Laureate Education, Inc. · NASDAQ:LAUR
Laureate Education — Q1 2022 Earnings Presentation
35 slides from Laureate Education's earnings presentation, May 5, 2022
Slide 1: First Quarter 2022 Earnings Presentation
First Quarter 2022 Earnings Presentation May 5, 2022 © 2022 Laureate Education, Inc. 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation includes statements that express Laureate’s opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, ‘‘forward-looking statements’’ within the meani
Slide 3: Presentation of Non-GAAP Measures
Presentation of Non-GAAP Measures In addition to the results provided in accordance with U.S. generally accepted accounting principles (GAAP) throughout this presentation, Laureate provides the non- GAAP measurements of Adjusted EBITDA, Adjusted EBITDA margin, total cash, net of debt (or net cash),
Slide 4: Summary Overview
SUMMARY OVERVIEW Note: Throughout this presentation amounts may not sum to totals due to rounding Amounts presented for enrollments, Revenue, Adjusted EBITDA and Adjusted EBITDA margin are for continuing operations only © 2022 Laureate Education, Inc. 4
Slide 5: Executive Summary
Executive Summary Strong Enrollment trends in both countries including the primary intake in Peru ‒ New Enrollments up 9% vs prior year period ‒ Total Enrollments up 11% vs prior year period Revenue and Adjusted EBITDA ahead of expectations for Q1 driven by favorable enrollments and timing of ex
Slide 6: Growth Priorities
GROWTH PRIORITIES © 2022 Laureate Education, Inc. 6
Slide 7: Attractive Growth Opportunities in Mexico & Peru Higher Education Markets
Attractive Growth Opportunities in Mexico & Peru Higher Education Markets Mexico Peru Combined Population (M) 128M 32M 160M Higher Education Students 5,005 1,642 6,647 (000s) Higher Education Gross U.S. E.U. 34% 47% 36% Participation Rate1 65% 54% Market Share for 42% 69% 51% Private Institutions2 S
Slide 8: Leading University Portfolio in Mexico & Peru
Leading University Portfolio in Mexico & Peru Enrollment Market QS StarsTM • Brand Founded @ 3/31/22 Segment Overall Ratings / Rankings Ranked Top 10 university in Mexico Premium/ 1960 93,400 One of only seven 4-Star rated universities Traditional Mexico Universidad del in Mexico by QS Stars™ Va
Slide 9: Digital Learning During Pandemic Accelerated Capital Light Operating Model
Digital Learning During Pandemic Accelerated Capital Light Operating Model Laureate to enable significant growth, without large-scale investments in campus expansions, through increased mix of Digital Learning Percentage of Teaching Hours Delivered Online 100% 40% – 60% 27% 2019 2020 /2021 2022+ (Pr
Slide 10: Multiple Vectors for Revenue Growth
Multiple Vectors for Revenue Growth Expected Medium-Term Revenue Growth Phase II Priorities 8% - 10% Phase I Priorities 5% - 7% Pre-Pandemic COVID Recovery Online Expansion Program Expansion New Campuses Scaling EdTech/B2B Targeted Future Organic Trends / Digital (Monetize IP) Revenue Growth Majorit
Slide 11: Q1 2022 Performance Results
Q1 2022 PERFORMANCE RESULTS © 2022 Laureate Education, Inc. 11
Slide 12: 2022 First Quarter – Financial Summary
2022 First Quarter – Financial Summary Q1 ’22 Variance Vs. Q1 ‘21 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 • Primary intake for Peru, secondary intake New Enrollment 81K 9% 9% for Mexico Total Enrollment 405K 11% 11% • Peru +14%, Mexico +7% • Driven by enrollm
