Perdoceo Education Corporation Reports Second Quarter and Year to Date 2024 Results

About this update from Perdoceo Education Corporation

Increases second quarter per share dividend by 18.2% to $0.13 per share SCHAUMBURG, Ill. --(BUSINESS WIRE)-- Perdoceo Education Corporation (NASDAQ: PRDO) today reported operating and financial results for the quarter and year to date ended June 30, 2024 . Second Quarter 2024 Results as Compared to Prior Year Quarter Total student enrollments at June 30, 2024 increased by 4.2% supported by a 14.7% increase at CTU that was partially offset with an 18.2% decrease at AIUS. Revenue decreased 10.6% to $166.7 million . This decrease was expected and partially due to a lag impact from the operational changes made at AIUS in the prior year. Operating income decreased 4.3% to $46.0 million , while adjusted operating income decreased 7.8% to $50.9 million .* Earnings per diluted share were $0.57 as compared to $0.80 , while adjusted earnings per diluted share were $0.60 as compared to $0.61 .* Ended the quarter with $675.2 million in cash, cash equivalents, restricted cash and available-for-sale-short-term investments. On July 31, 2024 the Board increased the per share quarterly dividend by 18.2% to $0.13 per share. Year to Date 2024 Results as Compared to Prior Year to Date Revenue decreased 12.3% to $335.0 million , which was in line with management’s expectation for a decline. Operating income increased 0.9% to $92.3 million , while adjusted operating income decreased 7.3% to $100.4 million .* Earnings per diluted share were $1.16 as compared to $1.30 , while adjusted earnings per diluted share were $1.21 as compared to $1.19 .* * See GAAP ( U.S. generally accepted accounting principles) to non-GAAP reconciliation attached to this press release "Our second quarter results exceeded expectations, as both of our academic institutions continued to experience high levels of student retention and engagement,” said Todd Nelson , President and Chief Executive Officer. “Our year-to-date results and enrollment trends have been supported by various operating process changes and technology upgrades within our onboarding, academic and student support processes. Our faculty and student support staff continue to focus on further enhancing student experiences and academic outcomes and we will continue to make informed investments in technology and student support processes.” REVENUE For the quarter ended June 30, 2024 , revenue of $166.7 million decreased 10.6% compared to revenue of $186.6 million for the prior year quarter. For the year to date ended June 30, 2024 , revenue of $335.0 million decreased 12.3% compared to revenue of $382.2 million for the prior year to date. For the Quarter Ended June 30 , For the Year to Date Ended June 30 , Revenue ($ in thousands) 2024 2023 % Change 2024 2023 % Change CTU $ 112,828 $ 119,292 -5.4 % $ 226,397 $ 243,784 -7.1 % AIUS 53,722 67,062 -19.9 % 108,227 137,902 -21.5 % Corporate and Other 190 210 NM 380 476 NM Total $ 166,740 $ 186,564 -10.6 % $ 335,004 $ 382,162 -12.3 % TOTAL STUDENT ENROLLMENTS As of June 30, 2024 , CTU’s total student enrollments increased 14.7%, while AIUS’ total student enrollments decreased 18.2%. At June 30 , Total Student Enrollments (1) 2024 2023 % Change CTU 29,700 25,900 14.7 % AIUS 9,900 12,100 -18.2 % Total 39,600 38,000 4.2 % (1) Total student enrollments do not include learners participating in: a) non-degree seeking and professional development programs, and b) degree seeking, non-Title IV, self-paced programs at the Company's universities. OPERATING INCOME For the quarter ended June 30, 2024 , operating income decreased by 4.3% to $46.0 million as compared to the prior year quarter. For the year to date ended June 30, 2024 , operating income increased by 0.9% to $92.3 million as compared to the prior year to date. For the Quarter Ended June 30 , For the Year to Date Ended June 30 , Operating Income ($ in thousands) 2024 2023 % Change 2024 2023 % Change CTU $ 42,890 $ 40,451 6.0 % $ 85,046 $ 84,141 1.1 % AIUS 12,926 17,078 -24.3 % 22,212 29,081 -23.6 % Corporate and Other (9,810 ) (9,435 ) -4.0 % (14,974 ) (21,792 ) 31.3 % Total $ 46,006 $ 48,094 -4.3 % $ 92,284 $ 91,430 0.9 % ADJUSTED OPERATING INCOME The Company believes it is useful to present non-GAAP financial measures, which exclude certain significant and non-cash items, as a means to understand the performance of its operations. