| << Back |
| Laureate Education, Inc. Reports Record Student Enrollment and Third Quarter 2006 Results |
Business Editors BALTIMORE--(BUSINESS WIRE)--Oct. 19, 2006--Laureate Education, Inc. (NASDAQ:LAUR), the world's leading international provider of higher education, announced record financial results for the quarter ended September 30, 2006.
-- Third quarter 2006 revenues increased 35% to $260.9 million,
compared to $193.8 million in the third quarter of 2005.
-- Income from continuing operations in the third quarter of 2006
was $9.9 million or $0.19 per diluted share. Excluding the
($0.03) impact of stock option expense, income from continuing
operations would have been $0.22 per diluted share, an
increase of 29% over the third quarter of 2005. The third
quarter 2006 net impact of the previously announced Chilean
buy-out, which includes changes in minority interest as well
as severance and other non-operating items, was ($0.02) per
diluted share. (For details see Reg G Reconciliation in the
investor relations section of www.laureate-inc.com).
-- The Company's campus-based institutions reported third quarter
total student enrollment increased 28% to 209,480 students.
The primary enrollment season for Laureate's Northern
Hemisphere institutions occurs during the third quarter of the
year.
-- Laureate Online Education reported a 10% increase in new
student enrollment and a 20% increase in total student
enrollment to 31,136 students.
-- Laureate Education closed previously announced transactions to
acquire the remaining 20% interest in its Chilean businesses
and negotiated all remaining earnout obligations to its former
business partner in Chile in exchange for a total settlement
of $161 million before any additional deal or related costs.
-- The Company believes that it will achieve earnings of between
$1.09 and $1.14 per diluted share for the quarter ending
December 31, 2006, excluding ($0.03) to ($0.04) per diluted
share impact of SFAS123R. Fourth Quarter 2006 Earnings Outlook
including SFAS123R expense is between $1.05 and $1.11 per
diluted share.
-- Laureate Education updates its full-year 2006 earnings outlook
of between $2.11 and $2.16 per diluted share, an increase of
27% or more over full-year 2005. This excludes estimated
SFAS123R impact of ($0.10) to ($0.12) per diluted share.
Full-year 2006 Earnings Outlook including SFAS123R expense is
$1.99 to $2.06 per diluted share. The full-year 2006 Outlook
includes the one time $0.04 net gain related to the continued
liquidation of Sylvan Ventures, as reported in the second
quarter of 2006.
-- The Company reiterates its full-year 2007 earnings outlook of
between $2.59 and $2.67 per diluted share, an increase of 20%
or more over full-year 2006. This excludes estimated stock
option expense of ($0.12) to ($0.14) per diluted share.
Full-year 2007 Earnings Outlook including SFAS123R expense is
$2.45 to $2.55 per diluted share.
Douglas Becker, Chairman and Chief Executive Officer of Laureate Education stated, "The third quarter marks the end of the primary enrollment season for Laureate's Northern Hemisphere institutions and is our largest intake season of the year. Our strong enrollment growth in this period, coupled with substantial margin improvement in our Laureate Online division, positions us well to achieve our goals for 2006. I am proud of the investments that we continue to make in new campuses, new programs, and especially in the management team. These investments make it possible for us to achieve our ambitious objectives for 2007 and beyond." Financial and Other Results As previously announced, all financial information for the prior year 2005 has been restated to reflect a preferential change in accounting for tuition revenue. Total revenues for the third quarter of 2006 were $260.9 million, an increase of 35% compared to total revenues of $193.8 million in the third quarter of 2005. Total operating income for the third quarter of 2006 decreased to $13.5 million, versus operating income of $15.4 million in the third quarter of 2005. Income from continuing operations in the third quarter of 2006 was $9.9 million or $0.19 per diluted share. Excluding the ($0.03) impact of stock option expense, income from continuing operations would have been $0.22 per diluted share, an increase of 29% over the third quarter of 2005. The third quarter 2006 net impact of