Increases second quarter per share dividend by
18.2% to $0.13 per share
Perdoceo Education Corporation (NASDAQ: PRDO) today reported
operating and financial results for the quarter and year to date
ended June 30, 2024.
Second Quarter 2024
Results as Compared to Prior Year Quarter
- Total student enrollments at June 30, 2024 increased by 4.2%
supported by a 14.7% increase at CTU that was partially offset with
an 18.2% decrease at AIUS.
- Revenue decreased 10.6% to $166.7 million. This decrease was
expected and partially due to a lag impact from the operational
changes made at AIUS in the prior year.
- Operating income decreased 4.3% to $46.0 million, while
adjusted operating income decreased 7.8% to $50.9 million.*
- Earnings per diluted share were $0.57 as compared to $0.80,
while adjusted earnings per diluted share were $0.60 as compared to
$0.61.*
- Ended the quarter with $675.2 million in cash, cash
equivalents, restricted cash and available-for-sale-short-term
investments.
- On July 31, 2024 the Board increased the per share quarterly
dividend by 18.2% to $0.13 per share.
Year to Date 2024
Results as Compared to Prior Year to Date
- Revenue decreased 12.3% to $335.0 million, which was in line
with management’s expectation for a decline.
- Operating income increased 0.9% to $92.3 million, while
adjusted operating income decreased 7.3% to $100.4 million.*
- Earnings per diluted share were $1.16 as compared to $1.30,
while adjusted earnings per diluted share were $1.21 as compared to
$1.19.*
*See GAAP (U.S. generally accepted accounting principles)
to non-GAAP reconciliation attached to this press release
"Our second quarter results exceeded expectations, as both of
our academic institutions continued to experience high levels of
student retention and engagement,” said Todd Nelson, President and
Chief Executive Officer. “Our year-to-date results and enrollment
trends have been supported by various operating process changes and
technology upgrades within our onboarding, academic and student
support processes. Our faculty and student support staff continue
to focus on further enhancing student experiences and academic
outcomes and we will continue to make informed investments in
technology and student support processes.”
REVENUE
- For the quarter ended June 30, 2024, revenue of $166.7 million
decreased 10.6% compared to revenue of $186.6 million for the prior
year quarter.
- For the year to date ended June 30, 2024, revenue of $335.0
million decreased 12.3% compared to revenue of $382.2 million for
the prior year to date.
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
Revenue ($ in
thousands)
2024
2023
% Change
2024
2023
% Change
CTU
$
112,828
$
119,292
-5.4
%
$
226,397
$
243,784
-7.1
%
AIUS
53,722
67,062
-19.9
%
108,227
137,902
-21.5
%
Corporate and Other
190
210
NM
380
476
NM
Total
$
166,740
$
186,564
-10.6
%
$
335,004
$
382,162
-12.3
%
TOTAL STUDENT ENROLLMENTS
- As of June 30, 2024, CTU’s total student enrollments increased
14.7%, while AIUS’ total student enrollments decreased 18.2%.
At June 30,
Total Student
Enrollments(1)
2024
2023
% Change
CTU
29,700
25,900
14.7
%
AIUS
9,900
12,100
-18.2
%
Total
39,600
38,000
4.2
%
(1)
Total student enrollments do not include
learners participating in: a) non-degree seeking and professional
development programs, and b) degree seeking, non-Title IV,
self-paced programs at the Company's universities.
OPERATING INCOME
- For the quarter ended June 30, 2024, operating income decreased
by 4.3% to $46.0 million as compared to the prior year
quarter.
- For the year to date ended June 30, 2024, operating income
increased by 0.9% to $92.3 million as compared to the prior year to
date.
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
Operating Income
($ in thousands)
2024
2023
% Change
2024
2023
% Change
CTU
$
42,890
$
40,451
6.0
%
$
85,046
$
84,141
1.1
%
AIUS
12,926
17,078
-24.3
%
22,212
29,081
-23.6
%
Corporate and Other
(9,810
)
(9,435
)
-4.0
%
(14,974
)
(21,792
)
31.3
%
Total
$
46,006
$
48,094
-4.3
%
$
92,284
$
91,430
0.9
%
ADJUSTED OPERATING INCOME
The Company believes it is useful to present non-GAAP financial
measures, which exclude certain significant and non-cash items, as
a means to understand the performance of its operations. (See table
below and the GAAP to non-GAAP reconciliation attached to this
press release for further details.)