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.) For the quarter ended June 30, 2024 , adjusted operating income of $50.9 million decreased 7.8% compared to adjusted operating income of $55.2 million for the prior year quarter. For the year to date ended June 30, 2024 , adjusted operating income of $100.4 million decreased 7.3% compared to adjusted operating income of $108.3 million for the prior year to date. For the Quarter Ended June 30 , For the Year to Date Ended June 30 , Adjusted Operating Income ($ in thousands) 2024 2023 2024 2023 Operating income $ 46,006 $ 48,094 $ 92,284 $ 91,430 Depreciation and amortization 3,069 4,369 6,085 9,524 Legal fee expense related to certain matters (1) 1,815 2,709 2,045 7,328 Adjusted Operating Income $ 50,890 $ 55,172 $ 100,414 $ 108,282 Increase (Decrease) -7.8 % -7.3 % (1) Legal fee expense associated with (i) responses to the Department of Education (the “Department”) relating to borrower defense to repayment applications from former students, and (ii) acquisition efforts. NET INCOME AND EARNINGS PER DILUTED SHARE For the quarter ended June 30, 2024 , the Company recorded: Net income of $38.4 million compared to $54.7 million for the prior year quarter. Earnings per diluted share of $0.57 compared to $0.80 for the prior year quarter. Adjusted earnings per diluted share of $0.60 compared to $0.61 for the prior year quarter. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.) For the year to date ended June 30, 2024 , the Company recorded: Net income of $77.9 million compared to $89.2 million for the prior year to date. Earnings per diluted share of $1.16 compared to $1.30 for the prior year to date. Adjusted earnings per diluted share of $1.21 compared to $1.19 for the prior year to date. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.) For the Quarter Ended June 30 , For the Year to Date Ended June 30 , 2024 2023 2024 2023 Reported Earnings Per Diluted Share $ 0.57 $ 0.80 $ 1.16 $ 1.30 Pre-tax adjustments included in operating expenses: Amortization for acquired intangible assets 0.02 0.03 0.04 0.07 Legal fee expense related to certain matters (1) 0.03 0.04 0.03 0.11 Gain on sale of intangible asset - (0.32 ) - (0.32 ) Tax effect of adjustments (2) (0.02 ) 0.06 (0.02 ) 0.03 Adjusted Earnings Per Diluted Share $ 0.60 $ 0.61 $ 1.21 $ 1.19 (1) Legal fee expense associated with (i) responses to the Department relating to borrower defense to repayment applications from former students, and (ii) acquisition efforts. (2) The tax effect of adjustments was calculated by multiplying the pre-tax adjustments with a tax rate of 25.0%. This tax rate is intended to reflect federal and state taxable jurisdictions as well as the nature of the adjustments. QUARTERLY DIVIDEND PAYMENT On July 31, 2024 , the board of directors approved its first dividend increase since implementing its dividend policy last year. The board of directors declared a quarterly dividend of $0.13 per share, an increase of 18.2%, which will be paid on September 13, 2024 for holders of record of common stock as of September 1, 2024 . Any decision to pay future cash dividends, however, will be made by the board of directors and depend on the Company’s available retained earnings, financial condition and other relevant factors. The Company expects quarterly dividend payments to be an integral and growing part of its balanced capital allocation strategy that also prioritizes investments in student support and technology projects, while also evaluating acquisitions and share repurchases. AGREEMENT TO ACQUIRE UNIVERSITY OF ST. AUGUSTINE FOR HEALTH SCIENCES On July 16, 2024 , the Company announced that it has signed a definitive agreement to acquire 100% ownership of the University of St. Augustine for Health Sciences, LLC (USAHS). USAHS is one of the nation’s leading universities offering graduate health sciences degrees, primarily in physical therapy, occupational therapy, speech language therapy and nursing, as well as continuing education programs. Perdoceo expects to pay approximately $142 million to $144 million in cash at closing. The actual cash paid will depend on adjustments for cash, debt and working capital based on the final closing balance sheet. Once completed, the Company expects that the acquisition will support further growth and diversification of its academic program offerings and will mark Perdoceo’s foray into health science degrees in a meaningful way. For the year ended December 31, 2023 , USAHS had revenues of