Hapvida corrected accounting practices from 2016 to 2023, increasing net equity for 2024 by 503 million reais under CPC 50 standards. However, under CPC 11, it resulted in a 202 million reais decrease. The firm also renegotiated debts, settling 2.9 billion reais for 1.7 billion, impacting results by 470 million reais, and posted a Q4 adjusted profit of 514.7 million reais.
Hapvida, a prominent Brazilian healthcare operator, announced on Wednesday that it has rectified its accounting practices spanning from 2016 to 2023. This adjustment has resulted in a positive effect on its net equity for 2024, amounting to 503 million reais (approximately $89 million) according to the CPC 50 accounting standards.
However, the implications on net equity are not uniformly positive; when applying CPC 11 standards, the equity decreased by 202 million reais. The corrections to financial statements involved the write-off of deferred tax liabilities and judicial deposits, along with adjustments to asset valuation and recognition of deferred revenue from insurance contracts.
In addition to accounting improvements, Hapvida has entered a debt renegotiation program initiated in December. This program addresses fines from the regulatory body ANS and reimbursements to Brazil’s public health system, effectively settling liabilities totaling 2.9 billion reais for a reduced payment of 1.7 billion reais.
The financial maneuver has yielded a net positive impact of 470 million reais on the company’s overall results. In its prior statements, Hapvida also reported a fourth-quarter adjusted net profit of 514.7 million reais, surpassing the forecasts set by analysts surveyed by LSEG.
Hapvida’s recent accounting revisions and successful debt restructuring mark significant steps for the healthcare operator. The adjustments have positively affected its equity under CPC 50 standards, despite a drawback under CPC 11. The completed debt renegotiation streamlines financial obligations while improving profitability, as evidenced by the reported fourth-quarter profits exceeding analyst expectations.
Original Source: www.tradingview.com
