Auna (AUNA) Q4 2025 earnings review
Regional Stability Masks Mexico's Profitability Collapse
Auna's Q4 results paint a sharply divided picture. Consolidated revenue grew 7% YoY to S/1,133 million, breaking a three-quarter streak of reported top-line declines, driven by excellent execution in Peru (+11%) and Colombia (+9%). However, this volume recovery completely bypassed the bottom line. Consolidated Adjusted EBITDA fell 13% YoY as Mexico's operating profit plummeted 37%. While management is claiming 'strong signs of recovery' and issued aggressive double-digit growth guidance for 2026, the S/64 million Q4 net loss—exacerbated by S/170 million in debt refinancing costs—shows the company is still paying a heavy toll for operational friction. Auna is currently a tale of two companies: a highly profitable, stable South American core subsidizing a troubled, expensive North American expansion.
🐂 Bull Case
Peru continues to be Auna's anchor, delivering 11% Q4 revenue growth and 14% EBITDA growth. Oncosalud's Medical Loss Ratio (MLR) hit a record low of 48.5%, proving the financial viability of the vertically integrated model.
The $825 million refinancing successfully extended maturities to 2030 and 2032, eliminating short-term liquidity risks and increasing direct local currency funding, which should reduce future FX volatility.
🐻 Bear Case
Despite management overhauls, Mexico's Adjusted EBITDA margin collapsed from 34.7% in 24Q4 to 22.8% this quarter. Slower-than-expected physician alignment and unfavorable service mix continue to destroy regional profitability.
Net Debt to Adjusted EBITDA remained flat at 3.6x for the fourth consecutive quarter. Despite generating positive Free Cash Flow, declining EBITDA and heavy refinancing premiums have stalled the deleveraging process.
⚖️ Verdict: ⚪
Neutral. The core Peruvian business is fantastic, but the turnaround in Mexico is proving slower and more expensive than anticipated. The 2026 guidance implies a rapid 'V-shaped' margin recovery in Mexico that carries significant execution risk.
Key Themes
Mexico Stabilization Narrative Contradicts Margin Data
Management's primary narrative is that Mexico showed 'strong signs of recovery' in Q4. However, the specific financial data directly contradicts this optimism. Mexico's Adjusted EBITDA plummeted 36% sequentially from Q3 to Q4 (S/88M → S/59M), and operating margins fell to a dismal 22.8%. Management explicitly noted that the newly extended ISSSTELEON contract—touted as a commercial win—actually drove an increase in the cost of treatments and unfavorable service mix, negatively impacting gross margins. Volume is not translating into profit.
Peru Operational Excellence & Record MLR
The Peruvian operations are the blueprint for Auna's success. Oncosalud drove a 4% increase in memberships and pushed its Oncology Medical Loss Ratio (MLR) to a record low of 48.5% (down 4.4 p.p. YoY). Management attributes this to lower average treatment costs and structural pharmaceutical scale efficiencies. This enabled Peru's Adjusted EBITDA to grow 14% YoY, acting as the sole engine preventing a total consolidated earnings collapse.
Oncology Growth Providing Lifeline in Mexico
While general hospital volumes in Mexico lag, high-complexity technology and services are gaining traction. Revenues from radiotherapy and chemotherapy surged 35% sequentially from Q3 to Q4. Oncology now represents 9% of Mexico's network revenues, up from just 3% a year ago. The new Oncocenter Center of Excellence is a tangible proof-of-concept that the AunaWay vertical integration strategy can capture high-margin segments in North America.
Colombia Risk-Sharing Pivot Accelerates
In Colombia, Auna successfully decoupled revenue growth from volume metrics by aggressively expanding risk-sharing agreements. These models grew to 21% of segment revenue in 4Q25 (up from 17% in 4Q24). Despite a 7-8% drop in actual surgery and emergency volumes, ticket increases and risk-sharing premiums drove 7% local currency revenue growth, proving the resilience of this managed-care shift.
Severe FX Volatility Obscures Core Operations
Auna's reported financials are heavily distorted by macro currency swings. For the full year, a 1% depreciation of the MXN and 3% appreciation of the COP against the PEN masked underlying dynamics. More concerningly, 'Net finance costs from exchange rate differences' injected a S/193M non-cash positive gain into the income statement for FY25, artificially inflating pre-tax profit optics. Investors must manually strip out these volatile line items to see the true operating cash flow.
Deleveraging Sputters Amid Refinancing Costs
Despite a stated medium-term goal to reduce leverage below 3.0x, Auna's Net Debt-to-Adjusted EBITDA ratio has been stable and stuck at 3.6x since December 2024. The $825M debt refinancing incurred S/170M in extraordinary expenses and premiums in Q4 alone. While this improves the maturity profile and lowers future cash interest, it drained liquidity in the short term, ensuring leverage targets will not be met until 2026 at the earliest.
Other KPIs
A bright spot on the balance sheet. Operating Cash Flow increased to S/663M while CapEx remained disciplined at S/145M. This 35% YoY increase in Free Cash Flow proves the core business is highly cash-generative, even if accounting net income is dragged down by non-cash derivative and FX volatility.
Decelerating. Operating capacity utilization dropped in Mexico (-9.4 p.p.), Colombia (-1.9 p.p.), and Peru (-0.9 p.p.). In Mexico, this stems from softer demand and broken physician relationships. In Colombia, it is a deliberate strategy to limit services to government-intervened payors. Regardless of the reason, fixed-cost leverage is deteriorating.
Guidance
Accelerating. This implies a significant ramp-up from the 4% FXN growth achieved in FY25. Management expects this to be driven by a return to volume growth in Mexico, normalized payer relationships in Colombia, and continued pricing power in Peru.
Reversing. Auna is guiding for double-digit profit growth following a 3% FXN contraction in FY25. Because the company expects margins to remain 'broadly stable,' this target relies almost entirely on the assumption that Mexico's top-line revenues will recover without requiring further margin-crushing promotional pricing or administrative overhaul costs.
Stable. Consistent with historical levels, reflecting a disciplined approach to capital allocation. Major expansion projects (like Trecca in Peru) are being structured as debt-neutral Public-Private Partnerships, keeping direct capex demands low.
Key Questions
Mexico Margin Squeeze
You noted that the ISSSTELEON contract extension negatively impacted gross margins due to treatment costs. Given your reliance on institutional and corporate packages to rebuild volume in Mexico, is the sub-25% EBITDA margin seen in Q4 the 'new normal' for this segment?
Oncosalud MLR Sustainability
Peru's Oncology MLR reached a spectacular 48.5% this quarter. In previous quarters, management cautioned that sub-50% MLRs were due to timing and not structurally repeatable. Are you formally revising your long-term MLR target downward, or should we model a snapback above 50% in 2026?
Path to Deleveraging
With the $825M refinancing complete but leverage stuck at 3.6x, what is the exact mathematical bridge to achieve your <3.0x target? Is it entirely dependent on EBITDA expansion, or are there further working capital or asset sale levers to pull?