Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 01, 2019 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | CECO | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Security Exchange Name | NASDAQ | |
Entity Registrant Name | CAREER EDUCATION CORP | |
Entity Central Index Key | 0001046568 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 70,377,310 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 0-23245 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-3932190 | |
Entity Address, Address Line One | 231 N. Martingale Road | |
Entity Address, City or Town | Schaumburg | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60173 | |
City Area Code | 847 | |
Local Phone Number | 781-3600 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | ||
CURRENT ASSETS: | ||||
Cash and cash equivalents, unrestricted | $ 47,411 | $ 32,394 | ||
Restricted cash | 30,000 | 337 | ||
Short-term investments | 234,415 | 196,428 | ||
Total cash and cash equivalents, restricted cash and short-term investments | 311,826 | 229,159 | ||
Student receivables, net of allowance for doubtful accounts of $27,075 and $23,307 as of September 30, 2019 and December 31, 2018, respectively | 29,913 | 28,751 | ||
Receivables, other, net | 1,336 | 2,567 | ||
Prepaid expenses | 7,645 | 7,771 | [1] | |
Inventories | 665 | 763 | ||
Other current assets | 1,640 | 437 | ||
Total current assets | 353,025 | 269,448 | ||
NON-CURRENT ASSETS: | ||||
Property and equipment, net of accumulated depreciation of $197,070 and $198,052 as of September 30, 2019 and December 31, 2018, respectively | 26,698 | 30,048 | ||
Right of use asset | 52,016 | |||
Goodwill | 87,356 | 87,356 | ||
Intangible assets, net of amortization of $1,400 as of both September 30, 2019 and December 31, 2018 | 7,900 | 7,900 | ||
Student receivables, net of allowance for doubtful accounts of $1,922 and $1,529 as of September 30, 2019 and December 31, 2018, respectively | 1,131 | 942 | ||
Deferred income tax assets, net | 65,363 | 81,628 | ||
Other assets | 5,140 | 4,993 | ||
Assets of discontinued operations | 178 | 178 | ||
TOTAL ASSETS | [2] | 598,807 | 482,493 | |
CURRENT LIABILITIES: | ||||
Lease liability-operating | 12,109 | |||
Accounts payable | 11,044 | 9,195 | ||
Accrued expenses: | ||||
Payroll and related benefits | 25,019 | 24,530 | ||
Advertising and marketing costs | 11,896 | 9,300 | ||
Income taxes | 1,675 | 1,472 | ||
Other | 46,610 | 19,668 | [1] | |
Deferred revenue | 23,784 | 32,351 | ||
Liabilities of discontinued operations | 3 | 536 | ||
Total current liabilities | 132,140 | 97,052 | ||
NON-CURRENT LIABILITIES: | ||||
Lease liability-operating | 54,904 | |||
Deferred rent obligations | [1] | 12,745 | ||
Other liabilities | 9,819 | 17,493 | [1] | |
Total non-current liabilities | 64,723 | 30,238 | ||
STOCKHOLDERS' EQUITY: | ||||
Preferred stock, $0.01 par value; 1,000,000 shares authorized; none issued or outstanding | ||||
Common stock, $0.01 par value; 300,000,000 shares authorized; 85,876,510 and 85,173,686 shares issued, 70,312,424 and 69,772,910 shares outstanding as of September 30, 2019 and December 31, 2018, respectively | 859 | 852 | ||
Additional paid-in capital | 633,536 | 628,295 | ||
Accumulated other comprehensive gain (loss) | 386 | (298) | ||
Accumulated deficit | (9,445) | (52,946) | [3] | |
Treasury stock, at cost; 15,564,086 and 15,400,776 shares as of September 30, 2019 and December 31, 2018, respectively | (223,392) | (220,700) | ||
Total stockholders' equity | 401,944 | 355,203 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 598,807 | $ 482,493 | ||
[1] | Balances as of December 31, 2018 that related to prepaid rent, remaining lease obligations for vacated spaces and deferred rent obligations were offset with the ROU asset as of January 1, 2019. | |||
[2] | Total assets do not include intercompany receivable or payable activity between institutions and corporate and investments in subsidiaries. | |||
[3] | Certain leases resulted in a negative ROU asset upon transition to ASC 842 related to vacated spaces that had liabilities previously established. Those leases that resulted in a negative ROU asset were recorded as an adjustment, net of tax, to accumulated deficit within stockholders equity on our condensed consolidated balance sheet as of January 1, 2019. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Student receivables, allowance for doubtful accounts, current | $ 27,075 | $ 23,307 |
