Revenue up 4.1% YoY
Total enrollment up 1.9% YoY
Diluted earnings per share $0.25; Adjusted EPS $0.93, growth of 3.3% YoY
Raises fiscal year 2024 revenue guidance to a range of $1,470 million to $1,530 million and Adjusted EPS guidance to a range of $4.25 to $4.45
First quarter highlights
- Revenue $368.8 million, up 4.1% year-over-year
- Total student enrollment 81,073, up 1.9% year-over-year
- Chamberlain University third straight quarter of total enrollment growth, up 5.2% year-over-year
- Walden University returned to total enrollment growth, up 0.5% year-over-year
- Investing in Growth with Purpose strategy, GAAP net income $10.6 million, and adjusted EBITDA $80.5 million, down 3.8% year-over-year
Capital allocation
- Repurchased $92 million of shares against $300 million Board authorized share repurchase program
- Net leverage 1.3x
Fiscal year 2024 guidance
- Revenue $1,470 million to $1,530 million
- Adjusted earnings per share $4.25 to $4.45
Adtalem Global Education Inc. (NYSE: ATGE) today reported first quarter fiscal 2024 results (ended Sept. 30, 2023) reflecting a return to total enrollment growth and enhanced academic outcomes.
“Our strategic transformation program – Growth with Purpose – achieved another milestone during the first quarter – returning Adtalem to total enrollment growth,” said Steve Beard, president, and chief executive officer, Adtalem Global Education.
Beard continued, “As we accelerate our performance across our five operational pillars, we are increasingly afforded the opportunity to take full advantage of our market leading scale and our market responsive healthcare focus. This gives us the confidence to raise our expectations for fiscal 2024. With more than 80,000 students and 300,000 alumni, Adtalem is well-positioned to address critical healthcare provider shortages. And our enterprise-wide emphasis on advancing health equity has never been more important.”
Financial Highlights
Selected financial data for the three months ended Sept. 30, 2023:
- Revenue of $368.8 million increased 4.1% compared with the prior year.
- Operating income was $28.2 million, compared with $23.6 million in the prior year; adjusted operating income was $63.3 million, compared with $66.8 million in the prior year.
- Net income was $10.6 million, compared with $0.6 million in the prior year; adjusted net income was $39.4 million, compared with $41.6 million in the prior year.
- Diluted earnings per share was $0.25, compared with $0.01 in the prior year; adjusted earnings per share was $0.93, compared with $0.90 in the prior year.
- Adjusted EBITDA was $80.5 million, compared with $83.7 million in the prior year; adjusted EBITDA margin was 21.8%, compared with 23.6% in the prior year.
Business Highlights
- Chamberlain University continues to innovate in specialized nursing education that addresses areas of acute nursing shortages, such as peri-operative, home health, nephrology, and emergency, through its Practice Ready. Specialty Focused.TM model. This model has provided more than 1,000 students in Chamberlain’s Bachelor of Science in Nursing degree program, the opportunity for specialized training. The proprietary learning model has been expanded to all 23 Chamberlain campuses, broadening access to more students.
- Walden’s 69th commencement celebrated the conferral of more than 6,500 doctoral, master’s, and bachelor’s degrees to students from all 50 U.S. states and more than 40 countries, of which nearly 35% were for post-licensure nursing programs. More than 50% of the graduates who reported their race, identified as being from minority groups.
- Faculty members from Walden and Chamberlain were elected into the Leadership Academy in Social Determinants of Health and Social Change, which further equips current nurse educators and interprofessional leaders to prepare future care providers to confidently and competently promote social change and advance health equity. The academy is the cornerstone of the groundbreaking collaboration between the National League for Nursing and Walden University.
- Adtalem’s ongoing investment in innovating the student experience was recognized with 4 Telly and 12 Viddy awards for immersive “user-centered design” and short-videos for enhanced learning curriculum.
- Our 2023 Sustainability Report, which encapsulates our mission, vision and sustainability efforts, was recently released and highlights the many ways Adtalem serves to bridge the gap between accessible education and systemic change in healthcare and demonstrates our continued global impact for a better future.
Segment Highlights
Chamberlain
$ in millions |
|
Three Months Ended
|
||
|
|
2023 |
2022 |
% Change |
Revenue |
|
$142.6 |
$135.4 |
5.3% |
Operating Income |
|
$24.3 |
$26.2 |
(7.1)% |
Adj. Operating Income |
|
$24.3 |
$27.0 |
(9.9)% |
Adj. EBITDA |
|
$31.5 |
$33.8 |
(6.5)% |
Total Students (1) |
|
34,889 |
33,153 |
5.2% |
- Total student enrollment increased 5.2% compared with the prior year, driven by continued growth in pre-licensure and post-licensure nursing programs as well as high persistence.
