SEC Filing | Vasta Platform Limited

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2021

Commission File Number 001-39415

VASTA PLATFORM LIMITED

(Exact name of registrant as specified in its charter)

The Cayman Islands
(State of incorporation or organization)

Av. Paulista, 901, 5^th Floor

Bela Vista, São Paulo – SP

01310-100, Brazil

+55 (11) 3133-7311
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes ☐ No ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes ☐ No ☒

TABLE OF CONTENTS

EXHIBIT
99.1	Press Release dated November 11, 2021 – Vasta Platform Limited announces today its financial and operating results for the third quarter of 2021
99.2	Vasta Platform Limited Unaudited Interim Condensed Consolidated Financial Statements as of September 30, 2021, and for the three- and nine-month periods ended September 30, 2021 and 2020

SIGNATURE

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

Vasta Platform Limited


By:	/s/ Mario Ghio Junior
	Name:	Mario Ghio Junior
	Title:	Chief Executive Officer

Date: November 12, 2021

Exhibit 99.1

São Paulo, November 11, 2021 – Vasta Platform Limited (NASDAQ: VSTA) – “Vasta” or the “Company,” announces today its financial and operating results for the third quarter of 2021 (3Q21) ended September 30, 2021. Financial results are expressed in Brazilian Reais and are presented in accordance with International Financial Reporting Standards (IFRS).

HIGHLIGHTS

Vasta concluded the 2021 cycle with a 7% subscription revenue growth over the same period of last year, or 11% excluding PAR (our hybrid subscription product based on textbooks). Total net revenue fell 12%, however, as the non-subscription revenue was severely impacted by the deterioration in the textbook business, on the back of Covid-19 (higher reuse of textbooks).

In the third quarter, net revenue contracted 10% year on year, owing to the different seasonality of the ACV recognition observed in 2021, with the concentration of deliveries in some brands in the second quarter.

Adjusted EBITDA totaled R$ 168 million in the 2021 cycle, a drop of 35% versus the 2020 cycle, driven by the reduction in net revenue, coupled with higher provision for doubtful accounts (PDA) and the enhancement in our corporate structure following the IPO in July 2020. Additionally, it was recorded in the 3Q21 a write-off of editorial costs amounting to R$ 20 million, referring to a rationalization of our portfolio considering the changes in the textbook business and our editorial strategy. Excluding this effect, adjusted EBITDA totaled R$ 188 million, 27% lower versus the 2020 cycle, yielding a margin of 21%. In the 3Q21, adjusted EBITDA was negative in R$ 29 million, or R$ 9 million excluding the write-off.

The higher PDA reflects the company’s care with provisioning standards, amidst a difficult period for some of our partner schools and the textbook distribution channel. Since the beginning of the pandemic, we have opted to support our partners by extending payment terms instead of granting discounts.

Vasta recorded adjusted net profit of R$ 28 million in the 2021 cycle, 57% down year-on-year.

On October 26, Vasta announced a distribution agreement with Instituto Presbiteriano Mackenzie, pursuant to which Vasta will be the sole and exclusive distributor of the Mackenzie Learning System across all of the basic education segments in Brazil.

On October 29, Vasta concluded the acquisition of Eleva platform, its biggest acquisition since the IPO. This transaction adds not only a sizeable and complementary portfolio of schools to Vasta’s portfolio, but also a long-term contract through which Vasta will be the exclusive provider of learning systems to almost all K-12 schools held by Eleva.

The B2B2C platform debuted in October, with Plurall MyTeacher (private classes platform) and Plurall Adapta (adaptive learning platform) recording their first sales.

On October 31, and with two months to go in the commercial campaign, the 2022 preliminary ACV totaled R$ 888 million, an organic growth of 20% versus the subscription revenue collected in the 2021 cycle, or 29% excluding paper-based PAR. With Eleva, the 2022 preliminary ACV was R$ 974 million, 32% higher year-on-year. Nearly 100% of our new sales have come from tradition learning systems, complementary solutions, or the newly launched digital textbook platform (which is offered on a fee-per-student basis).

MESSAGE FROM MANAGEMENT

In the third quarter, we concluded the 2021 cycle (4Q20 to 3Q21), one of the most challenging periods of our history. The adverse effects originated by the second wave of Covid-19 severely hit our business, leading to disappointing and below-potential operating results. The 2021 ACV of R$ 853 million (23% higher than the 2020 ACV) translated into R$ 741 million subscription revenue, a quite unusual gap in our industry, on the back of an unexpected dropout at our partner schools combined with a higher reuse of textbooks. At the same time, the non-subscription revenue declined 53%, due to the deterioration in the textbook business combined with our focus on bringing non-subscription clients to the subscription universe, our core business. Notwithstanding all the challenges, we delivered a 7% growth in subscription revenue, or 11% excluding PAR (highly dependent on textbooks).

We have reasons to say that the worst was left behind. With the social isolation measures almost fully lifted in the country (as most of Brazilian population is already immunized against Covid-19), we can expect the 2022 school year to be a regular one, without unexpected student dropouts that in the 2021 cycle led to subscription revenue substantially different from the ACV. While we don’t expect non-subscription revenue to recover strongly going forward, we don’t foresee reasons for another sharp reduction either. These two factors mean that Vasta is back to the growth territory in 2022, recovering the ground lost in 2021.

If 2021 was a lost year in terms of financial results, it has been a great year for the expansion of our Plurall platform, still the absolute leader in terms of K-12 web traffic. We particularly celebrate the debut of our B2B2C services: Plurall MyTeacher (private classes platform) and Plurall Adapta (adaptive learning platform) recorded their first sales in October. As it happens with products of this nature, first sales are quite small, but long-term potential is sound, and it could materialize exponentially once the product is better known by our Plurall community. Plurall Store, which offers a series of complementary solutions in partnership with education companies from all over the world, is also live in October, underscoring our platform’s potential to continue expanding through a crescent number of solutions to our clients, ultimately increasing client loyalty and enhancing our long-term growth potential.

On October 26, we announced a distribution agreement with Instituto Presbiteriano Mackenzie (“Mackenzie”), pursuant to which Vasta will be the sole and exclusive distributor of the Mackenzie Learning System across all of the basic education segments in Brazil. Mackenzie, a meaningful participant in the educational sector in Brazil since its foundation, shall remain responsible for the development of the didactic and learning materials of the Mackenzie Learning System and the definition of the system’s pedagogy and methodology. Vasta shall be responsible for support services, technological products and all services relating to the commercialization and expansion of the Mackenzie Learning System brand. The Agreement will start in 2022, in a long-term basis, already contributing to the 2022 ACV.

Finally, on October 29 we closed the acquisition of Eleva platform, our biggest acquisition since the IPO. This transaction adds not only a sizeable and complementary portfolio of schools to our platform, but also a long-term contract through which Vasta will be the exclusive provider of learning systems to almost all K-12 schools held by Eleva, uniquely positioning Vasta to benefit from the consolidation of the fragmented K-12 market. The expected base purchase price (subject to adjustments based on 2021 and 2022 results) is R$ 580 million, to which an estimated net cash adjustment of approximately R$ 32 million will be added. This amount will be paid in installments over the next five years, all adjusted by the positive variation of Brazil’s interbank deposit rate (CDI). The first installment, in the amount of R$ 160 million, was paid on the closing date.

On October 31, the 2022 preliminary ACV totaled R$ 888 million, an organic growth of 20% versus the subscription revenue collected in the 2021 cycle, with the commercial campaign still two months to go. Excluding paper-based PAR, the organic growth is 29%, as nearly 100% of our new sales have come from tradition learning systems, complementary solutions, or from the digital textbook platform offered on a fee-per-student basis, reflecting our focus on reducing exposure to the paper-based textbook channel. With Eleva, the preliminary 2022 ACV totaled R$ 974 million, a 32% growth versus our 2021 subscription revenue. We will update the 2022 ACV number when campaign ends. It is important to mention that in our projections we factor in neither the return of students who dropped out from our partners schools’ base in 2021 nor the normalization in the volume of textbooks typically acquired through PAR contracts in a regular year – this means that the 2021 ACV gap of R$112 million could be captured in the upcoming years.

Despite the macroeconomic deterioration, our premium brands Anglo and pH have had a strong performance during this sales campaign, reassuring our perception that quality and reputation remain the name of the game in this business. In this campaign, we have also counted with Fibonacci, our new premium learning system developed in partnership with Colegio Fibonacci, a top-10 school in the National High School Test (ENEM) for more than 10 years. Complementary solutions have continued to ramp-up its penetration over the client base, evidencing the potential of this segment – in the 2021 cycle, only 25% of partner schools adopted our complementary solutions, being 84% of these adopting only one solution.

OPERATING PERFORMANCE

Student Base – Subscription Models

Values in R$ '000	2021	2020	% Y/Y	2019	% Y/Y
Partner Schools - Core Content	4,508	4,167	8.2%	3,400	22.6%
Partner Schools - Complementary Solutions	1,114	636	75.2%	417	52.5%
Students - Core Content	1,335,152	1,311,147	1.8%	1,185,799	10.6%
Students - Complementary Content	307,941	213,058	44.5%	133,583	59.5%

Note: Students enrolled in partner schools.

From 2019 to 2021, Vasta grew 33% its partner schools base, reflecting the success of the commercial strategy. Although the volume of enrolled students in the 2021 cycle was below its full potential, we retained our client base with long-term contracts, which represents additional growth potential without acquisition costs should our partner schools’ base is restored in the upcoming years. Additionally, only 25% of our clients adopt complementary solutions, which underscores the high growth potential of this segment. Finally, to this client base it will be added the schools currently served by Eleva and the new schools that joined Vasta’s platform during the 2022 sales campaign.

FINANCIAL PERFORMANCE

Net Revenue

	3Q21	3Q20	% Y/Y	2021 Cycle	2020 Cycle	% Y/Y
Subscription	96,208	105,849	-9.1%	740,709	691,924	7.1%
Subscription ex-PAR	86,648	108,335	-20.0%	609,083	551,014	10.5%
Traditional Learning Systems	87,256	107,967	-19.2%	546,342	508,751	7.4%
Complementary Solutions	(609)	368	n.m.	62,741	42,264	48.5%
PAR	9,560	(2,486)	n.m.	131,626	140,910	-6.6%
Non-subscription	30,985	35,566	-12.9%	152,013	324,990	-53.2%
Total Net Revenue	127,193	141,415	-10.1%	892,722	1,016,914	-12.2%

Note: n.m.: not meaningful

In the third quarter, net revenue contracted 10% versus the same quarter of 2020, owing to the different seasonality of the ACV recognition observed in 2021, with the concentration of deliveries in some brands in the second quarter, and to the 13% decrease in non-subscription revenue.

In the 2021 cycle (4Q20 to 3Q21), subscription ex-PAR revenue increased 11%, while PAR was down 7%, reflecting the challenging environment for textbook sales. Within subscription revenue, we highlight the strength of complementary solutions, up 49% in the cycle. Non-subscription revenue decreased 53%, reflecting the impacts of the pandemic in the purchase of textbooks during the 2021 back-to-school period, in addition to the migration of former non-subscription clients to our subscription products, being a key driver for the 12% total net revenue decline in the cycle.

Adjusted EBITDA

Values in R$ '000	3Q21	3Q20	% Y/Y	2021 Cycle	2020 Cycle	% Y/Y
Net (loss) profit	(70,821)	(40,605)	74.4%	(116,286)	(27,591)	321.5%
(+) Income tax and social contribution	(32,963)	(18,593)	77.3%	(54,248)	(13,436)	303.7%
(+) Net financial result	18,154	18,912	-4.0%	58,987	128,586	-54.1%
(+) Depreciation and amortization	50,593	43,516	16.3%	194,446	162,701	19.5%
EBITDA	(35,037)	3,229	n.m.	82,899	250,259	-66.9%
EBITDA Margin	-27.5%	2.3%	(29.8)	9.3%	24.6%	(16.9)
(+) Non-recurring expenses	603	-	n.m.	6,324	922	585.9%
(+) IPO-related expenses	-	-	n.m.	50,580	-	n.m.
(+) Share-based compensation plan	5,832	3,824	52.5%	28,461	6,004	374.0%
Adjusted EBITDA	(28,602)	7,053	n.m.	168,264	257,185	-34.6%
Adjusted EBITDA Margin	-22.5%	5.0%	(27.5)	18.8%	25.3%	(8.0)

Note: n.m.: not meaningful

Adjusted EBITDA was negative in R$ 29 million in 3Q21, mostly driven by the unfavorable revenue seasonality of the third quarter (which hinders the dilution of fixed costs), by the higher provision for doubtful accounts (PDA) and by the enhancement in our corporate structure following the company’s IPO in July 2020, while the 3Q20 was favored by savings of R$ 2.7 million in personnel expenses, captured from reduced work journeys allowed by the provisional measure 936. Additionally, it was recorded in the 3Q21 a write-off of editorial costs amounting to R$ 20 million, referring to a rationalization of our portfolio considering the changes in the textbook business and our editorial strategy. Excluding this effect, our adjusted EBITDA was negative in R$ 9 million. In the cycle, our adjusted EBITDA totaled R$ 168 million, or R$ 188 million excluding the editorial cost write-off (-27% versus 2020 cycle).

Adjusted net income

Values in R$ '000	3Q21	3Q20	% Y/Y	2021 Cycle	2020 Cycle	% Y/Y
(Loss) Profit before taxes	(103,784)	(59,198)	75.3%	(170,534)	(41,027)	315.7%
(-) Taxes paid	-	-	n.m.	(1,167)	(4,611)	-74.7%
(+) Non-recurring expenses	603	-	n.m.	6,324	922	585.9%
(+) Share-based compensation plan	5,832	3,824	52.5%	28,461	6,004	374.0%
(+) IPO-related expenses	-	-	n.m.	50,580	-	n.m.
(+) Amortization of intangible assets⁽¹⁾	28,987	29,043	-0.2%	114,794	104,760	9.6%
Adjusted net (loss) profit	(68,361)	(26,331)	159.6%	28,458	66,048	-56.9%

(1) From business combinations. Note: n.m.: not meaningful

In the cycle, adjusted net profit totaled R$ 28 million, 57% down year-on-year.