approximately $170 million , operating income of approximately $35 million and served approximately 4,500 graduate and post-graduate students across multiple health sciences disciplines. Perdoceo expects the transaction to be immediately accretive to the Company’s adjusted operating income beginning in 2025. Please refer to our Form 8-K filed on July 16, 2024 for other details, material terms and other conditions related to the pending acquisition. BALANCE SHEET AND CASH FLOW For the quarter ended June 30, 2024 net cash provided by operating activities was $38.5 million , compared to net cash provided by operating activities of $61.6 million for the prior year quarter. For the year to date ended June 30, 2024 , net cash provided by operating activities was $93.0 million , compared to net cash provided by operating activities of $66.2 million in the prior year to date. As of June 30, 2024 and December 31, 2023 , cash, cash equivalents, restricted cash and available-for-sale short-term investments totaled $675.2 million and $604.2 million , respectively. For the Quarter Ended June 30 , For the Year to Date Ended June 30 , Selected Cash Flow Items ($ in thousands) 2024 2023 % Change 2024 2023 % Change Net cash provided by operating activities $ 38,525 $ 61,648 -37.5 % $ 93,017 $ 66,220 40.5 % Capital expenditures $ 824 $ 1,687 -51.2 % $ 2,022 $ 3,612 -44.0 % OUTLOOK The Company is providing the following third quarter outlook along with a full year outlook, subject to the key assumptions identified below. Please see the GAAP to non-GAAP reconciliation for adjusted operating income and adjusted earnings per diluted share attached to this press release for further details. Total Company Outlook For Quarter Ending September 30 , For the Year Ending December 31 , OUTLOOK ACTUAL OUTLOOK ACTUAL 2024 2023 2024 2023 Operating Income $41.6M - $43.6M $43,073 $161.8M - $172.8M $150,446 Depreciation and amortization $3.1M $3,914 $14.1M 16,887 Legal fee expense related to certain matters (1) $0.3M $246 $3.1M 7,579 Adjusted Operating Income $45.0M - $47.0M $47,233 $179.0M - $190.0M $174,912 Earnings Per Diluted Share $0.51 - $0.53 $0.62 $2.04 - $2.16 $2.18 Amortization of acquired intangible assets $0.02 $0.03 $0.08 $0.11 Legal fee expense related to certain matters (1) - - $0.05 $0.11 Gain on sale of intangible asset - - - ( $0.32 ) Tax effect of adjustments ( $0.01 ) ( $0.01 ) ( $0.04 ) $0.02 Adjusted Earnings Per Diluted Share $0.52 - $0.54 $0.64 $2.13 - $2.25 $2.10 (1) Legal fee expense associated with (i) responses to the Department relating to borrower defense to repayment applications from former students, and (ii) acquisition efforts. Operating income, which is the most directly comparable GAAP measure to adjusted operating income, and earnings per diluted share, which is the most directly comparable GAAP measure to adjusted earnings per diluted share, may not follow the same trends stated in the outlook above because of adjustments made for certain significant and non-cash items. The operating income, adjusted operating income, earnings per share and adjusted earnings per share outlook provided above for 2024 are based on the following key assumptions and factors, among others: (i) prospective student interest in the Company’s programs and trends in student retention and engagement remain consistent with management’s estimates, (ii) no significant additional impact of new or proposed regulations, including recent Department negotiated rulemaking initiatives, or other adverse changes in the legal or regulatory environment, which may require further operational changes in the way the Company’s academic institutions enroll, support and educate current and prospective students, among other impacts, (iii) no significant operating impacts from the settlements with the U.S. Federal Trade Commission and state attorneys general or other legal or regulatory matters, (iv) the impact from student loan initiatives implemented by the current administration remains consistent with management's estimates, (v) earnings per diluted share outlook assumes an effective income tax rate of approximately 28% for the third quarter and approximately 27% for the full year, and (vi) excludes any future impact from the Company’s stock repurchase program. Although these estimates and assumptions are based upon management’s good faith beliefs regarding current and future circumstances and actions that may be undertaken, actual results could differ materially