Laureate Education, Inc. · NASDAQ:LAUR
Laureate Education — Q2 2021 Earnings Presentation
34 slides from Laureate Education's earnings presentation, Aug 5, 2021
Slide 1: Second Quarter 2021 Earnings Presentation
Second Quarter 2021 Earnings Presentation August 5, 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 Continued strong operating trends …. despite COVID-19 headwinds Enrollment volume above pre-pandemic levels1 Adjusted EBITDA ahead of expectations for the second quarter Increasing full-year 2021 guidance on strength of first half results Net Loss of $29M in Q2 driven by
Slide 6: Laureate Portfolio Overview
Laureate Portfolio Overview Operations -- Remaining Operations -- Pending Asset Sales (as of June 30, 2021) Mexico Walden 2 Universities 35+ campuses 170K students Peru 2 Universities / 1 Tech-Voc 15+ campuses 180K students $1.1 billion $280 million Revenue1 Adjusted EBITDA1 $1.3 billion
Slide 7: Mexico & Peru Higher Education Market Overview
Mexico & Peru Higher Education Market Overview Mexico Peru Combined Population (M) 127M 33M 160M Higher Education Students 4,562 1,896 6,458 (000s) Higher Education 30% 47% 34% Participation Rate1 Market Share for 44% 72% 56% Private Institution2 Sources: UNESCO, World Bank, SEP database (1) Defined
Slide 8: Leading University Portfolio in Mexico & Peru
Leading University Portfolio in Mexico & Peru QS Stars™ Overall University Institution Market Segment Rating Ratings/Ranking • Ranked #7 university in Mexico Universidad del Valle de Premium/ • One of only three 4-Star rated Mexico universities in Mexico by QS México (UVM) Traditional Stars™ • Large
Slide 9: Q2 & YTD 2021 Performance Results
Q2 & YTD 2021 PERFORMANCE RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 9
Slide 10: 2021 Second Quarter – Financial Summary
2021 Second Quarter – Financial Summary Q2 ’21 Variance Vs. Q2 ‘20 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 New Enrollment 20K n.m. n.m. Total Enrollment 349K 9% 9% • Improved retention rates • Driven by enrollment volume and Revenue $328 8% 9% improved retent
Slide 11: 2021 Q2 YTD – Financial Summary
2021 Q2 YTD – Financial Summary Q2 YTD ’21 Variance Vs. Q2 YTD ‘20 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 New Enrollment 94K 13% 13% • Strong cycle one intake for Peru • Improved retention rates, +10pts Total Enrollment 349K 9% 9% versus PY (which was impact
Slide 12: Segment Results
SEGMENT RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 12
Slide 13: Mexico Segment Results
Mexico Segment Results Q2 Results Q2 YTD Results Notes ($ in millions) Organic/CC Q2 YTD Organic/CC (Enrollments in thousands) Q2 ’21 Vs. Q2 ’20 (1) ’21 Vs. Q2 YTD ’20 (1) • +11% NE through June, New Enrollment 18K 47% 45K 11% large intake occurs in Sept. • Driven by COVID-related Total Enrollment 1
Slide 14: Peru Segment Results
Peru Segment Results Q2 Results Q2 YTD Results Notes ($ in millions) Organic/CC Q2 YTD Organic/CC (Enrollments in thousands) Q2 ’21 Vs. Q2 ’20 (1) ’21 Vs. Q2 YTD ’20 (1) New Enrollment 2K n.m. 49K 14% • Strong cycle one intake • Driven by higher NE volumes Total Enrollment 180K 18% 180K 18% and impr
Slide 15: Q2 Capitalization – Adjusted for Pending Asset Sales
Q2 Capitalization – Adjusted for Pending Asset Sales ‒ $1.65Bn net cash position expected despite $316M of share repurchases1 (out of $500M program authorization) ($ in millions) Amount Comments Net Cash Position @ 6/30/21 $354 See Appendix Net Proceeds – Pending Asset Sales2 $1,300 Including assume
Slide 16: Outlook
OUTLOOK © 2021 Laureate Education, Inc. 16
Slide 17: FY 2021 Guidance Update
FY 2021 Guidance Update ($ in millions) Previous Current (Enrollments in thousands) Guidance Outlook (1) Total Enrollment 337K 350K Revenue $1,000 - $1,040 $1,025 - $1,065 Adjusted EBITDA $180 - $190 $205 - $215 (1) Based on actual FX rates for January through July 2021, and current spot FX rates (l
Slide 18: Q3 2021 Guidance Details