- For the quarter ended June 30, 2024, adjusted operating income
of $50.9 million decreased 7.8% compared to adjusted operating
income of $55.2 million for the prior year quarter.
- For the year to date ended June 30, 2024, adjusted operating
income of $100.4 million decreased 7.3% compared to adjusted
operating income of $108.3 million for the prior year to date.
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
Adjusted
Operating Income ($ in thousands)
2024
2023
2024
2023
Operating income
$
46,006
$
48,094
$
92,284
$
91,430
Depreciation and amortization
3,069
4,369
6,085
9,524
Legal fee expense related to certain
matters (1)
1,815
2,709
2,045
7,328
Adjusted Operating Income
$
50,890
$
55,172
$
100,414
$
108,282
Increase (Decrease)
-7.8
%
-7.3
%
(1)
Legal fee expense associated with (i)
responses to the Department of Education (the “Department”)
relating to borrower defense to repayment applications from former
students, and (ii) acquisition efforts.
NET INCOME AND EARNINGS PER DILUTED SHARE
For the quarter ended June 30, 2024, the Company recorded:
- Net income of $38.4 million compared to $54.7 million for the
prior year quarter.
- Earnings per diluted share of $0.57 compared to $0.80 for the
prior year quarter.
- Adjusted earnings per diluted share of $0.60 compared to $0.61
for the prior year quarter. (See table below and the GAAP to
non-GAAP reconciliation attached to this press release for further
details.)
For the year to date ended June 30, 2024, the Company
recorded:
- Net income of $77.9 million compared to $89.2 million for the
prior year to date.
- Earnings per diluted share of $1.16 compared to $1.30 for the
prior year to date.
- Adjusted earnings per diluted share of $1.21 compared to $1.19
for the prior year to date. (See table below and the GAAP to
non-GAAP reconciliation attached to this press release for further
details.)
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
2024
2023
2024
2023
Reported Earnings Per Diluted
Share
$
0.57
$
0.80
$
1.16
$
1.30
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets
0.02
0.03
0.04
0.07
Legal fee expense related to certain
matters (1)
0.03
0.04
0.03
0.11
Gain on sale of intangible asset
-
(0.32
)
-
(0.32
)
Tax effect of adjustments (2)
(0.02
)
0.06
(0.02
)
0.03
Adjusted Earnings Per Diluted
Share
$
0.60
$
0.61
$
1.21
$
1.19
(1)
Legal fee expense associated with (i)
responses to the Department relating to borrower defense to
repayment applications from former students, and (ii) acquisition
efforts.
(2)
The tax effect of adjustments was
calculated by multiplying the pre-tax adjustments with a tax rate
of 25.0%. This tax rate is intended to reflect federal and state
taxable jurisdictions as well as the nature of the adjustments.
QUARTERLY DIVIDEND PAYMENT
On July 31, 2024, the board of directors approved its first
dividend increase since implementing its dividend policy last year.
The board of directors declared a quarterly dividend of $0.13 per
share, an increase of 18.2%, which will be paid on September 13,
2024 for holders of record of common stock as of September 1, 2024.
Any decision to pay future cash dividends, however, will be made by
the board of directors and depend on the Company’s available
retained earnings, financial condition and other relevant factors.
The Company expects quarterly dividend payments to be an integral
and growing part of its balanced capital allocation strategy that
also prioritizes investments in student support and technology
projects, while also evaluating acquisitions and share
repurchases.
AGREEMENT TO ACQUIRE UNIVERSITY OF ST. AUGUSTINE FOR HEALTH
SCIENCES
On July 16, 2024, the Company announced that it has signed a
definitive agreement to acquire 100% ownership of the University of
St. Augustine for Health Sciences, LLC (USAHS). USAHS is one of the
nation’s leading universities offering graduate health sciences
degrees, primarily in physical therapy, occupational therapy,
speech language therapy and nursing, as well as continuing
education programs.
Perdoceo expects to pay approximately $142 million to $144
million in cash at closing. The actual cash paid will depend on
adjustments for cash, debt and working capital based on the final
closing balance sheet. Once completed, the Company expects that the
acquisition will support further growth and diversification of its
academic program offerings and will mark Perdoceo’s foray into
health science degrees in a meaningful way. For the year ended
December 31, 2023, USAHS had revenues of approximately $170
million, operating income of approximately $35 million and served
approximately 4,500 graduate and post-graduate students across
multiple health sciences disciplines. Perdoceo expects the
transaction to be immediately accretive to the Company’s adjusted
operating income beginning in 2025.
