Perdoceo Education Corporation (NASDAQ: PRDO) today reported
operating and financial results for the quarter and year ended
December 31, 2022.
Full Year 2022 Results
as Compared to Prior Year
- Revenue increased 0.3% to $695.2 million, with a 2.7% increase
at CTU mostly offset by a 3.1% decline at AIUS.
- Operating income decreased 13.0% to $129.6 million, while
adjusted operating income decreased 6.6% to $164.0 million.*
- Earnings per diluted share was $1.39 as compared to $1.55,
while adjusted earnings per diluted share was $1.63 as compared to
$1.70.*
- Total student enrollments at December 31, 2022 decreased by
3.0%. AIUS experienced a 10.8% decrease in total student
enrollments that was partially offset by a 2.0% increase at
CTU.
- Ended the year with $518.2 million in cash, cash equivalents,
restricted cash and available-for-sale-short-term investments.
Fourth Quarter 2022
Results as Compared to Prior Year Quarter
- Revenue increased 10.2% to $176.1 million, with a 13.1%
increase at CTU and a 5.9% increase at AIUS.
- Operating income decreased 34.4% to $22.7 million, while
adjusted operating income decreased 22.9% to $32.4 million,
primarily due to certain one-time investments within our academic
institutions.*
- Earnings per diluted share was $0.23 as compared to $0.35,
while adjusted earnings per diluted share was $0.31 as compared to
$0.40.*
*See GAAP (U.S. generally accepted accounting principles)
to non-GAAP reconciliation attached to this press release
"Overall, we ended 2022 on a positive note as we experienced
further improvement in student retention and engagement during the
second half of 2022,” said Andrew Hurst, President and Chief
Executive Officer. “As we look to 2023, we will continue to
optimize investments in technology that will drive operational
efficiencies across our academic institutions, while remaining
committed to further enhancing student experiences and academic
outcomes."
REVENUE
- For the quarter ended December 31, 2022, revenue of $176.1
million increased 10.2% compared to revenue of $159.9 million for
the prior year quarter.
- For the year ended December 31, 2022, revenue of $695.2 million
increased 0.3% compared to revenue of $693.0 million for the prior
year.
For the Quarter Ended December
31,
For the Year Ended December
31,
Revenue ($ in
thousands)
2022 (1)
2021
% Change
2022 (1)
2021
% Change
CTU
$
108,446
$
95,904
13.1
%
$
419,617
$
408,549
2.7
%
AIUS
67,445
63,712
5.9
%
274,479
283,360
-3.1
%
Corporate and Other
254
243
NM
1,112
1,125
NM
Total
$
176,145
$
159,859
10.2
%
$
695,208
$
693,034
0.3
%
(1) Results of operations include an acquisition completed on
December 1, 2022 within CTU and an acquisition completed on July 1,
2022 within AIUS.
TOTAL STUDENT ENROLLMENTS
- As of December 31, 2022, CTU’s total student enrollments
increased 2.0%, while AIUS’ total student enrollments decreased
10.8% as compared to the prior year end.
At December 31,
Total Student
Enrollments(1)
2022
2021
% Change
CTU
25,200
24,700
2.0
%
AIUS
14,000
15,700
-10.8
%
Total
39,200
40,400
-3.0
%
(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 our universities.
OPERATING INCOME
- For the quarter ended December 31, 2022, operating income
decreased by 34.4% to $22.7 million as compared to the prior year
quarter.
- For the year ended December 31, 2022, operating income
decreased by 13.0% to $129.6 million as compared to the prior
year.
For the Quarter Ended December
31,
For the Year Ended December
31,
Operating Income
($ in thousands)
2022 (1)
2021
% Change
2022 (1)
2021
% Change
CTU
$
34,082
$
35,723
-4.6
%
$
141,622
$
148,481
-4.6
%
AIUS
3,469
10,255
-66.2
%
33,315
39,130
-14.9
%
Corporate and Other
(14,877
)
(11,402
)
NM
(45,300
)
(38,595
)
NM
Total
$
22,674
$
34,576
-34.4
%
$
129,637
$
149,016
-13.0
%
(1) Results of operations include an acquisition completed on
December 1, 2022 within CTU and an acquisition completed on July 1,
2022 within AIUS.
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 December 31, 2022, adjusted operating
income of $32.4 million decreased 22.9% compared to adjusted
operating income of $42.0 million for the prior year quarter.
