also in the intake. We have been very careful, because people can pay for this, and the students are. There is not a whole lot of turnover, so it is testing the quality of the course in comparison to our competition. We start to foresee an improvement also in the market, and an environment that allows us to be more conservative with the price, keeping a ticket, keeping the margins, and still be able to grow. These, in our view, it is positive in the last month. We are sure that we are talking about this margin that we are showing to you. If you go to the left side.
We see here, in the 10%, and we got to the cases of. There was a lot of conversation here. We show that, yes, this is the center that we are talking about, the new reality of Estácio, YDUQS. When we see the base of students that is growing 3% year-by-year, 10% if you do not count the FIES, the intake we record, the retention rates also going up, all of this resulting in the greatest base of students in the history of Estácio. This allows you for the increase in the gross margin and the solid cash conversion. We have a very solid base on which we need to leverage to seek new stage for growth. We saw very clearly the position and the technology that we are discussing, the maturing of medicine as an opportunity.
We are talking about, well, this is good for us. This is good maybe if you look at the same institutions. Once we take a look, what is the cash position and generation of cash. A net debt that is basically zero with a lot of opportunities here. We are very tempted with the opportunities that are presenting. As I told you, we are not going to do something crazy. Once we look at some bills, some pricing that has been done here, we think that some are very expensive. In this situation, we rather go back to what we have been doing with YDUQS. Once again, a very solid base and a lot of opportunities for growth up ahead. Thank you very much. Here I will give it back to Tostes.
Well, thank you, Eduardo. Now we go to the Q&A. Please. Now, ladies and gentlemen, we will do a session of Q&A. To ask your question, please type asterisk nine in your telephone. You can ask a question in English. First question will be from [Roberto] of Bradesco. [Roberto].
Good morning. Thank you for the call. The first question is in regards the activities of the new poles. This is actually an organic growth of the sector. The growth is based in the growth of the market. The increase in penetration, et c., or are you getting the share from the competition? The second question is from the private sector, of course. We can see that in the first quarter that the second semester reduced the base of students. How have you felt this with the cycle of the second semester? We can foresee the levels to be around the 5% of the intake, or this is something that we can expect an increase?
Hi. Thank you for your question. I am going to try and answer them. If there is something missing, you can talk to me. In regards to the poles, we think that this is a market growth. We do not see a fight. We do not see one taking away the pie from the other. I think that everybody is growing. We see that there is a lot of these, and the growth is not so relevant, but we have the percentage. Maybe people are not in your radar, and they are growing alongside with us. We look outside, and we see the growth of the market. We do not see fights. Sometimes there is a fight for the student in regards to the financing. We have an expectation of this number to be decreased.
We see that there are students opting, what we have been working very well with transparency. What does that mean? The financing vs a discount here and there for the student and for us. Because we have situations that it is better to give a discount of 20% than to expect X month or X years to receive another 50%. It is better. It is healthier. We are getting to a balance point here, and the vision that we have here is that it will be lower. They gave me the okay. Okay. I got it right.
Thank you.
Next question will be from Leandro Bastos, from Citi.
Hi, good morning. Two questions. First of all, I am commenting that, how do you foresee the competition and the onsite, the DL and onsite, how do you foresee the market in the future? Also talking about CapEx, BRL 300 million-BRL 3 30 million of CapEx in millions, is it because of the improvements, Mais Médicos? Can you share what would be the normal, the standard, a cruising altitude of investments that you still do? Can you tell us more about the M&A?
Thank you, Leandro. Let's just see. Intake. Intake, that competition is not uniform. As I commented with [Roberto], indeed, this is earning, is a market that is growing, and we have once again grown a lot better in comparison to the previous semester, the previous year. Now, in general, very little aggressiveness between the competition. Now, in the onsite, on-campus, it really varies. The campuses are suffering more because of a decrease in the FIES, financing. In the Northeast, in the first semester, we had a stronger fight there that is being repeated.