Please refer to our Form 8-K filed on July 16, 2024 for other
details, material terms and other conditions related to the pending
acquisition.
BALANCE SHEET AND CASH FLOW
- For the quarter ended June 30, 2024 net cash provided by
operating activities was $38.5 million, compared to net cash
provided by operating activities of $61.6 million for the prior
year quarter.
- For the year to date ended June 30, 2024, net cash provided by
operating activities was $93.0 million, compared to net cash
provided by operating activities of $66.2 million in the prior year
to date.
- As of June 30, 2024 and December 31, 2023, cash, cash
equivalents, restricted cash and available-for-sale short-term
investments totaled $675.2 million and $604.2 million,
respectively.
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
Selected Cash
Flow Items ($ in thousands)
2024
2023
% Change
2024
2023
% Change
Net cash provided by operating
activities
$
38,525
$
61,648
-37.5
%
$
93,017
$
66,220
40.5
%
Capital expenditures
$
824
$
1,687
-51.2
%
$
2,022
$
3,612
-44.0
%
OUTLOOK
The Company is providing the following third quarter outlook
along with a full year outlook, subject to the key assumptions
identified below. Please see the GAAP to non-GAAP reconciliation
for adjusted operating income and adjusted earnings per diluted
share attached to this press release for further details.
Total Company Outlook
For Quarter Ending September
30,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2024
2023
2024
2023
Operating Income
$41.6M - $43.6M
$43,073
$161.8M - $172.8M
$150,446
Depreciation and amortization
$3.1M
$3,914
$14.1M
16,887
Legal fee expense related to certain
matters (1)
$0.3M
$246
$3.1M
7,579
Adjusted Operating Income
$45.0M - $47.0M
$47,233
$179.0M - $190.0M
$174,912
Earnings Per Diluted Share
$0.51 - $0.53
$0.62
$2.04 - $2.16
$2.18
Amortization of acquired intangible
assets
$0.02
$0.03
$0.08
$0.11
Legal fee expense related to certain
matters (1)
-
-
$0.05
$0.11
Gain on sale of intangible asset
-
-
-
($0.32)
Tax effect of adjustments
($0.01)
($0.01)
($0.04)
$0.02
Adjusted Earnings Per Diluted
Share
$0.52 - $0.54
$0.64
$2.13 - $2.25
$2.10
(1)
Legal fee expense associated with (i)
responses to the Department relating to borrower defense to
repayment applications from former students, and (ii) acquisition
efforts.
Operating income, which is the most directly comparable GAAP
measure to adjusted operating income, and earnings per diluted
share, which is the most directly comparable GAAP measure to
adjusted earnings per diluted share, may not follow the same trends
stated in the outlook above because of adjustments made for certain
significant and non-cash items. The operating income, adjusted
operating income, earnings per share and adjusted earnings per
share outlook provided above for 2024 are based on the following
key assumptions and factors, among others: (i) prospective student
interest in the Company’s programs and trends in student retention
and engagement remain consistent with management’s estimates, (ii)
no significant additional impact of new or proposed regulations,
including recent Department negotiated rulemaking initiatives, or
other adverse changes in the legal or regulatory environment, which
may require further operational changes in the way the Company’s
academic institutions enroll, support and educate current and
prospective students, among other impacts, (iii) no significant
operating impacts from the settlements with the U.S. Federal Trade
Commission and state attorneys general or other legal or regulatory
matters, (iv) the impact from student loan initiatives implemented
by the current administration remains consistent with management's
estimates, (v) earnings per diluted share outlook assumes an
effective income tax rate of approximately 28% for the third
quarter and approximately 27% for the full year, and (vi) excludes
any future impact from the Company’s stock repurchase program.
Although these estimates and assumptions are based upon
management’s good faith beliefs regarding current and future
circumstances and actions that may be undertaken, actual results
could differ materially from these estimates. In addition,
decisions the Company makes in the future as it continues to
evaluate diverse strategies to enhance stockholder value may impact
the outlook provided above.
CONFERENCE CALL INFORMATION
Perdoceo Education Corporation will host a conference call on
Wednesday, July 31, 2024 at 5:30 p.m. Eastern time to discuss
second quarter and year to date 2024 results and outlook.
