Auna (AUNA) Q1 2026 earnings review
Surging Cash Flow Masks Persistent Margin and FX Vulnerabilities
Auna delivered a mixed first quarter. The top line was strong, with consolidated revenue growing 13% YoY driven by solid execution in Colombia and Mexico. Crucially, the business proved its cash-generating capabilities, with Operating Cash Flow surging 65% YoY to S/175 million. However, the bottom line tells a cautionary tale of negative operating leverage. Adjusted EBITDA declined 2% YoY, and Net Income collapsed 76% to S/9 million, battered by a S/26 million non-cash FX loss. Management expects a heavily back-weighted year to hit their reaffirmed double-digit growth guidance, making H2 execution critical.
🐂 Bull Case
Operating Cash Flow grew 65% YoY to S/175M and Organic Free Cash Flow jumped 2.6x, driven by strict working capital discipline and supplier financing initiatives across all markets.
Auna has successfully diversified its Colombian payor base. Highly predictable PGP risk-sharing contracts now represent 21% of revenue, while exposure to government-intervened payors dropped from 19% to 14%.
🐻 Bear Case
Consolidated Adjusted EBITDA margin compressed by 2.9 p.p. YoY. Peru suffered from payor penalties and delayed rebates, while Mexico's YoY margins were squeezed by higher SG&A and talent investments.
Despite strong cash generation, the Leverage Ratio increased slightly to 3.7x due to FX depreciation, remaining stubbornly above management's medium-term target of <3.0x.
⚖️ Verdict: ⚪
Neutral. The robust cash conversion and top-line acceleration are highly encouraging and validate the core business model. However, persistent FX volatility, shrinking margins, and a heavy reliance on a steep second-half recovery to hit FY guidance warrant a 'wait-and-see' approach.
Key Themes
Colombia's Strategic Pivot to PGP
In a tough regulatory environment, Colombia is a bright spot. Auna's strategy to cap exposure to government-intervened payors is accelerating. Revenue from intervened payors dropped to 14% (from 19% a year ago), while Prospective Global Payment (PGP) risk-sharing contracts scaled to 21% of segment revenue. This mix shift drove a 14% local-currency revenue increase and an outright 7% LC growth in Segment Adjusted EBITDA.
The Mexico Narrative Contradiction
Management heavily promoted Mexico's 19% sequential (QoQ) Adjusted EBITDA bump as proof of a turnaround. However, comparing 26Q1 to the same period last year reveals a 14% local-currency plunge in Adjusted EBITDA. Segment margins actually deteriorated from 33.2% in 25Q1 to 26.4% today, driven by SG&A talent investments that have yet to yield proportionate bottom-line leverage.
Peru Hit by Negative Operating Leverage
Peru, traditionally Auna's most stable engine, showed cracks. Despite 9% top-line growth, Consolidated Peru Adjusted EBITDA fell 3% YoY. This reversing trend was fueled by an abnormal S/14M in revenue adjustments (payor penalties for delayed invoicing) and postponed medicine rebates. Healthcare Services Peru margin fell dramatically from 15.8% to 10.9% YoY.
Surging Operating Cash Flow
Accelerating working capital discipline is the strongest element of this report. Net cash from operating activities jumped S/69M (+65% YoY) to S/175M. Days Sales Outstanding (DSO) stabilized at 90 days, enabling an organic free cash flow expansion of 2.6x YoY. The business is generating cash despite profit headwinds.
High-Complexity Mix Shift in Mexico
Auna's structural pivot toward complex care is bearing fruit in Mexico. Oncology revenues (radiotherapy and chemotherapy) grew 32% sequentially and 2.7x YoY. The oncology line now represents 11% of the Mexico network's revenue, up from just 4% a year ago.
Macro: Foreign Exchange Wiping Out Profits
Currency volatility (Macro) remains a severe drag. While consolidated EBITDA was down 2% as reported, net finance costs spiked 75% YoY to S/141M. This was driven primarily by a S/26M non-cash FX loss (due to Sol depreciation against USD/MXN), reversing a S/37M gain in the prior year. This wiped out top-line gains and crashed Net Income by 76%.
Technological and Process Innovation Rollout
The company continues its modernization push, deploying S/12 million in CapEx this quarter for Hospital Information Systems and ERP implementations, heavily focused on the Mexico network. This technology infrastructure is critical for the 'AunaWay' integrated care model, aiming to standardise billing and reduce the invoicing delays that plagued Peru this quarter.
Other KPIs
Total MLR improved (dropped) by 2.2 p.p. YoY, while the pure Oncology MLR decreased 2.0 p.p. YoY to an impressive 49.6%. This reflects tight pricing discipline, cost control, and the addition of ~20,000 members from a new institutional contract with the Peruvian Judiciary.
Increased 4% (S/159 million) sequentially from 4Q25. This was almost entirely driven by a non-cash FX hit of S/138 million. The debt load keeps the Leverage Ratio pinned at 3.7x, delaying the timeline to reach the stated <3.0x target.
Guidance
Accelerating. Management explicitly reaffirmed full-year targets, which previously pointed to ~12% FX-Neutral EBITDA growth. Given Q1 Adjusted EBITDA was down 5% FX-Neutral, this guidance mathematically requires a massive acceleration in H2 2026. Management acknowledged they 'contemplated a softer first half,' but execution risk for the rest of the year is exceptionally high.
Stable. Management reiterated the long-term target of bringing Net Debt to Adjusted EBITDA below 3.0x. With the ratio currently at 3.7x and flat sequentially, the company is relying entirely on backend-weighted EBITDA growth rather than gross debt reduction to achieve this.
Key Questions
Peru Payor Penalties: Transitory or Structural?
You noted S/14M in revenue adjustments in Peru related to delayed invoicing penalties, citing a broader market trend of 'rigorous enforcement.' Is this a structural change in the Peruvian market, and what specific IT/process investments are being made to prevent these penalties going forward?
Bridge to H2 EBITDA Inflection
Q1 Adjusted EBITDA declined 5% FX-Neutral, yet you reaffirmed full-year guidance which historically pointed to double-digit growth. What specific catalysts give you a 'clear line of sight' to the steep acceleration required in the second half of 2026?
Mexico Margin Recovery Timeline
While Mexico showed strong QoQ improvement, YoY EBITDA margins compressed by almost 700 basis points due to SG&A talent investments and service mix. When do you expect these talent investments to demonstrate operating leverage and return Mexico to historical 30%+ EBITDA margins?