from these estimates. In addition, decisions the Company makes in the future as it continues to evaluate diverse strategies to enhance stockholder value may impact the outlook provided above. CONFERENCE CALL INFORMATION Perdoceo Education Corporation will host a conference call on Wednesday, July 31, 2024 at 5:30 p.m. Eastern time to discuss second quarter and year to date 2024 results and outlook. Interested parties can access the live webcast of the conference call at www.perdoceoed.com in the Investor Relations section of the website. Participants can also listen to the conference call by dialing 1-800-715-9871 (domestic) or 1-646-307-1963 (international). Both dial-in numbers will use the access code 5668214. Viewers can also access the conference call by following this link https://events.q4inc.com/attendee/614624375 . Please log-in or dial-in at least 10 minutes prior to the start time to ensure a connection. An archived version of the webcast will be accessible for 90 days at www.perdoceoed.com in the Investor Relations section of the website. ABOUT PERDOCEO EDUCATION CORPORATION Perdoceo’s accredited academic institutions offer a quality postsecondary education primarily online to a diverse student population, along with campus-based and blended learning programs. The Company’s academic institutions – Colorado Technical University (“CTU”) and the American InterContinental University System (“AIUS” or “AIU System”) – provide degree programs from the associate through doctoral level as well as non-degree seeking and professional development programs. Perdoceo’s academic institutions offer students industry-relevant and career-focused academic programs that are designed to meet the educational needs of today’s busy adults. CTU and AIUS continue to show innovation in higher education, advancing personalized learning technologies like their intellipath® learning platform and using data analytics and technology to serve and educate students while enhancing overall learning and academic experiences. Perdoceo is committed to providing quality education that closes the gap between learners who seek to advance their careers and employers needing a qualified workforce. For more information, please visit www.perdoceoed.com . Except for the historical and present factual information contained herein, the matters set forth in this release, including statements identified by words such as “believe,” “will,” “expect,” “continue,” “outlook,” “remain,” “focused on,” “should” and similar expressions, are forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on information currently available to us and are subject to various assumptions, risks, uncertainties and other factors that could cause our results of operations, financial condition, cash flows, performance, business prospects and opportunities to differ materially from those expressed in, or implied by, these statements. Except as expressly required by the federal securities laws, we undertake no obligation to update or revise such factors or any of the forward-looking statements contained herein to reflect future events, developments or changed circumstances, or for any other reason. These risks and uncertainties, the outcomes of which could materially and adversely affect our financial condition and operations, include, but are not limited to, the following: declines in enrollment or interest in our programs or our ability to market to and contact prospective students; our continued compliance with and eligibility to participate in Title IV Programs under the Higher Education Act of 1965, as amended, and the regulations thereunder (including the terms of any potential changes to or conditions imposed on our continued participation in the Title IV programs under new program participation agreements, the new 90-10, financial responsibility and administrative capability standards prescribed by the U.S. Department of Education ), as well as applicable accreditation standards and state regulatory requirements; the impact of various versions of “borrower defense to repayment” regulations; the final outcome of various legal challenges to the Department's loan discharge and forgiveness efforts; rulemaking or changing interpretations of existing regulations, guidance or historical practices by the U.S. Department of Education or any state or accreditor and increased focus by Congress and governmental agencies on, or increased negative publicity about, for-profit education