Accounts receivable and provision for doubtful accounts

Values in R$ '000	3Q21	3Q20	% Y/Y	2Q21	% Q/Q
Gross accounts receivable	249,628	274,264	-9.0%	336,958	-25.9%
Provision for doubtful accounts (PDA)	(39,103)	(26,929)	45.2%	(37,898)	3.2%
Coverage index	15.7%	9.8%	5.8	11.2%	4.4
Net accounts receivable	210,525	247,335	-14.9%	299,060	-29.6%
Average days of accounts receivable⁽¹⁾	85	88	(3)	119	(34)

(1) Balance of net accounts receivable divided by the last-twelve-month net revenue, multiplied by 360.

The increase in the provision for doubtful accounts (PDA) in the 3Q21 reflects our care with our provisioning standards. Consequently, the coverage index increased to 15.7% in 3Q21 from 9.8% in 3Q20, while the average days of receivable fell 3 days in the yearly comparison, at 85 days.

Since the beginning of the pandemic, our approach to credit issues faced by our school partners has been to extend payment terms instead of granting discounts. With the expected normalization of school activities in the upcoming school year, we expect an improvement in the receivable collection of this client segment in 2022. The textbook distribution channel has also been hit by the fast deterioration in sales, causing some of our clients to fall back in payments. As commented before, nearly 100% of our new sales contracted to the 2022 were composed of learning systems, complementary solutions, or digital textbooks; therefore, we are gradually reducing our exposure to the physical textbook distribution channel.

Financial leverage

Values in R$ '000	3Q21	2Q21	1Q21	4Q20
Financial debt	812,016	505,951	687,203	793,341
Accounts payable from business combinations	73,713	65,201	62,973	48,055
Total debt	885,729	571,152	750,176	841,396
Cash and cash equivalents	377,862	335,098	415,093	311,156
Marketable securities	317,178	81,090	259,581	491,102
Net debt	190,689	154,964	75,502	39,138
Net debt/LTM adjusted EBITDA	1.13	0.76	0.36	0.15

Vasta ended the 3Q21 with a net debt position of R$ 191 million, 1.1x the adjusted EBITDA of last twelve months.

CONFERENCE CALL INFORMATION

Vasta will discuss its third quarter 2021 results on November 11, 2021, via a conference call at 5:00 p.m. Eastern Time. To access the call (ID: 1557069), please dial: +1 (833) 519-1336 or +1 (914) 800-3898. A live and archived webcast of the call will be available on the Investor Relations section of the Company’s website at https://ir.vastaplatform.com.

ABOUT VASTA

Vasta is a leading, high-growth education company in Brazil powered by technology, providing end-to-end educational and digital solutions that cater to all needs of private schools operating in the K-12 educational segment, ultimately benefiting all of Vasta’s stakeholders, including students, parents, educators, administrators and private school owners. Vasta’s mission is to help private K-12 schools to be better and more profitable, supporting their digital transformation. Vasta believes it is uniquely positioned to help schools in Brazil undergo the process of digital transformation and bring their education skill set to the 21st century. Vasta promotes the unified use of technology in K-12 education with enhanced data and actionable insight for educators, increased collaboration among support staff and improvements in production, efficiency and quality. For more information, please visit ir.vastaplatform.com.

CONTACT

Investor Relations

ri@somoseducacao.com.br

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements that can be identified by the use of forward-looking words such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,” “intend,” “estimate” and “potential,” among others. Forward-looking statements appear in a number of places in this press release and include, but are not limited to, statements regarding our intent, belief or current expectations. Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to of various factors, including (i) general economic, financial, political, demographic and business conditions in Brazil, as well as any other countries we may serve in the future and their impact on our business; (ii) fluctuations in interest, inflation and exchange rates in Brazil and any other countries we may serve in the future; (iii) our ability to implement our business strategy and expand our portfolio of products and services; (iv) our ability to adapt to technological changes in the educational sector; (v) the availability of government authorizations on terms and conditions and within periods acceptable to us; (vi) our ability to continue attracting and retaining new partner schools and students; (vii) our ability to maintain the academic quality of our programs; (viii) the availability of qualified personnel and the ability to retain such personnel; (ix) changes in the financial condition of the students enrolling in our programs in general and in the competitive conditions in the education industry; (x) our capitalization and level of indebtedness; (xi) the interests of our controlling shareholder; (xii) changes in government regulations applicable to the education industry in Brazil; (xiii) government interventions in education industry programs, that affect the economic or tax regime, the collection of tuition fees or the regulatory framework applicable to educational institutions; (xiv) cancellations of contracts within the solutions we characterize as subscription arrangements or limitations on our ability to increase the rates we charge for the services we characterize as subscription arrangements; (xv) our ability to compete and conduct our business in the future; (xvi) our ability to anticipate changes in the business, changes in regulation or the materialization of existing and potential new risks; (xvii) the success of operating initiatives, including advertising and promotional efforts and new product, service and concept development by us and our competitors; (xviii) changes in consumer demands and preferences and technological advances, and our ability to innovate to respond to such changes; (xix) changes in labor, distribution and other operating costs; our compliance with, and changes to, government laws, regulations and tax matters that currently apply to us; (xx) the effectiveness of our risk management policies and procedures, including our internal control over financial reporting; (xxi) health crises, including due to pandemics such as the COVID-19 pandemic and government measures taken in response thereto; (xxii) other factors that may affect our financial condition, liquidity and results of operations; and (xxiii) other risk factors discussed under “Risk Factors.” Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated events.

NON-GAAP FINANCIAL MEASURES

This press release presents our EBITDA, Adjusted EBITDA, Free Cash Flow and Adjusted Cash Conversion Ratio, Adjusted Net (Loss) Profit, which are information for the convenience of investors. EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Cash Conversion Ratio and Adjusted Net (Loss) Profit are the key performance indicators used by us to measure financial operating performance. Our management believes that these non-GAAP financial measures provide useful information to investors and shareholders. We also use these measures internally to establish budgets and operational goals to manage and monitor our business, evaluate our underlying historical performance and business strategies and to report our results to the board of directors.

We calculate EBITDA as Net profit (loss) for the period / year plus income taxes and social contribution plus/minus net finance result plus depreciation and amortization. The EBITDA measure provides useful information to assess our operational performance.

We calculate Adjusted EBITDA as EBITDA plus/minus: (a) share-based compensation expenses, mainly due to the grant of additional shares to Somos’ employees in connection with the change of control of Somos to Cogna (for further information refer to note 23 (a) to the Consolidated Financial Statements); (b) Bonus IPO expenses, share based payments offered to certain employees and executives as result of IPO process and (c) other non-recurring expenses composed substantially by restructuring provisions. We understand that such adjustments are relevant and should be considered when calculating our Adjusted EBITDA, which is a practical measure to assess our operational performance that allows us to compare it with other companies that operates in the same segment.

We calculate Free Cash Flow as the net cash flows from operating activities as presented in the statement of cash flows of our financial statements adjusted by debt-like instruments (reverse factoring instruments) less cash flows required for: (i) acquisition of property, plant and equipment; (ii) addition to intangible assets; and (iii) acquisition of subsidiaries. We consider Free Cash Flow to be a liquidity measure, therefore, we adjust our Free Cash Flow metric with amounts that directly impacted the cash flows in the period in addition to the operating activities. The Free Cash Flow measure provides useful information to management and investors about the amount of cash generated by our operations, deducting for investments in property and equipment to maintain and grow our business.

We calculate Adjusted Cash Conversion Ratio as the cash flows from operating activities divided by Adjusted EBITDA for the relevant period.

We calculate Adjusted net (loss) profit as the net (loss) profit from the period as presented in Statement of Profit or Loss and Other Comprehensive Income adjusted by the same Adjusted EBITDA items, however, added by (a) Amortization of intangible assets from M&A, that includes goodwill and other assets and (b) taxes paid composed by cash effect over income tax and social contribution expenses.

We understand that, although Adjusted net (loss) profit, EBITDA, Adjusted EBITDA, Free Cash Flow and Adjusted Cash Conversion Ratio are used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS. Additionally, our calculations of Adjusted net (loss) profit, Adjusted EBITDA, Free Cash Flow and Adjusted Cash Conversion Ratio may be different from the calculation used by other companies, including our competitors in the education services industry, and therefore, our measures may not be comparable to those of other companies.

REVENUE RECOGNITION AND SEASONALITY

Our main deliveries of printed and digital materials to our customers occur in the last quarter of each year (typically in November and December), and in the first quarter of each subsequent year (typically in February and March), and revenue is recognized when the customers obtain control over the materials. In addition, the printed and digital materials we provide in the fourth quarter are used by our customers in the following school year and, therefore, our fourth quarter results reflect the growth in the number of our students from one school year to the next, leading to higher revenue in general in our fourth quarter compared with the preceding quarters in each year. Consequently, in aggregate, the seasonality of our revenues generally produces higher revenues in the first and fourth quarters of our fiscal year. Thus, the numbers for the second quarter and third quarter are usually less relevant. In addition, we generally bill our customers during the first half of each school year (which starts in January), which generally results in a higher cash position in the first half of each year compared to the second half.

A significant part of our expenses is also seasonal. Due to the nature of our business cycle, we need significant working capital, typically in September or October of each year, to cover costs related to production and inventory accumulation, selling and marketing expenses, and delivery of our teaching materials at the end of each year in preparation for the beginning of each school year. As a result, these operating expenses are generally incurred between September and December of each year.

Purchases through our Livro Fácil e-commerce platform are also very intense during the back-to-school period, between November, when school enrollment takes place and families plan to anticipate the purchase of products and services, and February of the following year, when classes are about to start. Thus, e-commerce revenue is mainly concentrated in the first and fourth quarters of the year.

KEY BUSINESS METRICS

ACV Bookings is a non-accounting managerial metric and represents our partner schools’ commitment to pay for our solutions offerings. We believe it is a meaningful indicator of demand for our solutions. We consider ACV Bookings is a helpful metric because it is designed to show amounts that we expect to be recognized as revenue from subscription services for the 12-month period between October 1 of one fiscal year through September 30 of the following fiscal year. We define ACV Bookings as the revenue we would expect to recognize from a partner school in each school year, based on the number of students who have contracted our services, or “enrolled students,” that will access our content at such partner school in such school year. We calculate ACV Bookings by multiplying the number of enrolled students at each school with the average ticket per student per year; the related number of enrolled students and average ticket per student per year are each calculated in accordance with the terms of each contract with the related school. Although our contracts with our schools are typically for 4-year terms, we record one year of revenue under such contracts as ACV Bookings. ACV Bookings are calculated based on the sum of actual contracts signed during the sales period and assumes the historical rates of returned goods from customers for the preceding 24-month period. Since the actual rates of returned goods from sales during the period may be different from the historical average rates and the actual volume of merchandise ordered by our customers may be different from the contracted amount, the actual revenue recognized during each period of a sales cycle may be different from the ACV Bookings for the respective sales cycle. Our reported ACV Bookings are subject to risks associated with, among other things, economic conditions and the markets in which we operate, including risks that our contracts may be canceled or adjusted (including as a result of the COVID-19 pandemic).

FINANCIAL STATEMENTS

Consolidated Statements of Financial Position

Assets	September 30, 2021		December 31, 2020

Current assets
Cash and cash equivalents		377,862		311,156
Marketable securities		317,178		491,102
Trade receivables		210,525		492,234
Inventories		240,636		249,632
Taxes recoverable		23,851		18,871
Income tax and social contribution recoverable		5,672		7,594
Prepayments		37,632		27,461
Other receivables		1,489		124
Related parties – other receivables		2,481		2,070
Total current assets		1,217,326		1,600,244

Non-current assets
Judicial deposits and escrow accounts		175,677		172,748
Deferred income tax and social contribution		143,477		88,546
Property, plant and equipment		164,989		192,006
Intangible assets and goodwill		4,939,155		4,924,726
Total non-current assets		5,423,298		5,378,026

Total Assets		6,640,624		6,978,270

Consolidated Statements of Financial Position (continued)

Liabilities	September 30, 2021			December 31, 2020

Current liabilities
Bonds and financing		262,445			502,882
Lease liabilities		18,672			18,263
Suppliers		186,272			279,454
Income tax and social contribution payable		17			1,761
Salaries and social contributions		70,910			69,123
Contract liabilities and deferred income		8,432			47,169
Accounts payable for business combination		20,055			17,132
Other liabilities		3,106			4,285
Other liabilities - related parties		39,677			135,307
Loans from related parties		-			20,884
Total current liabilities		609,586			1,096,260

Non-current liabilities
Bonds and financing		549,571			290,459
Lease liabilities		129,375			154,840
Accounts payable for business combination		53,658			30,923
Provision for tax, civil and labor losses		641,307			613,933
Contract liabilities and deferred income		4,607			6,538
Total non-current liabilities		1,378,518			1,096,693

Shareholder’s Equity
Share capital		4,820,815			4,820,815
Capital reserve		56,465			38,962
Shares in treasury		(11,765	)		-
Accumulated losses		(212,995	)		(74,460	)
Total Shareholder's Equity		4,652,520			4,785,317

Total Liabilities and Shareholder's Equity		6,640,624			6,978,270

Consolidated Income Statement

	Jul 01, to Sep 30, 2021			Jan 01, to Sep 30, 2021			Jul 01, to Sep 30, 2020			Jan 01, to Sep 30, 2020

Net revenue from sales and services		127,192			549,159			141,415			654,066
Sales		124,125			526,697			134,182			634,895
Services		3,067			22,462			7,233			19,171

Cost of goods sold and services		(79,381	)		(260,910	)		(62,230	)		(277,985	)

Gross profit		47,811			288,249			79,185			376,081
					-48	%		-44	%		-43	%
Operating income (expenses)
General and administrative expenses		(96,402	)		(304,208	)		(83,458	)		(265,752	)
Commercial expenses		(33,947	)		(119,040	)		(35,841	)		(116,437	)
Other operating income (expenses)		698			2,202			948			2,936
Impairment losses on trade receivables		(3,790	)		(21,998	)		(1,121	)		(12,704	)

(Loss) Profit before finance result and taxes		(85,630	)		(154,795	)		(40,287	)		(15,876	)

Finance income		10,532			21,793			5,942			14,579
Finance costs		(28,686	)		(69,174	)		(24,854	)		(101,399	)
Finance result		(18,154	)		(47,381	)		(18,912	)		(86,820	)