Interested parties can access the live webcast of the conference
call at www.perdoceoed.com in the Investor Relations section of the
website. Participants can also listen to the conference call by
dialing 1-800-715-9871 (domestic) or 1-646-307-1963
(international). Both dial-in numbers will use the access code
5668214. Viewers can also access the conference call by following
this link https://events.q4inc.com/attendee/614624375. Please
log-in or dial-in at least 10 minutes prior to the start time to
ensure a connection. An archived version of the webcast will be
accessible for 90 days at www.perdoceoed.com in the Investor
Relations section of the website.
ABOUT PERDOCEO EDUCATION CORPORATION
Perdoceo’s accredited academic institutions offer a quality
postsecondary education primarily online to a diverse student
population, along with campus-based and blended learning programs.
The Company’s academic institutions – Colorado Technical University
(“CTU”) and the American InterContinental University System (“AIUS”
or “AIU System”) – provide degree programs from the associate
through doctoral level as well as non-degree seeking and
professional development programs. Perdoceo’s academic institutions
offer students industry-relevant and career-focused academic
programs that are designed to meet the educational needs of today’s
busy adults. CTU and AIUS continue to show innovation in higher
education, advancing personalized learning technologies like their
intellipath® learning platform and using data analytics and
technology to serve and educate students while enhancing overall
learning and academic experiences. Perdoceo is committed to
providing quality education that closes the gap between learners
who seek to advance their careers and employers needing a qualified
workforce. For more information, please visit
www.perdoceoed.com.
Except for the historical and present factual information
contained herein, the matters set forth in this release, including
statements identified by words such as “believe,” “will,” “expect,”
“continue,” “outlook,” “remain,” “focused on,” “should” and similar
expressions, are forward-looking statements as defined in Section
21E of the Securities Exchange Act of 1934, as amended. These
statements are based on information currently available to us and
are subject to various assumptions, risks, uncertainties and other
factors that could cause our results of operations, financial
condition, cash flows, performance, business prospects and
opportunities to differ materially from those expressed in, or
implied by, these statements. Except as expressly required by the
federal securities laws, we undertake no obligation to update or
revise such factors or any of the forward-looking statements
contained herein to reflect future events, developments or changed
circumstances, or for any other reason. These risks and
uncertainties, the outcomes of which could materially and adversely
affect our financial condition and operations, include, but are not
limited to, the following: declines in enrollment or interest in
our programs or our ability to market to and contact prospective
students; our continued compliance with and eligibility to
participate in Title IV Programs under the Higher Education Act of
1965, as amended, and the regulations thereunder (including the
terms of any potential changes to or conditions imposed on our
continued participation in the Title IV programs under new program
participation agreements, the new 90-10, financial responsibility
and administrative capability standards prescribed by the U.S.
Department of Education), as well as applicable accreditation
standards and state regulatory requirements; the impact of various
versions of “borrower defense to repayment” regulations; the final
outcome of various legal challenges to the Department's loan
discharge and forgiveness efforts; rulemaking or changing
interpretations of existing regulations, guidance or historical
practices by the U.S. Department of Education or any state or
accreditor and increased focus by Congress and governmental
agencies on, or increased negative publicity about, for-profit
education institutions; the success of our initiatives to improve
student experiences, retention and academic outcomes; our continued
ability to participate in educational assistance programs for key
employers, veterans or other military personnel; our ability to pay
dividends on our common stock and execute our stock repurchase
program; increased competition; the impact of management changes;
and changes in the overall U.S. economy. Further information about
these and other relevant risks and uncertainties may be found in
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2023 and its subsequent filings with the Securities
and Exchange Commission.
