Laureate Education, Inc. · NASDAQ:LAUR
Laureate Education — 2018 Baird Global Consumer, Technology & Services Conference
28 slides from Laureate Education's conference presentation, Jun 6, 2018
Slide 1: 2018 Baird Global Consumer, Technology & Services Conference
2018 Baird Global Consumer, Technology & Services Conference Eilif Serck-Hanssen – CEO Jean-Jacques (JJ) Charhon - CFO June 6, 2018 © 2018 Laureate Education, Inc. 1
Slide 2: Disclaimer Statement
Disclaimer Statement 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 meaning of th
Slide 3: Executive Summary
Executive Summary We are the global leader in higher education in large and growing markets Three principles guide how our new management team approaches our business: (1) Focus (2) Simplification (3) Execution 2017 was a transformational year for Laureate and has positioned us for future success
Slide 4: Company Overview
COMPANY OVERVIEW © 2018 Laureate Education, Inc. 4
Slide 5: Largest Global Higher Education Network
Largest Global Higher Education Network EMEAA 11% Online (U.S.) 75% 17% PRIVATE LATAM PAY 72% (Revenue source) (Pro Forma % of Revenue by geography as of 12/31/2017 – Pro Forma for announced asset sales) 1M+ 55+ 200+ $4.4B $832M STUDENTS INSTITUTIONS CAMPUSES REVENUE ADJ. EBITDA (2017) (2017) © 2018
Slide 6: Diversified Platform Addressing Global Education Opportunities
Diversified Platform Addressing Global Education Opportunities (Based on Enrollments) Level of Study Mix Program Mix Modality of Traditional Universities(1) (2) % of Student Credit Hours Online High School Other Working Hybrid Adult Communications Business & 4% 9% Management & Online 7% Education 5%
Slide 7: Investment Highlights
INVESTMENT HIGHLIGHTS UNIQUELY POSITIONED FOR SUCCESS IN AN ATTRACTIVE MARKET © 2018 Laureate Education, Inc. 7
Slide 8: Strong Foundation with Clear Opportunities for Continued Growth
Strong Foundation with Clear Opportunities for Continued Growth Massive Market Opportunity and Strong Economic Incentives 1 Underpenetrated $1.5T market with strong growth drivers Technology Platform Supports Scalability 2 Integrated technology stack Recognized and Established Brands 3 Long-standing
Slide 9: Massive Market Opportunity
1 Massive Market Opportunity Outsized growth opportunities in Laureate’s target markets (emerging markets) Massive Market Opportunity(1) Global Higher Education Students(2) Massive market opportunity $1.5T +5% CAGR 214M 2015 167M 100M +7% CAGR 63M 3.2B Global middle class expected to almost double i
Slide 10: Strong Economic Incentives Driving Increased Participation
1 Strong Economic Incentives Driving Increased Participation Strong Economic Incentives Significantly Underpenetrated by Participation (average wage premium for those with a tertiary education(1)) (higher education participation rates(2)) 63% 149% 102% 36% 74% 23% 53% 21% EU United Mexico Brazil Uni
Slide 11: Technology Platform Supports Scalability
2 Technology Platform Supports Scalability Implementing our Common Operating Model is allowing the Company to transition from separate local systems to a standardized, scalable architecture Implementing Common Operating Model for Scale The Growth of Online & Hybrid % of Student Credit Hours Online(1
Slide 12: Recognized and Established Brands
3 Recognized and Established Brands Long-standing brands that have established a reputation for high quality education with many of our institutions having earned the highest available accreditation Proprietary IP and curriculum Licenses & Quality rated leveraged globally accreditation Infrastructur
Slide 13: Strong Student Outcomes
4 Strong Student Outcomes JOINT Third Party Research(1) RESEARCH 12 of 14 Mexico Laureate institutions surveyed (% of Laureate Mexico students that advance their socioeconomic status) met or exceeded vs. Peer Universities local market 41% employment benchmarks 27% Employment Salary 10% 13% 11% 5% Ou