(Loss) Before income tax and social contribution		(103,784	)		(202,176	)		(59,199	)		(102,696	)

Income tax and social contribution		32,963			63,641			18,593			34,797

(Loss) for the period		(70,821	)		(138,535	)		(40,606	)		(67,899	)

Total comprehensive (loss) income for the period		(70,821	)		(138,535	)		(40,606	)		(67,899	)
(Loss) per share
Basic		(0.85	)		(1.67	)		(0.49	)		(0.82	)
Diluted		(0.84	)		(1.65	)		(0.49	)		(0.82	)

Consolidated Statement of Cash Flows

	For the nine months ended September 30
	2021			2020

CASH FLOWS FROM OPERATING ACTIVITIES
Loss before income tax and social contribution		(202,176	)		(102,696	)
Adjustments for:
Depreciation and amortization		149,492			129,059
Impairment losses on trade receivables		21,998			12,704
Provision for tax, civil and labor losses		(775	)		(4,966	)
Interest on provision for tax, civil and labor losses		17,681			13,406
Provision for obsolete inventories		13,936			11,941
Interest on bonds and financing		24,272			46,725
Refund liability and right to returned goods		2,115			(25,118	)
Imputed interest on suppliers		3,213			2,945
Interest on accounts payable for business combination		811			1,394
Share-based payment expense		17,503			-
Interest on lease liabilities		11,602			11,337
Interest on marketable securities incurred and not withdrawed		(15,937	)		(2,018	)
Disposals of right of use assets and lease liabilities		(3,481	)		(1,023	)
Residual value of disposals of property and equipment and intangible assets		3,411			1,931

Changes in
Trade receivables		262,120			133,798
Inventories		(5,618	)		(37,741	)
Prepayments		(10,157	)		(4,629	)
Taxes recoverable		(3,049	)		22,090
Judicial deposits and escrow accounts		(2,929	)		1,029
Other receivables		(1,185	)		2,828
Suppliers		(92,912	)		(79,323	)
Salaries and social charges		1,062			9,484
Tax payable/Income taxes and social contribution		7,775			6,267
Contract liabilities and deferred income		(42,105	)		3,510
Other receivables and liabilities from related parties		(96,041	)		219,010
Other liabilities		(1,880	)		7,157
Cash from operating activities		58,745			379,101

Income tax and social contribution paid		(1,167	)		(5,234	)
Interest lease liabilities paid		(11,564	)		(10,900	)
Payment of interest on bonds and financing		(24,946	)		(49,403	)
Payment of provision for tax, civil and labor losses		(515	)		(6,812	)
Net cash from operating activities		20,553			306,752

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment		(9,452	)		(3,730	)
Additions to intangible assets		(36,763	)		(32,226	)
Acquisition of subsidiaries net of cash acquired and payments of business combinations		(33,591	)		(8,703	)
Realization of investment in marketable securities		189,861			(705,097	)
Net cash applied in investing activities		110,055			(749,756	)

CASH FLOWS FROM FINANCING ACTIVITIES
Suppliers - related parties		(3,676	)		(75,846	)
Loans from related parties		-			65,600
Payments of loans from related parties		(20,884	)		-
Lease liabilities paid		(15,308	)		(9,207	)
Parent company's net investment		-			4,197
Issuance of common shares in initial public offering		-			1,836,317
Transaction costs in initial public offering		-			(174,683	)
Acquisition of treasury shares		(11,765	)		-
Payments of bonds and financing		(477,651	)		(852,136	)
Issuance of public bonds net off issuance costs		497,000			-
Payments of accounts payable for business combination		(31,617	)		-
Others		-			(76,642	)
Net cash applied in financing activities		(63,901	)		717,600

NET INCREASE IN CASH AND CASH EQUIVALENTS		66,706			274,596

Cash and cash equivalents at beginning of period		311,156			43,287
Cash and cash equivalents at end of period		377,862			317,883

Exhibit 99.2

	VASTA Platform Limited
	Unaudited Interim Condensed Consolidated Financial Statements Nine-months period ended September 30, 2021

VASTA Platform Limited

Unaudited Interim Condensed

Consolidated Financial Statements

Nine-months period ended September 30, 2021

Consolidated statement of financial position	3

Consolidated interim statement of profit or loss and other comprehensive income	5

Consolidated interim statement of changes in equity	6

Consolidated interim statement of cash flows	7

Notes to the interim condensed consolidated financial statements	9

Consolidated Statement of Financial Position

In thousands of R$, unless otherwise stated

Assets	Note	September 30, 2021		December 31, 2020

Current assets
Cash and cash equivalents	8		377,862		311,156
Marketable securities	9		317,178		491,102
Trade receivables	10		210,525		492,234
Inventories	11		240,636		249,632
Taxes recoverable			23,851		18,871
Income tax and social contribution recoverable			5,672		7,594
Prepayments			37,632		27,461
Other receivables			1,489		124
Related parties – other receivables	20		2,481		2,070
Total current assets			1,217,326		1,600,244

Non-current assets
Judicial deposits and escrow accounts	21		175,677		172,748
Deferred income tax and social contribution	22		143,477		88,546
Property, plantand equipment	12		164,989		192,006
Intangible assets and goodwill	13		4,939,155		4,924,726

Total non-current assets			5,423,298		5,378,026

Total Assets			6,640,624		6,978,270

The accompanying notes are an integral part of this Unaudited Interim Condensed Consolidated Financial Statements

Consolidated Statement of Financial Position

In thousands of R$, unless otherwise stated

Liabilities	Note	September 30, 2021			December 31, 2020

Current liabilities
Bonds and financing	14		262,445			502,882
Lease liabilities	16		18,672			18,263
Suppliers	15		186,272			279,454
Income tax and social contribution payable			17			1,761
Salaries and social contributions	19		70,910			69,123
Contract liabilities and deferred income	17		8,432			47,169
Accounts payable for business combination	18		20,055			17,132
Other liabilities			3,106			4,285
Other liabilities - related parties	20		39,677			135,307
Loans from related parties	20		-			20,884
Total current liabilities			609,586			1,096,260

Non-current liabilities
Bonds and financing	14		549,571			290,459
Lease liabilities	16		129,375			154,840
Accounts payable for business combination	18		53,658			30,923
Provision for tax, civil and labor losses	21		641,307			613,933
Contract liabilities and deferred income	17		4,607			6,538
Total non-current liabilities			1,378,518			1,096,693

Shareholder's Equity
Share Capital	23		4,820,815			4,820,815
Capital reserve	23		56,465			38,962
Treasury shares (Note 23d)	23		(11,765	)		-
Accumulated losses			(212,995	)		(74,460	)
Total Shareholder's Equity			4,652,520			4,785,317

Total Liabilities and Shareholder's Equity			6,640,624			6,978,270

The accompanying notes are an integral part of this Unaudited Interim Condensed Consolidated Financial Statements

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

For the three-and-nine-month periods ended on September 30, 2021 and 2020

Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income

In thousands of R$, except for earnings for share

	Note	July 1, to September 30, 2021			September 30, 2021			July 1, to September 30, 2020			September 30, 2020

Net revenue from sales and services	24		127,192			549,159			141,415			654,066
Sales			124,125			526,697			134,182			634,895
Services			3,067			22,462			7,233			19,171

Cost of goods sold and services	25		(79,381	)		(260,910	)		(62,230	)		(277,985	)

Gross profit			47,811			288,249			79,185			376,081
						-48	%		-44	%		-43	%
Operating income (expenses)
General and administrative expenses	25		(96,402	)		(304,208	)		(83,458	)		(265,752	)
Commercial expenses	25		(33,947	)		(119,040	)		(35,841	)		(116,437	)
Other operating income (expenses)	25		698			2,202			948			2,936
Impairment losses on trade receivables	10 and 25		(3,790	)		(21,998	)		(1,121	)		(12,704	)

(Loss) Before finance result and taxes			(85,630	)		(154,795	)		(40,287	)		(15,876	)

Finance result
Finance income	26		10,532			21,793			5,942			14,579
Finance costs	26		(28,686	)		(69,174	)		(24,854	)		(101,399	)
			(18,154	)		(47,381	)		(18,912	)		(86,820	)

(Loss) Before income tax and social contribution			(103,784	)		(202,176	)		(59,199	)		(102,696	)

Income tax and social contribution	22		32,963			63,641			18,593			34,797

(Loss) for the period			(70,821	)		(138,535	)		(40,606	)		(67,899	)

Other comprehensive income for the period			-			-			-			-

Total comprehensive loss for the period			(70,821	)		(138,535	)		(40,606	)		(67,899	)
Attributable to Controlling Shareholders'

Loss per share

Basic			(0,85	)		(1,67	)		(0,49	)		(0,82	)
Diluted			(0,84	)		(1,65	)		(0,49	)		(0,82	)

The accompanying notes are an integral part of this Undaudited Interim Condensed Consolidated Financial Statements

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Interim Financial Statements

For the nine-month periods ended on September 30, 2021 and 2020

Consolidated Interim Statement of Changes in Equity

In thousands of R$, unless otherwise stated

	Parent Company's Net Investment			Share Capital		Share issuance costs			Share-based compensation reserve (granted)			Share-based compensation reserve (vested)		Treasury shares (Note 23d)			Accumulated losses			Total Shareholders' Equity/ Net Investment

Balance at December 31,2019		3,100,083			-		-			-			-		-			-			3,100,083

Movement in Parent’s investment, net		(3,100,083	)		3,104,280		-			-			-		-			-			4,197
Comprehensive loss for the period
Net loss for the period		-			-		-			-			-		-			(67,899	)		(67,899	)
Total comprehensive loss for the period		-			-		-			-			-		-			(67,899	)		(67,899	)

Shareholder contributions and distributions to shareholders
Issuance of common shares in initial public offering		-			1,836,317		-			-			-		-			-			1,836,317
Share based compensations granted and issued		-			-		-			33,043			-		-			-			33,043
Share issuance costs, net of taxes		-			-		(174,683	)		-			-		-			-			(174,683	)
Total shareholder contributions and distributions to shareholders		-			1,836,317		(174,683	)		33,043			-		-			-			1,694,677

Balance as of September 30, 2020		-			4,940,597		(174,683	)		33,043			-		-			(67,899	)		4,731,058

Balance as of December 31, 2020		-			4,961,988		(141,173	)		38,962			-		-			(74,460	)		4,785,317

Comprehensive loss for the period
Net loss for the period		-			-		-			-			-		-			(138,535	)		(138,535	)
Total comprehensive loss for the period		-			-		-			-			-		-			(138,535	)		(138,535	)

Share based compensation granted and issued (Note 23c itens b and c)		-			-		-			17,503			-		-			-			17,503
Share based compensation vested (Note 23a itens i,ii and iii)		-			-		-			(31,043	)		31,043		-			-			-
Acquisition of shares (Note 23d)		-			-		-								(11,765	)		-			(11,765	)
Net loss for the period		-			-		-			-			-		-						-
Balance as of September 30, 2021		-			4,961,988		(141,173	)		25,422			31,043		(11,765	)		(212,995	)		4,652,520

The accompanying notes are an integral part of this Unaudited Condensed Consolidated Interim Financial Statements

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

For the nine-month periods ended on September 30, 2021 and 2020

Consolidated Interim Statement of Cash Flows

In thousands of R$ unless otherwise stated

		Nine months period September 30,
	Notes	2021			2020

CASH FLOWS FROM OPERATING ACTIVITIES
Loss before income tax and social contribution			(202,176	)		(102,696	)
Adjustments for:
Depreciation and amortization	12 and 13		149,492			129,059
Impairment losses on trade receivables	10		21,998			12,704
Provision for tax, civil and labor losses	21		(775	)		(4,966	)
Interest on provision for tax, civil and labor losses	21		17,681			13,406
Provision for obsolete inventories	11		13,936			11,941
Interest on bonds and financing	26		24,272			46,725
Refund liability and right to returned goods			2,115			(25,118	)
Imputed interest on suppliers	26		3,213			2,945
Interest on accounts payable for business combination	18		811			1,394
Share-based payment expense			17,503			-
Interest on lease liabilities	16		11,602			11,337
Interest on marketable securities incurred and not collected	26		(15,937	)		(2,018	)
Disposals of right of use assets and lease liabilities			(3,481	)		(1,023	)
Residual value of disposals of property, plant and equipment and intangible assets	12 and 13		3,411			1,931

Changes in			43,665			95,621
Trade receivables	10		262,120			133,798
Inventories	11		(5,618	)		(37,741	)
Prepayments			(10,157	)		(4,629	)
Taxes recoverable			(3,049	)		22,090
Judicial deposits and escrow accounts	21		(2,929	)		1,029
Other receivables			(1,185	)		2,828
Suppliers	15		(92,912	)		(79,323	)
Salaries and social charges	19		1,062			9,484
Tax payable / Income taxes and social contribution			7,775			6,267
Contract liabilities and deferred income	17		(42,105	)		3,510
Other receivables and liabilities from related parties			(96,041	)		219,010
Other liabilities			(1,880	)		7,157
Cash from operating activities			58,745			379,101
Income tax and social contribution paid			(1,167	)		(5,234	)
Interest on liabilities paid	16		(11,564	)		(10,900	)
Payment of interest on bonds and financing	14		(24,946	)		(49,403	)
Payment of provision for tax, civil and labor losses	21		(515	)		(6,812	)
Net cash from operating activities			20,553			306,752
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment	12		(9,452	)		(3,730	)
Additions to intangible assets	13		(36,763	)		(32,226	)
Acquisition of subsidiaries net of cash acquired and payments of business combinations	5		(33,591	)		(8,703	)
Realization of investment in marketable securities			189,861			(705,097	)
Net cash from (applied in) investing activities			110,055			(749,756	)

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

For the nine-month periods ended on September 30, 2021 and 2020

Consolidated Interim Statement of Cash Flows

In thousands of R$ unless otherwise stated

CASH FLOWS FROM FINANCING ACTIVITIES

Suppliers - related parties	20	(3,676	)	(75,846	)
Loans from related parties		-		65,600
Payments of loans from related parties		(20,884	)	-
Lease liabilities paid	16	(15,308	)	(9,207	)
Parent Company's Net Investment		-		4,197
Issuance of common shares in initial public offering		-		1,836,317
Transaction costs in initial public offering		-		(174,683	)
Acquisition of treasury shares	23d	(11,765	)	-
Payments of bonds and financing	14	(477,651	)	(852,136	)
Issuance of public bonds net off issuance costs		497,000		-
Payments of accounts payable for business combination		(31,617	)	-
Others		-		(76,642	)
Net cash (applied in) from financing activities		(63,901	)	717,600

NET INCREASE IN CASH AND CASH EQUIVALENTS		66,706		274,596

Cash and cash equivalents at beginning of period	8	311,156		43,287
Cash and cash equivalents at end of period	8	377,862		317,883

NET INCREASE IN CASH AND CASH EQUIVALENTS		66,706		274,596

The accompanying notes are an integral part of this Unaudited Interim Condensed Consolidated Financial Statements

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Notes to the Condensed Interim Consolidated Financial Statements

(Amounts in thousands of R$, unless otherwise stated)

The Company and Basis of Presentation

1.1 The Company

Vasta Platform Ltd. (herein referred to as the “Company”, or previously named “Vasta Platform”, “Vasta’s Parent Company” or “Business”) is a publicly held company incorporated in the Cayman Islands on October 16, 2019, with headquarters in the city of São Paulo, Brazil. The Company is a technology-powered education content providing end-to-end educational and digital solutions that cater to all needs of private schools operating in the K-12 educational segment. Vasta’s fiscal year begins on January 1 of each year and ends on December 31 of the same year.