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
June 30,
December 31,
2024
2023
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents,
unrestricted
$
127,852
$
118,009
Restricted cash
1,037
1,012
Short-term investments
546,273
485,135
Total cash and cash equivalents,
restricted cash and short-term investments
675,162
604,156
Student receivables, net
34,855
29,398
Receivables, other
4,982
4,539
Prepaid expenses
12,558
11,712
Inventories
4,467
5,004
Other current assets
457
155
Total current assets
732,481
654,964
NON-CURRENT ASSETS:
Property and equipment, net
19,087
21,371
Right of use asset, net
16,455
19,096
Goodwill
241,162
241,162
Intangible assets, net
34,002
36,219
Student receivables, net
5,267
3,859
Deferred income tax assets, net
23,242
23,804
Other assets
6,545
6,841
TOTAL ASSETS
$
1,078,241
$
1,007,316
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Lease liability - operating
$
5,397
$
5,701
Accounts payable
13,267
10,766
Accrued expenses:
Payroll and related benefits
25,295
32,684
Advertising and marketing costs
6,984
7,196
Income taxes
6,502
3,974
Other
22,023
13,503
Deferred revenue
55,390
37,215
Total current liabilities
134,858
111,039
NON-CURRENT LIABILITIES:
Lease liability - operating
18,443
21,346
Other liabilities
25,416
33,510
Total non-current liabilities
43,859
54,856
STOCKHOLDERS' EQUITY:
Preferred stock
-
-
Common stock
910
903
Additional paid-in capital
701,153
694,798
Accumulated other comprehensive loss
(1,721
)
(666
)
Retained earnings
543,606
480,606
Treasury stock
(344,424
)
(334,220
)
Total stockholders' equity
899,524
841,421
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY
$
1,078,241
$
1,007,316
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share
amounts and percentages)
For the Quarter Ended June
30,
2024
% of Total Revenue
2023
% of Total Revenue
REVENUE:
Tuition and fees, net
$
165,404
99.2
%
$
184,520
98.9
%
Other
1,336
0.8
%
2,044
1.1
%
Total revenue
166,740
186,564
OPERATING EXPENSES:
Educational services and facilities
27,516
16.5
%
32,748
17.6
%
General and administrative
89,311
53.6
%
100,588
53.9
%
Depreciation and amortization
3,069
1.8
%
4,369
2.3
%
Asset impairment
838
0.5
%
765
0.4
%
Total operating expenses
120,734
72.4
%
138,470
74.2
%
Operating income
46,006
27.6
%
48,094
25.8
%
OTHER INCOME:
Interest income
7,190
4.3
%
4,531
2.4
%
Interest expense
(112
)
-0.1
%
(96
)
-0.1
%
Miscellaneous (expense) income
(70
)
0.0
%
22,074
11.8
%
Total other income
7,008
4.2
%
26,509
14.2
%
PRETAX INCOME
53,014
31.8
%
74,603
40.0
%
Provision for income taxes
14,585
8.7
%
19,930
10.7
%
NET INCOME
38,429
23.0
%
54,673
29.3
%
NET INCOME PER SHARE - BASIC:
$
0.59
$
0.81
NET INCOME PER SHARE -DILUTED:
$
0.57
$
0.80
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic
65,611
67,421
Diluted
67,077
68,533
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Quarter Ended June
30,
(In Thousands)
2024
2023
NET INCOME
$
38,429
$
54,673
OTHER COMPREHENSIVE LOSS, net of
tax:
Foreign currency translation
adjustments
(8
)
(3
)
Unrealized loss on investments
(93
)
(1,497
)
Total other comprehensive loss
(101
)
(1,500
)
COMPREHENSIVE INCOME
$
38,328
$
53,173
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share
amounts and percentages)
For the Year to Date Ended
June 30,
2024
% of Total Revenue
2023
% of Total Revenue
REVENUE:
Tuition and fees, net
$
332,402
99.2
%
$
377,839
98.9
%
Other
2,602
0.8
%
4,323
1.1
%
Total revenue
335,004
382,162
OPERATING EXPENSES:
Educational services and facilities
57,374
17.1
%
66,599
17.4
%
General and administrative
176,793
52.8
%
213,274
55.8
%
Depreciation and amortization
6,085
1.8
%
9,524
2.5
%
Asset impairment
2,468
0.7
%
1,335
0.3
%
Total operating expenses
242,720
72.5
%
290,732
76.1
%
Operating income
92,284
27.5
%
91,430
23.9
%
OTHER INCOME:
Interest income
13,983
4.2
%
8,349
2.2
%
Interest expense
(447
)
-0.1
%
(191
)
0.0
%
Miscellaneous income
45
0.0
%
22,068
5.8
%
Total other income
13,581
4.1
%
30,226
7.9
%
PRETAX INCOME
105,865
31.6
%
121,656
31.8
%
Provision for income taxes
27,994
8.4
%
32,499
8.5
%
NET INCOME
77,871
23.2
%
89,157
23.3
%
NET INCOME PER SHARE - BASIC:
$
1.19
$
1.32
NET INCOME PER SHARE -DILUTED:
$
1.16
$
1.30
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic
65,583
