Laureate Education, Inc. · NASDAQ:LAUR
Laureate Education — Q3 2021 Earnings Presentation
36 slides from Laureate Education's earnings presentation, Nov 4, 2021
Slide 1: Third Quarter 2021 Earnings Presentation
Third Quarter 2021 Earnings Presentation November 4, 2021 © 2021 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 © 2021 Laureate Education, Inc. 4
Slide 5: Executive Summary
Executive Summary Strong Q3 results with Revenue up 13% and Adjusted EBITDA up 68% vs prior year 1 …. Both ahead of expectations Growth Agenda initiated during H1 2021 is taking hold …. Q3 New Enrollments up 17% and Total Enrollments up 16% year-over-year Raising full-year 2021 guidance on str
Slide 6: Growth Priorities
GROWTH PRIORITIES © 2021 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) 127M 33M 160M Higher Education Students 4,562 1,896 6,458 (000s) Higher Education U.S. E.U. 30% 47% 34% Participation Rate1 62% 54% Market Share for 44% 72% 56% Private Institution2 Sources:
Slide 8: Leading University Portfolio in Mexico & Peru
Leading University Portfolio in Mexico & Peru Enrollment Market QS StarsTM • Brand Founded @ 9/30/21 Segment Overall Ratings / Rankings Ranked #7 university in Mexico Premium/ 1960 101,000 One of only three 4-Star rated universities Traditional Mexico Universidad del in Mexico by QS Stars™ Valle
Slide 9: Digital Learnings During Pandemic Accelerated Capital Light Operating Model
Digital Learnings 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+ (P
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: Q3 & YTD 2021 Performance Results
Q3 & YTD 2021 PERFORMANCE RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 11
Slide 12: 2021 Third Quarter – Financial Summary
2021 Third Quarter – Financial Summary Q3 ’21 Variance Vs. Q3 ‘20 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 • Strong primary enrollment intake in New Enrollment 95K 17% 17% Mexico & secondary intake in Peru • Driven by new enrollment growth and Total Enrollment
Slide 13: 2021 Q3 YTD – Financial Summary
2021 Q3 YTD – Financial Summary Q3 YTD ’21 Variance Vs. Q3 YTD ‘20 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 • YTD New enrollments +6% vs. New Enrollment 189K 15% 15% YTD 2019 • Total enrollment +5% vs. Sept 2019 Total Enrollment 390K 16% 16% • Improved retenti
Slide 14: Segment Results
SEGMENT RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 14
Slide 15: Mexico Segment Results
Mexico Segment Results Q3 Results Q3 YTD Results Notes ($ in millions) Organic/CC Q3 YTD Organic/CC (Enrollments in thousands) Q3 ’21 Vs. Q3 ’20 (1) ’21 Vs. Q3 YTD ’20 (1) • Strong primary intake in September New Enrollment 70K 11% 115K 11% • YTD New enrollments +4% vs. YTD 2019 • Driven by NE growt
Slide 16: Peru Segment Results
Peru Segment Results Q3 Results Q3 YTD Results Notes ($ in millions) Organic/CC Q3 YTD Organic/CC (Enrollments in thousands) Q3 ’21 Vs. Q3 ’20 (1) ’21 Vs. Q3 YTD ’20 (1) • Robust NE growth during secondary intake in Q3 New Enrollment 25K 35% 74K 20% • YTD New enrollments +9% vs. YTD 2019 • Driven by
Slide 17: Q3 Capitalization – Adjusted for Subsequent Events & Pending Items
Q3 Capitalization – Adjusted for Subsequent Events & Pending Items ($ in millions) Amount Comments Net Cash Position @ 9/30/21 $1,694 See Appendix Cash Distribution to Shareholders ($1,272) Paid on October 29th Taxes / Fees Due on Sales 1 ($170) To be Paid in Q4 and into 2022 Divestiture Cash Collat
Slide 18: Outlook
OUTLOOK © 2021 Laureate Education, Inc. 18
Slide 19: FY 2021 Guidance Update
FY 2021 Guidance Update ($ in millions) Previous Current (Enrollments in thousands) Guidance Outlook (1) Total Enrollment 350K 385K Revenue $1,025 - $1,065 $1,075 - $1,085 Adjusted EBITDA $205 - $215 $247 - $253 (1) Based on actual FX rates for January through October 2021, and spot FX rates (local
Slide 20: Appendix
APPENDIX © 2021 Laureate Education, Inc. 20
Slide 21: Academic Calendar Timing Impacts - Peru
Academic Calendar Timing Impacts - Peru • $18M in revenue timing shift from Q1 to 2H due to delayed class start in 2020 – Majority of benefit recognized in Q1 2021; offset in Q3/Q4 Week Of 2/22 3/1 3/8 3/15 3/22 3/29 4/5 4/12 UPC Delayed start in UPN 2020 due to COVID Cibertec 2021 semester start da