Walden
$ in millions |
|
Three Months Ended
|
||
|
|
2023 |
2022 |
% Change |
Revenue |
|
$141.6 |
$130.9 |
8.2% |
Operating Income |
|
$1.9 |
$2.9 |
(33.9)% |
Adj. Operating Income |
|
$31.1 |
$24.5 |
26.8% |
Adj. EBITDA |
|
$35.1 |
$29.0 |
21.0% |
Total Students (1) |
|
40,975 |
40,772 |
0.5% |
- Total student enrollment increased 0.5% compared with the prior year, driven by growth in healthcare programs and high persistence. Elimination of off-cycle start dates adversely impacted year-over-year total enrollment growth by 2.9%.
Medical and Veterinary
$ in millions |
|
Three Months Ended
|
||
|
|
2023 |
2022 |
% Change |
Revenue |
|
$84.6 |
$88.0 |
(3.8)% |
Operating Income |
|
$14.4 |
$10.2 |
40.3% |
Adj. Operating Income |
|
$14.5 |
$17.1 |
(15.2)% |
Adj. EBITDA |
|
$19.1 |
$21.6 |
(11.9)% |
Total Students (1) |
|
5,209 |
5,634 |
(7.5)% |
- Total student enrollment decreased 7.5% compared with the prior year, driven by declines in medical schools.
(1) | Represents total students attending sessions during each institution’s most recent enrollment period in Q1 FY 2024 and Q1 FY 2023 |
Fiscal Year 2024 Outlook
Adtalem guidance for fiscal year 2024, raises revenue guidance to a range of $1,470 million to $1,530 million from $1,460 million to $1,520 million, and raises adjusted earnings per share to be in the range of $4.25 to $4.45 from $4.20 to $4.40.
Conference Call and Webcast Information
Adtalem will hold a conference call to discuss its fiscal 2024 first quarter results today at 4:30 p.m. CDT (5:30 p.m. EDT).
The call can be accessed by dialing +1 877-407-6184 (U.S. participants) or +1 201-389-0877 (international participants) stating “Adtalem earnings call” or use conference ID: 13740758. The call will be simulcast through the Adtalem investor relations website at: https://investors.adtalem.com.
Adtalem will archive a replay of the call for 30 days. To access the replay, dial +1 877-660-6853 (U.S.) or +1 201-612-7415 (international), conference ID: 13740758, or visit the Adtalem investor relations website.
About Adtalem Global Education
Adtalem Global Education (NYSE: ATGE) is a national leader in post-secondary education and leading provider of professional talent to the healthcare industry. With a dedicated focus on driving strong outcomes that increase workforce preparedness, Adtalem empowers a diverse learner population to achieve their goals and make inspiring contributions to their communities. Adtalem is the parent organization of American University of the Caribbean School of Medicine, Chamberlain University, Ross University School of Medicine, Ross University School of Veterinary Medicine and Walden University. Adtalem’s family of institutions has more than 300,000 alumni and nearly 10,000 employees. Adtalem was named one of America’s Most Responsible Companies in 2021 and 2023 by Newsweek and Statista, and one of America’s Best Employers for Diversity in 2021 and 2022 by Forbes and Statista. Visit Adtalem.com for more information and follow on Twitter and LinkedIn.
Forward-Looking Statements
Certain statements contained in this release are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact, which includes statements regarding Adtalem’s future growth. Forward-looking statements can also be identified by words such as “future,” “believe,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “may,” “will,” “would,” “could,” “can,” “continue,” “preliminary,” “range,” and similar terms. These forward-looking statements are subject to risk and uncertainties that could cause actual results to differ materially from those described in the statements. These risk and uncertainties include the risk factors described in Item 1A. “Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) and our other filings with the SEC. These forward-looking statements are based on information available to us as of the date any such statements are made, and Adtalem assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized, except as required by law.
A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of special items that may be incurred in the future, although these special items could be material to Adtalem's results in accordance with GAAP.
