Corinthian Colleges Reports Third Quarter 2013 Results
30 Avril 2013 - 1:45PM
Corinthian Colleges, Inc.
(Nasdaq:COCO) reported financial results today for the third
quarter ended March 31, 2013. Results for the quarter were within
the company's previous guidance ranges for revenue, earnings per
share, and new student enrollment.
"During the third quarter we continued to focus on student
outcomes and initiatives to increase our student population,
improve operational efficiency, and diversify revenue," said Jack
Massimino, Corinthian's chairman and chief executive officer.
"Excluding the impact of losing Ability-to-Benefit (ATB) students,
our new enrollments were up slightly in the quarter and our student
population has been stabilizing relative to our peers over the last
few quarters."
"Total new student enrollment was down 5.7%, primarily due to
the loss of ATB students in the Everest ground schools," Massimino
said. "In addition, new Online Learning student enrollments
declined slightly quarter over quarter, as we continue to work
through staffing, technology and workflow process issues in Online
admissions and student finance."
"We are pursuing a number of initiatives to achieve more
consistent growth," Massimino said. "We implemented 42 new programs
at 20 campuses during the quarter, and our GED program enrollment
continues to grow. We believe the GED program will benefit the
communities we serve and has the potential to help increase our
campus enrollments over time. In addition, in recent months there
have been a substantial number of competitor school closures in our
service areas. Given macroeconomic and other factors, we expect to
see more industry consolidation in the months ahead. We will
continue to work with regulators and school companies to accept and
serve transfer students related to such closures."
Comparing the third quarter of fiscal 2013 with the same
quarter of the prior year (Note: results for continuing
operations only):
- Net revenue was $400.2 million versus $407.9 million, a
decrease of 1.9%.
- Total student population at March 31, 2013 was 87,776 versus
93,620 at March 31, 2012, a decrease of 6.2%.
- New student enrollments totaled 26,738 versus 28,355, a
decrease of 5.7%.
- Non-ATB new student enrollments totaled 26,374 versus 26,042,
an increase of 1.3%.
- Operating income was $12.6 million, compared with operating
income of $27.5 million, which excludes $1.3 million and $3.2
million in impairment and severance charges in Q3 13and Q3 12,
respectively.
- Income from continuing operations (after tax) was $3.1 million,
compared with $13.6 million, excluding impairment and severance
charges in both periods.
- Diluted earnings per share from continuing operations were
$0.04, versus diluted earnings per share of $0.16, excluding
impairment and severance charges in both periods.
Financial Review
Educational services expenses were 60.9% of
revenue in Q3 13 versus 59.5% in Q3 12. The increase was
primarily due to an increase in bad debt. Bad debt increased to
3.4% of revenue in Q3 13 versus 2.5% of revenue in Q3 12, due to
systems conversion issues.
Marketing and admissions expenses were 25.7% of
revenue in Q3 13 versus 24.2% in Q3 12. The increase is
primarily the result of higher advertising and lead generation
expenses per new enrollment.
General and administrative expenses were 10.2%
of revenue in Q3 13 versus 9.6% in Q3 12. The increase is
primarily due to an increase in professional services
expenses.
The operating margin was 3.2% in Q3 13 versus
6.8% in Q3 12, excluding impairment and severance charges in both
time periods.
Cash and cash equivalents totaled $43.9 million
at March 31, 2013, compared with $72.5 million at
June 30, 2012. The decrease in cash is primarily due to
the net repayment of borrowings under our credit facility,
partially offset by the timing of cash receipts and payments.
Debt and capital leases (including current
portion) totaled $30.7 million at March 31, 2013, compared
with $149.0 million at June 30, 2012. The decrease is due
to the net repayment of borrowings under our credit
facility.
Cash flow from operations was $128.8 million in
the first nine months of FY 13, versus $195.7 million in the same
period of the prior year. The decrease is primarily due to the
timing of cash receipts and payments.
Capital expenditures were $28.6 million for the
first nine months of fiscal 2013, versus $31.0 million in the same
period last year. The decrease is primarily the result of opening
fewer new campuses.
