Corinthian Colleges Reports First Quarter 2013 Results
31 Octobre 2012 - 12:45PM
Corinthian Colleges, Inc. (Nasdaq:COCO) reported
financial results today for the first quarter ended September 30,
2012. Results for the quarter exceeded the company's most current
guidance ranges for revenue, earnings per share and new student
enrollment growth. (Guidance excludes all one-time charges; the
Company recorded a $3.2 million impairment, facility closing and
severance charge in the quarter.)
"During the first quarter we continued to focus on improving the
value proposition of our programs and rejuvenating growth in our
ground schools," said Jack Massimino, Corinthian's chairman and
chief executive officer. "We reduced tuition for several programs
during the quarter, and our third-party lender reduced interest
rates on gap financing for our students. We expect these reductions
to help make our programs more affordable and attractive to
prospective students."
As the Company previously reported, effective July 1, 2012
federal student loans and grants are no longer available to
students who lack a high school diploma or GED. Such aid had
previously been available under the federal Ability-to-Benefit
(ATB) program. Given the loss of funding, the Company stopped
enrolling new ATB students as of July 1.
"Despite the loss of ATB students, our first quarter growth in
new students was higher than expected," Massimino said. "During the
quarter we continued to experience strong growth in on-line new
student enrollment and new enrollments at our Everest ground
schools were better than expected."
"We are pursuing a number of initiatives to help offset the loss
of ATB students and achieve more consistent growth," Massimino
said. "In addition to our price reductions, we are on schedule to
launch several new diploma programs across our ground schools
beginning in the second quarter. We began offering free GED
preparation programs at most of our U.S. Everest campuses in
October. These programs will help serve the large population of
high school dropouts in our service areas, and we expect some
portion of successful GED completers to enroll at Everest or other
post-secondary institutions."
Comparing the first quarter of fiscal 2013 with the same
quarter of the prior year (Note: results for continuing
operations):
- Net revenue was $408.6 million versus $398.2 million, an
increase of 2.6%.
- Total student population at September 30, 2012 was 92,070
versus 91,107 at September 30, 2011, an increase of 1.1%.
- Total new students were 31,458 versus 30,386, an increase of
3.5%.
- Operating income was $10.5 million, which includes a $3.2
million impairment and severance charge, compared with an operating
loss of $6.3 million, which includes $9.2 million in
impairment and severance charges.
- Income from continuing operations was $3.1 million, which
includes $1.9 million in impairment and severance charges, after
tax, compared with a loss of $5.7 million, which includes $5.5
million in impairment and severance charges, after tax.
- Diluted earnings per share from continuing operations were
$0.04 versus a diluted loss per share of $0.07. Excluding the
impairment and severance charges and the related tax effect,
diluted earnings per share from continuing operations were $0.06 in
Q1 13 and $0.00 in Q1 12.
Financial Review
Educational services expenses were 61.7% of
revenue in Q1 13 versus 62.7% in Q1 12. The decrease is
primarily the result of a decrease in compensation and facilities
expense, partially offset by an increase in bad debt
expense. Bad debt expense was 4.8% of revenue in Q1 13 versus
4.2% in Q1 12. The increase in bad debt expense is primarily
the result of a delay in drawing down Title IV funds associated
with a student information systems conversion.
Marketing and admissions expenses were 24.4% of
revenue in Q1 13 versus 25.0% in Q1 12. The decrease is
primarily the result of efficiencies in admissions.
General and administrative expenses were 10.5%
of revenue in Q1 13 versus 11.6% in Q1 12. The decrease is
primarily due to cost saving measures.
The operating margin was 3.4% in Q1 13 versus
0.7% in Q1 12, excluding impairment and severance charges. The
increase is primarily the result of lower operating expenses
partially offset by higher bad debt.
Cash and cash equivalents totaled $37.6 million
at September 30, 2012, compared with $72.5 million at June 30,
2012. The decrease in cash is primarily due to the net repayment of
cash borrowed at fiscal year-end, partially offset by the timing of
cash receipts and payments.
Debt and capital leases (including current
portion) totaled $112.0 million at September 30, 2012, compared
with $149.0 million at June 30, 2012.
Cash flow from operations was $20.4 million for
Q1 13, versus $54.1 million in Q1 12. The decrease was primarily
due to a decrease in cash provided by working capital.
Capital expenditures were $7.4 million in Q1
13, versus $11.2 million in Q1 12.
Guidance
The following guidance is for continuing operations and excludes
any one-time charges. The company expects that three schools
currently in teach-out will be reclassified to discontinued
operations in the second quarter.
|
|
|
|
Time Period |
Revenue |
Diluted EPS |
New Student
Growth |
Q2 13 |
$402 -- $412 million |
$0.05 -- $0.07 |
flat |
Conference Call Today
We will host a conference call today at 12:00 p.m. Eastern Time
(9:00 a.m. PT), to discuss first quarter results. The call
will be open to all interested investors through a live audio web
cast at www.cci.edu (Investors/Events & Presentations.) The
call will be archived on www.cci.edu after the call. A
telephonic playback of the conference call will also be available
through 11:00 p.m. PT, Tuesday, November 6th. The playback can
be reached by dialing (855) 859-2056 and using passcode
33902281.