Adtalem Global Education Inc. Consolidated Balance Sheets (unaudited) (in thousands) |
||||||
|
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
||
|
|
2023 |
|
2023 |
||
Assets: |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
262,438 |
|
$ |
273,689 |
Restricted cash |
|
|
1,988 |
|
|
1,386 |
Accounts receivable, net |
|
|
147,752 |
|
|
102,749 |
Prepaid expenses and other current assets |
|
|
60,750 |
|
|
100,715 |
Total current assets |
|
|
472,928 |
|
|
478,539 |
Noncurrent assets: |
|
|
|
|
|
|
Property and equipment, net |
|
|
264,766 |
|
|
258,522 |
Operating lease assets |
|
|
171,055 |
|
|
174,677 |
Deferred income taxes |
|
|
54,855 |
|
|
56,694 |
Intangible assets, net |
|
|
801,661 |
|
|
812,338 |
Goodwill |
|
|
961,262 |
|
|
961,262 |
Other assets, net |
|
|
67,634 |
|
|
68,509 |
Total noncurrent assets |
|
|
2,321,233 |
|
|
2,332,002 |
Total assets |
|
$ |
2,794,161 |
|
$ |
2,810,541 |
|
|
|
|
|
|
|
Liabilities and shareholders' equity: |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
76,866 |
|
$ |
81,812 |
Accrued payroll and benefits |
|
|
43,138 |
|
|
52,041 |
Accrued liabilities |
|
|
89,395 |
|
|
105,806 |
Deferred revenue |
|
|
250,555 |
|
|
153,871 |
Current operating lease liabilities |
|
|
35,681 |
|
|
37,673 |
Total current liabilities |
|
|
495,635 |
|
|
431,203 |
Noncurrent liabilities: |
|
|
|
|
|
|
Long-term debt |
|
|
695,725 |
|
|
695,077 |
Long-term operating lease liabilities |
|
|
160,523 |
|
|
163,441 |
Deferred income taxes |
|
|
26,394 |
|
|
26,068 |
Other liabilities |
|
|
37,221 |
|
|
37,416 |
Total noncurrent liabilities |
|
|
919,863 |
|
|
922,002 |
Total liabilities |
|
|
1,415,498 |
|
|
1,353,205 |
Commitments and contingencies |
|
|
|
|
|
|
Total shareholders' equity |
|
|
1,378,663 |
|
|
1,457,336 |
Total liabilities and shareholders' equity |
|
$ |
2,794,161 |
|
$ |
2,810,541 |
Adtalem Global Education Inc. Consolidated Statements of Income (unaudited) (in thousands, except per share data) |
||||||||
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
||||||
|
|
September 30, |
||||||
|
|
2023 |
|
2022 |
||||
Revenue |
|
$ |
368,845 |
|
|
$ |
354,269 |
|
Operating cost and expense: |
|
|
|
|
|
|
||
Cost of educational services |
|
|
168,618 |
|
|
|
159,645 |
|
Student services and administrative expense |
|
|
166,095 |
|
|
|
146,385 |
|
Restructuring expense |
|
|
676 |
|
|
|
15,065 |
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
Total operating cost and expense |
|
|
340,651 |
|
|
|
330,635 |
|
Operating income |
|
|
28,194 |
|
|
|
23,634 |
|
Interest expense |
|
|
(15,657 |
) |
|
|
(17,760 |
) |
Other income, net |
|
|
2,214 |
|
|
|
761 |
|
Income from continuing operations before income taxes |
|
|
14,751 |
|
|
|
6,635 |
|
Provision for income taxes |
|
|
(2,792 |
) |
|
|
(1,122 |
) |
Income from continuing operations |
|
|
11,959 |
|
|
|
5,513 |
|
Discontinued operations: |
|
|
|
|
|
|
||
Loss from discontinued operations before income taxes |
|
|
(1,765 |
) |
|
|
(3,265 |
) |
Loss on disposal of discontinued operations before income taxes |
|
|
— |
|
|
|
(3,359 |
) |
Benefit from income taxes |
|
|
452 |
|
|
|
1,703 |
|
Loss from discontinued operations |
|
|
(1,313 |
) |
|
|
(4,921 |
) |
Net income and comprehensive income |
|
$ |
10,646 |
|
|
$ |
592 |
|
|
|
|
|
|
|
|
||
Earnings (loss) per share: |
|
|
|
|
|
|
||
Basic: |
|
|
|
|
|
|
||
Continuing operations |
|
$ |
0.29 |
|
|
$ |
0.12 |
|
Discontinued operations |
|
$ |
(0.03 |
) |
|
$ |
(0.11 |
) |
Total basic earnings per share |
|
$ |
0.26 |
|
|
$ |
0.01 |
|
Diluted: |
|
|
|
|
|
|
||
Continuing operations |
|
$ |
0.28 |
|
|
$ |
0.12 |
|
Discontinued operations |
|
$ |
(0.03 |
) |
|
$ |
(0.11 |
) |
Total diluted earnings per share |
|
$ |
0.25 |
|
|
$ |
0.01 |
|
|
|
|
|
|
|
|
||
Weighted-average shares outstanding: |
|
|
|
|
|
|
||
Basic shares |
|
|
41,399 |
|
|
|
45,274 |
|
Diluted shares |
|
|
42,184 |
|
|
|
46,342 |
|
Adtalem Global Education Inc. Consolidated Statements of Cash Flows (unaudited) (in thousands) |
||||||||
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