Property and equipment, accumulated depreciation | 197,070 | 198,052 |
Intangible assets, amortization | 1,400 | 1,400 |
Student receivables, allowance for doubtful accounts, non-current | $ 1,922 | $ 1,529 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 85,876,510 | 85,173,686 |
Common stock, shares outstanding | 70,312,424 | 69,772,910 |
Treasury stock, shares | 15,564,086 | 15,400,776 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Income and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
REVENUE: | |||||
Total revenue | $ 154,959 | $ 145,690 | $ 469,253 | $ 435,791 | |
OPERATING EXPENSES: | |||||
Educational services and facilities | 25,318 | 27,201 | 76,995 | 84,437 | |
General and administrative | 103,063 | 96,842 | 331,057 | 293,190 | |
Depreciation and amortization | 2,284 | 2,364 | 6,752 | 7,049 | |
Total operating expenses | 130,665 | 126,407 | 414,804 | 384,676 | |
Operating income | 24,294 | 19,283 | 54,449 | 51,115 | |
OTHER INCOME: | |||||
Interest income | 1,698 | 950 | 4,730 | 2,326 | |
Interest expense | (43) | (108) | (125) | (323) | |
Miscellaneous income | 97 | 32 | 368 | 225 | |
Total other income | 1,752 | 874 | 4,973 | 2,228 | |
PRETAX INCOME | 26,046 | 20,157 | 59,422 | 53,343 | |
Provision for income taxes | 7,653 | 5,089 | 16,362 | 11,527 | |
INCOME FROM CONTINUING OPERATIONS | 18,393 | 15,068 | 43,060 | 41,816 | |
LOSS FROM DISCONTINUED OPERATIONS, net of tax | (159) | (211) | (594) | (706) | |
NET INCOME | 18,234 | 14,857 | 42,466 | 41,110 | |
OTHER COMPREHENSIVE (LOSS) INCOME, net of tax: | |||||
Foreign currency translation adjustments | (113) | (21) | (130) | (103) | |
Unrealized gain (loss) on investments | 44 | 106 | 814 | (4) | |
Total other comprehensive (loss) income | (69) | 85 | 684 | (107) | |
COMPREHENSIVE INCOME | $ 18,165 | $ 14,942 | $ 43,150 | $ 41,003 | |
NET INCOME (LOSS) PER SHARE - BASIC: | |||||
Income from continuing operations | $ 0.26 | $ 0.21 | $ 0.62 | $ 0.60 | |
Loss from discontinued operations | (0.01) | (0.01) | |||
Net income per share | 0.26 | 0.21 | 0.61 | 0.59 | |
NET INCOME (LOSS) PER SHARE - DILUTED: | |||||
Income from continuing operations | 0.25 | 0.21 | 0.60 | 0.59 | |
Loss from discontinued operations | (0.01) | (0.01) | |||
Net income per share | $ 0.25 | $ 0.21 | $ 0.59 | $ 0.58 | |
WEIGHTED AVERAGE SHARES OUTSTANDING: | |||||
Basic | 70,142 | 69,737 | 70,029 | 69,542 | |
Diluted | 72,142 | 71,790 | 71,901 | 71,425 | |
Tuition and Fees [Member] | |||||
REVENUE: | |||||
Total revenue | $ 154,291 | $ 144,882 | $ 467,298 | $ 433,736 | |
Other [Member] | |||||
REVENUE: | |||||
Total revenue | [1] | $ 668 | $ 808 | $ 1,955 | $ 2,055 |
[1] | Other revenue primarily includes contract training revenue and bookstore and laptop sales. |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Gain (Loss) [Member] | Accumulated Deficit [Member] |
BALANCE at Dec. 31, 2017 | $ 296,205 | $ 843 | $ (217,355) | $ 621,008 | $ (164) | $ (108,127) |
BALANCE, shares at Dec. 31, 2017 | 84,280,000 | |||||
BALANCE, shares at Dec. 31, 2017 | (15,162,000) | |||||
Net income | 41,110 | 41,110 | ||||
Foreign currency translation | (103) | (103) | ||||
Unrealized gain (loss) on investments | (4) | (4) | ||||
Share-based compensation expense | 4,144 | 4,144 | ||||
Common stock issued | (1,705) | $ 9 | $ (3,313) | 1,599 | ||
Common stock issued, shares | 879,000 | (236,000) | ||||
BALANCE at Sep. 30, 2018 | 339,647 | $ 852 | $ (220,668) | 626,751 | (271) | (67,017) |
BALANCE, shares at Sep. 30, 2018 | 85,159,000 | |||||
BALANCE, shares at Sep. 30, 2018 | (15,398,000) | |||||
BALANCE at Jun. 30, 2018 | 322,917 | $ 851 | $ (220,573) | 624,869 | (356) | (81,874) |
BALANCE, shares at Jun. 30, 2018 | 85,115,000 | |||||
BALANCE, shares at Jun. 30, 2018 | (15,392,000) | |||||
Net income | 14,857 | 14,857 | ||||
Foreign currency translation | (21) | (21) | ||||
Unrealized gain (loss) on investments | 106 | 106 | ||||
Share-based compensation expense | 1,445 | 1,445 | ||||
Common stock issued | 343 | $ 1 | $ (95) | 437 | ||
Common stock issued, shares | 44,000 | (6,000) | ||||
BALANCE at Sep. 30, 2018 | 339,647 | $ 852 | $ (220,668) | 626,751 | (271) | (67,017) |
BALANCE, shares at Sep. 30, 2018 | 85,159,000 | |||||
BALANCE, shares at Sep. 30, 2018 | (15,398,000) | |||||
BALANCE at Dec. 31, 2018 | $ 355,203 | $ 852 | $ (220,700) | 628,295 | (298) | (52,946) |
BALANCE, shares at Dec. 31, 2018 | 85,173,686 | 85,174,000 | ||||
