Belo Horizonte, May 12, 2016, Kroton Educacional S.A. (BM&FBovespa: KROT3; OTCQX: KROTY), "Kroton" or "Company," announces today its results for the first quarter of 2016 (1Q16).

Highlights - 1Q16 Results:

- The first admissions process of 2016 resulted in the addition of around 282,300 new On-Campus and Distance-Learning Undergraduate students (ex-Uniasselvi), an increase of 10.1% compared to 4Q15 and stable compared to 1Q15.

- The total Postsecondary Education student base (ex-Uniasselvi), which remained above the mark of one million students, expanded 0.8% and 10.0%, respectively, compared to 1Q15 and 4Q15.

- Pro forma net revenue advanced 1.9% compared to 1Q15, despite lower revenue from Pronatec and LFG.

- Pro forma adjusted EBITDA amounted to R$588.7 million, representing growth of 15.1% compared to 1Q15.

- Pro forma adjusted EBITDA margin stood at 48.0%, expanding 550 basis points, which highlights the important results obtained to date by the projects to capture operating efficiency gains.

- Pro forma adjusted net income came to R$490.5 million in 1Q16, growing 16.9% from R$419.6 million in 1Q15. Pro forma adjusted net margin also posted solid expansion in the period, of 5.1 p.p.

- Operating cash generation in 1Q16 was adversely affected by PN23 and by the seasonality of the flow of FIES re-enrollments, which should result in a more significant contribution to cash generation in 2Q16. In this context, note that 2Q16 should register the receipt of around R$900 million in FIES receivables (for the periods March and April), which should boost cash conversion in the first half of the year to a level significantly higher than in the same period of 2015.

- The Board of Directors approved the distribution of R$199.3 million or R$0.12 per share in dividends, which represents a payout of 35% of net income for distribution.

To access Kroton‘s earnings release, please, click here.

1Q16 Earnings Conference Call: May 12, 2016

English Portuguese
Time: 12:30 p.m. (Brasília) Time: 11:00 a.m. (Brasília)
Time: 11:30 a.m. (New York) Time: 10:00 a.m. (New York)
Phone: +1 (516) 300-1066

Phone: +55 (11) 3127-4971 or
+55 (11) 3728-5971
Code: Kroton Code: Kroton
Replay: +55 (11) 3127-4999 Replay: +55 (11) 3127-4999
Code: 43083716
Code: 56847279

Participants are requested to connect ten minutes prior to the time set for the conference call.

Slides and Webcast: The conference call slides will be available on our website on May 12. The Conference Call will be webcasted simultaneously on the same website, and will remain available after the event.

Notice to Shareholders

We hereby announce to the Shareholders that the Board of Directors of Kroton Educacional S.A. ("Company"), in the meeting held at 7:00 a.m. on May 12, 2016, approved, subject to approval of the Annual Shareholders’ Meeting of the Company that will consider and vote on the results of the fiscal year ended on December 31, 2016, the distribution of interim dividends, to be calculated towards the minimum mandatory dividends for fiscal year 2016.

To access the Notice to Shareholders, please, click here.

For more information, please contact our investor relations department:

Carlos Lazar - Director
Carolina Igi - Coordinator
Pedro Gomes - Coordinator

Telephone: +55 (11) 3133-7309 / +55 (11) 3133-7314 / +55 (11) 3133-7311

Contact IR

Phone: (55 11) 3133-7309