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Adtalem Global Education Announces Fourth Quarter and Full Year Fiscal 2018 Results

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Adtalem Global Education (NYSE:ATGE), a leading global education
provider, today reported academic, operating and financial results for
its fiscal 2018 fourth quarter and year ended June 30, 2018.

"Fiscal year 2018 was a transformative year for Adtalem and we enter
fiscal 2019 focused on our core verticals, committed to empowering our
students and the communities they serve and delivering superior academic
outcomes," said Lisa Wardell, president and CEO of Adtalem Global
Education. "We continue to streamline and strategically align our
portfolio to deliver consistent growth in areas of competitive
differentiation for Adtalem, while driving further operating
efficiencies across our organization, and balancing our capital
allocation by investing in our institutions and providing direct returns
to our owners."

Selected financial data for the three months ended June 30, 2018:

  • Revenue of $319.8 million increased 1.5 percent compared to the prior
    year
  • Net income was $62.8 million compared to $42.9 million in the prior
    year; net income from continuing operations excluding special items
    was $53.0 million compared to $48.1 million in the prior year
  • Diluted earnings per share was $1.02 compared to $0.67 in the prior
    year; diluted earnings per share from continuing operations excluding
    special items was $0.86 compared to $0.75 in the prior year
  • Approximately 531,000 shares of common stock were repurchased during
    the fourth quarter of fiscal 2018 at an average purchase price of
    $47.87 for a total of $25.4 million

Selected financial data for the twelve months ended June 30, 2018:

  • Revenue of $1,231.2 million increased 1.9 percent compared to the
    prior year
  • Net income was $33.8 million compared to $122.3 million in the prior
    year; net income from continuing operations excluding special items
    was $172.9 million compared to $160.4 million in the prior year
  • Diluted earnings per share was $0.54 compared to $1.91 in the prior
    year; diluted earnings per share from continuing operations excluding
    special items was $2.78 compared to $2.51 in the prior year
  • Operating cash flow for fiscal year 2018 was $239.2 million compared
    to $230.9 million in the prior year
  • Cash and cash equivalents were $430.7 million as of June 30, 2018,
    compared to $240.4 million as of June 30, 2017. Outstanding bank
    borrowings were $300.0 million and $125.0 million as of June 30, 2018
    and June 30, 2017, respectively

The fiscal 2018 fourth quarter results contained total pre-tax
restructuring charges of $1.9 million primarily related workforce
reductions and real estate consolidation.

During the second quarter of fiscal 2018, Adtalem signed an agreement to
transfer ownership of DeVry University to Cogswell Education LLC, which
is anticipated to be completed in early fiscal year 2019. During the
fourth quarter, Adtalem signed an agreement to transfer ownership of
Carrington College to San Joaquin Valley College, Inc., which is
anticipated to be completed in mid-year fiscal 2019. Both agreements are
subject to certain terms and conditions, including regulatory and
accreditor approval. As a result of these transactions, DeVry University
and Carrington College have been classified as discontinued operations.
Adtalem recorded an after-tax loss from discontinued operations of $34.6
million in the fourth quarter of fiscal year 2018.

Segment Highlights

Medical and Healthcare

Fourth quarter fiscal 2018 segment revenue increased 4.1 percent to
$201.0 million compared to the prior year. Chamberlain revenue in the
quarter increased 2.7 percent from the prior year to $115.4 million,
with increases in new student enrollment of 3.1 percent and total
student enrollment of 4.7 percent in the May 2018 session. For the July
2018 session, new student enrollment increased 1.0 percent and total
student enrollment grew 4.6 percent compared to the same session last
year. Revenue in the quarter for the medical and veterinary schools
increased 6.0 percent from the prior year to $85.6 million, with
increases in new student enrollment of 9.0 percent and total student
enrollment of 1.2 percent in the May 2018 semester compared to the same
term last year. Segment operating income in the fourth quarter increased
17.4 percent to $48.1 million compared to the prior year. Excluding
special items, segment operating income in the fourth quarter increased
12.5 percent to $48.3 million compared to the prior year.