Guidance
The following guidance is for continuing operations and excludes
any one-time charges.
|
Time Period |
Revenue |
Diluted EPS |
Total New Student
Growth |
Non-ATB New Student
Growth |
Q4 13 |
$378 - $388 million |
$0.03 - $0.05 |
(3-5%) |
7-9% |
Conference Call Today
We will host a conference call today at 12:00 p.m. Eastern Time
(9:00 a.m. PT), to discuss third 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 Monday, May 6th. The playback can be reached by
dialing (855) 859-2056 and using passcode 24281088.
About Corinthian
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 113 Everest, Heald and WyoTech
campuses, and also offer degrees online. For more information, go
to http://www.cci.edu.
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 initiatives to focus on student outcomes, increase
our student population, improve operational efficiency, diversify
revenue and achieve more consistent growth; our belief that
launching new diploma programs in ground schools and offering free
GED preparation programs at some Everest campuses will help
increase enrollment over time; our expectation that competitor
campus closures will continue and that our enrollment will increase
as a result of such closures; 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 ("ED's") determination
related to our financial responsibility composite score; the
company's effectiveness in its regulatory and accreditation
compliance efforts; 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) |
|
|
|
|
|
Consolidated
Statements of Operations (unaudited)
|
|
|
|
|
|
For the three months ended
March 31, |
For the nine months ended
March 31, |
|
2013 |
2012 |
2013 |
2012 |
|
|
|
|
|
Net
revenues |
$400,167 |
$407,857 |
$1,216,277 |
$1,191,289 |
Operating
expenses |
|
|
|
|
Educational services |
243,736 |
242,483 |
743,811 |
722,861 |
General and
administrative |
41,012 |
39,089 |
126,245 |
131,015 |
Marketing and admissions |
102,794 |
98,742 |
303,996 |
292,981 |
Impairment, facility closing
and severance charges |
1,279 |
3,221 |
2,039 |
15,164 |
Total operating expenses |
388,821 |
383,535 |
1,176,091 |
1,162,021 |
Income from
operations |
11,346 |
24,322 |
40,186 |
29,268 |
Interest income |
158 |
665 |
523 |
1,569 |
Interest expense |
(1,336) |
(2,394) |
(3,841) |
(7,774) |
Other expense, net |
(6,352) |
(3,425) |
(16,761) |
(6,576) |
Income from continuing operations before provision for
income taxes |
3,816 |
19,168 |
20,107 |
16,487 |
Provision for income
taxes |
1,439 |
7,490 |
7,760 |
6,181 |
Income from continuing
operations |
2,377 |
11,678 |
12,347 |
10,306 |
Loss from discontinued
operations, net of tax |
(3,397) |
(7,589) |
(11,856) |
(14,059) |
Net income
(loss) |
$(1,020) |
$4,089 |
$491 |
$(3,753) |
Income (loss) per
share—basic |
|
|
|
|
Income from continuing
operations |
$0.03 |
$0.14 |
$0.14 |
$0.12 |
Loss from discontinued
operations |
$(0.04) |
$(0.09) |
$(0.13) |
$(0.16) |
Income (loss) per
share—diluted |
|
|
|
|
Income from continuing
operations |
$0.03 |
$0.14 |
$0.14 |
$0.12 |
Loss from discontinued
operations |
$(0.04) |
$(0.09) |
$(0.13) |
$(0.16) |
Weighted average number
of common shares outstanding |
|
|
|
|
Basic |
|
86,065 |
85,080 |
85,780 |
84,918 |
Diluted |
|
87,097 |
86,124 |
86,616 |
85,446 |
|
|
|
|
|
|
Selected
Consolidated Balance Sheet Data (Unaudited) |
|
|
|
|
|
|
March 31,
2013 |
June 30,
2012 |
|
|
|
Cash and cash equivalents |
$43,899 |
$72,525 |
Receivables, net (including long term notes
receivable) |
$176,184 |
$197,763 |
Current assets |
$298,939 |
$356,345 |
Total assets |
$996,173 |
$1,064,513 |
Current liabilities |
$325,359 |
$284,154 |
Total debt and capital leases |
$30,673 |
$148,974 |
Total liabilities |
$424,946 |
$499,598 |
Total stockholders' equity |
$571,227 |
$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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