the previously announced Chilean buy-out, which includes changes in minority interest as well as severance and other non-operating items, was ($0.02) per diluted share. (For details see Reg G Reconciliation in the investor relations section of www.laureate-inc.com). For the nine-month period ended September 30, 2006, total revenues were $799.1 million, an increase of 33% compared to total revenues of $599.4 million in the same period of 2005. Total operating income for the nine-month period increased to $70.5 million, versus operating income of $61.8 million in the same period of 2005. Income from continuing operations for the nine-month period ended September 30, 2006 was $49.8 million or $0.94 per diluted share, an increase of 19% over the same period of 2005. Total cash and marketable securities at September 30, 2006 were $173.6 million, while total company debt was $463.9 million. Laureate Education closed previously announced transactions to acquire the remaining 20% interest in its Chilean businesses and negotiated all remaining earnout obligations to its former business partner in Chile in exchange for a total settlement of $161 million before any additional deal or related costs. In the South America region, total student enrollment in the third quarter 2005, previously reported as 69,997 students, has been revised to 66,668 students to reflect student attrition and graduations at 3 campuses which had been incorrectly reported. Laureate Education operates 25 institutions of higher education in 15 countries, offering academic programs to 240,616 students through 58 campuses and online. Management Appointments As part of Laureate's continuing efforts to develop and recruit exceptional executive talent for its rapidly growing network of universities, the Company announced several appointments:
-- Jorge Brake has been hired as President and CEO of Laureate
Education's Mexico and Central America Region. Mr. Brake
brings extensive management, marketing and product development
experience to Laureate, having served as President and CEO of
Procter & Gamble in Mexico and Central America.
-- Gary Wojtaszek has been hired Senior Vice President -
Treasurer for Laureate Education. Mr. Wojtaszek was previously
Vice President of Finance and Principal Accounting Officer of
Agere Systems, a global semi-conductor manufacturer with
operations throughout North America, Europe and Asia.
-- Cristina O'Naghten, CPA, has been hired as Vice President of
Internal Audit for Laureate Education. Mrs. O'Naghten brings
over 20 years of financial and audit experience to Laureate,
having recently served as General Motors Corporation's Audit
Services Director for Latin America, Africa, and Middle East
Region.
-- Anthony Viola, CPA, has been hired as Senior Vice President of
Tax for Laureate Education. Mr. Viola most recently served as
the Vice President of Taxes for Sodexho, a $6.5 billion
management services subsidiary of Sodexho Alliance.
Revenue Growth - Organic and Acquisition
For three months ended September 30th
% Growth
Revenue Amount Constant
(In Thousands) 2006 2005 in USD Currency
--------- --------- --------- ---------
Mexico/Central America(1) $ 74,809 $ 59,997 25% 27%
South America(2) 75,423 65,422 15% 13%
Europe 30,181 22,572 34% 31%
Online 59,843 45,809 31% 31%
--------- ---------
Subtotal 240,256 193,800 24%
Acquisitions(3) 20,650 -
--------- ---------
Total $ 260,906 $ 193,800 35%
========= =========
(1) Mexico/Central America includes Mexico, Costa Rica, Honduras and Panama. (2) South America includes Chile, Ecuador and Peru. (3) Acquisitions include: Cyprus College and Anhembi Morumbi (Brazil).
Revenue Growth - Organic and Acquisition
For nine months ended September 30th
% Growth
Revenue Amount Constant
(In Thousands) 2006 2005 in USD Currency
--------- --------- --------- ---------
Mexico/Central America(1) $ 215,957 $ 175,550 23% 22%
South America(2) 197,921 163,992 21% 14%
Europe 138,557 129,056 7% 10%
Online 167,566 130,848 28% 28%
--------- ---------
Subtotal 720,001 599,446 20%
Acquisitions(3) 79,134 -
--------- ---------
Total $ 799,135 $ 599,446 33%
========= =========
(1) Mexico/Central America includes Mexico, Costa Rica, Honduras (Q3 2005 and Q3 2006), and Panama. (2) South America includes Chile, Ecuador and Peru. (3) Acquisitions include: Honduras (Q1 and Q2 2006), Cyprus College and Anhembi Morumbi (Brazil).