The Company has built a “Platform as a Service”, solution or PaaS, with two main modules: Content & EdTech Platform and Digital Services. The Company’s Content & EdTech Platform combines a multi-brand and tech-enabled array with digital and printed content through long-term contracts with partner schools.

Since July 31, 2020, VASTA Platform Ltd. has been a publicly-held company registered with SEC (“The US Securities and Exchange Commission) and its shares are traded on Nasdaq Global Select Market under ticker symbol “VSTA”.

1.2 Corporate restructuring and business acquisitions

VASTA Platform, from October 11, 2018 until July 23, 2020, was not a separate legal entity. The Business (referred to herein when the company presented its financial statements combined with other entities) comprised combined carved-out historical balances of certain assets, liabilities and results of operations related to the delivery of educational content for private sector basic and secondary education (“K-12 curriculum”) previously carried out by the legal entity Cogna Educação S.A. and its subsidiaries (hereinafter referred to as “Cogna” or “Parent Entity”, or in combination with its subsidiaries, “Cogna Group”).

On October 11, 2018, Cogna (the ultimate Parent Entity) acquired control over Somos Educação S.A (hereinafter referred to as “Somos” or in combination with its subsidiaries, which included Somos Educação S.A. and Somos Sistemas de Ensino S.A (“Somos Sistemas” or “Anglo”) “Somos Group” for a consideration of R$6.3 billion (the “Acquisition”) comprising R$5.7 billion in cash and R$0.6 billion which was deposited in a restricted escrow account. In addition, R$ 3.3 billion of this R$ 6.3 billion was allocated to the K-12 Business of Somos Group for purpose of the combined carve-out financial statements. As a result of the Acquisition, VASTA Platform Limited represents the combination of the K-12 curriculum acquired and held by Somos (“Somos – Anglo”) and the K-12 Business held by Cogna (“Pitagoras” (operations included in the legal entity Saber Serviços Educacionais S.A.) or in combination with Somos – Anglo.

As part of an effort to streamline its operations, Cogna Group performed a comprehensive corporate restructuring concluded on December 31, 2019, to enhance the corporate structure (i.e. reducing the number of legal entities in the Cogna Group and improving overall synergies). As all entities that were involved in the corporate restructuring are under common control, this restructuring was accounted for using the historical basis of the related assets and liabilities as recorded by Cogna Group and did result in an overall change in the shareholding structure.

Beginning January 1, 2020, the business activities were restructured in the legal entity Somos Sistemas de Ensino S.A (“Somos Sistemas”). On January 7, 2020, the Company concluded the acquisition of the entire ownership interest in Pluri. On February 13, 2020, the Company concluded the acquisition of the entire ownership interest in Mind Makers. See Note 5.

On July 23, 2020, prior to completion of the Initial Public Offering – IPO, the Board of Directors’ Meeting approved the Contribution Agreement which Cogna (Vasta’s Parent Company) contributed with 100% of the shares issued by Somos Sistemas held by Cogna to Vasta Platform’s share capital. After the contribution, Somos Sistemas became wholly owned by Vasta’s Parent Company, which, in turn, continued to be controlled by Cogna. In addition, Cogna contributed shareholders capital in the amount R$ 2.426 in cash on July 23, 2020.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

On July 31, 2020 the Company held its public offering in the amount of US$ 19.00 per Class A common share, pursuant to the U.S. Securities Act of 1933 (the “Offering”), reaching the total amount of US$ 333,522 (R$ 1,836,317) with the issuance of 18,575,492 Vasta’s class A common shares. The Company incurred incremental costs directly attributable to the public offering in the amount of R$ 141,173, net of taxes.

On November 20, 2020, the Company acquired an ownership interest in Meritt Informação Educacional Ltda. See Note 5.

On March 2, 2021, the Company acquired an ownership interest in Sociedade Educational da Lagoa Ltda.(“SEL”) through its wholly owned subsidiary Somos Sistemas de Ensino S.A. See Note 5.

On May 27, 2021, the Company acquired an ownership interest in Nota 1000 Serviços Educacionais S.A (“Redação Nota 1000”) through its wholly owned subsidiary Somos Sistemas de Ensino S.A. See Note 5.

On August 1, the Company acquired an ownership interest in EMME – Produções de Materiais em Multimídia (“EMME”) through its wholy owned subsidiary Somos Sistemas de Ensino S.A. See Note 5.

The Consolidated Financial Statements comprise the following entities, which are all fully owned by the Company:

Company	September 30, 2021	December 31, 2020
	Interest %	Interest %
Vasta Platform Ltd. ("Vasta's Parent Company")	100%	100%
Somos Sistemas de Ensino S.A ("Somos Sistemas")	100%	100%
Livraria Livro Fácil Ltda. ("Livro Fácil")	100%	100%
A & R Comercio e Serviços de Informática Ltda. (“Pluri”)	100%	100%
Mind Makers Editora Educacional (“Mind Makers”)	100%	100%
Colégio Anglo São Paulo	100%	100%
Meritt Informação Educacional Ltda (“Meritt”)	100%	100%
Sociedade Educacional da Lagoa Ltda (“SEL”)	100%	-
Nota 1000 Serviços Educacionais S.A ("Redação Nota 1000")	100%	-
EMME – Produções de Materiais em Multimídia Ltda (“EMME”).	100%	-

1.3 Initiatives carried out by the Company and impacts of Covid-19 pandemic

It is widely accepted now that the global Coronavirus (“COVID-19”) pandemic changed the world’s growth prospects and added risks to Companies in an unprecedent scenario. In Brazil, as elsewhere, govermments at municipal and state-wide levels-imposed restrictions to contain the contamination, including social distancing, school shutdowns, travel restrictions, lockdowns, closure of non-essential businesses, among others. This caused major disruptions in the economy, affecting supply, demand, and logistics chains, as well as employment and, most importantly, impacting society as a whole.

In response to this scenario, the Company established a Crisis Committee and developed plans to protect the business, the health of its employees and its customer base. We highlight below the main initiatives carried out by the Company since the beginning of the COVID-19 pandemic in 2020 up to September 30, 2021:

1) Preserved employees’ health and safety organizing and coordinating remote work, reducing operations or closing down distribution centers and adopting protective equipment and social distancing rules.

2) Ensured educational content and services delivery through online platforms.

3) Implemented measures to ensure adequate liquidity and cash position.

4) Implemented short-term restructuring measures, including but not limited to temporary reduction in salaries and working hours, seeking to preserve jobs and payroll continuity.

5) Planned and executed organizational changes, specifically management positions, and operational activities through process review to face post-COVID mid-term impact.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

6) Strategic Plan for opportunities generated by the crisis.

7) Philanthropic actions that contributed to mitigate the impacts of COVID-19 on our Company segment;

8) On-line campaigns to promote our products to potential new customers; and

9) Negotiated access to credit lines granted to certain customers which have been highly affected by COVID-19, in order to keep our business network sustainable.

10) Financial leverage reorganization by obtaining R$ 500,000 (corresponding to 500,000 bonds) to maintain the strategic acquisition goals to comply with medium and long-term obligations and consequently, to mitigate risks over operating cash flows caused by COVID-19. See Note 14.

11) Issued new technological solutions embedeed with current learning systems and added of complementary solutions for the next school-year through digital transformation caused by social distancing restriction brought by COVID 19.

As a result of our actions, despite school closures and social distancing restrictions, the majority of our customers have been able to continue providing their educational services through our virtual platforms.

As of September 30, 2021, some municipalities and states determined classes reopening in private schools through certain sanitary restrictions as result of reduction of COVID-19 contamination due to elevated indexes of vaccination. Untill December 31, 2021 we are estimating that all classroom lessons will reopen in definitive, therefore, differently from June 30, 2021 the risk of uncertainty in our operations will not be relevant.

Basis of preparation and presentation of Unaudited Interim Condensed Consolidated Financial Statements

The Unaudited Interim Condensed Consolidated Financial Statements of Vasta Platform, the reporting entity, have been prepared in accordance with the International Financial Reporting Standards (IFRS) and interpretations as issued by the International Accounting Standards Board (“IASB”).

Declaration of Compliance and Basis of Preparation

The Company’s Condensed Interim Consolidated Financial Statements included in the SEC - 6K Form for the quarter ended September 30, 2021, encompasses the interim consolidated accounting information prepared pursuant to “International Accounting Standard (“IAS”) 34 - Interim Financial Reporting”, issued by the International Accounting Standards Board (IASB).

The Company’s management confirms that all relevant information in the interim accounting statements, and only this information, is being disclosed, and it corresponds to the information used in the development of its business management activities. The interim accounting information was prepared based on the historical costs, except for certain financial instruments measured at their fair value, as described in the accounting policies.

The main accounting policies used in preparing this interim consolidated accounting information are disclosed in note No. 4.2 to of the Company’s financial statements, the fiscal year ended December 31, 2020, issued on April 30, 2021. The same policies apply for comparison with the nine-month period ended September 30, 2020, and a practical expedient was applied to rent concessions in lease contracts as a direct consequence of the Covid-19 pandemic.

The information on the notes did not undergo significant changes in comparison with December 2020, which is why it is not fully presented in this interim accounting information and must, therefore, be read jointly with the past annual financial statement.

Vasta Platform’s Interim Condensed Combined Financial Statements

The Interim Condensed Combined Financial Statements were prepared until July 23, 2020 (completion of corporate restructuring described in note 1.2) which included the three and six-months period ended June 30, 2020 the Combined Financial Statements guidance. After July 23, 2020, the Company applied the guidance presented in item c.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

The Combined Financial Statements have been prepared to present the Business’ historical financial condition, the performance of its operations and its respective cash flows. The Combined Financial Statements materially reflect the financial statements of the “K-12 curriculum” private business as if it were operated as a separate entity from the Parent Entity. The entities that were part of these combined financial statements were Somos Sistemas, Livro Fácil, Colégio Anglo, Mind Makers and Pluri.

The combined assets, liabilities and results of operations of the Business are based on the historical accounting records of the Parent Entities. The balances of trade receivables, inventories, property, plant and equipment, intangible assets and goodwill, suppliers, bonds and financing, provision for risks of tax, civil and labor losses, financial expenses related to said bonds and financing, revenue and costs of goods sold and services relating to the Business were individually identified.

Vasta’s Unaudited Interim Condensed Consolidated Financial Statements

Since July 23, 2020, the Company has been preparing the Consolidated Financial Statements which include the accounts of the Company and its subsidiaries. Since all entities were under common control as of the date of the initial public offering, the results for the three and nine-months period ended September 30, 2020 are presented on a consolidated basis for the entire period.

Functional and Presentation Currency

The Interim Condensed Consolidated are presented in thousands of Brazilian Reals (“R$”), which is the Company’s functional currency. All financial information presented in R$ has been rounded to the nearest thousand, except as otherwise indicated.

Measurement basis

The Interim Condensed Consolidated Financial Statements were prepared based on historical cost, except for certain assets and liabilities that are measured at fair value, as explained in the accounting policies below.

Significant accounting policies

As mentioned in Note 2. a, the Unaudited Interim Condensed Consolidated Financial Statements as of September 30, 2021 should be read in conjunction with the Consolidated Financial Statements as of December 31, 2020, considering that its purpose is to provide an update on the activities, events and significant circumstances in relation to those disclosed in the Consolidated Financial Statements. Therefore, the Unaudited Interim Condensed Consolidated Financial Statements focus on new activities, events and circumstances and do not duplicate the information previously disclosed, except when Management judges that the maintenance of the information is relevant. The accounting policies have been consistently applied to all consolidated companies. There are no new accounting policies that could be applicable since January 1, 2021 or early adopted in the Unaudited Interim Consolidated Financial Statements.

Use of estimates and judgements

The Company for nine months period ended as of September 30, 2021, updated provision for slow moving calculation based on its accounting policies according to its previous inventory turnovers and disaggregated by brands. As result of this analysis,the slow-moving provision based on current estimate is R$ 57,202 versus a provision of R$ 68,919 based on old estimative. Except for the slow-moving provision, there are not changes on such estimates calculation and methodologies applied in judgements even neither accounting policies that could be applicable since of January 1, 2021 or earlier adopted in the Unaudited Interim Condensed Consolidated Financial Statements.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Business Combinations

As mentioned in Note 1.2 the Company concluded some acquisitions to improve its portfolio of educational solutions as presented below:

January 7, 2020 – Pluri

February 13, 2020 – Mind Makers

November 20, 2020 - Meritt

March 2, 2021 – SEL

May 27, 2021 –Redação Nota 1000

August 1, 2021 - EMME

The Company’ business combinations are described below:

Business Combinations during 2020

A & R Comercio e Serviços de Informática Ltda. (“Pluri”)

On January 7, 2020, the Company concluded the acquisition of the entire ownership interest of Pluri for R$ 26,000. Pluri is an entity based in the State of Pernambuco specialized in solutions such as consulting and technologies for education systems. This acquisition is in line with the Company’s strategy of focusing on the distribution of its operations to another region. The agreement is also subject to certain additional earn-outs, associated with achievements defined in the agreement, such as revenue and profit, that could increase the purchase price by an additional R$ 1,706 over the life of the earn-out period.

