Laureate Education, Inc. · NASDAQ:LAUR

Laureate Education — Q1 2021 Earnings Presentation

33 slides from Laureate Education's earnings presentation, May 6, 2021

  1. Slide 1: First Quarter 2021 Earnings Presentation

    First Quarter 2021 Earnings Presentation May 6, 2021 © 2021 Laureate Education, Inc. 1

  2. 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

  3. 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 debt, net of cash (or net debt),

  4. 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

  5. Slide 5: Executive Summary

    Executive Summary  Strong New Enrollment trends in Peru during its primary intake cycle; up 11% vs prior year period  Adjusted EBITDA ahead of expectations for Q1 driven by Peru intake and timing of expenses  Net Loss of $165M in Q1 driven by Laureate tradename impairment & discrete tax items  R

  6. Slide 6: Laureate Portfolio Overview

    Laureate Portfolio Overview Operations -- Remaining Operations -- Pending Asset Sales (as of March 31, 2021) Mexico Brazil  2 Universities  35+ campuses Walden  180K+ students Peru  2 Universities / 1 Tech-Voc  15+ campuses  180K+ students $1.1 billion $280 million Revenue1 Adjusted EBITDA1 $1

  7. 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

  8. 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

  9. Slide 9: Q1 2021 Performance Results

    Q1 2021 PERFORMANCE RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 9

  10. Slide 10: Q1 Academic Calendar Timing Impacts - Peru

    Q1 Academic Calendar Timing Impacts - Peru • $18M in incremental Q1 revenue vs prior year period due to delayed class start in 2020 – Majority of benefit to reverse in Q2 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 date 2020 se

  11. Slide 11: 2021 First Quarter – Financial Summary

    2021 First Quarter – Financial Summary Q1 ’21 Variance Vs. Q1 ‘20 Notes ($ in millions) (Enrollments in thousands) Results As Reported Organic/CC1 • +5% timing adjusted; strong primary New Enrollment 74K 59% 59% intake for Peru Total Enrollment 366K 2% 2% • +2% timing adjusted • (5%) timing adjusted

  12. Slide 12: Segment Results

    SEGMENT RESULTS CONTINUING OPERATIONS ONLY (I.E. MEXICO, PERU AND CORPORATE SEGMENTS) © 2021 Laureate Education, Inc. 12

  13. Slide 13: Mexico Segment Results

    Mexico Segment Results Q1 Results Notes ($ in millions) Organic/CC (Enrollments in thousands) Q1 ’21 Vs. Q1 ’20 (1) • Lingering COVID impact New Enrollment 27K (4%) • Small intake cycle, primary intake for Mexico will occur in September • Driven by COVID-related decline in 2020 Total Enrollment 184K

  14. Slide 14: Peru Segment Results

    Peru Segment Results Q1 Results Notes ($ in millions) Organic/CC (Enrollments in thousands) Q1 ’21 Vs. Q1 ’20 (1) • +11% adjusted for timing; strong primary New Enrollment 47K 157% intake Total Enrollment 182K 11% • +10% adjusted for timing Revenue $57 68% • +19% adjusted for timing • Largely an out

  15. Slide 15: Q1 Debt Capitalization – Adjusted for Pending Asset Sales

    Q1 Debt Capitalization – Adjusted for Pending Asset Sales ($ in millions) Amount Comments (Net Debt) / Cash @ 3/31/21 ($286) See Appendix Net Proceeds – Pending Asset Sales1 $1,950 Including assumed debt Post receipt of anticipated net Adjusted Net Cash Position @ 3/31/21 $1,664 cash proceeds & assu

  16. Slide 16: Outlook

    OUTLOOK © 2021 Laureate Education, Inc. 16

  17. Slide 17: Laureate Summary Outlook – 2020 to 2022E

    Laureate Summary Outlook – 2020 to 2022E (As Reported)1 Total Enrollment (000s) Revenue ($M) +4% +6% 337 337 350 $1,080 $1,025 $1,020 2020 2021E 2022E 2020 2021E 2022E Adjusted EBITDA ($M) Adjusted EBITDA Margin % +51% $280 25.9 $206 20.1 $185 18.1 780 bps 2020 2021E 2022E 2020 2021E 2022E Reaffirmi

  18. Slide 18: 2021 to 2022 Adjusted EBITDA Bridge

    2021 to 2022 Adjusted EBITDA Bridge (Guidance)1 ($USD in millions) +51% $280 $32 $13 $50 $185 2021 Guidance (2) G&A Reduction FAS 5 / Operational 2022 Guidance Indemnification Asset Improvement Strong Rebound Expected for 2022 (1) Based on actual FX rates for January through April 2021, and current