- For the year ended December 31, 2022, adjusted operating income
of $164.0 million decreased 6.6% compared to adjusted operating
income of $175.5 million for the prior year.
For the Quarter Ended December
31,
For the Year Ended
December 31,
Adjusted
Operating Income ($ in thousands)
2022
2021
2022
2021
Operating income
$
22,674
$
34,576
$
129,637
$
149,016
Depreciation and amortization (1)
4,878
4,964
19,734
16,766
Legal fee expense related to certain
matters (2)
4,869
2,494
14,597
9,735
Adjusted Operating Income
$
32,421
$
42,034
$
163,968
$
175,517
Increase (Decrease)
-22.9
%
-6.6
%
(1) Amortization relates to definite-lived intangible assets
associated with acquisitions.
(2) 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 December 31, 2022, the Company
recorded:
- Net income of $16.0 million compared to $24.5 million for the
prior year quarter.
- Earnings per diluted share of $0.23 compared to $0.35 for the
prior year quarter.
- Adjusted earnings per diluted share of $0.31 compared to $0.40
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 ended December 31, 2022, the Company recorded:
- Net income of $95.9 million compared to $109.6 million for the
prior year.
- Earnings per diluted share of $1.39 compared to $1.55 for the
prior year.
- Adjusted earnings per diluted share of $1.63 compared to $1.70
for the prior year. (See table below and the GAAP to non-GAAP
reconciliation attached to this press release for further
details.)
For the Quarter Ended December
31,
For the Year Ended December
31,
2022
2021
2022
2021
Reported Earnings Per Diluted
Share
$
0.23
$
0.35
$
1.39
$
1.55
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets (1)
0.03
0.03
0.11
0.06
Legal fee expense related to certain
matters (2)
0.07
0.04
0.21
0.14
Tax effect of adjustments (3)
(0.02
)
(0.02
)
(0.08
)
(0.05
)
Adjusted Earnings Per Diluted
Share
$
0.31
$
0.40
$
1.63
$
1.70
(1) Amortization relates to definite-lived intangible assets
associated with acquisitions.
(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) 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.
BALANCE SHEET AND CASH FLOW
- For the quarter ended December 31, 2022, net cash provided by
operating activities was $40.5 million, compared to net cash
provided by operating activities of $46.9 million for the prior
year quarter.
- For the year ended December 31, 2022, net cash provided by
operating activities was $148.2 million, compared to net cash
provided by operating activities of $191.1 million in the prior
year.
- At December 31, 2022 and December 31, 2021, cash, cash
equivalents, restricted cash and available-for-sale short-term
investments totaled $518.2 million and $499.4 million,
respectively.
- For the year ended December 31, 2022, the Company repurchased
2.1 million shares for $23.1 million at an average price of $11.02
as compared to 2.3 million shares for $25.3 million at an average
price of $10.94 for the year ended December 31, 2021.
For the Quarter Ended December
31,
For the Year Ended December
31,
Selected Cash
Flow Items ($ in thousands)
2022
2021
% Change
2022
2021
% Change
Net cash provided by operating
activities
$
40,546
$
46,910
-13.6
%
$
148,186
$
191,116
-22.5
%
Business acquisitions, net of cash
acquired
$
45,271
$
196
NM
$
84,308
$
57,143
47.5
%
Capital expenditures
$
3,515
$
4,177
-15.8
%
$
12,620
$
10,453
20.7
%
OUTLOOK
The Company is providing the following 2023 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 March
31,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2023
2022
2023
2022
Operating Income
$41.3M - $43.3M
$43.7M
$120.6M - $140.6M
$129.6M
Depreciation and amortization
$5.1M
$4.9M
$17.4M
$19.8M
Legal fee expense related to certain
matters (1)
$4.6M
$2.3M
$12.0M
$14.6M
Adjusted Operating Income
$51.0M - $53.0M
$50.9M
$150.0M - $170.0M
$164.0M
Earnings Per Diluted Share
$0.47 - $0.49
$0.46
$1.41 - $1.63
$1.39
Amortization of acquired intangible
assets
$0.04
$0.02
$0.12
$0.11
Legal fee expense related to certain
matters (1)
$0.07
$0.03
$0.17
$0.21
Tax effect of adjustments
($0.03)
($0.01)
($0.07)
($0.08)
Adjusted Earnings Per Diluted
Share
$0.55 - $0.57
$0.50
$1.63 - $1.85
$1.63
(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 2023 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 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 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 26.0% for both the first
quarter and 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
Thursday, February 23, 2023 at 5:30 p.m. Eastern time to discuss
fourth quarter and full year 2022 results and 2023 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 1-844-200-6205 (domestic) or 1-929-526-1599
(international). Both dial-in numbers will use the access code
690929. Viewers can also access the conference call by following
this link https://events.q4inc.com/attendee/456229475. 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; 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
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 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 eligibility to participate in educational assistance
programs for veterans or other military personnel; 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, 2022 and
its subsequent filings with the Securities and Exchange
Commission.