Mind Makers Editora Educacional (“Mind Makers”)

On February 13, 2020, the Company concluded the acquisition of the entire ownership interest of Mind Makers, a company that offers computer programming and robotics courses and helps students develop skills relevant to their educational progress, such as coding and product development, as well as entrepreneurial and social and emotional soft skills including teamwork, leadership and perseverance. The total purchase price was R$ 18,200, of which R$ 10,000 was paid upon signing the agreement, with half of the remaining balance payable in 2021 and the other half of the remaining balance payable in 2022, with the 2021 and 2022 payments subject to certain adjustments. The agreement is also subject to certain additional earn-outs, associated with achievements defined in the agreement, such as revenue and profit, that could increase the purchase price by an additional R$ 5,421 over the life of the earn-out period.

Meritt Informação Educacional Ltda (“Meritt”).

On November 20, 2020, the Company acquired the ownership interest of Meritt Informação Educacional Ltda. in order to improve its current integrated educational platform of educational assessments, which will allow the Company to monitor students’ performance and educational tests in real time, as well as improvements in randomization in test questions and alternatives. The purchase price was R$ 3,500, of which R$ 3,200 was paid in cash and R$ 300 in installments that are still outstanding and accrue contractual charges according to the Interbank rate (CDI). The agreement is also subject to certain earn-outs, that could increase the purchase price by an additional R$4,030 over the life of the earn-out period.

Business Combinations during 2021

Sociedade Educacional da Lagoa Ltda. (“SEL”)

On March 2, 2021, the Company announced the execution by its subsidiary, Somos Sistemas de Ensino S.A. (“Somos Sistemas”), of a Purchase Agreement to acquire (the “Acquisition”), subject to certain conditions precedent, Sociedade Educacional da Lagoa Ltda. (“SEL”). SEL provides technical and pedagogical services to education platforms, including the maintenance of such platforms, development and improvement of contents and training of professionals. Founded in 1997, SEL currently serves, directly or indirectly, 441 schools, 272 thousand K-12 students and approximately 503 thousand students in the post-secondary and continuing education segment.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

The consideration paid was R$ 65,000, of which R$ 38,124 was paid in cash. The remaining balance, of R$ 26,876 is subject to certain post-closing price adjustments. The consideration will be divided in installments over a 4-year period (each installment adjusted by the positive variation of 100% of CDI ).

Nota 1000 Serviços Educacionais S.A. (“Redação Nota 1000”)

On May 27, 2021, the Company acquired through its subsidiary, Somos Sistemas de Ensino S.A. (“Somos Sistemas”) the entity Redação Nota 1000, which provides essay review services as a service platform, through its proprietary software. The Redação Nota 1000’s users may choose their essays reviewed under different approaches as follows: (i) solely by essay-review specialists (manual); (ii) on an automated basis by the company’s software, with a final review by a specialist (semi-automated); or (iii) exclusively on an automated basis by the company’s software. Founded in 2014, Redação Nota 1000 has provided services to over 270 schools and 700,000 students, with more than 1.3 million essays reviewed.

The consideration was R$ 11,387, of which R$ 4,093 was paid in cash and the remaining balance of R$ 7,294 will be paid in installments with final due date on December 24, 2026 (each installment adjusted by the positive variation of 100% of CDI index). In addition, the Company recognized a contingent consideration of R$ 2,650 subjects to certain post-closing price adjustments.

EMME – Produções de Materiais em Multimídia (“EMME”)

On August 1, 2021 the Company acquired through its subsidiary, Somos Sistemas de Ensino S.A. (“Somos Sistemas”) the entity EMME, which provides educational marketing solutions for schools, through license of its “software as a service”. The consideration was R$ 15,316 of which R$ 3,063 was paid in cash and the remaining balance of R$ 12,253 will be paid in installments with final due date on August 16, 2026 (each installment adjusted by the positive variation of inflation- “IPCA” – Extended National Consumer Price Index).

Assets and liabilities involved in the Business Combinations and Consideration transferred

The acquisitions were accounted for using the acquisition method of accounting, i.e., the consideration transferred, and the identifiable assets and liabilities acquired were measured at fair value, while goodwill is measured as the excess of consideration paid over those items.

The following table presents the assets and liabilities acquired for each business combination in 2021:

	SEL		Redação Nota 1000		EMME		Total of Combination
Current assets
Cash and cash equivalents		1,461		525		637		2,623
Trade receivables		-		1,327		1,082		2,409
Prepayments		-		-		14		14
Taxes recoverable		-		-		9		9
Other receivables		180		-		-		180
Total current assets		1,641		1,852		1,742		5,235

Non-current assets
Property, plant and equipment		611		-		128		739
Other intangible assets		-		1,099		1		1,100
Intangible assets - Customer Portfolio (ii)		18,783		-		-		18,783
Intangible assets - Software (iii)		1,296		5,692		4,048		11,036
Total non-current assets		20,690		6,791		4,177		31,658

Total Assets		22,331		8,643		5,919		36,893

Current liabilities
Suppliers		-		180		13		193
Salaries and social contributions		1		124		600		725
Taxes payable		17		207		101		325
Income tax and social contribution payable		33		-		-		33
Other liabilities		-		1,673		2		1,675
Total current liabilities		51		2,184		716		2,951

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	SEL			Redação Nota 1000			EMME			Total of Combination
Non-current liabilities
Provision for tax, civil and labor losses (iv)		-			908			10,075			10,983
Total non-current liabilities		-			908			10,075			10,983

Total liabilities		51			3,092			10,791			13,934

Shareholder's Equity		2,201			(1,240	)		(8,921	)		(7,960	)

Total liabilities and Shareholders' Equity		2,252			1,852			1,870			5,974

Equity		(2,201	)		1,240			8,921			7,960
Acquisition Price		65,000			11,387			15,317			91,704
Goodwill not allocated		62,799			12,627			24,238			99,664

Net assets (A)		22,280			5,551			(4,873	)		22,958
Total Consideration transferred (B)		65,000			11,387			15,317			91,704
Goodwill after allocation (B – A) (i)		42,720			5,836			20,190			68,746

(i) Goodwill is recognized based on expected synergies from combining the operations of the acquirees and of the acquiror, as well as an expected increase in the Company’s market-share due to the penetration of the Company’s products and services in regions where the Company did not operate before. Also, the current tax law allows the deductibility of the acquisition date goodwill and fair value of net assets acquired when a non-substantive action is taken after acquisition by the Company (i.e. when the Company merges or spins off the companies acquired) and therefore the tax and accounting bases of the net assets acquired are the same as of the acquisition date.

(ii) As a result of purchase price allocation, the Company identified R$ 18,783, customer portfolio (“SESI”), based on customer portfolio receivables expectation around 8% per year. see Note 13.

(iii) As a result of purchase price allocation, the Company identified R$ 11,036, Educational Software applied in the “SESI” learning system, Writing Correction Software for Education System “Redação Nota 1000” and software that produces digital marketing material solutions for schools “EMME”, all of them based on relief from royalties criteria (RIR) and each acquisition with its corresponding rate of net revenue by investment see Note 13.

(iv) Refers to contingent liability identified as contingent consideration of R$ 10,075 being R$ 6,471 corresponding tax and R$ 3,604 labor contingencies all of them subject to certain post-closing price adjustments.

From the date of acquisition to September 30, 2021, SEL , Redação Nota 1000 and EMME contributed to the Interim Condensed Consolidated Financial Statements net sales and services the amount of R$4,515, R$1,359 and R$213, respectively, and net profit (loss) in the amount of R$3,104, R$ (1,101) and R$(139), respectively. If the acquisitions had been concluded on January 1, 2021, the Company estimates its combined (include Company and the acquistions of SEL, Nota 1000 and EMME) net revenue from sales and services would have been R$ 554,388 and it would have recorded Net loss of R$ (142,730) for the period ended on September 30, 2021.

Financial Risk Management

The Company has a risk management policy for regular monitoring and managing the nature and overall position of financial risks and to assess its financial results and impacts on its cash flows. Counterparty credit limits are also reviewed periodically or whenever the Company identifies significant changes in financial risk.

The economic and financial risks reflect the behavior of macroeconomic variables such as interest rates as well as other characteristics of the financial instruments maintained by the Company. These risks are managed through control and monitoring policies, specific strategies, and limits.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

The Company maintained its approach and strong cash and marketable securities position, as well as its treasury policy, during the crisis caused by the COVID-19 pandemic.

Financial risk factors

The Company’s activities expose it to certain financial risks mainly related to market risk, credit risk and liquidity risk. Management and the Group’s Board of Directors monitor such risks in line with their capital management policy objectives.

This Note presents information on the Company’s exposure to each of the risks above, the objectives of the Company, measurement policies, and the Company’s risk and capital management process.

The Company has no derivative transactions.

Market risk - cash flow interest rate risk

This risk arises from the possibility that the Company incur losses because of interest rate fluctuations that increase finance costs related to financing and bonds raised in the market and obligations for acquisitions from third parties payable in installments. The Company continuously monitors market interest rates in order to assess the need to contract financial instruments to hedge against volatility of these rates. Additionally, financial assets also indexed to CDI and IPCA (broad consumer price index) partially mitigate any interest rate exposures.

Interest rates contracted are as follows:

	September 30, 2021		December 31, 2020		Interest rate
Bonds
Private Bonds – 5th Issuance - serie 1		-		100,892	CDI + 1.15% p.a.
Private Bonds – 5th Issuance - serie 2		103,880		102,868	CDI + 1.00% p.a.
Private Bonds – 6th Issuance - serie 2		204,871		206,733	CDI + 1.70% p.a.
Private Bonds – 7th Issuance - single		-		381,850	CDI + 1.15% p.a.
Bonds – 1th Issuance - single		502,333		-	CDI + 2.30% p.a.
Financing and Lease Liabilities - Mind Makers		933		998	TJPLP + 5% p.a.
Financing and Lease Liabilities		148,047		173,103	IPCA
Accounts Payable for Business Combination		73,713		48,055	100% CDI
Loans from related parties		-		20,884	CDI + 3.57%
		1,033,776		1,035,383

Credit risk

Credit risk arises from the potential default of a counterparty on an agreement or financial instrument, resulting in financial loss. The Company is exposed to credit risk in its operating activities (mainly in connection with trade receivables, see Note 10 and financial activities that include reverse factoring deposits with banks and other financial institutions and other financial instruments contracted.

The Company mitigates its exposure to credit risks associated with financial instruments, deposits in banks and short-term investments by investing in prime financial institutions and in accordance with limits previously set in the Company’s policy. See (Notes 8 and 9).

To mitigate risks associated with trade receivables, the Company adopts a sales policy and an analysis of the financial and equity condition of its counterparties. The sales policy is directly associated with the level of credit risk the Company is willing to accept in the normal course of its business.

The diversification of its receivable’s portfolio, the selectivity of its customers, as well as the monitoring of sales financing terms and individual position limits are procedures adopted to minimize defaults or losses in the realization of trade receivables. Thus, the Company does not have significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics.

Furthermore, the Company reviews the recoverable amount of its trade receivables at the end of each reporting period to ensure that adequate credit losses are recorded (Note 10). The Company limits its exposure to credit risks associated with financial instruments, bank deposits and financial investments by making its investments in financial institutions for which credit risk is monitored, according to limits previously established in the Company’ policy. When necessary, appropriate provisions are recognized to cover this risk.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Liquidity risk

Covid 19 - Impacts

In order to cover possible liquidity deficiencies or mismatches between cash and cash equivalents and short-term debt and financial obligations, the Company continues to operate with reverse factoring as long as this credit line is offered by banks and accepted by Company suppliers.

This is the risk of the Company not having enough funds and or bank credit limits to meet its short-term financial commitments, due to mismatching terms in expected receipts and payments.

The Company continuously monitors its cash balance and indebtedness level and implemented measures to allow access to the capital markets, when necessary. It also endeavors to assure they remain within existing credit limits. Management also continuously monitors projected and actual cash flows and the combination of the maturity profiles of the financial assets, liabilities and takes into consideration its debt financing plans, covenant compliance, internal liquidity targets and, if applicable, regulatory requirements.

Cash surplus generated by the Company is handled in short-term deposits being those investments composed by enough liquidity thus providing to the Company the appropriate committment with the going concern presumption.

Company on August 6^th through its subsidiary Somos Sistemas de Ensino S.A issued R$ 500.000 in simple debentures, not convertible. The debentures are aimed to reinforce the Company capital structure and its impacts caused by COVID 19 as well as alonging the debt maturity profile, see Note 14.

The table below presents the maturity of the Company’s financial liabilities.

Financial liabilities by maturity ranges

September 30, 2021	Less than one year		Between one and two years		Over two years		Total
Bonds and financing (Note 14)		262,445		549,571		-		812,016
Lease Liabilities (Note 16)		18,672		25,875		103,500		148,047
Accounts Payable for business combination (Note 18)		20,055		28,907		24,751		73,713
Suppliers (Note 15)		91,676		-		-		91,676
Reverse Factoring (Note 15)		94,596		-		-		94,596
Other liabilities - related parties (Note 20)		39,677		-		-		39,677
		527,121		604,353		128,251		1,259,725

Financial liabilities by maturity ranges

The table below reflects the estimated interest rate based on CDI for 12 months (8.99% p.a) extracted from BACEN (Brazilian Central Bank) on September 30,2021. Amounts payable refer to principal and interest based on undiscounted contractual amounts and, therefore, do not reflect the financial position presented as of September 30,2021:


September 30, 2021	Less than one year		Between one and two years		Over two years		Total
Bonds and financing		286,038		598,977		-		885,016
Lease Liabilities		20,351		28,201		112,805		161,356
Accounts Payable for business combination		21,858		31,506		26,976		80,340
Suppliers		91,676		-		-		91,676
Reverse Factoring		100,830		-		-		100,830
Other liabilities - related parties		39,677		-		-		39,677
		560,430		658,685		139,781		1,358,895

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

On September 30, 2021, the Company had positive working capital of R$ 607,740 (R$ 503,984 on December 31, 2020) mainly due to suppliers and accounts payables with related parties, such as bonds outstanding, suppliers, loans, and other liabilities.