||||||
|
|
September 30, |
||||||
|
|
2023 |
|
2022 |
||||
Operating activities: |
|
|
|
|
|
|
||
Net income |
|
$ |
10,646 |
|
|
$ |
592 |
|
Loss from discontinued operations |
|
|
1,313 |
|
|
|
4,921 |
|
Income from continuing operations |
|
|
11,959 |
|
|
|
5,513 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
||
Stock-based compensation expense |
|
|
7,455 |
|
|
|
6,145 |
|
Amortization and impairments to operating lease assets |
|
|
8,765 |
|
|
|
19,708 |
|
Depreciation |
|
|
9,778 |
|
|
|
10,805 |
|
Amortization of intangible assets |
|
|
10,677 |
|
|
|
18,528 |
|
Amortization and write-off of debt discount and issuance costs |
|
|
1,155 |
|
|
|
4,227 |
|
Provision for bad debts |
|
|
10,226 |
|
|
|
5,991 |
|
Deferred income taxes |
|
|
2,165 |
|
|
|
2,629 |
|
Loss on disposals, accelerated depreciation, and impairments to property and equipment |
|
|
38 |
|
|
|
3,483 |
|
Gain on extinguishment of debt |
|
|
— |
|
|
|
(71 |
) |
Loss on investments |
|
|
447 |
|
|
|
901 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
(50,116 |
) |
|
|
(33,219 |
) |
Prepaid expenses and other current assets |
|
|
(5,532 |
) |
|
|
(2,483 |
) |
Accounts payable |
|
|
(2,870 |
) |
|
|
8,711 |
|
Accrued payroll and benefits |
|
|
(8,882 |
) |
|
|
(12,743 |
) |
Accrued liabilities |
|
|
13,770 |
|
|
|
(9,010 |
) |
Deferred revenue |
|
|
98,658 |
|
|
|
82,688 |
|
Operating lease liabilities |
|
|
(10,053 |
) |
|
|
(12,921 |
) |
Other assets and liabilities |
|
|
(6,914 |
) |
|
|
(7,406 |
) |
Net cash provided by operating activities-continuing operations |
|
|
90,726 |
|
|
|
91,476 |
|
Net cash provided by (used in) operating activities-discontinued operations |
|
|
8,959 |
|
|
|
(130 |
) |
Net cash provided by operating activities |
|
|
99,685 |
|
|
|
91,346 |
|
Investing activities: |
|
|
|
|
|
|
||
Capital expenditures |
|
|
(15,046 |
) |
|
|
(5,551 |
) |
Proceeds from sale of marketable securities |
|
|
400 |
|
|
|
356 |
|
Purchases of marketable securities |
|
|
(300 |
) |
|
|
(308 |
) |
Net cash used in investing activities-continuing operations |
|
|
(14,946 |
) |
|
|
(5,503 |
) |
Payment for working capital adjustment for sale of business |
|
|
— |
|
|
|
(811 |
) |
Net cash used in investing activities |
|
|
(14,946 |
) |
|
|
(6,314 |
) |
Financing activities: |
|
|
|
|
|
|
||
Proceeds from exercise of stock options |
|
|
550 |
|
|
|
1,241 |
|
Employee taxes paid on withholding shares |
|
|
(5,651 |
) |
|
|
(3,486 |
) |
Proceeds from stock issued under Colleague Stock Purchase Plan |
|
|
190 |
|
|
|
132 |
|
Repurchases of common stock for treasury |
|
|
(90,477 |
) |
|
|
— |
|
Repayments of long-term debt |
|
|
— |
|
|
|
(100,861 |
) |
Net cash used in financing activities |
|
|
(95,388 |
) |
|
|
(102,974 |
) |
Net decrease in cash, cash equivalents and restricted cash |
|
|
(10,649 |
) |
|
|
(17,942 |
) |
Cash, cash equivalents and restricted cash at beginning of period |
|
|
275,075 |
|
|
|
347,937 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
264,426 |
|
|
$ |
329,995 |
|
Non-cash investing and financing activities: |
|
|
|
|
|
|
||
Accrued capital expenditures |
|
$ |
9,217 |
|
|
$ |
4,713 |
|
Accrued liability for repurchases of common stock |
|
$ |
3,600 |
|
|
$ |
— |
|
Accrued excise tax on share repurchases |
|
$ |
1,928 |
|
|
$ |
— |
|
Adtalem Global Education Inc. Segment Information (unaudited) (in thousands) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
||||||||||||||
|
|
September 30, |
||||||||||||||
|
|
|
|
|
|
|
|
Increase/(Decrease) |
|
|||||||
|
|
2023 |
|
2022 |
|
$ |
|
% |
|
|||||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Chamberlain |
|
$ |
142,596 |
|
|
$ |
135,405 |
|
|
$ |
7,191 |
|
|
5.3 |
|
% |
Walden |
|
|
141,608 |
|
|
|
130,901 |
|
|
|
10,707 |
|
|
8.2 |
|
% |
Medical and Veterinary |
|
|
84,641 |
|
|
|
87,963 |
|
|
|
(3,322 |
) |
|
(3.8 |
) |
% |
Total consolidated revenue |
|
$ |
368,845 |
|
|
$ |
354,269 |
|
|
$ |
14,576 |
|
|
4.1 |
|
% |
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Chamberlain |
|
$ |
24,324 |
|
|
$ |
26,184 |
|
|
$ |
(1,860 |