67,328
Diluted
66,956
68,512
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Year to Date Ended
June 30,
(In Thousands)
2024
2023
NET INCOME
$
77,871
$
89,157
OTHER COMPREHENSIVE LOSS, net of
tax:
Foreign currency translation
adjustments
(39
)
23
Unrealized loss on investments
(1,016
)
(197
)
Total other comprehensive loss
(1,055
)
(174
)
COMPREHENSIVE INCOME
$
76,816
$
88,983
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
For the Year to Date Ended
June 30,
2024
2023
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income
$
77,871
$
89,157
Adjustments to reconcile net income to net
cash provided by operating activities:
Asset impairment
2,468
1,335
Gain on sale of asset
-
(22,086
)
Depreciation and amortization expense
6,085
9,524
Bad debt expense
12,631
18,927
Compensation expense related to
share-based awards
4,557
4,315
Deferred income taxes
562
2,975
Changes in operating assets and
liabilities
(11,157
)
(37,927
)
Net cash provided by operating
activities
93,017
66,220
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchases of available-for-sale
investments
(204,060
)
(159,183
)
Sales of available-for-sale
investments
145,945
132,325
Purchases of property and equipment
(2,022
)
(3,612
)
Net cash used in investing activities
(60,137
)
(30,470
)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Issuance of common stock
1,805
313
Purchase of treasury stock
(6,769
)
(2,729
)
Payments of employee tax associated with
stock compensation
(3,435
)
(2,209
)
Payments of cash dividends and dividend
equivalents
(14,613
)
-
Net cash used in financing activities
(23,012
)
(4,625
)
NET INCREASE IN CASH, CASH EQUIVALENTS
AND RESTRICTED CASH
9,868
31,125
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, beginning of the period
119,021
118,884
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, end of the period
$
128,889
$
150,009
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED SELECTED SEGMENT
INFORMATION
(In thousands, except
percentages)
For the Quarter Ended June
30,
2024
2023
REVENUE:
CTU
$
112,828
$
119,292
AIUS
53,722
67,062
Corporate and Other
190
210
Total
$
166,740
$
186,564
OPERATING INCOME (LOSS):
CTU
$
42,890
$
40,451
AIUS
12,926
17,078
Corporate and Other
(9,810
)
(9,435
)
Total
$
46,006
$
48,094
OPERATING MARGIN (LOSS):
CTU
38.0
%
33.9
%
AIUS
24.1
%
25.5
%
Corporate and Other
NM
NM
Total
27.6
%
25.8
%
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED SELECTED SEGMENT
INFORMATION
(In thousands, except
percentages)
For the Year to Date Ended
June 30,
2024
2023
REVENUE:
CTU
$
226,397
$
243,784
AIUS
108,227
137,902
Corporate and Other
380
476
Total
$
335,004
$
382,162
OPERATING INCOME (LOSS):
CTU
$
85,046
$
84,141
AIUS
22,212
29,081
Corporate and Other
(14,974
)
(21,792
)
Total
$
92,284
$
91,430
OPERATING MARGIN (LOSS):
CTU
37.6
%
34.5
%
AIUS
20.5
%
21.1
%
Corporate and Other
NM
NM
Total
27.5
%
23.9
%
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF
GAAP TO NON-GAAP ITEMS (1)
(In thousands, unless otherwise
noted)
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
ACTUAL
ACTUAL
Adjusted
Operating Income
2024
2023
2024
2023
Operating income
$
46,006
$
48,094
$
92,284
$
91,430
Depreciation and amortization
3,069
4,369
6,085
9,524
Legal fee expense related to certain
matters (2)
1,815
2,709
2,045
7,328
Adjusted Operating Income
$
50,890
$
55,172
$
100,414
$
108,282
For the Quarter Ending
September 30,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2024
2023
2024
2023
Operating income
$41.6M - $43.6M
$
43,073
$161.8M - $172.8M
$
150,446
Depreciation and amortization
3.1M
3,914
14.1M
16,887
Legal fee expense related to certain
matters (2)
0.3M
246
3.1M
7,579
Adjusted Operating Income
$45.0M - $47.0M
$
47,233
$179.0M - $190.0M
$
174,912
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF
GAAP TO NON-GAAP ITEMS (1) (cont’d)
For the Quarter Ended June
30,
For the Year to Date Ended
June 30,
ACTUAL
ACTUAL
2024
2023
2024
2023
Reported Earnings Per Diluted
Share
$
0.57
$
0.80
$
1.16
$
1.30
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets
0.02
0.03
0.04
0.07
Legal fee expense related to certain
matters (2)
0.03
0.04
0.03
0.11
Gain on sale of intangible asset (3)
-
(0.32
)
-
(0.32
)
Total pre-tax adjustments
$
0.05
$
(0.25
)
$
0.07
$
(0.14
)