Additional highlights include the previously announced appointment and
start in late August of a new president of Chamberlain University, Dr.
Karen Cox, following the retirement of Dr. Susan Groenwald and the
planned relocation of the Ross University School of Medicine (RUSM)
campus to Barbados beginning with the January 2019 semester, pending
final regulatory approval from the U.S. Department of Education.

Professional Education

Fourth quarter segment revenue increased 13.6 percent to $45.3 million
compared to the prior year, with continued increases at the Association
of Certified Anti-Money Laundering Specialists (ACAMS) and improved
performance at Becker Professional Education supported by repositioning
the organization and launching a refined product offering. Segment
operating income in the fourth quarter increased 14.1 percent to $12.6
million compared to the prior year. Excluding special items, segment
operating income in the fourth quarter increased 17.3 percent to $13.0
million compared to the prior year.

Technology and Business

Fourth quarter segment revenue decreased 10.3 percent to $74.3 million
compared to the prior year. On a constant currency basis, revenue
increased 0.9 percent. Segment operating income in the fourth quarter
decreased 29.3 percent to $13.7 million compared to the prior year.
Excluding special items, segment operating income in the fourth quarter
decreased 23.0 percent to $14.9 million compared to the prior year.

Adtalem Outlook

Fiscal 2019 first quarter revenue is expected to increase approximately
1 percent compared to the prior year with growth primarily coming from
the Medical and Healthcare segment. First quarter operating costs before
special items are expected to be flat to up approximately 1 percent
compared to the prior year.

Fiscal 2019 full year revenue is expected to increase 3 to 4 percent
compared to the prior year driven by growth within the Medical and
Healthcare and Professional Education segments. The effective income tax
rate is expected to be in the 18 to 19 percent range. Earnings from
continuing operations before special items are expected to be in line
with the prior year. Full year capital spending is expected to be in the
$70 to $75 million range, including approximately $25 to $30 million for
the relocation of RUSM to Barbados. Adtalem's outlook excludes potential
charges related to restructuring plans and the pending ownership
transfer of DeVry University and Carrington College.

Conference Call and Webcast Information

Adtalem will hold a conference call to discuss its fiscal 2018 fourth
quarter earnings on Thursday, August 16, at 4 p.m. CT (5 p.m. ET). The
conference call will be led by Lisa Wardell, president and chief
executive officer; and Patrick Unzicker, chief financial officer and
treasurer.

For those wishing to participate by telephone, dial 877-407-6184
(domestic) or 201-389-0877 (international) and ask for the Adtalem call
or use conference ID: 13682557. Adtalem will also broadcast the
conference call on Adtalem's website at: http://www.investorcalendar.com/event/37094.

Please access the website at least 15 minutes prior to the start of the
call to register, download and install any necessary audio software.

Adtalem will archive a telephone replay of the call until September 16,
2018. To access the replay, dial 877-660-6853 (domestic) or 201-612-7415
(international), conference ID: 13682557. To access the webcast replay,
please visit Adtalem's website at: http://www.investorcalendar.com/event/37094.

About Adtalem Global Education

The purpose of Adtalem Global Education is to empower students to
achieve their goals, find success, and make inspiring contributions to
our global community. Adtalem Global Education Inc. (NYSE: ATGE; member
S&P MidCap 400 Index) is a leading global education provider and the
parent organization of Adtalem Educacional do Brasil, American
University of the Caribbean School of Medicine, Association of Certified
Anti-Money Laundering Specialists, Becker Professional Education,
Carrington College, Chamberlain University, DeVry University and its
Keller Graduate School of Management, EduPristine, Ross University
School of Medicine and Ross University School of Veterinary Medicine.
For more information, please visit adtalem.com.