About Corinthian Colleges
Corinthian is one of the largest post-secondary education
companies in North America. Our mission is to change students'
lives. We offer diploma and degree programs that prepare students
for careers in demand or for advancement in their chosen fields.
Our program areas include health care, business, criminal justice,
transportation technology and maintenance, construction trades and
information technology. We have 116 Everest, Heald and WyoTech
campuses, and also offer degrees online. For more information, go
to http://www.cci.edu.
The Corinthian Colleges, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=8848
Certain statements in this press release may be deemed to be
forward-looking statements under the Private Securities Litigation
Reform Act of 1995. The company intends that all such
statements be subject to the "safe-harbor" provisions of that
Act. Such statements include, but are not limited to, those
regarding our belief that reduced tuition for several programs and
lower interest rates on third-party loans will make our programs
more affordable and attractive to prospective students; our belief
that launching new diploma programs in ground schools and offering
free GED preparation programs at some Everest campuses will help
offset the loss of ATB students; our expectation that some portion
of successful GED completers will enroll at Everest or other
post-secondary institutions; growth in exclusively on-line
students; overall enrollment growth or declines in future periods;
our ability to manage student outcomes and improve the student
value proposition; and the statements under the heading "Guidance"
above. Many factors may cause the company's actual results to
differ materially from those discussed in any such forward-looking
statements or elsewhere, including: potential negative effects from
the loss of ATB students; the uncertain outcome of the Department
of Education's rule making related to gainful employment, which
could change the manner in which we conduct our business; the
company's effectiveness in its regulatory and accreditation
compliance efforts; changes by the California legislature that
impact the eligibility of the Company's students to receive Cal
Grants; the Company's potential inability to affect the default
rates of its students on their federal student loans; the outcome
of ongoing reviews and inquiries by accrediting, state and federal
agencies; the outcome of pending litigation against the company;
risks associated with variability in the expense and effectiveness
of the company's advertising and promotional efforts; potential
increased competition; changes in general macroeconomic and market
conditions (including credit and labor market conditions, the
unemployment rate, and the rates of change of each such item); and
the other risks and uncertainties described in the company's
filings with the U.S. Securities and Exchange Commission. The
historical results achieved by the company are not necessarily
indicative of its future prospects. The company undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Corinthian Colleges,
Inc. |
(In thousands, except
per share data) |
|
|
|
Condensed Consolidated
Statements of Operations |
|
For the three months
ended |
|
September
30, |
|
2012 |
2011 |
|
(Unaudited) |
(Unaudited) |
|
|
|
Net revenues |
$ 408,560 |
$ 398,197 |
Operating expenses: |
|
|
Educational services |
252,173 |
249,682 |
General and administrative |
42,950 |
46,100 |
Marketing and admissions |
99,736 |
99,476 |
Impairment, facility closing, and
severance charges |
3,206 |
9,226 |
Total operating expenses |
398,065 |
404,484 |
|
|
|
Income (loss) from operations |
10,495 |
(6,287) |
|
|
|
Interest (income) |
(202) |
(159) |
Interest expense |
1,292 |
2,576 |
Other expense, net |
4,245 |
943 |
Pre-tax income (loss) from continuing
operations |
5,160 |
(9,647) |
Provision (benefit) for income
taxes |
2,064 |
(3,941) |
Income (loss) from continuing operations |
3,096 |
(5,706) |
Loss from discontinued operations, net of
tax |
(1,518) |
(3,930) |
Net (loss) income |
$ 1,578 |
$ (9,636) |
|
|
|
|
|
|
Income (loss) per common share ---
Basic: |
|
|
Income (loss) from continuing
operations |
$ 0.04 |
$ (0.07) |
Loss from discontinued operations |
(0.02) |
(0.04) |
Net (loss) income |
$ 0.02 |
$ (0.11) |
|
|
|
Income (loss) per common share ---
Diluted: |
|
|
Income (loss) from continuing
operations |
$ 0.04 |
$ (0.07) |
Loss from discontinued operations |
(0.02) |
(0.04) |
Net (loss) income |
$ 0.02 |
$ (0.11) |
|
|
|
Weighted average number of common shares
outstanding: |
|
|
Basic |
85,486 |
84,807 |
Diluted |
86,194 |
84,807 |
|
|
|
|
|
|
|
|
|
Selected Condensed Consolidated
Balance Sheet Data |
|
|
|
September
30, |
June 30, |
|
2012 |
2012 |
|
(Unaudited) |
(Unaudited) |
|
|
|
Cash and cash equivalents |
$ 37,603 |
$ 72,525 |
Receivables, net (including long term notes
receivable) |
$ 241,494 |
$ 199,094 |
Current assets |
$ 345,213 |
$ 352,607 |
Total assets |
$ 1,060,212 |
$ 1,064,513 |
Current liabilities |
$ 309,592 |
$ 282,758 |
Debt and capital leases (including current
portion) |
$ 112,044 |
$ 148,974 |
Total liabilities |
$ 492,163 |
$ 499,598 |
Total stockholders' equity |
$ 568,049 |
$ 564,915 |
CONTACT: Investors:
Anna Marie Dunlap
SVP Investor Relations
714-424-2678
Media:
Kent Jenkins
VP Public Affairs Communications
202-682-9494
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