But the rest of Brazil, I think that there is a sensation that we are improving. We've done our homework and the competition as well. So I believe that everybody is within the same new reality. Now, we've been working to have a situation of costs that compensate this loss. So we can see the competition, certainly not as strong as last year. But about the CapEx, I'm going to ask for my partner here to talk to you.
Talking about CapEx, Leandro. Looking up ahead. Now, there is an issue that is very associated to the strategic decision of the company in regards to expansion. It's very important that we talk about this. Expansion is a CapEx that is directly connected to future revenues. This is very important because depending on what we decide for the next few years, this CapEx might increase or decrease, especially because of the expansion. Last year, we had about 6%. This year, we are talking about BRL 330 million, which is our CapEx. And we try to better leverage with the market, with the change of standards, with the change of thresholds, and that might generate about 10%. Up ahead, higher if you take a look at the future. But once again, this is a very important variable that influences CapEx is expansion.
The Mais Médicos II is a CapEx that we will do this year, and we will continue to do next year.
Thank you very much.
Very good. Next question will be from Marcelo Santos from JP Morgan. Marcelo, good morning.
Thank you for this. I have two questions. If you can please explore a little bit, the new businesses that are under the umbrella of YDUQS. Also, second question, to tell us a little bit about the implications of the intake on the on-campus that you are indicating a growth of 0% and 10%. What does that mean for the base for the next years? I mean, do we have a drop here, a scenario that is foreseeing two years of decreasing numbers or not? Are there any variables that should hinder that drop and foster growth?
Now, let's say this, in new businesses with YDUQS, now we have a series of opportunities here, and they are oppressed, and we don't take a look at them because of how big our on-site undergraduate programs are. Sometimes this was a hindrance to our focus, and it caused some issues because of our own mentality of the teaching, and I am going to clarify this. Well, for example, once you have a teacher on-site, well, and I can say that because I'm one of the 8,000 teachers. If you get a class, then you have a book that has been written two, three, four, five years ago. It's one thing. For you to do a class, and there is a content online that is more up to date. This is updated in the weeks leading to the class.
It's also more didactic for the student, for the youth, to study in a way that is more modern and more online with what they expect. This is a transformational experience. Instead of asking to read chapter X, you're telling them to go to the online class, which is not a video. It's part of a video and then with a text, with exercises, with something, and then you have tools on the classroom, and then you have a transformation in the teaching that we are working here, and this new mentality of the separation of the business is very important. What do we have as a history here? Our medicine has grown a lot because of the entrepreneurship of some people. Now, we have also a few teachers here, and we have also a physician. I mean, he's a doctor, but he also is an entrepreneur.
And he was, over the last years, building our medical teaching curriculum here. And our vision of YDUQS is to give our partners Afya an opportunity to grow, but also everybody else that maybe do not have the same degree that you have. We have a lot of potential here. What we offer, our potential is still not realized. So we are solving issues here. The DL, which was one of a side thing from the on-campus, and that was separated and developed, and it's growing. We don't want to say, "Oh, we're going to do this and do that." Well, maybe we still think that there are things inside here that are being discovered by people. And YDUQS will help us to give visibility, but always taking one step at a time. The growth, for the next 50 years, is going to be more accelerated.
And the world here, we have a very strong step-by-step approach. Again, new businesses. It's medicine, it's DL, putting, placing more attention on the distance learning. The post-graduate studies also. And we will eventually get into or acquire brands that we admire, and we believe that there is an opportunity to be present in different segments of the market. So we want to give you all this with YDUQS, and we're going to move up ahead. Now, your second question, which is about the indications for the on-campus. Our prediction is to grow the base over the next years. Once again, if we grow 3%, we have the prediction of growing more until the end of the year. The relative base in regards to the previous year. And what we see on the on-campus is a growth that is highlighted and not the decrease of that number.
I am sorry, I talk too much.
No, thank you. Just to clarify here, the base has grown, but the on-site, the on-campus is not growing. You can imagine. Let me just try and understand the answer here. You expect growth. Next year, you think that the on-campus is going to stop falling, the numbers?