Capital management

The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure of the Company, management can make, or may propose to the shareholders when their approval is required, adjustment to the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce, for example, debt.

The Company monitors capital on the basis of the gearing ratio. This ratio corresponds to the net debt expressed as a percentage of total capitalization. Net debt comprises financial liabilities less cash and cash equivalents. Total capitalization is calculated as shareholders’ equity as shown in the consolidated balance sheet plus net debt.

The Company’s main capital management objectives are to safeguard its ability to continue as a going concern, optimize returns, allow consistency of operations to others stakeholders, and maintain an optimal capital structure reducing financial costs and maximizing the returns. In addition, the Company monitors financial leverage adequacy, and mitigates risks that may affect the availability of capital for Company development. As a result of the IPO, see Note 1.2, the Company reduced its net debt improving its gearing ratio and adjusting its capital structure aiming to face new capital challenges from COVID-19 and investing in new ventures through acquisitions.

	September 30, 2021			December 31, 2020

Net debt (i)		881,863			1,138,988
Total shareholders' equity		4,652,520			4,785,317
Total capitalization (ii)		3,770,658			3,646,329
Gearing ratio - % - (iii)		23	%		31	%

(i)

Net debt comprises financial liabilities (note 7) net of cash and equivalents.

(ii)

Refers to the difference between Shareholders’ Equity and Net debt.

(iii)

The Gearing Ratio is calculated based on Net Debt/Total Capitalization.

Sensitivity analysis

The following table presents the sensitivity analysis of potential losses from financial instruments, according to Management’s assessment of relevant market risks presented above.

A probable scenario over a 12-month horizon was used, with a projected rate of 8.99% p.a. as per CDI reference rates disclosed by B3 S.A. (Brazilian stock exchange). Two further scenarios are presented, stressing, respectively, a 25% and 50% deterioration of the projected rates.

	Index - % per year	Balance as September 30, 2021			Base scenario			Scenario I			Scenario II
Financial Assets	103.8% of CDI		375,247			35,017			43,771			52,525
Marketable Securities	105.2% CDI		317,178			29,997			37,496			44,996
			692,425			65,014			81,267			97,521

Accounts Payable for Business Combination	100% of CDI		(73.713	)		(6,627	)		(8,283	)		(9,940	)
Lease liabilities	% of CDI		(148,047	)		(13,309	)		(16,637	)		(19,964	)
Bonds and financing	CDI + 1.99%		(812,016	)		(83,394	)		(104,243	)		(125,091	)
			(1,033,776	)		(103,330	)		(129,163	)		(154,995	)

Net exposure			(341,351	)		(38,316	)		(47,896	)		(57,474	)

Interest Rate -% p.a	-		-			8.99	%		11.24	%		13.49	%
	-		-			-			25	%		50	%

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Financial Instruments by Category

The Company holds the following financial instruments:


	Fair Value Hierarchy	September 30, 2021		December 31, 2020
Assets - Amortized cost
Cash and cash equivalents	1		377,862		311,156
Marketable Securities	1		317,178		491,102
Trade receivables	2		210,525		492,234
Other receivables	2		1,489		124
Related parties – other receivables	2		2,481		2,070
			909,535		1,296,686

Liabilities - Amortized cost
Bonds and financing	2		812,016		793,341
Lease liabilities	2		148,047		173,103
Reverse Factoring	2		94,596		110,513
Suppliers	2		91,676		168,941
Accounts payable for business combination	2		73,713		48,055
Other liabilities - related parties	2		39,677		135,307
Loans from related parties	2		-		20,884
			1,259,725		1,450,144

The Company’s financial instruments are recorded in the Interim Condensed Consolidated Statement of Financial Position at amounts that are consistent with their fair values.

The fair value of financial assets and liabilities was determined based on available market information and appropriate valuation methodologies for each case. However, significant judgment is required to interpret market data and produce the most appropriate estimates of realizable values. Consequently, the estimates of fair value do not necessarily indicate the amounts that could be realized in the current market. The use of different market inputs and/or valuation methodologies could have a material impact on the estimated fair value.

Cash and cash equivalents

Composition

The balance of this account comprises the following amounts:

	September 30, 2021		December 31, 2020
Cash		77		13
Bank account		2,538		10,996
Financial investments (i)		375,247		300,147
		377,862		311,156

(i)

The Company invests in short-term fixed income investment funds with daily liquidity and no material risk of change in value. Financial investments presented an average gross yield of 105,2% of the annual CDI rate on September 30, 2021 (101,7% on December 31, 2020). All investments are highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value and correspond to the cash obligations for the period.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Marketable securities

Composition

	Credit Risk	September 30, 2021		December 31, 2020

Financial bills (LF)	AAA		1,350		149,720
Financial treasury bills (LFT)	AAA		315,828		341,382
			317,178		491,102

The average gross yield of securities is based on 105,2% CDI on September 30, 2021 (104% CDI on December 31, 2020).

Trade receivables

The balance of this account comprises the following amounts:

Composition

	September 30, 2021			December 31, 2020
Trade receivables		235,934			501,498
Related Parties (Note 20)		13,694			22,791
( - ) Impairment losses on trade receivables		(39,103	)		(32,055	)
		210,525			492,234

Maturities of trade receivables

	September 30, 2021			December 31, 2020
Not yet due		157,287			425,327
Past due
Up to 30 days		17,085			8,456
From 31 to 60 days		8,998			10,931
From 61 to 90 days		8,278			8,764
From 91 to 180 days		17,218			15,539
From 181 to 360 days		15,873			18,038
Over 360 days		11,195			12,279
Total past due		78,647			74,007

Customers in bankruptcy		-			2,164
Related partiess (note 20)		13,694			22,791
Provision for impairment of trade receivables		(39,103	)		(32,055	)

		210,525			492,234

The gross book value of trade receivables is written off when the Company has no reasonable expectations of recovering the financial asset in its entirety or a portion thereof. Collection efforts continue to be made, even for the receivables that have been written off, and amounts recoverable are recognized directly in the Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income upon collection.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Impairment losses on trade receivables

The Company measures impairment losses on trade receivables at an amount equal to lifetime expected credit losses (“ECL”) estimated using a provision matrix monthly. This matrix is prepared by analyzing the receivables established each month (in the 12-month period) and the related composition per default range and by calculating the recovery performance. In this methodology, for each default range an estimated loss likelihood percentage is established, which considers current and prospective information on macroeconomic factors that affect the customers’ ability to settle the receivables.

The Company also recognizes impairment losses on trade receivables at 100% for customers that filed for bankruptcy, based on historical experience, which indicates that these receivables are generally not recoverable.

The credit risk and expected credit losses associated with amounts due from related parties is not significant.

The following table details the risk profile of trade receivables based on the Company’s provision matrix as of September 30, 2021 and as of December 31, 2020.

Expected credit losses aging

	As of September 30, 2021			As of December 31, 2020
	Expected credit loss rate (%) (i)	Lifetime ECL (R$)		Expected credit loss rate (%)(i)			Lifetime ECL (R$)
Not yet due	0.18%		315		0,10	%		432
Past due
Up to 30 days	10.80%		1,845		6.19	%		523
From 31 to 60 days	19.40%		1,746		12.92	%		1,413
From 61 to 90 days	28.20%		2,334		20.64	%		1,809
From 91 to 180 days	48.50%		8,351		43.66	%		6,785
From 181 to 360 days	84.60%		13,429		51.67	%		9,320
Over 360 days	99.00%		11,083		78.26	%		9,609
			39,103					29,891
Customers in bankruptcy (ii)	100,00%		-		100,00	%		2,164
Impairment losses on trade receivables			39,103					32,055

(i)

The expected credit loss rates as of September 30, 2021 increased when compared to December 31, 2020 due the change of effective credit losses observed in period ended substantially caused by COVID 19 pandemic.

(ii)

At December 31, 2020 the Company’s Management recorded 100% impairment losses for three of its customers that went on bankruptcy. All those corporate customers were national booksellers that were present in the main cities of Brazil and therefore were considered as strategic marketplaces for the sale of our published materials to final customers (students, teachers, and schools). The Company did not identify bankrupt customers with impairment losses in the nine-month period ended September 30, 2021.

Changes on provision

	September 30, 2021			September 30, 2020
Opening balance		32,055			22,524
Additions (i)		23,159			16,015
Reversals		(1,161	)		(3,311	)
Write offs (ii)		(14,950	)		(8,299	)
Closing balance		39,103			26,929

(i)

See note d. expected credit losses; .

(ii)

The Company assessed its customers credit lines, and some of them were renegotiated. Due to historical losses and lack of prospects of credit recovery alongside these customers, the Company recognized R$ 14,950 as write-off as of September 30, 2021.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

11 Inventories

The balance of this account comprises the following amounts:

Composition

	September 30, 2021		December 31, 2020
Finished products (i)		160,177		168,328
Work in process		51,742		52,322
Raw materials		22,114		20,485
Imports in progress		5,925		2,642
Right to returned goods (ii)		678		5,855
		240,636		249,632

(i)

Amounts net of slow-moving items and net realizable value.

(ii)

Represents the Company’s right to recover products from customers where customers exercise their right of return under the Company’s returns policies, where the Company estimates the volume of goods returned based on experience and foreseen expectations. The provision for right to returned goods reduced as of September 30, 2021 compared with December 31, 2020 due to its commercial cycle seasonality .

Changes in provision for losses with slow-moving inventories, net realizable value and provision for goods returned are broken down as follows:

Changes in provision

	September 30, 2021			September 30, 2020
Opening balance		62,210			69,080
Additions		15,997			16,492
(Reversals)		(2,061	)		(4,551	)
Inventory losses (i)		(14,429	)		(7,390	)
Closing balance		61,717			73,631

(i)

Refers substantially to physical books destroyed, previously provisioned, due to indication of damage or obsolescence caused by changes in the educational content during the schoolyear. Differently from previous years, the Company anticipated the physical books discharges previously expected to December 31, 2021 once its commercial cycle finishes as of September 30, 2021.

Covid 19 Impacts

The Company assessed its inventories and corresponding accounting estimates and as result of COVID-19 pandemic and did not identify any relevant impact due to obsolescence or depreciation of inventories.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Property, plant and Equipment

The cost, weighted average depreciation rates and accumulated depreciation are as follows:

		September 30, 2021							December 31, 2020
	Weighted average depreciation rate	Cost		Accumulated depreciation			Net Book value		Cost		Accumulated depreciation			Net Book value

IT equipment	10% - 33%		32,505		(26,783	)		5,722		27,036		(25,557	)		1,479
Furniture, equipment and fittings	10% - 33%		38,007		(28,890	)		9,117		36,314		(26,406	)		9,908
Property, buildings and improvements	5%-20%		52,684		(35,317	)		17,367		51,407		(31,429	)		19,978
In progress	-		1,977		-			1,977		315		-			315
Right of use assets	12%		232,342		(101,927	)		130,415		241,906		(82,033	)		159,873
Land	-		391		-			391		453		-			453
Total			357,906		(192,917	)		164,989		357,431		(165,425	)		192,006

Changes in property, plant and equipment are as follows:

	IT equipment			Furniture, equipment and fittings			Property, buildings and improvements			In progress			Rights of use assets			Land			Total
As of December 31, 2020		1,479			9,908			19,978			315			159,873			453			192,006
Additions /Updates (i)		5,317			1,168			877			2,062			15,361			-			24,785
Additions by business combination		152			587			-			-			-			-			739
Renegotiation (ii)		-			-			-			-			(21,638	)		-			(21,638	)
Disposals / Cancelled contracts		-			(124	)		-			-			(3,287	)		-			(3,411	)
Depreciation		(1,226	)		(2,484	)		(3,888	)		-			(19,894	)		-			(27,492	)
Transfers		-			62			400			(400	)		-			(62	)		-
As of September 30, 2021		5,722			9,117			17,367			1,977			130,415			391			164,989

(i)

Refers substantially to IFRS 16, new lease agreements of R$ 15,361 which the Company considers as part of its digital learning solutions through computer tablets that have been part of current learning system solutions in a period of COVID 19 pandemic. See the corresponding lease liability in Note 16.

(ii)

The Company returned part of São Jose dos Campos’warehouse to lessor in September 2021. The Company kept the contract interest, lease period changing lease installments. The Company de-recognized the right of use and corresponding lease liabilities, see Note 16.

	IT equipment			Furniture, equipment and fittings			Property, buildings and improvements			In progress			Right of use assets			Land		Total
As of December 31, 2019		2,486			12,366			19,682			4,538			145,436			453		184,961
Additions /Updates (i)		424			41			628			1,427			16,853			-		19,373
Additions by business combination		59			153			-			-			-			-		212
Disposals / Cancelled contracts		(25	)		(202	)		(4	)		-			(3,249	)		-		(3,480	)
Depreciation		(1,477	)		(1,611	)		(3,385	)		-			(13,566	)		-		(20,039	)
Transfers		-			-			4,207			(4,207	)		-			-		-
As of September 30, 2020		1,467			10,747			21,128			1,758			145,474			453		181,027

(i)

Refers substantially to IFRS 16, R$ 16,853 refers to lease contracts previously signed and renewed based on contractual terms. See the corresponding lease liability in Note 16.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Covid 19 Impacts

The Company assesses, at each reporting date, much more so with the COVID 19 advent, whether there is an indication that a property, plnat and equipment asset may be impaired. If any indication exists, the Company estimates the asset’s recoverable amount. There aren’t indications of impairment of property, plant and equipment as of September 30, 2021.