Forward Looking Statement

Certain statements contained in this release concerning Adtalem Global
Education's expected future performance, including those statements
concerning expectations or plans, constitute "forward-looking
statements" within the meaning of the Safe Harbor Provision of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements generally can be identified by phrases such as Adtalem Global
Education or its management "believes," "expects," "anticipates,"
"foresees," "forecasts," "estimates," "plans," "intends," "estimates,"
"potential," "continue," "may," "will," "should," "could," or other
words or phrases of similar import which predict or indicate future
events or trends or that are not statements of historical matters.
Actual results may differ materially from those projected or implied by
these forward-looking statements. Potential risks, uncertainties and
other factors that could cause results to differ are described more
fully in Item 1A, "Risk Factors," in the most recent Annual Report on
Form 10-K for the year ending June 30, 2017 filed with the Securities
and Exchange Commission (SEC) on August 24, 2017 and its most recent
Quarterly Report on Form 10-Q for the quarter ending March 31, 2018 and
filed with the SEC on May 3, 2018. Any forward-looking statement made by
us in this release is based only on information currently available to
us and speaks only as of the date on which it is made. We undertake no
obligation to publicly update any forward-looking statement, whether
written or oral, that may be made from time to time, whether as a result
of new information, future developments or otherwise.

 

Enrollment from Continuing Operations

  FY 2018   FY 2017   % Change
Adtalem Global Education Student Enrollments(1)
New students 3,022 2,955 +2.3%
Total students 112,270 114,482 -1.9%
 
Chamberlain University
May Session
New students 3,896 3,779 +3.1%
Total students 30,309 28,961 +4.7%
July Session
New students(2) 2,523 2,497 +1.0%
Total students 28,037 26,811 +4.6%

Medical and Veterinary

May Semester(3)

New students 499 458 +9.0%
Total students 5,556 5,491 +1.2%
 

Enrollment from Discontinued Operations

 

Carrington College

FY 2018

FY 2017

% Change

3 months ending June 30, 2018
New students(4) 2,029 1,384 +46.6%
Total students 5,540 5,362 +3.3%
 
DeVry University
Undergraduate – May Session
New students 2,701 2,406 +12.3%
Total students 17,885 20,691 -13.6%
Graduate – May Session
Coursetakers(5) 7,053 8,469 -16.7%
Undergraduate – July Session
New students 2,977 2,616 +13.8%
Total students 17,478 18,853 -7.3%
Graduate – July Session
Coursetakers(5) 6,449 7,442 -13.3%

1) Includes the most recently reported enrollments at Adtalem's
postsecondary institutions

2) Post-licensure online programs only; pre-licensure campus-based
programs start in September, January and May; Total students includes
pre and post-licensure enrollment

3) Includes enrollments in its medical and veterinary preparatory
programs

4) Fourth quarter 2018 results included an additional intake period over
the prior year

5) The term "coursetaker" refers to the number of courses taken by a
student. Thus one student taking two courses equals two coursetakers

 
ADTALEM GLOBAL EDUCATION INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
 
        June 30,
2018   2017
(in thousands, except share and par value amounts)
ASSETS:
Current Assets:
Cash and Cash Equivalents $ 430,690 $ 240,426
Marketable Securities and Investments 4,255 4,013
Restricted Cash 310 1,312
Accounts Receivable, Net 146,726 148,677
Prepaid Expenses and Other Current Assets 58,887 36,513
Current Assets Held for Sale 47,132   40,266  
Total Current Assets 688,000   471,207  
Land, Building and Equipment:
Land 48,177 48,937
Building 389,129 407,624
Equipment 302,516 284,175
Construction in Progress 25,360   21,556  
765,182 762,292
Accumulated Depreciation (376,528 ) (336,027 )
Land, Building and Equipment Held for Sale, Net -   62,561  
Land, Building and Equipment, Net 388,654   488,826  
Noncurrent Assets:
Deferred Income Taxes 38,780 34,755
Intangible Assets, Net 362,931 391,958
Goodwill 813,887 829,086
Other Assets, Net 39,259 36,777
Noncurrent Assets Held for Sale 13,450   62,409  
Total Noncurrent Assets 1,268,307   1,354,985  
TOTAL ASSETS $ 2,344,961   $ 2,315,018  
 