) |
|
(7.1 |
) |
% |
Walden |
|
|
1,938 |
|
|
|
2,933 |
|
|
|
(995 |
) |
|
(33.9 |
) |
% |
Medical and Veterinary |
|
|
14,363 |
|
|
|
10,238 |
|
|
|
4,125 |
|
|
40.3 |
|
% |
Home Office and Other |
|
|
(12,431 |
) |
|
|
(15,721 |
) |
|
|
3,290 |
|
|
20.9 |
|
% |
Total consolidated operating income |
|
$ |
28,194 |
|
|
$ |
23,634 |
|
|
$ |
4,560 |
|
|
19.3 |
|
% |
Non-GAAP Financial Measures and Reconciliations
We believe that certain non-GAAP financial measures provide investors with useful supplemental information regarding the underlying business trends and performance of Adtalem’s ongoing operations as seen through the eyes of management and are useful for period-over-period comparisons. We use these supplemental non-GAAP financial measures internally in our assessment of performance and budgeting process. However, these non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. The following are non-GAAP financial measures used in the subsequent GAAP to non-GAAP reconciliation tables:
Adjusted net income (most comparable GAAP measure: net income) – Measure of Adtalem’s net income adjusted for restructuring expense, business integration expense, intangible amortization expense, write-off of debt discount and issuance costs, gain on extinguishment of debt, litigation reserve, and net loss from discontinued operations.
Adjusted earnings per share (most comparable GAAP measure: earnings per share) – Measure of Adtalem’s diluted earnings per share adjusted for restructuring expense, business integration expense, intangible amortization expense, write-off of debt discount and issuance costs, gain on extinguishment of debt, litigation reserve, and net loss from discontinued operations.
Adjusted operating income (most comparable GAAP measure: operating income) – Measure of Adtalem’s operating income adjusted for restructuring expense, business integration expense, intangible amortization expense, and litigation reserve. This measure is applied on a consolidated and segment basis, depending on the context of the discussion.
Adjusted EBITDA (most comparable GAAP measure: net income) – Measure of Adtalem’s net income adjusted for net loss from discontinued operations, interest expense, other income, net, provision for income taxes, depreciation and amortization, stock-based compensation, restructuring expense, business integration expense, and litigation reserve. This measure is applied on a consolidated and segment basis, depending on the context of the discussion. Income taxes, interest expense, and other income, net is not recorded at the reportable segments, and therefore, the segment adjusted EBITDA reconciliations begin with operating income.
Free cash flow (most comparable GAAP measure: net cash provided by operating activities-continuing operations) – Defined as net cash provided by operating activities-continuing operations less capital expenditures.
Net debt – Defined as long-term debt less cash and cash equivalents.
Net leverage – Defined as net debt divided by adjusted EBITDA.
A description of special items in our non-GAAP financial measures described above are as follows:
- Restructuring expense primarily related to real estate consolidations at Walden, Medical and Veterinary, and Adtalem’s home office. We do not include normal, recurring, cash operating expenses in our restructuring expense.
- Business integration expense include expenses related to the Walden acquisition and certain costs related to growth transformation initiatives. We do not include normal, recurring, cash operating expenses in our business integration expense.
- Intangible amortization expense on acquired intangible assets.
- Write-off of debt discount and issuance costs and gain on extinguishment of debt related to prepayments of debt, and reserves related to significant litigation.
- Net loss from discontinued operations includes expense from ongoing litigation costs and settlements related to the DeVry University divestiture and a loss on the sale of ACAMS, Becker, and OCL for working capital adjustments to the initial sales prices.