institutions; the success of our initiatives to improve student experiences, retention and academic outcomes; our continued ability to participate in educational assistance programs for key employers, veterans or other military personnel; our ability to pay dividends on our common stock and execute our stock repurchase program; increased competition; the impact of management changes; and changes in the overall U.S. economy. Further information about these and other relevant risks and uncertainties may be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and its subsequent filings with the Securities and Exchange Commission . PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) June 30 , December 31 , 2024 2023 (unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents, unrestricted $ 127,852 $ 118,009 Restricted cash 1,037 1,012 Short-term investments 546,273 485,135 Total cash and cash equivalents, restricted cash and short-term investments 675,162 604,156 Student receivables, net 34,855 29,398 Receivables, other 4,982 4,539 Prepaid expenses 12,558 11,712 Inventories 4,467 5,004 Other current assets 457 155 Total current assets 732,481 654,964 NON-CURRENT ASSETS: Property and equipment, net 19,087 21,371 Right of use asset, net 16,455 19,096 Goodwill 241,162 241,162 Intangible assets, net 34,002 36,219 Student receivables, net 5,267 3,859 Deferred income tax assets, net 23,242 23,804 Other assets 6,545 6,841 TOTAL ASSETS $ 1,078,241 $ 1,007,316 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Lease liability - operating $ 5,397 $ 5,701 Accounts payable 13,267 10,766 Accrued expenses: Payroll and related benefits 25,295 32,684 Advertising and marketing costs 6,984 7,196 Income taxes 6,502 3,974 Other 22,023 13,503 Deferred revenue 55,390 37,215 Total current liabilities 134,858 111,039 NON-CURRENT LIABILITIES: Lease liability - operating 18,443 21,346 Other liabilities 25,416 33,510 Total non-current liabilities 43,859 54,856 STOCKHOLDERS' EQUITY: Preferred stock - - Common stock 910 903 Additional paid-in capital 701,153 694,798 Accumulated other comprehensive loss (1,721 ) (666 ) Retained earnings 543,606 480,606 Treasury stock (344,424 ) (334,220 ) Total stockholders' equity 899,524 841,421 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,078,241 $ 1,007,316 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts and percentages) For the Quarter Ended June 30 , 2024 % of Total Revenue 2023 % of Total Revenue REVENUE: Tuition and fees, net $ 165,404 99.2 % $ 184,520 98.9 % Other 1,336 0.8 % 2,044 1.1 % Total revenue 166,740 186,564 OPERATING EXPENSES: Educational services and facilities 27,516 16.5 % 32,748 17.6 % General and administrative 89,311 53.6 % 100,588 53.9 % Depreciation and amortization 3,069 1.8 % 4,369 2.3 % Asset impairment 838 0.5 % 765 0.4 % Total operating expenses 120,734 72.4 % 138,470 74.2 % Operating income 46,006 27.6 % 48,094 25.8 % OTHER INCOME: Interest income 7,190 4.3 % 4,531 2.4 % Interest expense (112 ) -0.1 % (96 ) -0.1 % Miscellaneous (expense) income (70 ) 0.0 % 22,074 11.8 % Total other income 7,008 4.2 % 26,509 14.2 % PRETAX INCOME 53,014 31.8 % 74,603 40.0 % Provision for income taxes 14,585 8.7 % 19,930 10.7 % NET INCOME 38,429 23.0 % 54,673 29.3 % NET INCOME PER SHARE - BASIC: $ 0.59 $ 0.81 NET INCOME PER SHARE -DILUTED: $ 0.57 $ 0.80 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 65,611 67,421 Diluted 67,077 68,533 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Quarter Ended June 30 , (In Thousands) 2024 2023 NET INCOME $ 38,429 $ 54,673 OTHER COMPREHENSIVE LOSS, net of tax: Foreign currency translation adjustments (8 ) (3 ) Unrealized loss on investments (93 ) (1,497 ) Total other comprehensive loss (101 ) (1,500 ) COMPREHENSIVE INCOME $ 38,328 $ 53,173 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts and percentages) For the Year to Date Ended June 30 , 2024 % of Total Revenue 2023 % of Total Revenue REVENUE: Tuition and fees, net $ 332,402 99.2 % $ 377,839 98.9 % Other 2,602 0.8 % 4,323 1.1 % Total revenue 335,004 382,162 OPERATING EXPENSES: Educational services and facilities 57,374 17.1 % 66,599 17.4 % General and administrative 176,793 52.8 % 213,274 55.8 % Depreciation and amortization 6,085 1.8 % 9,524 2.5 % Asset impairment 2,468 0.7 % 1,335 0.3 % Total operating expenses 242,720 72.5 % 290,732 76.1 % Operating income 92,284 27.5 % 91,430 23.9 % OTHER INCOME: Interest income 13,983 4.2 % 8,349 2.2 % Interest expense (447 ) -0.1 % (191 ) 0.0 % Miscellaneous income 45 0.0 % 22,068 5.8 % Total other income 13,581 4.1 % 30,226 7.9 % PRETAX INCOME 105,865 31.6 % 121,656 31.8 % Provision for income taxes 27,994 8.4 % 32,499 8.5 % NET INCOME 77,871 23.2 % 89,157 23.3 % NET INCOME PER SHARE - BASIC: $ 1.19 $ 1.32 NET INCOME PER SHARE -DILUTED: $ 1.16 $ 1.30 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 65,583 67,328 Diluted 66,956 68,512 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Year to Date Ended June 30 , (In Thousands) 2024 2023 NET INCOME $ 77,871 $ 89,157 OTHER COMPREHENSIVE LOSS, net of tax: Foreign currency translation adjustments (39 ) 23 Unrealized loss on investments (1,016 ) (197 ) Total other comprehensive loss (1,055 ) (174 ) COMPREHENSIVE INCOME $ 76,816 $ 88,983 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) For the Year to Date Ended June 30 , 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 77,871 $ 89,157 Adjustments to reconcile net income to net cash provided by operating activities: Asset impairment 2,468 1,335 Gain on sale of asset - (22,086 ) Depreciation and amortization expense 6,085 9,524 Bad debt expense 12,631 18,927 Compensation expense related to share-based awards 4,557 4,315 Deferred income taxes 562 2,975 Changes in operating assets and liabilities (11,157 ) (37,927 ) Net cash provided by operating activities 93,017 66,220 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of available-for-sale investments (204,060 ) (159,183 ) Sales of available-for-sale investments 145,945 132,325 Purchases of property and equipment (2,022 ) (3,612 ) Net cash used in investing activities (60,137 ) (30,470 ) CASH FLOWS FROM FINANCING ACTIVITIES: Issuance of common stock 1,805 313 Purchase of treasury stock (6,769 ) (2,729 ) Payments of employee tax associated with stock compensation (3,435 ) (2,209 ) Payments of cash dividends and dividend equivalents (14,613 ) - Net cash used in financing activities (23,012 ) (4,625 ) NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 9,868 31,125 CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of the period 119,021 118,884 CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of the period $ 128,889 $ 150,009 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED SELECTED SEGMENT INFORMATION (In thousands, except percentages) For the Quarter Ended June 30 , 2024 2023 REVENUE: CTU $ 112,828 $ 119,292 AIUS 53,722 67,062 Corporate and Other 190 210 Total $ 166,740 $ 186,564 OPERATING INCOME (LOSS): CTU $ 42,890 $ 40,451 AIUS 12,926 17,078 Corporate and Other (9,810 ) (9,435 ) Total $ 46,006 $ 48,094 OPERATING MARGIN (LOSS): CTU 38.0 % 33.9 % AIUS 24.1 % 25.5 % Corporate and Other NM NM Total 27.6 % 25.8 % PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED SELECTED SEGMENT INFORMATION (In thousands, except percentages) For the Year to Date Ended June 30 , 2024 2023 REVENUE: CTU $ 226,397 $ 243,784 AIUS 108,227 137,902 Corporate and Other 380 476 Total $ 335,004 $ 382,162 OPERATING INCOME (LOSS): CTU $ 85,046 $ 84,141 AIUS 22,212 29,081 Corporate and Other (14,974 ) (21,792 ) Total $ 92,284 $ 91,430 OPERATING MARGIN (LOSS): CTU 37.6 % 34.5 % AIUS 20.5 % 21.1 % Corporate and Other NM NM Total 27.5 % 23.9 % PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ITEMS (1) (In thousands, unless otherwise noted) For the Quarter Ended June 30 , For the Year to Date Ended June 30 , ACTUAL ACTUAL Adjusted Operating Income 2024 2023 2024 2023 Operating income $ 46,006 $ 48,094 $ 92,284 $ 91,430 Depreciation and amortization 3,069 4,369 6,085 9,524 Legal fee expense related to certain matters (2) 1,815 2,709 2,045 7,328 Adjusted Operating Income $ 50,890 $ 55,172 $ 100,414 $ 108,282 For the Quarter Ending September 30 , For the Year Ending December 31 , OUTLOOK ACTUAL OUTLOOK ACTUAL 2024 2023 2024 2023 Operating income $41.6M - $43.6M $ 43,073 $161.8M - $172.8M $ 150,446 Depreciation and amortization 3.1M 3,914 14.1M 16,887 Legal fee expense related to certain matters (2) 0.3M 246 3.1M 7,579 Adjusted Operating Income $45.0M - $47.0M $ 47,233 $179.0M - $190.0M $ 174,912 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ITEMS (1) (cont’d) For the Quarter Ended June 30 , For the Year to Date Ended June 30 , ACTUAL ACTUAL 2024 2023 2024 2023 Reported Earnings Per Diluted Share $ 0.57 $ 0.80 $ 1.16 $ 1.30 Pre-tax adjustments included in operating expenses: Amortization for acquired intangible assets 0.02 0.03 0.04 0.07 Legal fee expense related to certain