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(In thousands)
December 31,
December 31,
2022
2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents,
unrestricted
$
109,408
$
319,982
Restricted cash
9,476
5,196
Short-term investments
399,315
174,213
Total cash and cash equivalents,
restricted cash and short-term investments
518,199
499,391
Student receivables, net
42,551
43,033
Receivables, other
3,457
1,692
Prepaid expenses
8,411
6,919
Inventories
1,904
904
Other current assets
597
2,514
Total current assets
575,119
554,453
NON-CURRENT ASSETS:
Property and equipment, net
26,038
28,355
Right of use asset, net
26,156
36,664
Goodwill
243,540
162,579
Intangible assets, net
53,564
32,208
Student receivables, net
1,850
1,372
Deferred income tax assets, net
24,613
25,114
Other assets
6,488
6,688
TOTAL ASSETS
$
957,368
$
847,433
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Lease liability - operating
$
6,555
$
9,400
Accounts payable
13,518
10,838
Accrued expenses:
Payroll and related benefits
40,306
25,312
Advertising and marketing costs
8,977
8,690
Income taxes
7,814
211
Other
14,621
15,180
Deferred revenue
71,590
70,613
Total current liabilities
163,381
140,244
NON-CURRENT LIABILITIES:
Lease liability - operating
27,286
35,549
Other liabilities
40,856
21,530
Total non-current liabilities
68,142
57,079
STOCKHOLDERS' EQUITY:
Preferred stock
-
-
Common stock
894
887
Additional paid-in capital
684,183
674,242
Accumulated other comprehensive loss
(5,447
)
(96
)
Retained earnings
347,839
251,972
Treasury stock
(301,624
)
(276,895
)
Total stockholders' equity
725,845
650,110
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY
$
957,368
$
847,433
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED
STATEMENTS OF INCOME
(In thousands, except per share
amounts and percentages)
For the Quarter Ended December
31,
2022
% of Total Revenue
2021
% of Total Revenue
REVENUE:
Tuition and fees, net
$
174,012
98.8
%
$
158,185
99.0
%
Other
2,133
1.2
%
1,674
1.0
%
Total revenue
176,145
159,859
OPERATING EXPENSES:
Educational services and facilities
31,217
17.7
%
25,276
15.8
%
General and administrative
114,610
65.1
%
95,043
59.5
%
Depreciation and amortization
4,878
2.8
%
4,964
3.1
%
Asset impairment
2,766
1.6
%
-
0.0
%
Total operating expenses
153,471
87.1
%
125,283
78.4
%
Operating income
22,674
12.9
%
34,576
21.6
%
OTHER INCOME:
Interest income
3,169
1.8
%
136
0.1
%
Interest expense
(102
)
-0.1
%
-
0.0
%
Miscellaneous (expense) income
(1,313
)
-0.7
%
63
0.0
%
Total other income
1,754
1.0
%
199
0.1
%
PRETAX INCOME
24,428
13.9
%
34,775
21.8
%
Provision for income taxes
8,473
4.8
%
10,309
6.4
%
NET INCOME
15,955
9.1
%
24,466
15.3
%
NET INCOME PER SHARE - BASIC:
$
0.24
$
0.35
NET INCOME PER SHARE -DILUTED:
$
0.23
$
0.35
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic
67,165
69,565
Diluted
68,423
70,335
UNAUDITED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
For the Quarter Ended December
31,
(In Thousands)
2022
2021
NET INCOME
$
15,955
$
24,466
OTHER COMPREHENSIVE INCOME (LOSS), net
of tax:
Foreign currency translation
adjustments
217
(2
)
Unrealized gain (loss) on investments
653
(91
)
Total other comprehensive income
(loss)
870
(93
)
COMPREHENSIVE INCOME
$
16,825
$
24,373
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
INCOME
(In thousands, except per share
amounts and percentages)
For the Year Ended December
31,
2022
% of Total Revenue
2021
% of Total Revenue
REVENUE:
Tuition and fees, net
$
687,672
98.9
%
$
688,415
99.3
%
Other
7,536
1.1
%
4,619
0.7
%
Total revenue
695,208
693,034
OPERATING EXPENSES:
Educational services and
facilities
116,723
16.8
%
108,743
15.7
%
General and administrative