Adtalem Global Education Inc. Non-GAAP Operating Income by Segment (unaudited) (in thousands) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
||||||||||||||
|
|
September 30, |
||||||||||||||
|
|
|
|
|
|
|
|
Increase/(Decrease) |
|
|||||||
|
|
2023 |
|
2022 |
|
$ |
|
% |
|
|||||||
Chamberlain: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
24,324 |
|
|
$ |
26,184 |
|
|
$ |
(1,860 |
) |
|
(7.1 |
) |
% |
Restructuring expense |
|
|
— |
|
|
|
818 |
|
|
|
(818 |
) |
|
|
|
|
Adjusted operating income (non-GAAP) |
|
$ |
24,324 |
|
|
$ |
27,002 |
|
|
$ |
(2,678 |
) |
|
(9.9 |
) |
% |
Operating margin (GAAP) |
|
|
17.1 |
|
% |
|
19.3 |
|
% |
|
|
|
|
|
||
Operating margin (non-GAAP) |
|
|
17.1 |
|
% |
|
19.9 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Walden: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
1,938 |
|
|
$ |
2,933 |
|
|
$ |
(995 |
) |
|
(33.9 |
) |
% |
Restructuring expense |
|
|
— |
|
|
|
3,080 |
|
|
|
(3,080 |
) |
|
|
|
|
Intangible amortization expense |
|
|
10,677 |
|
|
|
18,528 |
|
|
|
(7,851 |
) |
|
|
|
|
Litigation reserve |
|
|
18,500 |
|
|
|
— |
|
|
|
18,500 |
|
|
|
|
|
Adjusted operating income (non-GAAP) |
|
$ |
31,115 |
|
|
$ |
24,541 |
|
|
$ |
6,574 |
|
|
26.8 |
|
% |
Operating margin (GAAP) |
|
|
1.4 |
|
% |
|
2.2 |
|
% |
|
|
|
|
|
||
Operating margin (non-GAAP) |
|
|
22.0 |
|
% |
|
18.7 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Medical and Veterinary: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
14,363 |
|
|
$ |
10,238 |
|
|
$ |
4,125 |
|
|
40.3 |
|
% |
Restructuring expense |
|
|
114 |
|
|
|
6,826 |
|
|
|
(6,712 |
) |
|
|
|
|
Adjusted operating income (non-GAAP) |
|
$ |
14,477 |
|
|
$ |
17,064 |
|
|
$ |
(2,587 |
) |
|
(15.2 |
) |
% |
Operating margin (GAAP) |
|
|
17.0 |
|
% |
|
11.6 |
|
% |
|
|
|
|
|
||
Operating margin (non-GAAP) |
|
|
17.1 |
|
% |
|
19.4 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Home Office and Other: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating loss (GAAP) |
|
$ |
(12,431 |
) |
|
$ |
(15,721 |
) |
|
$ |
3,290 |
|
|
20.9 |
|
% |
Restructuring expense |
|
|
562 |
|
|
|
4,341 |
|
|
|
(3,779 |
) |
|
|
|
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
|
|
(4,278 |
) |
|
|
|
|
Adjusted operating loss (non-GAAP) |
|
$ |
(6,607 |
) |
|
$ |
(1,840 |
) |
|
$ |
(4,767 |
) |
|
(259.1 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adtalem Global Education: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
28,194 |
|
|
$ |
23,634 |
|
|
$ |
4,560 |
|
|
19.3 |
|
% |
Restructuring expense |
|
|
676 |
|
|
|
15,065 |
|
|
|
(14,389 |
) |
|
|
|
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
|
|
(4,278 |
) |
|
|
|
|
Intangible amortization expense |
|
|
10,677 |
|
|
|
18,528 |
|
|
|
(7,851 |
) |
|
|
|
|
Litigation reserve |
|
|
18,500 |
|
|
|
— |
|
|
|
18,500 |
|
|
|
|
|
Adjusted operating income (non-GAAP) |
|
$ |
63,309 |
|
|
$ |
66,767 |
|
|
$ |
(3,458 |
) |
|
(5.2 |
) |
% |
Operating margin (GAAP) |
|
|
7.6 |
|
% |
|
6.7 |
|
% |
|
|
|
|
|
||
Operating margin (non-GAAP) |
|
|
17.2 |
|
% |
|
18.8 |
|
% |
|
|
|
|
|
Adtalem Global Education Inc. Non-GAAP Adjusted EBITDA by Segment (unaudited) (in thousands) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
||||||||||||||
|
|
September 30, |
||||||||||||||
|
|
|
|
|
|
|
|
Increase/(Decrease) |
|
|||||||
|
|
2023 |
|
2022 |
|
$ |
|
% |
|
|||||||
Chamberlain: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
24,324 |
|
|
$ |
26,184 |
|
|
$ |
(1,860 |
) |
|
(7.1 |
) |
% |
Restructuring expense |
|
|
— |
|
|
|
818 |
|
|
|
(818 |
) |
|
|
|
|
Depreciation |
|
|
4,316 |
|
|
|
4,481 |
|
|
|
(165 |
) |