BALANCE, shares at Dec. 31, 2018 | (15,400,776) | (15,401,000) | ||||
Net income | $ 42,466 | 42,466 | ||||
Foreign currency translation | (130) | (130) | ||||
Unrealized gain (loss) on investments | 814 | 814 | ||||
Adjustment for change in accounting method | 1,035 | 1,035 | ||||
Share-based compensation expense | 3,922 | 3,922 | ||||
Common stock issued | (1,366) | $ 7 | $ (2,692) | 1,319 | ||
Common stock issued, shares | 703,000 | (163,000) | ||||
BALANCE at Sep. 30, 2019 | $ 401,944 | $ 859 | $ (223,392) | 633,536 | 386 | (9,445) |
BALANCE, shares at Sep. 30, 2019 | 85,876,510 | 85,877,000 | ||||
BALANCE, shares at Sep. 30, 2019 | (15,564,086) | (15,564,000) | ||||
BALANCE at Jun. 30, 2019 | $ 381,248 | $ 857 | $ (223,263) | 630,878 | 455 | (27,679) |
BALANCE, shares at Jun. 30, 2019 | 85,668,000 | |||||
BALANCE, shares at Jun. 30, 2019 | (15,558,000) | |||||
Net income | 18,234 | 18,234 | ||||
Foreign currency translation | (113) | (113) | ||||
Unrealized gain (loss) on investments | 44 | 44 | ||||
Share-based compensation expense | 1,516 | 1,516 | ||||
Common stock issued | 1,015 | $ 2 | $ (129) | 1,142 | ||
Common stock issued, shares | 209,000 | (6,000) | ||||
BALANCE at Sep. 30, 2019 | $ 401,944 | $ 859 | $ (223,392) | $ 633,536 | $ 386 | $ (9,445) |
BALANCE, shares at Sep. 30, 2019 | 85,876,510 | 85,877,000 | ||||
BALANCE, shares at Sep. 30, 2019 | (15,564,086) | (15,564,000) |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 42,466 | $ 41,110 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 6,752 | 7,049 |
Bad debt expense | 32,028 | 21,579 |
Compensation expense related to share-based awards | 3,922 | 4,143 |
Deferred income taxes | 16,265 | 11,174 |
Changes in operating assets and liabilities | (16,042) | (66,760) |
Net cash provided by operating activities | 85,391 | 18,295 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of available-for-sale investments | (418,156) | (190,726) |
Sales of available-for-sale investments | 382,022 | 191,555 |
Purchases of property and equipment | (3,220) | (3,952) |
Other | 9 | |
Net cash used in investing activities | (39,345) | (3,123) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Issuance of common stock | 1,326 | 1,608 |
Payments of employee tax associated with stock compensation | (2,692) | (3,313) |
Net cash used in financing activities | (1,366) | (1,705) |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 44,680 | 13,467 |
CASH AND CASH EQUIVALENTS, beginning of the period | 32,731 | 18,899 |
CASH AND CASH EQUIVALENTS, end of the period | $ 77,411 | $ 32,366 |
Description of the Company
Description of the Company | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of the Company | 1. DESCRIPTION OF THE COMPANY Career Education’s academic institutions offer a quality education to a diverse student population in a variety of disciplines through online, campus-based and blended learning programs. Our two regionally accredited universities – Colorado Technical University (“CTU”) (“AIU”) path ® A listing of our university locations and web links to these institutions can be found at www.careered.com. As used in this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” “the Company” and “CEC” refer to Career Education Corporation and our wholly-owned subsidiaries. The terms “institution” and “university” refer to an individual, branded, for-profit educational institution, owned by us and includes its campus locations. The term “campus” refers to an individual main or branch campus operated by one of our institutions. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | 2. BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) The unaudited condensed consolidated financial statements presented herein include the accounts of Career Education Corporation and our wholly-owned subsidiaries ( “CEC”) Our reporting segments are determined in accordance with Financial Accounting Standards Board (“FASB”) (“ASC”) Segment Reporting University Group As of January 1, 2019, the Company combined the former All Other Campuses reporting segment with ‘Corporate and Other’ as part of continuing operations. Prior period segment amounts have been recast to reflect our reporting segments on a comparable basis. Effective January 1, 2019, we have implemented FASB ASC Topic 842 – Leases Leases |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2019 | |