Tax effect of adjustments (4)
(0.02
)
0.06
(0.02
)
0.03
Total adjustments after tax
0.03
(0.19
)
0.05
(0.11
)
Adjusted Earnings Per Diluted
Share
$
0.60
$
0.61
$
1.21
$
1.19
For the Quarter Ending
September 30,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2024
2023
2024
2023
Reported Earnings Per Diluted
Share
$0.51 - $0.53
$
0.62
$2.04 - $2.16
$
2.18
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets
0.02
0.03
0.08
0.11
Legal fee expense related to certain
matters (2)
-
-
0.05
0.11
Gain on sale of intangible asset (3)
-
-
-
(0.32
)
Total pre-tax adjustments
$0.02
$
0.03
$0.13
$
(0.10
)
Tax effect of adjustments (4)
(0.01
)
(0.01
)
(0.04
)
0.02
Total adjustments after tax
0.01
0.02
0.09
(0.08
)
Adjusted Earnings Per Diluted
Share
$0.52 - $0.54
$
0.64
$2.13 - $2.25
$
2.10
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF
GAAP TO NON-GAAP ITEMS (1) (cont’d)
(1)
The Company believes it is useful to
present non-GAAP financial measures which exclude certain
significant and non-cash items as a means to understand the
performance of its operations. As a general matter, the Company
uses non-GAAP financial measures in conjunction with results
presented in accordance with GAAP to help analyze the performance
of its operations, assist with preparing the annual operating plan,
and measure performance for some forms of compensation. In
addition, the Company believes that non-GAAP financial information
is used by analysts and others in the investment community to
analyze the Company’s historical results and to provide estimates
of future performance.
The Company believes adjusted operating
income and adjusted earnings per diluted share allow it to analyze
and assess its operations and compare current operating results
with the operational performance of other companies in its industry
because it does not give effect to potential differences caused by
items it does not consider reflective of underlying operating
performance, such as amortization for acquired intangible assets,
significant legal settlements and legal fee expense related to
certain matters. The Company believes the items it is adjusting for
are not normal operating expenses necessary to run its business. In
evaluating adjusted operating income and adjusted earnings per
diluted share, investors should be aware that in the future the
Company may incur expenses similar to the adjustments presented
above. The presentation of adjusted operating income and adjusted
earnings per diluted share should not be construed as an inference
that the Company's future results will be unaffected by expenses
that are unusual, non-routine or non-recurring. Adjusted operating
income and adjusted earnings per diluted share have limitations as
an analytical tool, and should not be considered in isolation, or
as a substitute for net income, operating income, earnings per
diluted share, or any other performance measure derived in
accordance and reported under GAAP or as an alternative to cash
flow from operating activities or as a measure of liquidity.
Non-GAAP financial measures, when viewed
in a reconciliation to corresponding GAAP financial measures,
provide an additional way of viewing the Company’s results of
operations and the factors and trends affecting the Company’s
business. Non-GAAP financial measures should be considered as a
supplement to, and not as a substitute for, or superior to, the
corresponding financial results presented in accordance with
GAAP.
(2)
Legal fee expense associated with (i)
responses to the Department relating to borrower defense to
repayment applications from former students, and (ii) acquisition
efforts.
(3)
Non-cash gain associated with the sale of
the LCB tradename in exchange for outstanding shares of Perdoceo's
stock.
(4)
The tax effect of adjustments was
calculated by multiplying the pre-tax adjustments with a tax rate
of 25.0%. This tax rate is intended to reflect federal and state
taxable jurisdictions as well as the nature of the adjustments.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240731873972/en/
Investors: Alpha IR Group Sam Gibbons (312) 445-2870
PRDO@alpha-ir.com
Or
Media: Perdoceo Education Corporation (847) 585-2600
media@perdoceoed.com
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