|
|
|
|
Stock-based compensation |
|
|
2,907 |
|
|
|
2,274 |
|
|
|
633 |
|
|
|
|
|
Adjusted EBITDA (non-GAAP) |
|
$ |
31,547 |
|
|
$ |
33,757 |
|
|
$ |
(2,210 |
) |
|
(6.5 |
) |
% |
Adjusted EBITDA margin (non-GAAP) |
|
|
22.1 |
|
% |
|
24.9 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Walden: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
1,938 |
|
|
$ |
2,933 |
|
|
$ |
(995 |
) |
|
(33.9 |
) |
% |
Restructuring expense |
|
|
— |
|
|
|
3,080 |
|
|
|
(3,080 |
) |
|
|
|
|
Intangible amortization expense |
|
|
10,677 |
|
|
|
18,528 |
|
|
|
(7,851 |
) |
|
|
|
|
Litigation reserve |
|
|
18,500 |
|
|
|
— |
|
|
|
18,500 |
|
|
|
|
|
Depreciation |
|
|
2,162 |
|
|
|
2,595 |
|
|
|
(433 |
) |
|
|
|
|
Stock-based compensation |
|
|
1,864 |
|
|
|
1,905 |
|
|
|
(41 |
) |
|
|
|
|
Adjusted EBITDA (non-GAAP) |
|
$ |
35,141 |
|
|
$ |
29,041 |
|
|
$ |
6,100 |
|
|
21.0 |
|
% |
Adjusted EBITDA margin (non-GAAP) |
|
|
24.8 |
|
% |
|
22.2 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Medical and Veterinary: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (GAAP) |
|
$ |
14,363 |
|
|
$ |
10,238 |
|
|
$ |
4,125 |
|
|
40.3 |
|
% |
Restructuring expense |
|
|
114 |
|
|
|
6,826 |
|
|
|
(6,712 |
) |
|
|
|
|
Depreciation |
|
|
2,944 |
|
|
|
3,105 |
|
|
|
(161 |
) |
|
|
|
|
Stock-based compensation |
|
|
1,640 |
|
|
|
1,475 |
|
|
|
165 |
|
|
|
|
|
Adjusted EBITDA (non-GAAP) |
|
$ |
19,061 |
|
|
$ |
21,644 |
|
|
$ |
(2,583 |
) |
|
(11.9 |
) |
% |
Adjusted EBITDA margin (non-GAAP) |
|
|
22.5 |
|
% |
|
24.6 |
|
% |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Home Office and Other: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating loss (GAAP) |
|
$ |
(12,431 |
) |
|
$ |
(15,721 |
) |
|
$ |
3,290 |
|
|
20.9 |
|
% |
Restructuring expense |
|
|
562 |
|
|
|
4,341 |
|
|
|
(3,779 |
) |
|
|
|
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
|
|
(4,278 |
) |
|
|
|
|
Depreciation |
|
|
356 |
|
|
|
624 |
|
|
|
(268 |
) |
|
|
|
|
Stock-based compensation |
|
|
1,044 |
|
|
|
491 |
|
|
|
553 |
|
|
|
|
|
Adjusted EBITDA (non-GAAP) |
|
$ |
(5,207 |
) |
|
$ |
(725 |
) |
|
$ |
(4,482 |
) |
|
(618.2 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adtalem Global Education: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income (GAAP) |
|
$ |
10,646 |
|
|
$ |
592 |
|
|
$ |
10,054 |
|
|
1,698.3 |
|
% |
Net loss from discontinued operations |
|
|
1,313 |
|
|
|
4,921 |
|
|
|
(3,608 |
) |
|
|
|
|
Interest expense |
|
|
15,657 |
|
|
|
17,760 |
|
|
|
(2,103 |
) |
|
|
|
|
Other income, net |
|
|
(2,214 |
) |
|
|
(761 |
) |
|
|
(1,453 |
) |
|
|
|
|
Provision for income taxes |
|
|
2,792 |
|
|
|
1,122 |
|
|
|
1,670 |
|
|
|
|
|
Operating income (GAAP) |
|
|
28,194 |
|
|
|
23,634 |
|
|
|
4,560 |
|
|
|
|
|
Depreciation and amortization |
|
|
20,455 |
|
|
|
29,333 |
|
|
|
(8,878 |
) |
|
|
|
|
Stock-based compensation |
|
|
7,455 |
|
|
|
6,145 |
|
|
|
1,310 |
|
|
|
|
|
Restructuring expense |
|
|
676 |
|
|
|
15,065 |
|
|
|
(14,389 |
) |
|
|
|
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
|
|
(4,278 |
) |
|
|
|
|
Litigation reserve |
|
|
18,500 |
|
|
|
— |
|
|
|
18,500 |
|
|
|
|
|
Adjusted EBITDA (non-GAAP) |
|
$ |
80,542 |
|
|
$ |
83,717 |
|
|
$ |
(3,175 |
) |
|
(3.8 |
) |
% |
Adjusted EBITDA margin (non-GAAP) |
|
|
21.8 |
|
% |
|
23.6 |
|
% |
|
|
|
|
|
Adtalem Global Education Inc. Non-GAAP Earnings Disclosure (unaudited) (in thousands, except per share data) |
||||||||
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
||||||
|
|
September 30, |
||||||
|
|
2023 |
|
2022 |
||||
Net income (GAAP) |
|
$ |
10,646 |
|
|
$ |
592 |
|
Restructuring expense |
|
|