426,120
61.3
%
418,509
60.4
%
Depreciation and amortization
19,734
2.8
%
16,766
2.4
%
Asset impairment
2,994
0.4
%
-
0.0
%
Total operating expenses
565,571
81.4
%
544,018
78.5
%
Operating income
129,637
18.6
%
149,016
21.5
%
OTHER INCOME:
Interest income
6,866
1.0
%
930
0.1
%
Interest expense
(400
)
-0.1
%
(920
)
-0.1
%
Miscellaneous (expense)
income
(1,834
)
-0.3
%
41
0.0
%
Total other income
4,632
0.7
%
51
0.0
%
PRETAX INCOME
134,269
19.3
%
149,067
21.5
%
Provision for income taxes
38,402
5.5
%
39,430
5.7
%
NET INCOME
95,867
13.8
%
109,637
15.8
%
NET INCOME PER SHARE - BASIC:
$
1.41
$
1.57
NET INCOME PER SHARE -DILUTED:
$
1.39
$
1.55
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic
67,934
70,024
Diluted
69,031
70,881
CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME
For the Year Ended December
31,
(In Thousands)
2022
2021
NET INCOME
$
95,867
$
109,637
OTHER COMPREHENSIVE LOSS, net of
tax:
Foreign currency translation
adjustments
(166
)
(177
)
Unrealized loss on
investments
(5,185
)
(283
)
Total other comprehensive loss
(5,351
)
(460
)
COMPREHENSIVE INCOME
$
90,516
$
109,177
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands)
For the Year Ended December
31,
2022
2021
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income
$
95,867
$
109,637
Adjustments to reconcile net income to net
cash provided by operating activities:
Asset impairment
2,994
-
Depreciation and amortization expense
19,734
16,766
Bad debt expense
41,574
44,344
Compensation expense related to
share-based awards
8,751
14,972
Deferred income taxes
(720
)
15,330
Changes in operating assets and
liabilities:
Student receivables, gross
6,380
6,631
Allowance for credit losses
(38,992
)
(47,417
)
Receivables, other
(1,670
)
5,396
Inventories, prepaid expenses, and other
current assets
2,640
3,285
Other non-current assets
843
72
Accounts payable
1,922
(2,744
)
Accrued expenses and other non-current
liabilities
22,332
(3,404
)
Deferred revenue
(11,767
)
30,724
Right of use asset and lease liability
(1,702
)
(2,476
)
Net cash provided by operating
activities
148,186
191,116
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchases of available-for-sale
investments
(492,100
)
(269,739
)
Sales of available-for-sale
investments
262,277
391,659
Purchases of property and equipment
(12,620
)
(10,453
)
Business acquisitions, net of cash
acquired
(84,308
)
(57,143
)
Net cash (used in) provided by investing
activities
(326,751
)
54,324
CASH FLOWS FROM FINANCING
ACTIVITIES:
Purchase of treasury stock
(23,117
)
(25,296
)
Issuance of common stock
1,197
861
Payments of employee tax associated with
stock compensation
(1,612
)
(5,511
)
Release of cash held in escrow
(4,197
)
-
Net cash used in financing activities
(27,729
)
(29,946
)
NET (DECREASE) INCREASE IN CASH, CASH
EQUIVALENTS AND RESTRICTED CASH
(206,294
)
215,494
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, beginning of the period
325,178
109,684
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, end of the period
$
118,884
$
325,178
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED SELECTED SEGMENT
INFORMATION
(In thousands, except
percentages)
For the Quarter Ended December
31,
2022(1)
2021
REVENUE:
CTU
$
108,446
$
95,904
AIUS
67,445
63,712
Corporate and Other
254
243
Total
$
176,145
$
159,859
OPERATING INCOME (LOSS):
CTU
$
34,082
$
35,723
AIUS
3,469
10,255
Corporate and Other
(14,877
)
(11,402
)
Total
$
22,674
$
34,576
OPERATING MARGIN (LOSS):
CTU
31.4
%
37.2
%
AIUS
5.1
%
16.1
%
Corporate and Other
NM
NM
Total
12.9
%
21.6
%
(1) Results of operations include an acquisition completed on
December 1, 2022 within CTU and an acquisition completed on July 1,
2022 within AIUS.