Slide 22: 2021 Third Quarter – Net Income Reconciliation
2021 Third Quarter – Net Income Reconciliation Q3 ’21 B / (W) Vs. Q3 ’20 Notes ($ in millions) Reported $ % Adjusted EBITDA 76 26 51% • Strong operating performance • Primarily related to amortization of Depreciation & Amort. (26) (8) (42%) tradename (moved to finite life asset) Interest Expense, ne
Slide 23: 2021 Q3 YTD – Net Income Reconciliation
2021 Q3 YTD – Net Income Reconciliation Q3 YTD ’21 B / (W) Vs. Q3 YTD ’20 Notes ($ in millions) Reported $ % Adjusted EBITDA 193 78 67% • Strong performance in Peru • Primarily related to amortization of Depreciation & Amort. (76) (20) (35%) tradename (moved to finite life asset) Interest Expense, n
Slide 24: Capitalization at 9/30/21
Capitalization at 9/30/21 ($ in millions) Total Company as of 9/30/21 Cash $1,860 Debt ($166) Net Cash Position $1,694 Net Cash Position of $1.7bn as of September 30th © 2021 Laureate Education, Inc. 24
Slide 25: 2021 Full Year Guidance Details
2021 Full Year Guidance Details (USD millions, except enrollments in thousands) Total Enrollment Revenues Adj. EBITDA 2020 Results 337K $1,025 $206 Organic Growth 48K $85 – $95 $71 – $77 Growth % 14% 8% – 9% 34% – 37% FAS 5 Expense/Indemnification Asset (non-cash) - - ($7) 2021 Guidance (Constant Cu
Slide 26: Q4 2021 Guidance Details
Q4 2021 Guidance Details (USD millions) Revenues Adj. EBITDA 2020 Q4 Results $285 $91 Organic Growth $17 – $27 ($32) – ($26) Growth % 6% - 9% (35%) – (29%) 2021 Q4 Guidance (Constant Currency) $302 – $312 $59 – $65 FX Impact (spot FX) (1) ($17) ($5) 2021 Q4 Guidance (@ spot FX) (1) $285 – $295 $54 –
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 30% 31% 30% 28% 29% 28% 56% 61% 47% 46% 49% 24% 23% 24% 44% 18
Slide 28: Financial Results & Tables
Financial Results & Tables © 2021 Laureate Education, Inc. 28
Slide 29: Financial Tables
Financial Tables Consolidated Statements of Operations For the three months ended September 30, For the nine months ended September 30, IN MILLIONS 2021 2020 Change 2021 2020 Change Revenues $ 267.7 $ 243.5 $ 24.2 $ 790.0 $ 739.7 $ 50.3 Costs and expenses: Direct costs 182.0 185.8 (3.8) 577.1 614.1
Slide 30: Financial Tables
Financial Tables Revenue and Adjusted EBITDA by segment: Quarter IN MILLIONS % Change $ Variance Components Organic Organic For the three months ended Constant Constant September 30, 2021 2020 Reported Currency(1) Total Currency Other Acq/Div. FX Revenues Mexico $ 131.3 $ 115.9 13% 3% $ 15.4 $ 3.5 $
Slide 31: Financial Tables
Financial Tables Revenue and Adjusted EBITDA by segment: Year-to-Date IN MILLIONS % Change $ Variance Components Organic Organic For the nine months ended Constant Constant September 30, 2021 2020 Reported Currency(2) Total Currency Other Acq/Div. FX Revenues Mexico $ 390.9 $ 385.0 2% (5)% $ 5.9 $ (
Slide 32: Financial Tables
Financial Tables Consolidated Balance Sheets IN MILLIONS September 30, 2021 December 31, 2020 Change Assets Cash and cash equivalents $ 1,856.9 $ 750.1 $ 1,106.8 Receivables (current), net 159.9 111.9 48.0 Other current assets 147.8 146.8 1.0 Property and equipment, net 493.4 578.5 (85.1) Operating
Slide 33: Financial Tables
Financial Tables Consolidated Statements of Cash Flows For the nine months ended September 30, IN MILLIONS 2021 2020 Change Cash flows from operating activities Net income (loss) $ 166.0 $ (997.7) $ 1,163.7 Depreciation and amortization 75.6 116.1 (40.5) Loss on impairment of assets 68.4 782.5 (714.
Slide 34: Financial Tables
Financial Tables Non-GAAP Reconciliation (1 of 2) The following table reconciles (Loss) income from continuing operations to Adjusted EBITDA and Adjusted EBITDA margin: For the three months ended September 30, For the nine months ended September 30, IN MILLIONS 2021 2020 Change 2021 2020 Change Loss
Slide 35: Financial Tables
Financial Tables Non-GAAP Reconciliation (2 of 2) The following table reconciles operating cash flow to Free Cash Flow for the nine months ended September 30, 2021 and 2020: IN MILLIONS 2021 2020 Change Net cash provided by operating activities $ 54.0 $ 221.8 $ (167.8) Capital expenditures: Purchase
Slide 36: © 2021 Laureate Education, Inc.
© 2021 Laureate Education, Inc. 36