Perdoceo Education Corporation · NASDAQ:PRDO
Perdoceo Education — Career Education — Q1 2015 Earnings Presentation
19 slides from Perdoceo Education's earnings presentation, May 6, 2015
Slide 1: First Quarter 2015 Investor Conference Call
Exhibit 99.2 CAREER EDUCATION CORPORATION FIRST QUARTER 2015 INVESTOR CONFERENCE CALL MAY 6, 2015 Ron McCray Chairman & Interim Chief Executive Officer Dave Rawden Interim Chief Financial Officer Jason Friesen Senior Vice President, Chief University Education Officer Lysa Clemens Senior Vice Preside
Slide 2: Cautionary Statements & Disclosures
Cautionary Statements & Disclosures This presentation contains “forward-looking statements,” as defined in Section 21E of the Securities Exchange Act of 1934, as amended, that reflect our current expectations regarding our future growth, results of operations, cash flows, performance and business pr
Slide 3: Agenda
Agenda • Overview of Strategy to Divest or Teach-out Remaining Career Colleges • Snapshot of Career Education’s Future • First Quarter Results & Business Highlights • Outlook/Guidance • Q&A Session 3
Slide 4: Update on Turnaround Plan
Update on Turnaround Plan • Divest or teach-out remaining Career Colleges • Several factors handicapped the Company’s ability to operate programs, including: • A prolonged recession with depressed hiring • Increasing costs of education and corresponding student debt levels • Challenging regulatory e
Slide 5: Update on Career Colleges and Le Cordon Bleu
Update on Career Colleges and Le Cordon Bleu Planned Actions for Career Colleges and Le Cordon Bleu Institution Action Status Sanford-Brown Teach-Out Teach-outs announced 5/6/15 Missouri College Pursue Divestiture Sale process remains ongoing Briarcliffe College Pursue Divestiture Sale process remai
Slide 6: Update on Career Colleges (cont.)
Update on Career Colleges (cont.) Review of Teach-Out Process • A gradual discontinuation of operations • Affords students a reasonable opportunity to complete programs before a campus closes • Reflects our commitment to student success – Many campuses keep serving students for 18 months or more – M
Slide 7: Review of Transitional Group (Before & After)
Review of Transitional Group (Before & After) All teach-out schools and Career Colleges for sale will move from the Career Colleges Group to the Transitional Group. The Company expects all campuses selected for teach-out to be closed by 2018. 16 (1) Teach-out dates are estimated based on current stu
Slide 8: Snapshot of Career Education's Future
Snapshot of Career Education’s Future The core offering of the organization will be driven by degree-oriented, higher education offered primarily online through regionally accredited universities. Business Highlights Recent University Group Performance Trailing Twelve Months • The company maintains
Slide 9: Priorities for the University Group
Priorities for the University Group • Continue streamlining operations and strengthening academic outcomes • Invest in technology innovation – Intellipath adaptive learning technology is a differentiating product – Developing new mobile application at CTU to enrich student experience • Introduce rel
Slide 10: First Quarter University Group Highlights
First Quarter University Group Highlights • Total revenue of $138.2 million – Down 0.9% year-over-year – Total enrollments fairly flat • Operating income $11.7 million – Quarterly increase of 7.6% year-over-year • Operating margins expanded 70 basis points to 8.5% – Driven by continued execution of
Slide 11: Total University Student Enrollments
Total University Student Enrollments 33,900 33,800 31,300 32,000 30,600 10,800 (1) (1) AIU had three start dates in 1Q 2014 and two start dates in 2Q 2014 which explains why there is a spike in total enrollments in 1Q 2014 and a corresponding decrease in 2Q All2014. other periods each had two AIU st
Slide 12: Total University Student Enrollments Online-Only
Total University Student Enrollments Online – Only 30,200 30,600 28,600 28,300 28,900 10,700 (1) (1) AIU had three start dates in 1Q 2014 and two start dates in 2Q 2014 which explains why there is a spike in total enrollments in 1Q 2014 and a corresponding decrease in 2Q All2014. other periods each
Slide 13: Adjusted EBITDA for Career, Transitional, and Disc. Ops
Adjusted EBITDA for Career, Transitional, and Disc. Ops 13
Slide 14: Financial Impacts of Restructuring
Financial Impacts of Restructuring • On track with prior Adjusted EBITDA guidance for Transitional Group – Amount needs to be redefined with Career Colleges added to group • Developing new guidance on impact of Transitional and discontinued operations – Estimatingthe restructuringchargeswill rangefr
Slide 15: Strong Cash Position
Strong Cash Position (1) Balances presented above are quarter end balances and include both continuing and discontinued operations. 15
Slide 16: Outlook/Guidance
Outlook/Guidance • Continue to expect positive Adjusted EBITDA from University • Modest total student enrollment growth for University in 2015 • Expect additional progress reducing real estate obligations for Transitional and discontinued operations • Continue to expect more than $40 million in oper
Slide 17: Reconciliation of GAAP to Non-GAAP Items
Reconciliation of GAAP to Non-GAAP Items CAREER EDUCATION CORPORATION AND SUBSIDIARIES (1) UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ITEMS (In thousands) Adjusted EBITDA Q1 2015 Q4 2014 Q3 2014 Q2 2014 Q1 2014 University Group and Corporate: Pre-tax loss from continuing operations $ (24,990) $ (7
Slide 18: Reconciliation of GAAP to Non-GAAP Items (cont.)
Reconciliation of GAAP to Non-GAAP Items con’t– (1) The Company believes it is useful to present non-GAAP financial measures which exclude certain significant items as a means to understand the performance of its operations. As a general matter, the company uses non-GAAP financial measures in conjun
Slide 19: End of Presentation
End of Presentation 19