No. Yes. Next year, the base of students, the numbers of students will not drop. But I want you to take a look at on page five, slide five, where we see the on-campus, excluding FIES, that is growing in 6,000 students. Of course, there is a reduction in the FIES-funded students. The on-campus, the numbers overall drop, but we are taking a hit from FIES now, and that is it. And what is for the future, there is a growth foreseen for the on-campus student base here in the thousands.
Thank you.
Next question will be Susana Salaru from Itaú BBA.
Hi, thank you for the opportunity. I have two questions. First question, in regards to the expansion of the DL. You are looking at the medium to small range, of the medium and small cities. What would be this definition of what would be a small city? What would be a medium city? If you think about a city with up until 30,000 inhabitants, they already have a very good offer of the distance learning. So what would be the cities that you want to, let us just say, increase your capillarity? That would be the first question. And secondly, do you have a target of cities? You have about 500. How many do you expect to cover in the future?
Susana, thank you for your question. We have a goal or vision of getting to 1,500 cities. We have a very good penetration in the big centers. We are talking about the cities that have over two million inhabitants. If you see the cities with 500 people, we are in every city, 300,000- 500,000. There is only one that we are not in there. So what we have here is 300- 500. Even though we are in most of them, there is relevant growth there. There are many cities that we will need another pole, another center, partner center, and we are talking about the cities of 100,000 people where we see a lot of potential for growth.
These cities are completely penetrated. You are going to be the second player, right? Second, third. What do we first see here? We have four or five players that managed to crack the distance learning. Now, we respect each other. We copy the good things, they copy our good things, and there is a lot of people that are trying. There are people that think that submitting a PDF to the student is a distance learning or that corresponds to 20% online. No, this is not sustainable. We trust in our product, in our brand. I don't think that this will, at least in the short term, unlock a war of prices. There is still a lot of people that want to grow.
And I see in the small cities an introduction of technology that is very important for the expansion of all of them. I don't think, in no way, that these cities. They might have distance learning, but I don't think that any of them have reached their potential.
Thank you.
The next question will be from [Mariana] from Credit Suisse. [Mariana].
Good morning, and thank you for my question. I have three questions, actually, very quick. First, PDD. We see that this line is very stable year- by- year, but there is a change of behavior. The dropout, non-negotiated, but the PDD of the monthly payer are dropping so the line is very stable. I wanted to understand that dynamic. How do you provision this? Do you expect more decrease? How is this going to evolve to the future? The second question, even doing a follow-up of the previous comment on the distance learning, you mentioned that the competition is not so complicated, but the ticket suffered a lot this quarter. What happened? It was something one-off, or it was your strategy to improve the intake. What is the logic here for the drop?
The follow-up on what was commented on in regards to providing services for third parties or contracted parties. If you can detail a little bit more of that. What is the economics of that idea? Is there anybody that is doing that? Is there any difference from what is up ahead in what is in the market? When is this going to be done? Is this a short-term, more for next year? When do you expect to launch this? These are my questions. Thank you.
It's a pleasure to see you in the sector. Well, before I give to Zeno to answer about PDD, I'm going to answer the two questions about the distance learning. Well, now, talking about [Estácio]. It's very important to understand, it's not because the city has a center is that they have distance learning. There is a neighborhood, there is a convenience of going into the center for you to use the internet of the center. Even in the big cities, we see sub-penetration of distance learning centers. In regards to the ticket, now, it moved parallel, I should say. This is a fluctuation of the market.
We are seeking to increase the penetration, while giving offers to bring more people inside, doing the investment. But if you notice, there is a relevant variation in our mix. We have the Flex course, more expensive, and more people opting for that. So you have the situation where we are facing that 0.7 as a natural fluctuation in the market. In no way, this is in an environment where you have big margins. This is not fighting for the prices. Now, the third-party services, once again, we want to avoid wells and whistles. What we see is that the customer is faster. Taking a look at the products, the YDUQS as the online teaching, this is a very good partnership.