Student Enrollment
As of October 18, 2006
New Student Enrollment(1) 2006 2005 % Change
-------- --------- ---------
Mexico/Central America 44,436 35,674 25%
South America 29,984 28,863 4%
Europe 6,431 5,818 11%
-------- ---------
Total Campus Based 80,851 70,355 15%
Total New Student Enrollment at
Acquired Schools(3) 8,972 --
-------- ---------
Subtotal 89,823 70,355 28%
Online 18,735 16,994 10%
-------- ---------
Total New Student Enrollment with
Acquisitions 108,558 87,349 24%
======== =========
Total Student Enrollment(2) 2006 2005
-------- ---------
Mexico/Central America 94,246 82,305 15%
South America 74,601 66,668(4) 12%
Europe 15,932 14,732 8%
-------- ---------
Total Campus Based 184,779 163,705 13%
Total Student Enrollment at Acquired
Schools(3) 24,701 --
-------- ---------
Subtotal 209,480 163,705 28%
Online 31,136 26,023 20%
-------- ---------
Total Student Enrollment with
Acquisitions 240,616 189,728 27%
======== =========
(1) New Student Enrollment is YTD, reported as of 10/18/2006 and 10/19/2005, respectively. (2) Total Student Enrollment is census, reported as of 10/18/2006 and 10/19/2005, respectively. (3) Acquisitions (less than 1 year) include the following: Cyprus College and Anhembi Morumbi (Brazil). (4) Student enrollment in 2005 is revised to reflect attrition and graduations at 3 campuses, which had been incorrectly reported. Financial Outlook The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially.
Fourth Quarter 2006:
-- For its campus-based and online businesses, Laureate Education
anticipates total revenue of $315 to $340 million for the
fourth quarter 2006.
-- The Company anticipates Campus-Based revenue of $250 to $270
million for the fourth quarter 2006, with operating margins
between 28% and 29%. Latin America revenue is expected to be
between $185 and $200 million with operating margins of 31% to
32%. Europe revenue is expected to be between $65 and $70
million with operating margins of 28% to 29%. General and
administrative expenses for the Campus-Based division are
expected to be approximately $5 million.
-- The Company anticipates Online revenue of $65 to $70 million
for the fourth quarter 2006, with operating margins between
28% and 29%.
-- Corporate general and administrative expenses are expected to
be approximately $15 million in the fourth quarter 2006.
-- The Company currently believes that it will achieve earnings
of between $1.09 and $1.14 per diluted share for the fourth
quarter 2006, excluding estimated stock option expense of
($0.03) to ($0.04) per diluted share. Fourth Quarter 2006
Earnings Outlook including SFAS123R expense is between $1.05
and $1.11 per diluted share.
-- Fully-diluted weighted average shares outstanding is expected
to be approximately 53.3 million for the quarter ending
December 31, 2006.
Full-Year 2006:
-- Laureate Education updates its full-year 2006 earnings outlook
of between $2.11 and $2.16 per diluted share, an increase of
27% or more over full-year 2005. This excludes estimated
SFAS123R impact of ($0.10) to ($0.12) per diluted share.
Full-year 2006 Earnings Outlook including SFAS123R expense is
$1.99 to $2.06 per diluted share. The full-year 2006 Outlook
includes the one time $0.04 net gain related to the continued
liquidation of Sylvan Ventures, as reported in the second
quarter of 2006.
Full-Year 2007:
-- The Company reiterates its full-year 2007 earnings outlook of
between $2.59 and $2.67 per diluted share, an increase of 20%
or more over full-year 2006. This excludes estimated stock
option expense of ($0.12) to ($0.14) per diluted share.
Full-year 2007 Earnings Outlook including SFAS123R expense is
$2.45 to $2.55 per diluted share.
Presentation materials for today's conference call with the financial community will be available to listeners through the investor relations section of the Company's website, www.laureate-inc.com. The live webcast of Laureate's third quarter conference call will be broadcast at 5:00 p.m. eastern time today. About Laureate Education, Inc. Laureate Education, Inc. (NASDAQ:LAUR) is focused on providing a superior university experience to over 240,000 students through the leading global network of accredited campus-based and online universities. Addressing the rapidly growing global demand for higher education, Laureate offers a broad range of career-oriented undergraduate and graduate programs through campus-based universities located in Latin America, Europe, and Asia. Through online universities, Laureate offers the growing population of non-traditional, working-adult students the convenience and flexibility of distance learning to pursue undergraduate, master's and doctorate degree programs in major career fields including engineering, education, business, and healthcare. For more information, please visit our website, www.laureate-inc.com. Forward-Looking Statements This release includes information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company's actual results could differ materially from those described in the forward-looking statements.