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED SELECTED SEGMENT
INFORMATION
(In thousands, except
percentages)
For the Year Ended December
31,
2022(1)
2021
REVENUE:
CTU
$
419,617
$
408,549
AIUS
274,479
283,360
Corporate and Other
1,112
1,125
Total
$
695,208
$
693,034
OPERATING INCOME (LOSS):
CTU
$
141,622
$
148,481
AIUS
33,315
39,130
Corporate and Other
(45,300
)
(38,595
)
Total
$
129,637
$
149,016
OPERATING MARGIN (LOSS):
CTU
33.8
%
36.3
%
AIUS
12.1
%
13.8
%
Corporate and Other
NM
NM
Total
18.6
%
21.5
%
(1) Results of operations include an acquisition completed on
December 1, 2022 within CTU and an acquisition completed on July 1,
2022 within AIUS.
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF
GAAP TO NON-GAAP ITEMS (1)
(In thousands, unless otherwise
noted)
For the Quarter Ended December
31,
For the Year Ended December
31,
ACTUAL
ACTUAL
Adjusted
Operating Income
2022
2021
2022
2021
Operating income
$
22,674
$
34,576
$
129,637
$
149,016
Depreciation and amortization (2)
4,878
4,964
19,734
16,766
Legal fee expense related to certain
matters (3)
4,869
2,494
14,597
9,735
Adjusted Operating Income
$
32,421
$
42,034
$
163,968
$
175,517
For the Quarter Ending March
31,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2023
2022
2023
2022
Operating income
$41.3M - $43.3M
$
43,693
$120.6M - $140.6M
$
129,637
Depreciation and amortization (2)
5.1M
4,882
17.4M
19,734
Legal fee expense related to certain
matters (3)
4.6M
2,347
12.0M
14,597
Adjusted Operating Income
$51.0M - $53.0M
$
50,922
$150.0M - $170.0M
$
163,968
PERDOCEO EDUCATION CORPORATION
AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF
GAAP TO NON-GAAP ITEMS (1) (cont’d)
For the Quarter Ended December
31,
For the Year Ended December
31,
ACTUAL
ACTUAL
2022
2021
2022
2021
Reported Earnings Per Diluted
Share
$
0.23
$
0.35
$
1.39
$
1.55
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets (2)
0.03
0.03
0.11
0.06
Legal fee expense related to certain
matters (3)
0.07
0.04
0.21
0.14
Total pre-tax adjustments
$
0.10
$
0.07
$
0.32
$
0.20
Tax effect of adjustments (4)
(0.02
)
(0.02
)
(0.08
)
(0.05
)
Total adjustments after tax
0.08
0.05
0.24
0.15
Adjusted Earnings Per Diluted
Share
$
0.31
$
0.40
$
1.63
$
1.70
For the Quarter Ending March
31,
For the Year Ending December
31,
OUTLOOK
ACTUAL
OUTLOOK
ACTUAL
2023
2022
2023
2022
Reported Earnings Per Diluted
Share
$0.47 - $0.49
$
0.46
$1.41 -$ 1.63
$
1.39
Pre-tax adjustments included in
operating expenses:
Amortization for acquired intangible
assets (2)
0.04
0.02
0.12
0.11
Legal fee expense related to certain
matters (3)
0.07
0.03
0.17
0.21
Total pre-tax adjustments
$
0.11
$
0.05
$
0.29
$
0.32
Tax effect of adjustments (4)
(0.03)
(0.01
)
($0.07)
(0.08
)
Total adjustments after tax
0.08
0.04
0.22
0.24
Adjusted Earnings Per Diluted
Share
$0.55 - $0.57
$
0.50
$1.63 - $1.85
$
1.63
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.
Results of operations include the Coding Dojo acquisition as of
December 1, 2022, the CalSouthern acquisition as of July 1, 2022,
the DigitalCrafts acquisition as of August 2, 2021 and the Hippo
acquisition as of September 10, 2021.
(2) Amortization for acquired intangible assets relate to
definite-lived intangible assets associated with acquisitions.
(3) Legal fee expense associated with (i) responses to the
Department relating to borrower defense to repayment applications
from former students, and (ii) acquisition efforts.
(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/20230223005867/en/
Investors: Alpha IR Group Davis Snyder (312) 445-2870
PRDO@alpha-ir.com Or Media: Perdoceo Education Corporation
(847) 585-2600 media@perdoceoed.com
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