LIABILITIES:
Current Liabilities:
Accounts Payable $ 47,477 $ 43,083
Accrued Salaries, Wages and Benefits 71,289 76,906
Accrued Liabilities 80,803 90,061
Deferred Revenue 106,773 103,542
Current Portion of Long-Term Debt 3,000 -
Current Liabilities Held for Sale 56,439   63,735  
Total Current Liabilities 365,781   377,327  
Noncurrent Liabilities:
Long-Term Debt 290,073 125,000
Deferred Income Taxes 29,115 34,712
Other Liabilities 131,380 101,672
Noncurrent Liabilities Held for Sale 216   983  
Total Noncurrent Liabilities 450,784   262,367  
TOTAL LIABILITIES 816,565   639,694  
NONCONTROLLING INTEREST 8,319   6,285  
SHAREHOLDERS' EQUITY:
Common Stock, $0.01 Par Value, 200,000,000 Shares Authorized:
59,893,000 and 62,371,000
Shares Outstanding at June 30, 2018 and June 30, 2017, respectively 793 781
Additional Paid-in Capital 454,653 415,912
Retained Earnings 1,918,164 1,881,397
Accumulated Other Comprehensive Loss (142,168 ) (59,119 )
Treasury Stock, at Cost, 19,390,000 and 15,691,000 Shares at June
30, 2018 and June 30, 2017,
respectively (711,365 ) (569,932 )
TOTAL SHAREHOLDERS' EQUITY 1,520,077   1,669,039  
TOTAL LIABILITIES, NONCONTROLLING INTEREST AND SHAREHOLDERS'
EQUITY
$ 2,344,961   $ 2,315,018  
 

ADTALEM GLOBAL EDUCATION INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
               
Three Months Ended

June 30,

Year Ended

June 30,

2018 2017 2018 2017
(in thousands, except per share amounts)
REVENUE:
Tuition $ 277,816 $ 275,710 $ 1,070,721 $ 1,056,296
Other Educational 41,971   39,506   160,490   151,613  
Total Revenue 319,787   315,216   1,231,211   1,207,909  
OPERATING COST AND EXPENSE:
Cost of Educational Services 155,673 159,333 645,604 638,245
Student Services and Administrative Expense 97,064 95,857 373,064 369,043
Restructuring Expense 1,883 8,285 5,067 12,973
Regulatory Settlements -   -   -   52,150  
Total Operating Cost and Expense 254,620   263,475   1,023,735   1,072,411  
Operating Income from Continuing Operations 65,167   51,741   207,476   135,498  
INTEREST:
Interest Income 1,015 1,184 5,827 4,905
Interest Expense (7,373 ) (2,734 ) (14,620 ) (9,144 )
Net Interest Expense (6,358 ) (1,550 ) (8,793 ) (4,239 )
Income from Continuing Operations Before Income Taxes 58,809 50,191 198,683 131,259
Income Tax Benefit (Provision) 38,673 (6,100 ) (84,102 ) (9,594 )
Equity Method Investment Loss -   (694 ) (138 ) (694 )
Income from Continuing Operations 97,482   43,397   114,443   120,971  
DISCONTINUED OPERATIONS:
(Loss) Income from Discontinued Operations Before
Income Taxes (52,882 ) 1,626 (124,162 ) 3,135
Income Tax Benefit (Provision) 18,275   (1,669 ) 44,016   (826 )
(Loss) Income from Discontinued Operations (34,607 ) (43 ) (80,146 ) 2,309  
NET INCOME 62,875 43,354 34,297 123,280
Net Income Attributable to Noncontrolling Interest (69 ) (495 ) (528 ) (997 )
NET INCOME ATTRIBUTABLE TO ADTALEM GLOBAL
EDUCATION $ 62,806   $ 42,859   $ 33,769   $ 122,283  
 
AMOUNTS ATTRIBUTABLE TO ADTALEM GLOBAL
EDUCATION:
Income from Continuing Operations $ 97,413 $ 42,902 $ 113,915 $ 119,974
(Loss) Income from Discontinued Operations (34,607 ) (43 ) (80,146 ) 2,309  
NET INCOME ATTRIBUTABLE TO ADTALEM GLOBAL
EDUCATION $ 62,806   $ 42,859   $ 33,769   $ 122,283  
 
EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE
TO ADTALEM GLOBAL EDUCATION SHAREHOLDERS:
Basic:
Continuing Operations $ 1.60 $ 0.68 $ 1.85 $ 1.89
Discontinued Operations $ (0.57 ) $ (0.00 ) $ (1.30 ) $ 0.04
Total $ 1.03 $ 0.68 $ 0.55 $ 1.93
Diluted:
Continuing Operations $ 1.58 $ 0.67 $ 1.83 $ 1.87
Discontinued Operations $ (0.56 ) $ (0.00 ) $ (1.29 ) $ 0.04
Total $ 1.02 $ 0.67 $ 0.54 $ 1.91
 
Cash Dividends Declared per Common Share $ - $ - $ - $ 0.18
 

ADTALEM GLOBAL EDUCATION INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
         
Year Ended June 30,
2018 2017
(in thousands)
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income $ 34,297 $ 123,280
Loss (Income) from Discontinued Operations 80,146 (2,309 )
Adjustments to Reconcile Net Income to Net Cash Provided by
Operating Activities:
Stock-Based Compensation Expense 14,499 16,600
Depreciation 43,286 45,805
Amortization of Intangible Assets 9,538 11,169
Amortization of Deferred Debt Issuance Costs 2,273 704
Impairment of Intangible Assets 400 -
Provision for Refunds and Uncollectible Accounts 33,801 34,529
Deferred Income Taxes (10,595 ) 3,797
Loss on Disposals, Accelerated Depreciation and Adjustments to Land,
Building and Equipment
31,728 10,507
Changes in Assets and Liabilities:
Accounts Receivable (43,294 ) (57,356 )
Prepaid Expenses and Other 16,793 (9,647 )
Accounts Payable 9,964 3,846
Accrued Salaries, Wages, Benefits and Liabilities (4,938 ) 9,500
Deferred Revenue 3,382   11,334  
Net Cash Provided by Operating Activities-Continuing Operations 221,280 201,759
Net Cash Provided by Operating Activities-Discontinued Operations 17,909   29,161  
NET CASH PROVIDED BY OPERATING ACTIVITIES 239,189   230,920  
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures (66,530 ) (42,508 )
Payment for Purchase of Businesses, Net of Cash Acquired (4,041 ) (330,567 )
Payment for Investment in Business (5,000 ) -
Marketable Securities Purchased (159 ) (93 )
Net Cash Used in Investing Activities-Continuing Operations (75,730 ) (373,168 )
Net Cash Provided by (Used in) Investing Activities-Discontinued
Operations
4,280   (6,486 )
NET CASH USED IN INVESTING ACTIVITIES (71,450 ) (379,654 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Exercise of Stock Options 23,821 27,675
Employee Taxes Paid on Withholding Shares (4,203 ) (2,956 )
Proceeds from Stock Issued Under Colleague Stock Purchase Plan 803 865
Repurchase of Common Stock for Treasury (137,028 ) (48,508 )
Cash Dividends Paid - (11,414 )
Payments of Seller Financed Obligations (11,413 ) (4,819 )
Borrowings Under Credit Facility 578,000 527,000
Repayments Under Credit Facility (403,000 ) (402,000 )
Payment of Debt Issuance Costs (9,871 ) -
Capital Investment from Noncontrolling Interest 95   -  
NET CASH PROVIDED BY FINANCING ACTIVITIES 37,204   85,843  
Effects of Exchange Rate Differences (11,634 ) (1,360 )
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED
CASH
193,309 (64,251 )
Cash, Cash Equivalents and Restricted Cash at Beginning of Year 251,096   315,347  
Cash, Cash Equivalents and Restricted Cash at End of Year 444,405 251,096
Less: Cash, Cash Equivalents and Restricted Cash of Discontinued
Operations at End of Year
13,405   9,358  
Cash, Cash Equivalents and Restricted Cash at End of Year $ 431,000   $ 241,738  
 

ADTALEM GLOBAL EDUCATION INC.
SEGMENT INFORMATION
(Unaudited)
                     
Three Months Ended

June 30,

Year Ended

June 30,

2018   2017  

Increase
(Decrease)

2018   2017  

Increase
(Decrease)