The following factors might cause such a difference:
-- The Company's operations can be materially affected by
competition in its target markets and by overall market
conditions, among other factors.
-- The Company's foreign operations, in particular, are subject
to political, economic, legal, regulatory and currency-related
risks.
Additional information regarding these risk factors and uncertainties is detailed from time to time in the Company's filings with the Securities and Exchange Commission, including but not limited to our most recent Forms 10-K/A and 10-Q, available for viewing on our website. (To access this information on our website, www.laureate-inc.com, please click on "Investor Relations", "SEC Filings").
Laureate Education, Inc. & Subsidiaries
Consolidated Statements of Operations
(Amounts in thousands, except per share data)
Three Months Ended September 30,
----------------------------------------
$ %
2006 2005 Variance Variance
----------------------------------------
Revenues (restated)
Mexico/Central America (a) $74,809 $59,997 $14,812 25%
South America (b) 94,419 65,422 28,997 44%
--------- ---------- --------- ---------
Campus Based - Latin America 169,228 125,419 43,809 35%
Mediterranean Region (c) 7,548 3,086 4,462 145%
Hospitality 17,393 14,178 3,215 23%
France 6,894 5,308 1,586 30%
--------- ---------- --------- ---------
Campus Based - Europe 31,835 22,572 9,263 41%
--------- ---------- --------- ---------
Campus Based Total 201,063 147,991 53,072 36%
--------- ---------- --------- ---------
Laureate Online Education 59,843 45,809 14,034 31%
--------- ---------- --------- ---------
Total revenues 260,906 193,800 67,106 35%
--------- ---------- --------- ---------
Core operating expenses 236,250 170,214 66,036 39%
General and administrative
expenses 11,154 8,145 3,009 37%
--------- ---------- --------- ---------
Total operating expenses 247,404 178,359 69,045 39%
--------- ---------- --------- ---------
Operating income 13,502 15,441 (1,939) -13%
Non-operating items
Interest and other income 4,527 2,876 1,651 57%
Interest expense (4,886) (2,611) (2,275) -87%
Foreign exchange gain (loss) 854 (90) 944 N/A
--------- ---------- --------- ---------
Total non-operating items 495 175 320 183%
--------- ---------- --------- ---------
Income from continuing
operations before minority
interest, equity in net
income (loss) of affiliates,
and income taxes 13,997 15,616 (1,619) -10%
Minority interest in income of
consolidated subsidiaries,
net of income tax (3,359) (4,634) 1,275 28%
Equity in net loss of
affiliates, net of income tax (163) (166) 3 2%
Income tax expense (591) (1,749) 1,158 66%
--------- ---------- --------- ---------
Income from continuing
operations 9,884 9,067 817 9%
Loss from discontinued
operations, net of income tax
(d) (113) (229) 116 51%
Gain on disposal of
discontinued operations, net
of income tax 2,217 - 2,217 N/A
--------- ---------- --------- ---------
Net income $11,988 $8,838 $3,150 36%
========= ========== ========= =========
Weighted average shares
(basic) 51,522 49,801
Weighted average shares
(diluted) 53,124 52,073
EPS-Net income (basic) $0.23 $0.18
EPS-Net income (diluted) $0.23 $0.17
EPS- Income from continuing
operations (basic) $0.19 $0.18
EPS- Income from continuing
operations (diluted) $0.19 $0.17
Segment operating profit
(loss):
Campus Based - Latin
America $30,348 $29,416 $932 3%
Campus Based - Europe (12,013) (6,981) (5,032) -72%
Campus Based - Overhead (5,998) (5,861) (137) -2%
--------- ---------- --------- ---------
Campus Based - Total $12,337 $16,574 $(4,237) -26%
--------- ---------- --------- ---------
Laureate Online $12,319 $7,012 $5,307 76%
--------- ---------- --------- ---------
a) Mexico/Central America includes Mexico, Costa Rica, Panama and
Honduras.
b) South America includes Chile, Brazil, Ecuador and Peru.
c) The Mediterranean Region includes Spain and Cyprus.
d) The 2006 and 2005 operating results present the WSI and India
business units as well as a nonstrategic European business as
discontinued operations.