  19. Slide 19: Q2 2021 Guidance Details

    Q2 2021 Guidance Details (USD millions) Revenues Adj. EBITDA 2020 Q2 Results $304 $94 Organic Growth $1 – $21 ($9) – $1 Growth % 0% - 7% (9%) - 1% 2021 Q2 Guidance (Constant Currency) $305 – $325 $85 – $95 FX Impact (spot FX) (1) ($5) ($10) 2021 Q2 Guidance (@ spot FX) (1) $300 – $320 $75 – $85 Unfa

  20. Slide 20: Appendix

    APPENDIX © 2021 Laureate Education, Inc. 20

  21. Slide 21: 2021 First Quarter – Net Income Reconciliation

    2021 First Quarter – Net Income Reconciliation Q1 ’21 B / (W) Vs. Q1 ’20 Notes ($ in millions) Reported $ % • Strong Peru intake and timing of academic Adjusted EBITDA 10 39 n.m. calendar • Flat excluding amortization of tradename Depreciation & Amort. (23) (3) (16%) (moved to finite life asset in Q

  22. Slide 22: Debt Capitalization At 3/31/21

    Debt Capitalization At 3/31/21 ($ in millions) Continuing Discontinued Total Operations Operations Company Revolver $- $- $- Sr. Notes $799 - $799 Local Debt / Seller Notes $203 $118 $320 Gross Debt $1,002 $118 $1,119 Cash ($561) ($272) ($833) Net Debt / (Cash) $440 ($154) $286 Net Debt of $286M as

  23. Slide 23: Discontinued Operations – Q1 2021 vs. Q1 2020

    Discontinued Operations – Q1 2021 vs. Q1 2020 Online1 Brazil1 Other2 Total Disc. Ops ($ in millions) Vs. Organic/ Organic/ Vs. Organic/ Vs. Organic/ Q1 Q1 Vs. Q1 Q1 Q1 (Enrollments in Q1 CC vs. CC vs. Q1 CC vs. Q1 CC vs. thousands) ’21 ’21 ’20 ’21 ’21 ’20 Q1 ‘203 Q1 ‘203 ’20 Q1 ‘203 ’20 Q1 ‘203 New

  24. Slide 24: Discontinued Operations Q1 2021 vs. Q1 2020 – Adjusted EBITDA Reconciliation

    Discontinued Operations Q1 2021 vs. Q1 2020 – Adjusted EBITDA Reconciliation Total Disc. Ops ($ in millions) Q1 ‘21 Q1 ‘20 (Loss) income from discontinued operations, net of tax $0 ($108) Income tax expense (benefit) $10 ($5) Other non-operating expense (income) $11 $55 Loss on sale of discontinued

  25. 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

  26. Slide 26: Financial Results & Tables

    Financial Results & Tables © 2021 Laureate Education, Inc. 26

  27. Slide 27: Financial Tables – Consolidated Statements of Operations

    Financial Tables Consolidated Statements of Operations For the three months ended March 31, IN MILLIONS 2021 2020 Change Revenues $ 194.7 $ 192.3 $ 2.4 Costs and expenses: Direct costs 181.8 220.6 (38.8) General and administrative expenses 42.6 45.1 (2.5) Loss on impairment of assets 56.7 3.8 52.9 O

  28. Slide 28: Financial Tables – Revenue and Adjusted EBITDA by Segment

    Financial Tables Revenue and Adjusted EBITDA by segment IN MILLIONS % Change $ Variance Components Organic Organic For the three months ended Constant Constant March 31, 2021 2020 Reported Currency(2) Total Currency Other Acq/Div. FX Revenues Mexico $ 135.4 $ 154.2 (12)% (11)% $ (18.8) $ (16.2) $ —

  29. Slide 29: Financial Tables – Consolidated Balance Sheets

    Financial Tables Consolidated Balance Sheets IN MILLIONS March 31, 2021 December 31, 2020 Change Assets Cash and cash equivalents $ 561.3 $ 750.1 $ (188.8) Receivables (current), net 115.1 111.9 3.2 Other current assets 167.0 146.8 20.2 Current assets held for sale 467.8 435.0 32.8 Property and equi

  30. Slide 30: Financial Tables – Consolidated Statements of Cash Flows

    Financial Tables Consolidated Statements of Cash Flows For the three months ended March 31, IN MILLIONS 2021 2020 Change Cash flows from operating activities Net (loss) income $ (164.9) $ 98.3 $ (263.2) Depreciation and amortization 22.7 44.2 (21.5) Loss on impairment of assets 57.7 3.8 53.9 Loss on

  31. Slide 31: Non-GAAP Reconciliation (1 of 2)

    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 March 31, IN MILLIONS 2021 2020 Change (Loss) income from continuing operations $ (164.5) $ 206.1 $ (370

  32. Slide 32: 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, 2021 and 2020: IN MILLIONS 2021 2020 Change Net cash provided by (used in) operating activities $ 11.3 $ (3.5) $ 14.8 Capital expenditures: Purc

  33. Slide 33: © 2021 Laureate Education, Inc.

    © 2021 Laureate Education, Inc. 33

Laureate Education — Q1 2021 Earnings Presentation on 6ix