Q3 2021 Guidance Details (USD millions) Revenues Adj. EBITDA 2020 Q3 Results $244 $50 Organic Growth ($4) – $16 ($15) – ($5) Growth % (2%) - 7% (30%) – (10%) 2021 Q3 Guidance (Constant Currency) $240 – $260 $35 – $45 FX Impact (spot FX) (1) ($5) ($5) 2021 Q3 Guidance (@ spot FX) (1) $235 – $255 $30
Slide 19: Appendix
APPENDIX © 2021 Laureate Education, Inc. 19
Slide 20: Academic Calendar Timing Impacts - Peru
Academic Calendar Timing Impacts - Peru • $18M in revenue timing shift from Q1 to 2H due to delayed class start in 2020 – Majority of benefit recognized in Q1 2021; offset in Q3/Q4 Week Of 2/22 3/1 3/8 3/15 3/22 3/29 4/5 4/12 UPC Delayed start in UPN 2020 due to COVID Cibertec 2021 semester start da
Slide 21: 2021 Second Quarter – Net Income Reconciliation
2021 Second Quarter – Net Income Reconciliation Q2 ’21 B / (W) Vs. Q2 ’20 Notes ($ in millions) Reported $ % Adjusted EBITDA 107 13 14% • Strong performance in Peru • Primarily related to amortization of Depreciation & Amort. (27) (9) (49%) tradename (moved to finite life asset) Interest Expense, ne
Slide 22: 2021 Q2 YTD – Net Income Reconciliation
2021 Q2 YTD – Net Income Reconciliation Q2 YTD ’21 B / (W) Vs. Q2 YTD ’20 Notes ($ in millions) Reported $ % Adjusted EBITDA 117 52 81% • Strong performance in Peru • Primarily related to amortization of Depreciation & Amort. (50) (12) (31%) tradename (moved to finite life asset) Interest Expense, n
Slide 23: Capitalization at 6/30/21
Capitalization at 6/30/21 ($ in millions) Continuing Discontinued Total Operations Operations Company Revolver $- $- $- Sr. Notes - - - Local Debt / Seller Notes $179 - $179 Gross Debt $179 - $179 Cash ($427) ($105) ($532) Net Debt / (Cash) ($248) ($105) ($354) Net Cash Position of $354M as of June
Slide 24: 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 13K $25 – $65 $27 – $37 Growth % 4% 2% - 6% 13% – 18% FAS 5 Expense/Indemnification Asset (non-cash) - - ($8) 2021 Guidance (Constant Cur
Slide 25: 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 26: Financial Results & Tables
Financial Results & Tables © 2021 Laureate Education, Inc. 26
Slide 27: Financial Tables
Financial Tables Consolidated Statements of Operations For the three months ended June 30, For the six months ended June 30, IN MILLIONS 2021 2020 Change 2021 2020 Change Revenues $ 327.6 $ 303.9 $ 23.7 $ 522.3 $ 496.2 $ 26.1 Costs and expenses: Direct costs 213.3 207.8 5.5 395.2 428.4 (33.2) Genera
Slide 28: 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 June 30, 2021 2020 Reported Currency(1) Total Currency Other Acq/Div. FX Revenues Mexico $ 124.3 $ 114.9 8% (7)% $ 9.4 $ (8.0) $ —
Slide 29: Financial Tables
Financial Tables Revenue and Adjusted EBITDA by segment: Year-to-Date IN MILLIONS % Change $ Variance Components Organic Organic For the six months ended Constant Constant June 30, 2021 2020 Reported Currency(2) Total Currency Other Acq/Div. FX Revenues Mexico $ 259.7 $ 269.1 (3)% (9)% $ (9.4) $ (24
Slide 30: Financial Tables
Financial Tables Consolidated Balance Sheets IN MILLIONS June 30, 2021 December 31, 2020 Change Assets Cash and cash equivalents $ 427.1 $ 750.1 $ (323.0) Receivables (current), net 123.5 111.9 11.6 Other current assets 144.3 146.8 (2.5) Current assets held for sale 202.1 435.0 (232.9) Property and
Slide 31: Financial Tables
Financial Tables Consolidated Statements of Cash Flows For the six months ended June 30, IN MILLIONS 2021 2020 Change Cash flows from operating activities Net loss $ (194.2) $ (213.3) $ 19.1 Depreciation and amortization 49.7 84.3 (34.6) Loss on impairment of assets 65.1 448.9 (383.8) (Gain) loss on
Slide 32: 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 June 30, For the six months ended June 30, IN MILLIONS 2021 2020 Change 2021 2020 Change (Loss) income f
Slide 33: Financial Tables
Financial Tables Non-GAAP Reconciliation (2 of 2) The following table reconciles operating cash flow to Free Cash Flow for the six months ended June 30, 2021 and 2020: IN MILLIONS 2021 2020 Change Net cash provided by operating activities $ 17.9 $ 61.4 $ (43.5) Capital expenditures: Purchase of prop
Slide 34: © 2021 Laureate Education, Inc.
© 2021 Laureate Education, Inc. 34