GT = Greater Than, LT = Less Than
Nine Months Ended September 30,
----------------------------------------
$ %
2006 2005 Variance Variance
----------------------------------------
Revenues (restated)
Mexico/Central America (a) $221,766 $175,550 $46,216 26%
South America (b) 260,768 163,992 96,776 59%
--------- ---------- --------- ---------
Campus Based - Latin America 482,534 339,542 142,992 42%
Mediterranean Region (c) 73,357 60,150 13,207 22%
Hospitality 45,076 39,549 5,527 14%
France 30,602 29,357 1,245 4%
--------- ---------- --------- ---------
Campus Based - Europe 149,035 129,056 19,979 15%
--------- ---------- --------- ---------
Campus Based Total 631,569 468,598 162,971 35%
--------- ---------- --------- ---------
Laureate Online Education 167,566 130,848 36,718 28%
--------- ---------- --------- ---------
Total revenues 799,135 599,446 199,689 33%
--------- ---------- --------- ---------
Core operating expenses 696,200 517,020 179,180 35%
General and administrative
expenses 32,425 20,641 11,784 57%
--------- ---------- --------- ---------
Total operating expenses 728,625 537,661 190,964 36%
--------- ---------- --------- ---------
Operating income 70,510 61,785 8,725 14%
Non-operating items
Gain on sale of Chancery
Software, Ltd. 9,322 - 9,322 N/A
Interest and other income 12,531 8,565 3,966 46%
Interest expense (11,634) (7,687) (3,947) -51%
Foreign exchange income
(loss) 540 (777) 1,317 N/A
--------- ---------- --------- ---------
Total non-operating items 10,759 101 10,658 GT 200%
--------- ---------- --------- ---------
Income from continuing
operations before minority
interest, equity in net
income (loss) of affiliates,
and income taxes 81,269 61,886 19,383 31%
Minority interest in income of
consolidated subsidiaries,
net of income tax (18,161) (12,880) (5,281) -41%
Equity in net loss of
affiliates, net of income tax (374) (370) (4) -1%
Income tax expense (12,958) (6,931) (6,027) -87%
--------- ---------- --------- ---------
Income from continuing
operations 49,776 41,705 8,071 19%
(Loss) Income from
discontinued operations, net
of income tax (d) (1,786) 386 (2,172) N/A
Income (Loss) on disposal of
discontinued operations, net
of income tax 1,296 (9,751) 11,047 N/A
--------- ---------- --------- ---------
Net income $49,286 $32,340 $16,946 52%
========= ========== ========= =========
Weighted average shares
(basic) 51,134 49,539
Weighted average shares
(diluted) 52,963 51,948
EPS-Net income (basic) $0.96 $0.65
EPS-Net income (diluted) $0.93 $0.62
EPS- Income from continuing
operations (basic) $0.97 $0.84
EPS- Income from continuing
operations (diluted) $0.94 $0.80
Segment operating profit
(loss):
Campus Based - Latin
America $87,101 $70,691 $16,410 23%
Campus Based - Europe 7,622 10,073 (2,451) -24%
Campus Based - Overhead (16,573) (11,859) (4,714) -40%
--------- ---------- --------- ---------
Campus Based - Total $78,150 $68,905 $9,245 13%
--------- ---------- --------- ---------
Laureate Online $24,785 $13,521 $11,264 83%
--------- ---------- --------- ---------
a) Mexico/Central America includes Mexico, Costa Rica, Panama and
Honduras.
b) South America includes Chile, Brazil, Ecuador and Peru.
c) The Mediterranean Region includes Spain and Cyprus.
d) The 2006 and 2005 operating results present the WSI and India
business units as well as a nonstrategic European business as
discontinued operations.
GT = Greater Than, LT = Less Than
CONTACT: Laureate Education, Inc.
Rosemarie Mecca, 410-843-8070
or
Chris Symanoskie, 410-843-6394
SOURCE: Laureate Education, Inc.
|
| "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Laureate Education, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year. |