REVENUE: (in thousands)
Medical and Healthcare $ 201,025 $ 193,131 4.1 % $ 815,674 $ 802,462 1.6 %
Professional Education 45,289 39,863 13.6 % 147,195 131,769 11.7 %
Technology and Business 74,332 82,903 (10.3 )% 270,934 276,341 (2.0 )%
Home Office and Other (859 ) (681 ) (26.1 )% (2,592 ) (2,663 ) 2.7 %
Total Consolidated Revenue 319,787   315,216   1.5 % 1,231,211   1,207,909   1.9 %
OPERATING INCOME (LOSS):
Medical and Healthcare 48,089 40,973 17.4 % 189,672 187,138 1.4 %
Professional Education 12,613 11,057 14.1 % 27,695 19,866 39.4 %
Technology and Business 13,682 19,340 (29.3 )% 29,431 36,204 (18.7 )%
Home Office and Other (9,217 ) (19,629 ) 53.0 % (39,322 ) (107,710 ) 63.5 %
Total Consolidated Operating Income $ 65,167   $ 51,741   25.9 % $ 207,476   $ 135,498   53.1 %
 

NON-GAAP SEGMENT INFORMATION
(Unaudited)
 
During the three and twelve months ended June 30, 2018, Adtalem
classified the operating results of DeVry University and Carrington
College ("Carrington") as discontinued operations, and recorded
special items related to the following: (i) Restructuring charges
related to severance for workforce reductions and real estate
consolidations at the medical and veterinary schools, which is part
of the Medical and Healthcare segment, Becker Professional
Education, which is part of the Professional Education segment and
Adtalem's home office (not related to any segment) in order to align
its cost structure with operating changes; (ii) Asset impairment
charges at Adtalem Brazil related to the expected fiscal year 2019
dispositions of the São Luis and Joao Pessoa institutions (presented
as restructuring expense), which is part of the Technology and
Business segment; (iii) Income tax charges related to implementation
of the Tax Cuts and Jobs Act of 2017; and (iv) A tax benefit for the
loss on Adtalem's investment in Carrington. During the three and
twelve months ended June 30, 2017, Adtalem recorded special items
related to the following: (i) Restructuring charges related to
severance for workforce reductions and real estate consolidations at
the administrative support operations of the medical and veterinary
schools and Adtalem's home office in order to align its cost
structure with enrollments; and (ii) Charges related to regulatory
settlement agreements. In addition, in accordance with U.S.
Generally Accepted Accounting Principles ("GAAP"), the operating
results of DeVry University and Carrington are reclassified as
discontinued operations for the three and twelve months ended June
30, 2017. The following tables illustrate the effects of the
discontinued operations and special items on Adtalem's operating
income and net income. Management believes that the non-GAAP
disclosure of adjusted operating income, adjusted net income and
adjusted earnings per share excluding the discontinued operations
and special items provides investors with useful supplemental
information regarding the underlying business trends and performance
of Adtalem's ongoing operations and is useful for period-over-period
comparisons of such operations given the special nature of
discontinued operations, restructuring charges, regulatory
settlements and certain income tax charges and deductions. Adtalem
uses these supplemental financial measures internally in its
management and budgeting process. However, these non-GAAP financial
measures should be viewed in addition to, and not as a substitute
for, Adtalem's reported results prepared in accordance with GAAP.
The following tables reconcile these non-GAAP measures to the most
directly comparable GAAP information (in thousands):
          Three Months Ended

June 30,

    Year Ended

June 30,

2018     2017    

Increase
(Decrease)

2018     2017    

Increase
(Decrease)

Medical and Healthcare Operating Income $ 48,089 $ 40,973 17.4 % $ 189,672 $ 187,138 1.4 %
Restructuring Expense 161   1,915   (91.6 )% 803   2,582   (68.9 )%
Medical and Healthcare Operating Income
Excluding Special Items $ 48,250   $ 42,888   12.5 % $ 190,475   $ 189,720   0.4 %
 
Professional Education Operating Income $ 12,613 $ 11,057 14.1 % $ 27,695 $ 19,866 39.4 %
Restructuring Expense 357   -   NM 357   -   NM
Professional Education Operating Income
Excluding Special Items $ 12,970   $ 11,057   17.3 % $ 28,052   $ 19,866   41.2 %
 