Intangible Assets and Goodwill

The cost, weighted average amortization rates and accumulated amortization of intangible assets and goodwill comprise the following amounts:

		September 30, 2021							December 31, 2020
	Weighted average amortization rate	Cost		Accumulated amortization			Net Book value		Cost		Accumulated amortization			Net Book value
Software	15%		234,263		(141,531	)		92,732		204,213		(120,798	)		83,414
Customer Portfolio	8%		1,132,575		(250,956	)		881,619		1,113,792		(184,934	)		928,858
Trademarks	5%		631,935		(78,831	)		553,104		631,935		(58,349	)		573,586
Platform content production	33%		68,321		(43,960	)		24,361		53,069		(29,248	)		23,821
Other Intangible assets	33%		39,383		(32,091	)		7,293		38,283		(32,040	)		6,243
In progress	-		3,495		-			3,495		999		-			999
Goodwill	-		3,376,551		-			3,376,551		3,307,805		-			3,307,805
			5,486,523		(547,369	)		4,939,155		5,350,096		(425,369	)		4,924,726

Changes in intangible assets and goodwill were as follows:

	Software			Customer Portfolio			Trademarks			Platform content production (i)			Other Intangible assets			In progress (i)			Goodwill (ii)		Total
As of December 31, 2020		83,414			928,858			573,586			23,821			6,243			999			3,307,805		4,924,726
Additions		16,019			-			-			15,252			-			5,492			-		36,763
Additions by business combination		11,036			18,783			-			-			1,100			-			68,746		99,665
Amoritization		(20,733	)		(66,022	)		(20,482	)		(14,712	)		(51	)		-			-		(122,000	)
Transfers		2,996			-			-			-			-			(2,996	)		-		-
As of September 30, 2021		92,732			881,619			553,104			24,361			7,293			3,495			3,376,551		4,939,155

(i)

Substantially refers to development of the projects related to Plurall Platform. The Company has invested in changes in its digital platform that include substantially “Plurall Digital Transformation” in the amount of approximately R$ 15,252 million, and project related to learning systems, in the amount of R$ 5,492 million which had its investments accelerated due to education demands created by the COVID-19 pandemic.

(ii)

The Company recognized R$ 68,746 as goodwill on SEL, Redação Nota 1000 and EMME acquisition, see Note 5.

Covid 19 Impacts

The Company opted to maintain investments in strategic projects and those related to improving the provision of services, given that they are considered essential for long-term growth, and partially reduced investments related to non-strategic projects or administrative area, such as IT projects or improvement in performance indicator reports. The Company will continue to evaluate COVID impacts on its business and cash flow and may postpone its plans to expand through significant acquisitions or investments.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	Software			Customer Portfolio			Trademarks			Platform content production			Other Intangible assets			In progress			Goodwill			Total
As of December 31, 2019		76,325			1,010,722			584,035			9,426			4,563			14,051			3,286,263			4,985,385
Additions		7,374			-			-			23,417			906			529						32,226
Additions by business combination		-			4,625			16,060			-			177			-			16,300			37,162
Disposals		(77	)		-			-			-			(89	)		-			(326	)		(492	)
Amoritization		(17,442	)		(64,374	)		(20,346	)		(6,506	)		(352	)		-			-			(109,020	)
Transfers		17,065			28			(3	)		(3,231	)		-			(14,051	)		192			-
As of September 30, 2020		83,245			951,001			579,746			23,106			5,205			529			3,302,429			4,945,261

Goodwill impairment test

During the year, the Company evaluated circumstances that could indicate impairment of its goodwill caused by impacts of Covid-19 and carried out a sensitivity analysis in the long-term model and cash flows, including any impacts / risks that could be estimated based on its best estimate of future cash flows. The conclusion of these tests conducted by the Company for the year ended December 31, 2020, showed that no adjustments were required to these assets. Further, the Company assessed the circumstances that could indicate impairment for the nine months period ended September 30, 2021 and no impairment indicator was identified.

The Company is comprised of two separate CGUs (each one of its reportable operating segments, as per Note 27), for which the recoverable amount has been determined based on value-in-use calculations, Goodwill is allocated to each CGU as shown below:

Content & EdTech Platform			3,345,633
Digital Platform			30,918
			3,376,551

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Bonds and financing

The balance of bonds and financing comprises the following amounts:

	December 31, 2020		Additions (ii)		Payment of interest (i)			Payment (i)			Interest accrued		Transaction cost of bonds			Transfers			September 30, 2021
Bonds with Related Parties		502,743		-		(24,873	)		(477,564	)		18,844		-			238,715			257,865
Bonds		-		-		-			-			5,333		(993	)		-			4,340
Finance		139		-		(73	)		(87	)		95		-			166			240
Current liabilities		502,882		-		(24,946	)		(477,651	)		24,272		(993	)		238,881			262,445

Bonds with Related Parties		289,600		-		-			-			-		-			(238,715	)		50,885
Bonds		-		500,000		-			-			-		(2,007	)		-			497,993
Finance		859												-			(166	)		693
Non-current liabilities		290,459		500,000		-			-			-		(2,007	)		(238,881	)		549,571

Total		793,341		500,000		(24,946	)		(477,651	)		24,272		(3,000	)		-			812,016

(i)

On March 15, 2021, the Company, substantially settled bonds with related parties amounting to R$ 100,000 and R$ 1,488, in principal and interest, respectively as follows: 5th Issuance, 1st series – R$ 101,488. In addition, the Company settled only interest on the following bonds: 5th Issuance, 2nd series – R$ 1,451, 6th Issuance, 2nd series – R$ 3,613 and 7th Issuance, single series – R$ 5,663. This measure is part of a commitment with shareholders as a result of the IPO.

On May 31, 2021, the Company partially settled bonds with related parties amounting to R$ 188,000, in principal as follows: 7^th issuance single series, being the remaining amount to be paid on August 16, 2021. Regarding the financing with Banco de Desenvolvimento de Minas Gerais S.A - BDMG, the Company paid the amount of R$87 and 73, respectively for principal and interest.

On August 6, 2021, the Company settled the remaining 7^th issuance with related parties in the amounts of R$189,564 and R$5,871, as principal and interest. In addition, the Company settled only interest on the following bonds: 5th Issuance, 2nd series – R$ 2,029 and 6th Issuance, 2nd series – R$ 4,758.

(ii)

On August 6, 2021, Vasta’s subsidiary Somos Sistemas de Ensino S.A. issued R$ 500 million in simple debentures not convertible into shares, subject to compensatory interest of 100% of DI Interest Deposit rate (CDI), plus spread of 2.30% per year. The debentures are aimed at reinforcing the company’s capital structure and elongating the debt maturity profile, which average maturity now stands at 35 months.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	December 31, 2019		Additions by Business Combination		Payment of interest			Payment (i)			Interest accrued		Transfers			September 30, 2020
Bonds with Related Parties		440,947		-		(49,368	)		(852,136	)		30,520		910,400			480,363
Finance		-		-		(35	)		-			35		139			139
Current liabilities		440,947		-		(49,403	)		(852,136	)		30,555		910,539			480,502

Bonds		1,200,000		-		-			-			16,170		(910,400	)		305,770
Finance leases		-		998		-			-			-		(139	)		859
Non-current liabilities		1,200,000		998		-			-			16,170		(910,539	)		306,629

Total		1,640,947		998		(49,403	)		(852,136	)		46,725		-			787,131

(i)

On August 4, 2020, the Company, substantially settled bonds with related parties amounting by R$ 852,136 and R$ 29,864, respectively principal and interest, as follow: 7th Issuance, 1st serie – R$ 310,918; 8th Issuance R$ 448,826 and 9th Issuance 115,591. In addition, the Company settled only interest on the following bonds: 7th Issuance, 2nd serie – R$4,671 and 6th Issuance, 2nd serie – R$ 1,994. This measure is part of committed take with shareholders thorugh IPO.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Bonds’ description

See below the bonds outstanding on September 30, 2021:

Subscriber	Related Parties	Related Parties	Third parties
Issuance	5th	6th	1th GAGL11
Series	2^nd Series	2^nd Series	Single Series
Date of issuance	08/15/2018	08/15/2017	08/06/2021
Maturity Date	08/15/2023	08/15/2022	08/05/2024
First payment after	60 months	60 months	35 months
Remuneration payment	Semi-annual interest	Semi-annual interest	Semi-annual interest
Financials charges	CDI + 1,00% p,a,	CDI + 1,70% p,a,	CDI + 2,30% p,a,

Principal amount (in millions of R$)	100	200	500

Bonds’ maturities

The maturities range of these accounts, considering related and third parties are as follow:

	September 30, 2021
Maturity of installments	Total		%
2021		-		0.0	%
2022		262,445		32.3	%
2023		51,578		6.4	%
2024 onwards		497,993		61.3	%
Total non-current liabilities		812,016		100.0	%

		812,016		100.0	%

Debit commitments

The maintenance of the contractual maturity of debentures at their original maturities is subject to covenants, which are being regularly complied with. The key covenant compliance indicators are the following:

Bonds with related parties

On November 19, 2019, all rights and obligations related to bonds issued by Saber with third parties were transferred to Cogna, under the condition that R$ 1,535,800 of the amounts should be transferred to the Company upon the Corporate Restructuring. Through this process, the Company is subject to the following clauses: (i) the acceleration of the other debentures originally issued by Saber; (ii) the grant by the Company of any liens on Company assets or its capital stock; (iii) a change in control by Cogna of Saber’s subsidiaries, subject to certain exceptions. Additionally, the Company has agreed until the maturity of the private debentures that: (i) it will allocate at least 50% of the use of proceeds from any liquidity event to repay such debentures; (ii) it will not obtain any new loans unless the proceeds of such loans are directed to repayment of its debentures with Cogna; and (iii) the Company will not pledge shares and/or dividends.

The Company complied with all debit commitments in the period applicable on September 30, 2021 and December 31, 2020.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Bonds with third parties

The bond issued by Somos Sistemas requires the maintance of certain financial indicators “covenants” which are annually calculated based on Somos Sistemas Consolidated financial statements. The period of covenants compliance comprises 12 months immediately prior to the end of each year, being the first year of analysis December 31, 2021 and based on ration between adjusted net debt by adjusted consolidated EBTIDA. The net debt adjusted EBTIDA ratio should be less or equal:

4.25 in 2021

4.00% in 2022

3.75% in 2023

3.50 in 2024

This ratio cannot be breched for two consecutive periods or three alternate periods.

Consolidated net debt: Company’s total debt (short- and long-term loans and financing, including capital markets operations, less cash equivalents cash which could be withdrawned untill five business days added by accounts payable for business combinations)

Adjusted consolidated EBITDA: Earnings before income taxes, depreciation and amortization, financial results, added by financial income and considering non-recurring income.

Suppliers

The balance of this account comprises the following amounts:

Composition

	September 30, 2021		December 31, 2020
Local suppliers (ii)		67,892		128,639
Related parties (note 20)		17,309		20,985
Copyright		6,475		19,317
Reverse Factoring (i)		94,596		110,513
		186,272		279,454

(i)

Some of the Company’s domestic suppliers sell their products with extended payment terms and may subsequently transfer their receivables due by the Company to financial institutions without right of recourse, in a transaction characterized as “Reverse Factoring”. The Company charged interest over the payment term at a rate that is commensurate with its own credit risk. The reverse factoring presents maturity dates from one year.

(ii)

The decrease in outstanding balances of supplier’s amounts is due to schoolyear seasonality and all editorial costs and correlated obligations usually initiated in July/August for each year and completed in December.

Lease liabilities

The lease agreements have an average term of 7 years and weighted average rate of 14.32% p.a.

	September 30, 2021			September 30, 2020
Opening balance		173,103			153,714
Additions for new lease agreements (i)		15,361			16,865
Renegotiation		(21,638	)		-
Cancelled contracts		(3,481	)		(3,429	)
Renegotiation - COVID-19 impact		(28	)		(844	)
Interest		11,602			11,337
Payment of interest		(11,564	)		(10,900	)
Payment of principal		(15,308	)		(9,207	)
Closing balance		148,047			157,536

Current liabilities		18,672			13,112
Non-current liabilities		129,375			144,424
		148,047			157,536

(i)Refers to new lease agreements which the Company has embeded part of its digital learning solutions. Those lease agreements (digital learning) refer to lease terms of 36 months, with rates negotiated in the range from 10,3% p.a to 10,88% p.a.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Short-term leases (lease period of 12 months or less) and leases of low-value assets (such as personal computers and office furniture) are recognized on a straight-line basis in rent expenses for the period and are not included in lease liabilities. Fixed and variable lease payments, including those related to short-term contracts and to low-value assets, were the following for the nine months periods ended September 30, 2021 and 2020:

	Period ended September 30
	2021		2020
Fixed Payments		26,872		20,107
Payments related to short-term contracts and low value assets, variable price contracts (note 25)		14,459		15,003
		41,331		35,110

Contract liabilities and deferred income

	September 30, 2021		December 31, 2020
Refund liability (i)		4,413		42,005
Sales of 'employees' payroll (iii)		1,174		2,348
Deferred income in leaseback agreement (ii)		5,908		6,665
Other contract liabilities		1,544		2,689
		13,039		53,707

Current		8,432		47,169
Non-current		4,607		6,538
		13,039		53,707

(i) Refers to the customers’ right to return products, as mentioned in the Note 11, the Company business cycle is comprehended from September to September for each year, being the provision reduced in the end of business cycle and estimated in the fourth quarter.

(ii) In March 2018, the predecessor Somos-Anglo entered into a sales and leaseback agreement of a property located at Avenida João Dias in the city of São Paulo in the amount of R$ 25,500. This transaction included deferred income of R$ 9,104, which has been appropriated according to the lease term of the property (120 months).

(iii) Refers to deferred income related to the sale of a 5-year exclusivity to process our Company employees’ payroll to Banco Itaú for R$ 7,000 thousand, in August 2017. This income is recognized in the Income Statement on a straight-line basis throughout the contract term as “Other Operating income” as the Company believes that the rights of exclusivity are transferred to Itaú over the 5-year period.

18 Accounts payable for business combination

	September 30, 2021		December 31, 2020
Pluri		3,192		12,817
Mind Makers		6,916		15,000
Livro Fácil		13,854		15,907
Meritt		3,953		4,331
SEL (i)		26,448		-
Redação Nota 1000 (ii)		6,990		-
EMME (iii)		12,360		-
		73,713		48,055

Current		20,055		17,132
Non-current		53,658		30,923
		73,713		48,055

(i)

Refers to the SEL acquisition (see note 5).

(ii)

Refers to Redação Nota 1000 acquisition (see note 5).

(iii)

Refers to EMME acquisition (see note 5).