matters (2) 0.03 0.04 0.03 0.11 Gain on sale of intangible asset (3) - (0.32 ) - (0.32 ) Total pre-tax adjustments $ 0.05 $ (0.25 ) $ 0.07 $ (0.14 ) Tax effect of adjustments (4) (0.02 ) 0.06 (0.02 ) 0.03 Total adjustments after tax 0.03 (0.19 ) 0.05 (0.11 ) Adjusted Earnings Per Diluted Share $ 0.60 $ 0.61 $ 1.21 $ 1.19 For the Quarter Ending September 30 , For the Year Ending December 31 , OUTLOOK ACTUAL OUTLOOK ACTUAL 2024 2023 2024 2023 Reported Earnings Per Diluted Share $0.51 - $0.53 $ 0.62 $2.04 - $2.16 $ 2.18 Pre-tax adjustments included in operating expenses: Amortization for acquired intangible assets 0.02 0.03 0.08 0.11 Legal fee expense related to certain matters (2) - - 0.05 0.11 Gain on sale of intangible asset (3) - - - (0.32 ) Total pre-tax adjustments $0.02 $ 0.03 $0.13 $ (0.10 ) Tax effect of adjustments (4) (0.01 ) (0.01 ) (0.04 ) 0.02 Total adjustments after tax 0.01 0.02 0.09 (0.08 ) Adjusted Earnings Per Diluted Share $0.52 - $0.54 $ 0.64 $2.13 - $2.25 $ 2.10 PERDOCEO EDUCATION CORPORATION AND SUBSIDIARIES UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ITEMS (1) (cont’d) (1) The Company believes it is useful to present non-GAAP financial measures which exclude certain significant and non-cash items as a means to understand the performance of its operations. As a general matter, the Company uses non-GAAP financial measures in conjunction with results presented in accordance with GAAP to help analyze the performance of its operations, assist with preparing the annual operating plan, and measure performance for some forms of compensation. In addition, the Company believes that non-GAAP financial information is used by analysts and others in the investment community to analyze the Company’s historical results and to provide estimates of future performance. The Company believes adjusted operating income and adjusted earnings per diluted share allow it to analyze and assess its operations and compare current operating results with the operational performance of other companies in its industry because it does not give effect to potential differences caused by items it does not consider reflective of underlying operating performance, such as amortization for acquired intangible assets, significant legal settlements and legal fee expense related to certain matters. The Company believes the items it is adjusting for are not normal operating expenses necessary to run its business. In evaluating adjusted operating income and adjusted earnings per diluted share, investors should be aware that in the future the Company may incur expenses similar to the adjustments presented above. The presentation of adjusted operating income and adjusted earnings per diluted share should not be construed as an inference that the Company's future results will be unaffected by expenses that are unusual, non-routine or non-recurring. Adjusted operating income and adjusted earnings per diluted share have limitations as an analytical tool, and should not be considered in isolation, or as a substitute for net income, operating income, earnings per diluted share, or any other performance measure derived in accordance and reported under GAAP or as an alternative to cash flow from operating activities or as a measure of liquidity. Non-GAAP financial measures, when viewed in a reconciliation to corresponding GAAP financial measures, provide an additional way of viewing the Company’s results of operations and the factors and trends affecting the Company’s business. Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding financial results presented in accordance with GAAP. (2) Legal fee expense associated with (i) responses to the Department relating to borrower defense to repayment applications from former students, and (ii) acquisition efforts. (3) Non-cash gain associated with the sale of the LCB tradename in exchange for outstanding shares of Perdoceo's stock. (4) The tax effect of adjustments was calculated by multiplying the pre-tax adjustments with a tax rate of 25.0%. This tax rate is intended to reflect federal and state taxable jurisdictions as well as the nature of the adjustments. View source version on businesswire.com : https://www.businesswire.com/news/home/20240731873972/en/ Investors: Alpha IR Group Sam Gibbons (312) 445-2870 [email protected] Or Media: Perdoceo Education Corporation (847) 585-2600 [email protected] Source: Perdoceo Education Corporation

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