Slide 13: Segment Results
SEGMENT RESULTS © 2022 Laureate Education, Inc. 13
Slide 14: Mexico Segment Results
Mexico Segment Results Q1 Results Notes ($ in millions) Organic/CC (Enrollments in thousands) Q1 ’22 Vs. Q1 ’21 (1) • Strong results during secondary intake New Enrollment 32K 15% cycle, primary intake for Mexico will occur in September • Driven by new enrollment and strength of Total Enrollment 197
Slide 15: Peru Segment Results
Peru Segment Results Q1 Results Notes ($ in millions) Organic/CC (Enrollments in thousands) Q1 ’22 Vs. Q1 ’21 (1) • Continued strong growth in new enrollment New Enrollment 49K 5% • High comparable period in Q1 2021 (COVID catch-up); +19% vs Q1 2019 intake levels • Driven by new enrollment volume an
Slide 16: Q1 2022 Capitalization and Return of Capital
Q1 2022 Capitalization and Return of Capital ($ in millions) Amount Comments Net Cash Position @ 3/31/22 $138 See Appendix Divestiture Related Escrow 1 $74 Expected in 2H 2022 Adjusted Net Cash Position @ 3/31/22 $212 Returning Capital to Shareholders Remains a Priority • 14M shares repurchased YTD2
Slide 17: Outlook
OUTLOOK © 2022 Laureate Education, Inc. 17
Slide 18: 2022 Outlook – Executive Summary
2022 Outlook – Executive Summary Market dynamics remain favorable for the private sector in Mexico & Peru Digital education accelerating Total Revenue growth expected at +10% Vs. 20211 (up 10% on an as-reported basis) 2022 Adjusted EBITDA expected to be up +24% Vs. 20211 (up 30% on an as-rep
Slide 19: 2022 FY Outlook - Updated
2022 FY Outlook - Updated ($ in millions) Prior Change Current (Enrollments in thousands) FY 2022 Outlook (mid-pt) FY 2022 Outlook (1) Total Enrollment 405K - 415K +3K 410K - 416K Revenue $1,169 - $1,194 +$16 $1,190 - $1,206 Adjusted EBITDA $320 - $330 +$5 $326 - $334 (1) Based on actual FX rates fo
Slide 20: 2022 Outlook (At Mid-Point)
2022 Outlook (At Mid-Point)1 Total Enrollment (000s) Revenue ($M) +6% +10% 389 413 $1,198 $1,087 2021A 2022E 2021A 2022E Adjusted EBITDA ($M) Adjusted EBITDA Margin % +30% $330 27.5% $253 23.3% 420 bps 2021A 2022E 2021A 2022E Strong Top Line Growth With Significant Margin Accretion (1) Based on actu
Slide 21: Q2 2022 Guidance Details
Q2 2022 Guidance Details ($ in millions) Q2 2022 Outlook (1) Revenue $364 - $374 Adjusted EBITDA $126 - $131 Continued Growth Momentum Expected in the Second Quarter (1) Based on actual FX rates for April, and spot FX rates (local currency per US dollar) of MXN 20.48 & PEN 3.82 for May through June
Slide 22: Appendix
APPENDIX © 2022 Laureate Education, Inc. 22
Slide 23: 2022 First Quarter – Net Income Reconciliation
2022 First Quarter – Net Income Reconciliation Q1 ’22 B / (W) Vs. Q1 ’21 Notes ($ in millions) Reported $ % Adjusted EBITDA 27 18 180% • PY included $13M non-cash FAS5 charge Depreciation & Amort. (14) 8 37% Interest Expense, net (2) 21 93% • Repayment of debt Impairments - 57 n.m. • Impairments cha
Slide 24: Capitalization at 3/31/22
Capitalization at 3/31/22 ($ in millions) Total Company as of 3/31/22 Cash & Cash Equivalents1 $294 Gross Debt ($156) Net Cash Position $138 Net Cash Position of $138M as of March 31st (1) Excludes $74M escrow related to Walden divestiture © 2022 Laureate Education, Inc. 24
