Cengage Learning Hldgs Ii Inc · OTC:CNGO
Cengage Learning Hldgs Ii — Cengage Learning Holdings II — Q3 2026 Earnings Presentation
22 slides from Cengage Learning Hldgs Ii's earnings presentation, Feb 19, 2026
Slide 1: Third Quarter Fiscal Year 2026 Investor Update
Third Quarter Fiscal Year 2026 Investor Update [February 19, 2026] 1
Slide 2: Agenda
Agenda • Introduction • Richard Veith, SVP, Treasurer • Business Update • Michael Hansen, Chief Executive Officer • Financial Update • Dean Tilsley, Chief Financial Officer • Q&A Jessica G. Empowers Educators to Embrace Digital Learning Rya C. Delivers Job Outcomes Through Skilling Programs Michael
Slide 3: Safe Harbor / Forward-Looking Statements
Safe Harbor / Forward-Looking Statements Cautionary Note Regarding Forward-Looking Statements • The following slides and related discussion contain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-look
Slide 4: Business Update
Business Update Michael Hansen Chief Executive Officer 4
Slide 5: Q3 Business Update
Q3 Business Update Strong Financial Momentum: December QTD Adjusted Cash Revenue up 10% and Adjusted Cash EBITDA up $21M over prior year driven by solid performance in Higher Education and Work segments. Workforce-Aligned Learning & New Partnerships: Cengage is strengthening its positioning in educa
Slide 6: Financial Update
Financial Update Dean Tilsley Chief Financial Officer 6
Slide 7: Financial Highlights
Financial Highlights Strong Growth in Key US HED and Ed2Go driving Q3 growth of 10% for Adj Cash Revenue, coupled with new operating model shifts Adj Cash EBITDA to positive v negative in Q3, 25 Quarter Ended December 31 • TTM Adjusted Cash Revenue was up 3% YoY, driven by the Key HED and Work segme
Slide 8: Higher Education
Higher Education US HED Digital first strategy and Institutional sales drives continues revenue and margin growth Overview HED • HED Q3 Adj Cash Revenues up 15% YoY and up 3% YTD. On a Q3 Adj Cash Revenue ($M) YTD Adj Cash Revenue ($M) GAAP basis, revenues are up 9% for the Qtr and 8% YTD. +15% 3% $
Slide 9: Work
Work Accelerating Ed2Go Growth coupled with strong operational leverage driving Revenue and EBITDA growth Overview Work Q3 Adj Cash Revenue ($M) YTD Adj Cash Revenue ($M) • Work Q3 Adj Cash Revenues are up 6% YoY and up 4% YTD 6% 4% with Adj Cash EBITDA up 2% YoY for the Qtr and up 7% YTD reflecting
Slide 10: School
School FY26 YoY performance impacted by low adoption year with strong quarter driven by early renewals in GALE K12 Overview School • Q3 School Adj Cash Revenue up 17% YoY, reflecting early Q3 Adj Cash Revenue ($M) YTD Adj Cash Revenue ($M) renewals for Gale K12 and focused sales efforts by the K12 1
Slide 11: English Language Learning (ELL)
English Language Learning (ELL) Challenging YoY comparison due to exit from MOE deal and no large adoptions compared to last year Overview ELL • ELL Q3 Adjusted Cash Revenues are up 1% YoY and down Q3 Adj Cash Revenue ($M) YTD Adj Cash Revenue ($M) 10% YTD, materially impacted by one significant non
Slide 12: Summary of Cash Flows
Summary of Cash Flows DEC YTD DEC YTD • Improvements in working capital $M FY25 FY26 Change reflect strong collections in Q3 as we get past the invoicing issues 1 experienced in H1 due to the new Adjusted Cash EBITDA 369 362 (7) ERP implemented last April plus growth in institutional sales and Less:
Slide 13: Liquidity & Debt
Liquidity & Debt Liquidity position is strong and Net DEC 31, 2024 DEC 31, 2025 Leverage improves 0.2x to 2.5x $M reflecting Cengage's continued commitment to Cash and Cash Equivalents 294 279 deleveraging 1 Available under Revolving Credit Facilities 195 195 • Total liquidity was $474M reflecting p
Slide 14: Q&A
Q&A Ben H. Enables Ethical, Compliant Operations Takeyce W. Designs Quality Pooja R. Content Assures the Quality of Online Education 14
Slide 15: Appendix
Appendix Abbey K. Connects Skill Learners to Opportunity Jason S. Creates Easy to Use Casey R. Learning Products Connects Educators with the Right Tools for Success 15
Slide 16: Definitions: Non-GAAP Financial Measures
Definitions: Non-GAAP Financial Measures We believe that certain non-GAAP financial measures provide useful information for evaluating our business performance by eliminating the effects of financing decisions as well as excluding the impact of activities not related to our ongoing operations. Howev
Slide 17: GAAP Results - Condensed Consolidated Statements of Operations
GAAP Results - Condensed Consolidated Statements of Operations Three Months ended Nine Months ended December 31, December 31, (in millions) 2025 2024 2025 2024 Revenues $ 360.0 $ 337.0 $ 1,110.8 $ 1,084.9 Cost of revenues, excluding amortization of pre-publication costs and identifiable intangible a
Slide 18: GAAP Results – Condensed Consolidated Balance Sheet
GAAP Results – Condensed Consolidated Balance Sheet As of As of December 31, March 31, December 31, March 31, (in millions) 2025 2025 Change 2025 2025 Change Assets Liabilities, Contingently Redeemable Convertible Preferred Cash and cash equivalents $ 278.7 $ 256.4 $ 22.3 Stock, and Stockholders' De
Slide 19: Segment Revenue and Adj GAAP Financial Measures - Three & Nine Months Ended
Segment Revenue and Adj GAAP Financial Measures¹ - Three & Nine Months Ended Three Months Ended Nine Months Ended December 31, Change December 31, Change 2025 2024 $ % 2025 2024 $ % Revenue: Revenue: HED $ 193.6 $ 176.4 $ 17.2 9.8% HED $ 551.0 $ 511.9 $ 39.2 7.6% WORK 77.3 70.5 6.8 9.7% WORK 243.5 2
Slide 20: Segment Adj Cash Financial Measures - Three & Nine Months Ended
Segment Adj Cash Financial Measures¹ - Three & Nine Months Ended Three Months Ended Nine Months Ended December 31, B / (W) December 31, B / (W) 2025 2024 $ % 2025 2024 $ % Adj Cash Revenue: Adj Cash Revenue: HED $ 93.6 $ 81.9 11.7 14.3% HED $ 492.2 $ 478.0 14.2 3.0% WORK 69.3 65.4 3.9 5.9% WORK 258.
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations¹ Non-GAAP Reconciliations $M FY24 FY25 FY26 FY25 FY26 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 TTM TTM GAAP Revenue 327 449 343 352 1,471 331 417 337 380 1,465 332 419 360 1,437 1,491 Change in deferred revenue (53) 172 (112) 28 34 (51) 189 (115) 40 64 (74) 189 (115) 51 39 Adj
Slide 22: Summary of Cash Flows
Summary of Cash Flows $M DEC YTD DEC YTD Change FY25 FY26 Summary of cash flows: Net cash provided by operating activities 158 173 15 Net cash used in investing activities (91) (96) (5) Net cash used in financing activities (37) (56) (20) Impact on cash and cash equivalents from changes in foreign c
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