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

The change in the balance is as follows:

	September 30, 2021			December 31, 2020
Opening balance		48,055			10,941
Additions		96,907			58,857
Price adjustment (i)		(5,203	)		-
Payment		(66,019	)		(26,389	)
Interest adjustment		811			1,568
Others		(838	)		3,078
Closing balance		73,713			48,055

(i)

Refers to Mind Makers price adjustment based on December 31, 2020’s revenue targets calculated and approved on September 3, 2021.

The maturity years of such balances as of September 30, 2021 are shown in the table below:

		September 30, 2021				December 31, 2020
Maturity of installments		Total		%		Total		%
	2021		20,055		27.2		17,132		35.7

	2022		28,907		39.2		13,811		28.7
	2023		16,212		22.0		17,112		35.6
	2024		2,746		3.7		-		-
	2025		5,793		7.9		-		-

			73,713		100.0		48,055		100.0

Salaries and Social Contribution

	September 30, 2021		December 31, 2020
Salaries payable		17,456		15,891
Social contribution payable (i)		24,372		30,511
Provision for vacation pay and 13th salary		25,559		15,920
Provision for profit sharing (ii)		63		5,880
Others		3,460		921
		70,910		69,123

(i)

Refers to the effect of social contribution over restricted share unit’s compensation plans issued on July 31 and November 10, 2020. The Company records the taxes over the shares on a monthly basis according to the Company’s share price.

(ii)

The provision for profit sharing is based on qualitative and quantitative metrics determined by Management. In 2020, some metrics were reviewed on account of COVID 19. The provision for profit sharing was settled in the second quarter of 2021.

Related parties

As presented in note 1, the Company is part of Cogna Group and some of the Company’s transactions and arrangements involve entities that belong to the Cogna Group. The effect of these transactions is reflected in these Consolidated Financial Statements, with these related parties segregated by nature of transaction measured on an arm’s length basis and determined by intercompany agreements and approved by the Company’s Management. Furthermore, all of them are settled in cash, except for certain intangibles described in item 20(d).

The balances and transactions between the Company and its affiliates have been eliminated in the Company’s Consolidated Financial Statements. The balances and transactions between related parties are shown below:

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	September 30, 2021
	Other receivables (i)		Trade receivables (Note 10 and 20c)		Indemnification asset (note 20b)		Other payments (ii)		Suppliers (note 15)		Bonds (note 14)
Acel Adminstração de Cursos Educacionais Ltda		-		1,208		-		-		455		-
Anhanguera Educacional Participacoes SA.		-		413		-		-		-		-
Centro Educacional Leonardo Da Vinci SS		-		-		-		-		6		-
Cogna Educação S.A.		-		-		157,568		3,021		-		308,750
Colégio Ambiental Ltda		-		443		-		-		40		-
Colégio JAO Ltda.		-		681		-		-		33		-
Colegio Manauara Lato Sensu Ltda.		-		1,750		-		-		1,981		-
Colegio Visao Eireli		-		270		-		-		13		-
Conlégio Cidade Ltda		-		137		-		-		15		-
Curso e Colégio Coqueiro Ltda		-		298		-		-		20		-
ECSA Escola A Chave do Saber Ltda		-		71		-		-		16		-
Editora Atica S.A.		-		1,764		-		20,423		6,192		-
Editora E Distribuidora Educacional S.A.		-		436		-		15,339		88		-
Editora Scipione S.A.		-		475		-		736		503		-
Educação Inovação e Tecnologia S.A.		13		-		-		-		-		-
Escola Mater Christi Ltda.		-		78		-		-		139		-
Escola Riacho Doce Ltda		-		21		-		-		62		-
Maxiprint Editora Ltda.		-		98		-		117		27		-
Nucleo Brasileiro de Estudos Avançados Ltda		-		19		-		-		-		-
Papelaria Brasiliana Ltda		-		554		-		-		-		-
Pitagoras Sistema De Educacao Superior Ltda.		-		76		-		-		-		-
Saber Serviços Educacionais S.A.		5		580		-		-		590		-
Saraiva Educacao S.A.		2,141		1,231		-		-		5,539		-
SGE Comercio De Material Didatico Ltda.		-		0		-		-		660		-
Sistema P H De Ensino Ltda.		-		1,751		-		-		177		-
Sociedade Educacional Alphaville Ltda		-		100		-		-		1		-
Sociedade Educacional Doze De Outubro Ltda.		-		170		-		-		47		-
Sociedade Educacional NEODNA Cuiaba Ltda		-		37		-		-		-		-
Sociedade Educacional Parana Ltda.		-		46				-		11
Somos Idiomas SA		112		-		-		-		-		-
Somos Operações Escolares S.A.		-		606		-		31		29		-
SSE Serviços Educacionais Ltda.		-		381		-		-		665		-
Stoodi Ensino a Distancia Ltda		124		-		-		-		-		-
Others		86		-		-		10		-		-
		2,481		13,694		157,568		39,677		17,309		308,750

(i)

Refers substantially to accounts receivable generated from sharing costs e.g IT services shared by the Company to Cogna Group

(ii)

Refers substantially to accounts payable by sharing expenses e.g property leasing, personnel and IT licences shared with Cogna Group.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	December 31, 2020
	Other receivables (i)		Trade receivables (Note 9)		Indemnification asset (note 20b)		Other payments (ii)		Loans (iii)		Suppliers (note 14)		Bonds (note 13)
Acel Adminstração de Cursos Educacionais Ltda		-		2,899		-		-		-		36		-
Anhanguera Educacional Participacoes SA.		-		413		-		-		-		-		-
Centro Educacional Leonardo Da Vinci SS		-		63		-		-		-		-		-
Cogna Educação S.A.		-		-		153,714		1,354		20,884		-		691,451
Colégio Ambiental Ltda		-		315		-		-		-				-
Colégio JAO Ltda.		-		772		-		-		-		-		-
Colegio Manauara Lato Sensu Ltda.		-		2,838		-		-		-		173		-
Colégio Motivo Ltda.		-		1,250		-		-		-		249		-
Colegio Visao Eireli		-		115		-		-		-		-		-
Conlégio Cidade Ltda		-		155		-		-		-				-
Curso e Colégio Coqueiro Ltda		-		188		-		-		-				-
ECSA Escola A Chave do Saber Ltda		-		435		-		-		-				-
Editora Atica S.A.		-		1,193		-		72,158		-		7,392		-
Editora E Distribuidora Educacional S.A.		-		528		-		9,547		-		89		-
Editora Scipione S.A.		-		414		-		13,408		-		1,386		-
Educação Inovação e Tecnologia S.A.		-		-		-		229		-		0		-
EDUFOR Serviços Educacionais Ltda		-		10		-		-		-				-
Escola Mater Christi Ltda.		-		216		-		-		-		104		-
Escola Riacho Doce Ltda		-		253		-		-		-				-
Maxiprint Editora Ltda.		13		367		-		-		-		26		-
Nucleo Brasileiro de Estudos Avançados Ltda		-		391		-		-		-				-
Papelaria Brasiliana Ltda		-		1,478		-		-		-				-
Pitagoras Sistema De Educacao Superior Ltda.		-		127		-		-		-		-		-
Saber Serviços Educacionais S.A.		1,686		3,710		-		-		-		2,658		100,892
Saraiva Educacao S.A.		-		804		-		36,454		-		8,010		-
SGE Comercio De Material Didatico Ltda.		-		6		-		41		-		661		-
Sistema P H De Ensino Ltda.		-		2,348		-		2,116		-		163		-
Sociedade Educacional Alphaville Ltda		-		190		-		-		-				-
Sociedade Educacional Doze De Outubro Ltda.		-		231		-		-		-		36		-
Sociedade Educacional NEODNA Cuiaba Ltda		-		102		-		-		-				-
Somos Idiomas SA		79		-		-		-		-		-		-
Somos Operações Escolares S.A.		292		980		-		-		-		-		-
		2,070		22,791		153,714		135,307		20,884		20,985		792,343

(i)

Refers to other receivables related to cost sharing agreements where substantially Saber Serviços Educacionais (“Saber”), a Cogna Group entity, takes services from the Company;

(ii)

Refers substantially to “Reverse Factoring” contracts for raw material purchases, specifically graphics and paper, which the Company reimburses Atica and Scipione. See item a, below;

(iii)

Unitl December 31, 2020 the Company held a loan with Cogna Educação S.A. in the amount of R$ 20,884 being paid on January 21, 2021.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

	Nine months ended September 30, 2021								Nine months ended September 30, 2020
Transactions held:	Revenues		Finance costs (i)		Cost Sharing (note 20c)		Sublease (note 20e)		Revenues		Finance costs(i)		Cost Sharing (note 20c)		Sublease (note 20e)

Acel Administracao De Cursos Educacionais Ltda.		1,204		-		-		-		138		-		-		-
Centro Educacional Leonardo Da Vinci SS		41		-		-		-		-		-		-		-
Cogna Educação S.A.		-		18,844		-		-		-		47,726		-		-
Colégio Ambiental Ltda		443		-		-		-		-		-		-		-
Colégio Cidade Ltda		108		-		-		-		-		-		-		-
Colegio JAO Ltda.		546		-		-		-		-		-		-		-
Colégio Manauara Lato Sensu Ltda.		641		-		-		-		371		-		-		-
Colégio Motivo Ltda.		35		-				-		372		-		-		-
Colégio Visão Ltda		287		-		-		-		-		-		-		-
Cursos e Colégio Coqueiros Ltda		242		-		-		-		-		-		-		-
Ecsa Escola A Chave Do Saber Ltda.		148		-		-		-		162		-		-		-
Editora Atica S.A.		2,852		-		4,602		8,901		5,725		272		11,989		1,727
Editora E Distribuidora Educacional SA.		-		-		23,561		-		1,841		-		26,873		772
Editora Scipione SA.		1,076		-		-		-		883		-		-		-
Escola Mater Christi		35		-		-		-		-		-		-		-
Escola Riacho Doce Ltda		39		-		-		-		-		-		-		-
Maxiprint Editora Ltda.		-		-		-		-		608		-		-		-
Nucleo Brasileiro de Estudos Avancados Ltda		63		-		-		-		-		-		-		-
Papelaria Brasiliana Ltda		46		-		-		-		-		-		-		-
Saber Serviços Educacionais S.A.		189		-		-		-		854		-		-		-
Saraiva Educacao SA.		2,077		-		-		2,271		1,785		-		-		5,023
Sistema P H De Ensino Ltda.		2,628		-		-		-		3,991		-		-		-
Sociedade Educacional Alphaville SA		196		-		-		-		-		-		-		-
Sociedade Educacional Doze De Outubro Ltda		237		-		-		-		127		-		-		-
Sociedade Educacional Neodna Cuiaba Ltda.		224		-		-		-		257		-		-		-
Sociedade Educacional Parana Ltda.		-		-		-		-		795		-		-		-
SOE Operações Escolares SA.		543		-		-		-		-		-		-		-
Somos Educação S.A.		-		-		-		-		-		1,235		-		-
Somos Idiomas Ltda		-		-		-		195		-		-		-		-
Somos Operações Escolares SA.		243		-		-		-		-		-		-		-
SSE Serviços Educacionais Ltda.		164		-		-		-		-		-		-		-
Others		-		-		-		-		393		-		-		1,686
		14,307		18,844		28,163		11,367		18,302		49,233		38,862		9,208

(i)

Refers to debentures interest; see Note 14. Until September 30, 2020 there were no debentures.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements

as of September 30, 2021

Suppliers and other arrangements with related parties

The Company, as a result of the carve-out process on December 31, 2019, maintained the reverse factoring operations (specifically purchases of raw materials with affiliates of the Cogna Group) and until then owned the assets and liabilities. After the carve-out process on January 1, 2020, the Company assumed these commitments. However, the Company took into account the fact that these contracts would last a year or less after the base carve-out date, and the cost and benefit of transferring the contracts from Cogna Group affiliates to the Company would be greater than keep them with Cogna Group. As a result, Management decided to reimburse Grupo Cogna for these expenses as the contracts expired and settled the entire remaining balance of this transaction in May 2021. Since January 1, 2021 the Company does not arrange reverse factoring transactions with related parties, being the residual amount opened as of December 31, 2021 settled on May, 2021 on amount R$ 83,922

In addition to this process, the affiliates also had some shared expenses such as property lease, expenses with personnel and software license, which continued even after the carve-out operation was completed and still remain today. As of September 30, 2021, only shared expense transactions are part of these commitments, which amounted to R$39,677 (R$135,307 as of December 31, 2020).

Guarantees related to contingencies acquired through past business combination

In December 2019, the Company and Cogna Group signed the agreement to legally bind the indemnification of the seller in connection with the acquisition of Somos by Cogna Group, in order to indemnify the Company for any and all losses that may be incurred in connection with all contingencies or lawsuits related to the Predecessor up to the maximum amount of R$ 157,6 million as of September 30, 2021 (R$ 153,7 million as of December 31, 2020). See Provision for risks of tax, civil and labor losses and judicial deposits and escrow account footnote (note 20).

Trade receivables

The Company and its subsidiaries provide learning systems, textbooks, and complementary educational solutions to the Cogna Group which substantially comprises schools, publishers, language schools and stationery shops. All sales and services provided are based on intercompany contracts and its commercial conditions, which include price, margin and payment terms, were determined on an arm’s length basis.

Cost sharing agreements with related parties

The Company expensed certain amounts based on an apportionment from Cogna Group related to shared services, including the shared service center, IT expenses, proprietary IT systems and legal and accounting activities, and shared warehouses and other logistic activities based on agreements. Those expenses, in the amount of R$ 28,163 for the nine months period ended September 30, 2021 (R$ 38,862 for the nine months period ended September 30, 2020) are related to these apportionments.

Brand and Copyrights sharing agreements with related parties

In November and December 2019, the Company and its related parties entered into brand and copyrights sharing agreements with related parties, as follows:

(i)

On November 6, 2019, the Company entered into a trademark license agreement (as amended in 2020) with EDE whereby the Company was granted at no cost rights to use related to the trademark “Pitágoras.” This agreement is valid for a period of 20 years, automatically and successively renewable for the same period.

(ii)

On November 11, 2019, the Company and EDE (Cogna Group’s Parent Company) entered into a copyright license agreement whereby EDE agreed to grant a license, at no cost, to the Company, for commercial exploitation and use of copyrights related to the educational platform materials. This agreement is valid for three years.

Vasta Platform Limited

Unaudited Interim Condensed Consolidated Financial Statements