Slide 25: 2022 Full Year Guidance Details
2022 Full Year Guidance Details (USD millions, except enrollments in thousands) Total Enrollment Revenues Adj. EBITDA 2021 FY Results As Reported 389K $1,087 $253 Campus Closures (End of 2021) (2K) - - 2021 FY Results Adjusted 387K $1,087 $253 Organic Growth 23K - 29K $103 - $119 $56 - $64 Organic G
Slide 26: Q2 2022 Guidance Details
Q2 2022 Guidance Details (USD millions) Revenues Adj. EBITDA 2021 Q2 Results As Reported $328 $107 Timing Impact Intra-Year (academic calendar) $7 $5 2021 Q2 Results Adjusted $335 $112 Organic Growth $34 - $44 $16 - $21 Organic Growth % 10% - 13% 14% - 19% FAS 5 Expense/Indemnification Asset (non-ca
Slide 27: Intra-Year Seasonality Trends
Intra-Year Seasonality Trends • Large intake cycles at end of Q1 (Peru) and end of Q3 (Mexico) drive seasonality of earnings • Q2 and Q4 are typically Laureate’s strongest earnings quarters Revenue Seasonality Adjusted EBITDA Seasonality 31% 30% 30% 49% 29% 28% 47% 46% 27% 42% 44% 25% 23% 24% 30% 19
Slide 28: Financial Results & Tables
Financial Results & Tables © 2022 Laureate Education, Inc. 28
Slide 29: Financial Tables – Consolidated Statements of Operations
Financial Tables Consolidated Statements of Operations For the three months ended March 31, IN MILLIONS 2022 2021 Change Revenues $ 209.6 $ 194.7 $ 14.9 Costs and expenses: Direct costs 182.9 181.8 1.1 General and administrative expenses 17.5 42.6 (25.1) Loss on impairment of assets 0.1 56.7 (56.6)
Slide 30: Financial Tables – Revenue and Adjusted EBITDA by Segment
Financial Tables Revenue and Adjusted EBITDA by segment: Quarter IN MILLIONS % Change $ Variance Components Organic Organic For the three months ended Constant Constant March 31, 2022 2021 Reported Currency(1) Total Currency Other Acq/Div. FX Revenues Mexico $ 142.5 $ 135.4 5% 6% $ 7.1 $ 8.0 $ — $ —
Slide 31: Financial Tables – Consolidated Balance Sheets
Financial Tables Consolidated Balance Sheets IN MILLIONS March 31, 2022 December 31, 2021 Change Assets Cash and cash equivalents $ 293.8 $ 324.8 $ (31.0) Receivables (current), net 129.1 152.0 (22.9) Other current assets 68.7 67.5 1.2 Property and equipment, net 516.9 499.5 17.4 Operating lease rig
Slide 32: Financial Tables – Consolidated Statements of Cash Flows
Financial Tables Consolidated Statements of Cash Flows For the three months ended March 31, IN MILLIONS 2022 2021 Change Cash flows from operating activities Net loss $ (44.7) $ (164.9) $ 120.2 Depreciation and amortization 14.4 22.7 (8.3) Loss on impairment of assets 0.1 57.7 (57.6) (Gain) loss on
Slide 33: Non-GAAP Reconciliation (1 of 2)
Financial Tables Non-GAAP Reconciliation (1 of 2) The following table reconciles income (loss) from continuing operations to Adjusted EBITDA and Adjusted EBITDA margin: For the three months ended March 31, IN MILLIONS 2022 2021 Change Loss from continuing operations $ (45.4) $ (164.5) $ 119.1 Plus:
Slide 34: Non-GAAP Reconciliation (2 of 2)
Financial Tables Non-GAAP Reconciliation (2 of 2) The following table reconciles operating cash flow to Free Cash Flow for the three months ended March 31, 2022 and 2021: IN MILLIONS 2022 2021 Change Net cash provided by operating activities $ 53.9 $ 11.3 $ 42.6 Capital expenditures: Purchase of pro
Slide 35: © 2022 Laureate Education, Inc.
© 2022 Laureate Education, Inc. 35