Slide 14: Experienced Management Team Focused on Simplification and Execution
5 Experienced Management Team Focused on Simplification and Execution EILIF SERCK-HANSSEN CHIEF EXECUTIVE OFFICER • Laureate Experience: 10 years • International Experience: 29 years MANAGEMENT TEAM GLOBAL CORPORATE FUNCTIONS RICARDO BERCKEMEYER PRESIDENT AND CHIEF OPERATING OFFICER JEAN-JACQUES (JJ
Slide 15: Strategic Priorities 2018-2020
STRATEGIC PRIORITIES 2018-2020 © 2018 Laureate Education, Inc. 15
Slide 16: Laureate's 2018 - 2020 Priorities
Laureate’s 2018 - 2020 Priorities OPERATIONAL EXCELLENCE 1 2 3 4 5 Simplification Margin Capital Quality & Growth & Risk Mgmt Expansion Efficiency Outcomes Disciplined Execute on EiP Leverage Execute on Leverage LEAF Approach To Wave 2 (inflight) Hybridity For Geographic & Framework For Portfolio Re
Slide 17: Financial Overview
FINANCIAL OVERVIEW © 2018 Laureate Education, Inc. 17
Slide 18: Strong Secular Trends Drive Consistent Growth
Strong Secular Trends Drive Consistent Growth 18 Years of Consecutive Growth in Total Enrollment (students in 000’s) Global 1,068 recession 6 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Steady Organic Constant Currency Growth(1) 2013 2014 2015 2016
Slide 19: Strong 2017 Performance -- Record Revenue and Adjusted EBITDA
Strong 2017 Performance -- Record Revenue and Adjusted EBITDA Online & Brazil Brazil Online & Partnerships 13% 17% Partnerships 16% 20% Mexico 15% EMEAA 16% $4.4B Mexico 15% EMEAA $832M Revenue 12% Adj EBITDA Centam & Centam & US Cam. US Cam. 6% 5% Andean & Andean & Iberian Iberian 30% 35% % shown a
Slide 20: Common Platform Drives Operating Leverage
Common Platform Drives Operating Leverage Sources of Margin Expansion Adj. EBITDA Margin(1)(2) Unlevered FCF Margin(2)(3) Initiatives Optimize Common Operating Model Network- wide 21% Deployment in Brazil and Peru underway 19% 18% Upgrade across network to follow 16% Common Curriculum & Scale In
Slide 21: Significant Strengthening of the Capital Structure
Significant Strengthening of the Capital Structure Net Debt / Adj. EBITDA(1) Actions to Improve Capital Structure Since IPO • Repriced $1.2 billion Senior Secured Term Loan due 2024, reducing interest rate by 100 bps from 4.50% to 3.50% for LIBOR term loans, and 3.50% to 2.50% for alternate base rat
Slide 22: 1Q 2018 off to a Strong Start -- Summary Highlights
1Q 2018 off to a Strong Start -- Summary Highlights 1Q Results ahead of Guidance … Adj. EBITDA up 16% Vs. 1Q 2017 (1) New Enrollments up 5% overall … Strong 12% Growth in Brazil Walden Turnaround on track with New Enrollments up 1% for intake cycle Great progress in simplifying portfolio. $1
Slide 23: Summary
3 SUMMARY © 2018 Laureate Education, Inc. 23
Slide 24: Summary and Wrap up
Summary and Wrap up We are the global leader in a large and growing market Dependable growth; 18 years of organic enrollment growth Unmatched scale yields network benefits Common Operating Model supports margin expansion through operating leverage Strategic plan for capital efficient growth through
Slide 25: Appendix
APPENDIX © 2018 Laureate Education, Inc. 25
Slide 26: Financial Summary
Financial Summary Non-GAAP Reconciliation For the three months ended For the year ended December 31, December 31, IN MILLIONS 2017 2016 Change 2017 2016 Change Net income $ 200.5 $ 38.5 $ 162.0 $ 93.8 $ 366.2 $ (272.4) Plus: Equity in net income of affiliates, net of tax (0.2) (0.1) (0.1) (0.2) (0.1
Slide 27: Financial Summary
Financial Summary Non-GAAP Reconciliation For the three months ended March 31, IN MILLIONS 2018 2017 Change Net income (loss) $ 171.5 $ (120.4) $ 291.9 Plus: Income tax expense (benefit) 2.5 (27.1) 29.6 Income (loss) from continuing operations before income taxes 174.1 (147.4) 321.5 Plus: Gain on sa
Slide 28: © 2018 Laureate Education, Inc.
© 2018 Laureate Education, Inc. 28
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