Technology and Business Operating Income $ 13,682 $ 19,340 (29.3 )% $ 29,431 $ 36,204 (18.7 )%
Restructuring Expense 1,216   -   NM 1,216   -   NM
Technology and Business Operating Income
Excluding Special Items $ 14,898   $ 19,340   (23.0 )% $ 30,647   $ 36,204   (15.3 )%
 
Home Office and Other Operating Loss $ (9,217 ) $ (19,629 ) 53.0 % $ (39,322 ) $ (107,710 ) 63.5 %
Restructuring Expense 149 6,370 (97.7 )% 2,691 10,391 (74.1 )%
Regulatory Settlement -   -   NM -   52,150   NM
Home Office and Other Operating Loss
Excluding Special Items $ (9,068 ) $ (13,259 ) 31.6 % $ (36,631 ) $ (45,169 ) 18.9 %
 

NON-GAAP EARNINGS DISCLOSURE
(Unaudited)
               
Three Months Ended

June 30,

Year Ended

June 30,

2018 2017 2018 2017
(in thousands, except per share amounts)
Net Income $ 62,806 $ 42,859 $ 33,769 $ 122,283
Earnings per Share (diluted) $ 1.02 $ 0.67 $ 0.54 $ 1.91
Continuing Operations:
Restructuring Expense $ 1,883 $ 8,285 $ 5,067 $ 12,973
Effect on Earnings per Share (diluted) $ 0.03 $ 0.13 $ 0.08 $ 0.20
Tax Cuts and Jobs Act of 2017 $ 2,682 $ - $ 103,878 $ -
Effect on Earnings per Share (diluted) $ 0.04 $ - $ 1.67 $ -
Tax Benefit on Carrington Loss $ (48,903 ) $ - $ (48,903 ) $ -
Effect on Earnings per Share (diluted) $ (0.79 ) $ - $ (0.79 ) $ -
Regulatory Settlements $ - $ - $ - $ 52,150
Effect on Earnings per Share (diluted) $ - $ - $ - $ 0.81
Income Tax Impact on Non-GAAP Adjustments $ (84 ) $ (3,045 ) $ (1,083 ) $ (24,666 )
Effect on Earnings per Share (diluted) $ 0.00 $ (0.05 ) $ (0.02 ) $ (0.39 )
Discontinued Operations, net of tax $ 34,607 $ 43 $ 80,146 $ (2,309 )
Effect on Earnings per Share (diluted) $ 0.56 $ 0.00 $ 1.29 $ (0.04 )
Net Income from Continuing Operations Excluding Special
Items, net of tax $ 52,991 $ 48,142 $ 172,874 $ 160,431
Earnings per Share from Continuing Operations Excluding
Special Items, net of tax $ 0.86 $ 0.75 $ 2.78 $ 2.51
Shares used in EPS calculation 61,659 64,034 62,280 64,019
 

SUPPLEMENTAL RECONCILIATIONS
(Unaudited)
             
Three Months Ended June 30, 2018
(in thousands)
Medical and Professional Technology and Home Office
Healthcare Education Business and Other Consolidated

Revenue:

Fiscal Year 2017 as Reported $ 193,131 $ 39,863 $ 82,903 $ (681 ) $ 315,216
Organic Growth (Decline) 7,894 4,580 (20 ) (178 ) 12,276
Effect of Acquisitions - 846 741 - 1,587
Effect of Currency Change -   -   (9,292 ) -   (9,292 )
Fiscal Year 2018 as Reported $ 201,025   $ 45,289   $ 74,332   $ (859 ) $ 319,787  
 

Fiscal Year 2018 % Change:

Organic Growth (Decline) 4.1 % 11.5 % (0.0 %) NM 3.9 %
Effect of Acquisitions -   2.1 % 0.9 % NM   0.5 %
Constant Currency Change 4.1 % 13.6 % 0.9 % NM 4.4 %
Effect of Currency Change -   -   (11.2 %) NM   (2.9 %)
Fiscal Year 2018 % Change
as Reported 4.1 % 13.6 % (10.3 %) NM   1.5 %
 
Year Ended June 30, 2018
(in thousands)
Medical and Professional Technology and Home Office

Revenue:

Healthcare Education Business and Other Consolidated
Fiscal Year 2017 as Reported $ 802,462 $ 131,769 $ 276,341 $ (2,663 ) $ 1,207,909
Organic Growth (Decline) 17,779 14,198 1,929 71 33,977
Effect of Acquisitions - 1,228 1,734 - 2,962
Hurricane Impact (4,567 ) - - - (4,567 )
Effect of Currency Change -   -   (9,070 ) -   (9,070 )
Fiscal Year 2018 as Reported $ 815,674   $ 147,195   $ 270,934   $ (2,592 ) $ 1,231,211  
 

Fiscal Year 2018 % Change:

Organic Growth (Decline) 2.2 % 10.8 % 0.7 % NM 2.8 %
Effect of Acquisitions - 0.9 % 0.6 % NM 0.2 %
Hurricane Impact (0.6 %) -   -   NM   (0.4 %)
Constant Currency Change 1.6 % 11.7 % 1.3 % NM 2.7 %
Effect of Currency Change -   -   (3.3 %) NM   (0.8 %)
Fiscal Year 2018 % Change
as Reported 1.6 % 11.7 % (2.0 %) NM   1.9 %

 

SUPPLEMENTAL RECONCILIATIONS
(Unaudited)
 
Three Months Ended June 30, 2018
(in thousands)
Medical and Professional Technology and Home Office

Total Expenses:

Healthcare Education Business and Other Consolidated
Fiscal Year 2017 as Reported $ 152,158 $ 28,806 $ 63,564 $ 18,947 $ 263,475
Cost Increase (Reduction) 2,533 1,535 2,459 (4,370 ) 2,157
Effect of Acquisitions - 1,978 536 - 2,514
Restructuring Expense Change (1,754 ) 357 1,216 (6,221 ) (6,402 )
Effect of Currency Change -   -   (7,124 ) -   (7,124 )
Fiscal Year 2018 as Reported $ 152,937   $ 32,676   $ 60,651   $ 8,356   $ 254,620  
 

Fiscal Year 2018 % Change:

Cost Increase (Reduction) 1.7 % 5.3 % 3.9 % NM 0.8 %
Effect of Acquisitions - 6.9 % 0.8 % NM 1.0 %
Restructuring Expense Change (1.2 %) 1.2 % 1.9 % NM   (2.4 %)
Constant Currency Change 0.5 % 13.4 % 6.6 % NM (0.7 %)
Effect of Currency Change -   -   (11.2 %) NM   (2.7 %)
Fiscal Year 2018 % Change
as Reported 0.5 % 13.4 % (4.6 %) NM   (3.4 %)
 
Year Ended June 30, 2018
(in thousands)
Medical and Professional Technology and Home Office

Total Expenses:

Healthcare Education Business and Other Consolidated
Fiscal Year 2017 as Reported $ 615,323 $ 111,903 $ 240,136 $ 105,049 $ 1,072,411
Cost Increase (Reduction) (913 ) 4,586 5,645 (8,469 ) 849
Effect of Acquisitions - 2,653 1,142 - 3,795
Hurricane Impact 13,372 - - - 13,372
Restructuring Expense Change (1,779 ) 357 1,216 (7,700 ) (7,906 )
Regulatory Settlement Change - - - (52,150 ) (52,150 )
Effect of Currency Change -   -   (6,636 ) -   (6,636 )
Fiscal Year 2018 as Reported $ 626,003   $ 119,499   $ 241,503   $ 36,730   $ 1,023,735  
 

Fiscal Year 2018 % Change:

Cost Increase (Reduction) (0.1 %) 4.1 % 2.4 % NM 0.1 %
Effect of Acquisitions - 2.4 % 0.5 % NM 0.4 %
Hurricane Impact 2.2 % - - NM 1.2 %
Restructuring Expense Change (0.3 %) 0.3 % 0.5 % NM (0.7 %)
Regulatory Settlement Change -   -   -   NM   (4.9 %)
Constant Currency Change 1.7 % 6.8 % 3.3 % NM (3.9 %)
Effect of Currency Change -   -   (2.8 %) NM   (0.6 %)
Fiscal Year 2018 % Change
as Reported 1.7 % 6.8 % 0.6 % NM   (4.5 %)
 

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