676 |
|
|
|
15,065 |
|
Business integration expense |
|
|
5,262 |
|
|
|
9,540 |
|
Intangible amortization expense |
|
|
10,677 |
|
|
|
18,528 |
|
Write-off of debt discount and issuance costs, gain on extinguishment of debt, and litigation reserve |
|
|
18,500 |
|
|
|
2,824 |
|
Income tax impact on non-GAAP adjustments (1) |
|
|
(7,693 |
) |
|
|
(9,871 |
) |
Net loss from discontinued operations |
|
|
1,313 |
|
|
|
4,921 |
|
Adjusted net income (non-GAAP) |
|
$ |
39,381 |
|
|
$ |
41,599 |
|
(1) |
Represents the income tax impact of non-GAAP continuing operations adjustments that is recognized in our GAAP financial statements. |
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
||||||
|
|
September 30, |
||||||
|
|
2023 |
|
2022 |
||||
Earnings per share, diluted (GAAP) |
|
$ |
0.25 |
|
|
$ |
0.01 |
|
Effect on diluted earnings per share: |
|
|
|
|
|
|
||
Restructuring expense |
|
|
0.02 |
|
|
|
0.33 |
|
Business integration expense |
|
|
0.12 |
|
|
|
0.21 |
|
Intangible amortization expense |
|
|
0.25 |
|
|
|
0.40 |
|
Write-off of debt discount and issuance costs, gain on extinguishment of debt, and litigation reserve |
|
|
0.44 |
|
|
|
0.06 |
|
Income tax impact on non-GAAP adjustments (1) |
|
|
(0.18 |
) |
|
|
(0.21 |
) |
Net loss from discontinued operations |
|
|
0.03 |
|
|
|
0.11 |
|
Adjusted earnings per share, diluted (non-GAAP) |
|
$ |
0.93 |
|
|
$ |
0.90 |
|
Diluted shares used in non-GAAP EPS calculation |
|
|
42,184 |
|
|
|
46,342 |
|
Note: May not sum due to rounding. | ||
(1) |
Represents the income tax impact of non-GAAP continuing operations adjustments that is recognized in our GAAP financial statements. |
Adtalem Global Education Inc. Non-GAAP Free Cash Flow Disclosure (unaudited) (in thousands) |
||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||||||||||
|
|
FY24 |
|
FY23 |
|
FY24 |
|
FY23 |
|
FY23 |
|
FY23 |
|
FY23 |
||||||||||||||
|
|
Q1 |
|
Q1 |
|
Q1 |
|
Q4 |
|
Q3 |
|
Q2 |
|
Q1 |
||||||||||||||
Net cash provided by operating activities-continuing operations (GAAP) |
|
$ |
90,726 |
|
|
$ |
91,476 |
|
|
$ |
204,934 |
|
|
$ |
205,684 |
|
|
$ |
255,052 |
|
|
$ |
225,247 |
|
|
$ |
225,972 |
|
Capital expenditures |
|
|
(15,046 |
) |
|
|
(5,551 |
) |
|
|
(46,503 |
) |
|
|
(37,008 |
) |
|
|
(27,861 |
) |
|
|
(26,029 |
) |
|
|
(29,914 |
) |
Free cash flow (non-GAAP) |
|
$ |
75,680 |
|
|
$ |
85,925 |
|
|
$ |
158,431 |
|
|
$ |
168,676 |
|
|
$ |
227,191 |
|
|
$ |
199,218 |
|
|
$ |
196,058 |
|
Adtalem Global Education Inc. Non-GAAP Net Leverage Disclosure (unaudited) (in thousands) |
||||
|
|
|
|
|
|
|
Twelve Months Ended |
||
|
|
September 30, 2023 |
||
Adtalem Global Education: |
|
|
|
|
Net income (GAAP) |
|
$ |
103,412 |
|
Net loss from discontinued operations |
|
|
4,786 |
|
Interest expense |
|
|
60,997 |
|
Other income, net |
|
|
(8,418 |
) |
Provision for income taxes |
|
|
11,953 |
|
Depreciation and amortization |
|
|
93,936 |
|
Stock-based compensation |
|
|
15,609 |
|
Restructuring expense |
|
|
4,428 |
|
Business integration expense |
|
|
38,383 |
|
Litigation reserve |
|
|
28,500 |
|
Gain on sale of assets |
|
|
(13,317 |
) |
Adjusted EBITDA (non-GAAP) |
|
$ |
340,269 |
|
|
|
|
|
|
|
|
September 30, 2023 |
||
Long-term debt |
|
$ |
708,283 |
|
Less: Cash and cash equivalents |
|
|
(262,438 |
) |
Net debt (non-GAAP) |
|
$ |
445,845 |
|
|
|
|
|
|
Net leverage (non-GAAP) |
|
|
1.3 x |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20231026062619/en/
Contacts
Investor Contact
Jay Spitzer and Chandrika Nigam
Investor.Relations@Adtalem.com
+1 312-906-6600
Media Contact
Talisha Holmes
AdtalemMedia@Adtalem.com
+1 872-270-0331