Now, we are working to deliver to ourselves a business with a quality that is good. Our challenge here is to do a quality education for many, and this tool, digital tool is very important. It's fantastic because it allows us for us to have great control of what is given to the people. It helps with the didactics and brings more modern tools to the classroom. Now, if you can let us work a little bit more and just be a little bit patient, we will give you more results.
Now talking about PDD or bad debt. The bad debt. Yeah. This provision, we are having a mix. It's not what is expected. We have communicated the market [DG part]. These are products that have provisions for when the student. Well, you have a commitment for the provision. [DG part], there is nothing beyond what is expected. Now, looking at the monthly payer, this is very connected to the efficiency of charging. We have improved the recovery of this class. [DG pay], we are improving, but even the monthly payer, this is a more outdated modality. We understand it better, but we are improving on how we charge the students. You can see the mix. There is a difference of mix if you compare to the previous year in the bad debt, but nothing different.
Thank you very much.
Next question will be from Caio Moscardini from Morgan Stanley.
Hi, I have two questions. First, how do you pay your centers, the partner centers? We have a growth in costs and a growth of distance learning is growing. Is this due to an increase of payment that is done to the partners or an increase of share of the partners within the revenue of distance learning? Now, in regards to the campuses of Mais Médicos II, which are under a judicial dispute, is there a timeline for us to know the final result? What is your expectation?
Thank you, Caio. Well, I am very happy. Every time we have that increase, we see that our partners are growing, and the more they grow, the healthier we are. Well, this is the B part of your question. The mix of partners is growing within our universe here, and this is natural that the payouts are increasing more than the revenue. We have about 90 of our own centers up until last year, it was 100 partners. We have 700 partners, so we have a lot of centers being opened. Mais Médicos II. We have some decisions coming that already started. We started the works. We expect that the next three will be solved in the semester, and then this will allow us to capture at least two next year, and maybe the fourth.
Now, it all depends on the legal system, and you know that has a bit of an unpredictability, not only for us, but for everybody. But we are very optimistic of having this for next year. Coming back for sure. Well, another two or three for 2024/ 2023.
Well, very good.
Next question will be from Samuel Alves from BTG Pactual. Samuel.
Hi. Good morning, everyone. Two questions, actually. First question is, can you comment a little bit about the percentage of the intake that is complete, this preliminary number for the next cycle that you opened? A second question would be, if you allow me, if you can talk about the student dropout. We see an improvement in those indicators in the second quarter, specifically on the on-site, on-campus. Now, only 300 students dropping out in the second quarter. I think that is the lowest numbers in your company. Is there a change of criteria or is this a loyalty project? If you can give us details, that would really help.
Percentage, we are talking about 70%- 75%. There is still a month up ahead. A month is a lot of time, but we are talking about 70%- 75%. What we have here, if you compare it to the same talk that we had in the first quarter, it's a little bit up ahead than what we did. In regards to the dropout, well, no, there isn't anything. We have a very strong work that has been done, and it's very nice. Well, I've been here for a very short time, and I can see the numbers making sense. This is a big effort from the team. From these undertakings, we can see the results. More clarity in the numbers, more the capacity to transform and react.
Once again, this is the maturing of the work that has been developed over the last few years, and we are gathering the results. There is no change for criteria of dropout.
Thank you.
Now we close the Q&A session. Therefore, I give the word to Eduardo Parente for the follow-up. Eduardo?
Well, it's Eduardo. Well, we had a few more questions I asked. I'm sorry that we couldn't answer, but to respect the competition, there is a call starting at 10:00 A.M., and I think that it's important to give them the space. Before the next result, we are all going to talk in YDUQS Day, and in October, we're going to have wonderful results for you. Thank you very much, and have a wonderful day.
The teleconference of Estácio Participações is closed. Thank you for your participation, and have a wonderful day.