New Accounting Pronouncements And Changes In Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | 3. RECENT ACCOUNTING PRONOUNCEMENTS Recent accounting guidance adopted in 2019 In February 2018, the FASB issued ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“AOCI”) In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The objective of Topic 842 is to establish transparency and comparability that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The core principle of Topic 842 is that lessees should recognize the assets and liabilities that arise from leases. All leases create an asset and liability for the lessee in accordance with FASB Concept Statements No. 6 Elements of Financial Statements, and, therefore, recognition of those lease assets and liabilities represents an improvement over previous GAAP. The accounting applied for lessors largely remained unchanged. The amendment in this ASU requires recognition of a lease liability and a right of use asset at the lease inception date. For all public business entities, ASU 2016-02 is effective for annual periods and interim periods beginning after December 15, 2018. We completed the assessment of our evaluation of the new standard on our accounting policies and processes and adopted this guidance beginning 2019 using a modified retrospective approach without restating prior comparative periods . The most significant impact primarily relates to our accounting for real estate leases and real estate subleases. The adoption of this guidance significantly impacts the presentation of our financial condition and disclosures, but didn’t materially impact our results of operations. See Note 7 “ Leases ” for further information. Recent accounting guidance not yet adopted In August 2018, the FASB issued ASU No. 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | 4. FINANCIAL INSTRUMENTS Investments consist of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands): September 30, 2019 Gross Unrealized Cost Gain (Loss) Fair Value Short-term investments (available for sale): Municipal bonds $ 1,078 $ 3 $ - $ 1,081 Non-governmental debt securities 212,120 490 (54 ) 212,556 Treasury and federal agencies 20,788 4 (14 ) 20,778 Total short-term investments (available for sale) 233,986 497 (68 ) 234,415 December 31, 2018 Gross Unrealized Cost Gain (Loss) Fair Value Short-term investments (available for sale): Non-governmental debt securities $ 179,393 $ 35 $ (337 ) $ 179,091 Treasury and federal agencies 17,417 5 (85 ) 17,337 Total short-term investments (available for sale) $ 196,810 $ 40 $ (422 ) $ 196,428 In the table above, unrealized holding gains (losses) relate to short-term investments that have been in a continuous unrealized gain (loss) position for less than one year. Our non-governmental debt securities primarily consist of commercial paper and certificates of deposit. Our treasury and federal agencies primarily consist of U.S. Treasury bills and federal home loan debt securities. We do not intend to sell our investments in these securities prior to maturity and it is not likely that we will be required to sell these investments before recovery of the amortized cost basis. Fair Value Measurements FASB ASC Topic 820 – Fair Value Measurements As of September 30, 2019, we held investments that are required to be measured at fair value on a recurring basis. These investments (available-for-sale) consist of municipal bonds, non-governmental debt securities and treasury and federal agencies securities. Available for sale securities included in Level 1 are valued at quoted prices in active markets for identical assets and liabilities. Available for sale securities included in Level 2 are estimated based on observable inputs other than quoted prices in active markets for identical assets and liabilities, such as quoted prices for identical or similar assets or liabilities in inactive markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Investments measured at fair value on a recurring basis subject to the disclosure requirements of FASB ASC Topic 820 – Fair Value Measurements As of September 30, 2019 Level 1 Level 2 Level 3 Total Municipal bonds $ - $ 1,081 $ - $ 1,081 Non-governmental debt securities 15,000 197,556 - 212,556 Treasury and federal agencies - 20,778 - 20,778 Totals $ 15,000 $ 219,415 $ - $ 234,415 As of December 31, 2018 Level 1 Level 2 Level 3 Total Non-governmental debt securities $ 20,000 $ 159,091 $ - $ 179,091 Treasury and federal agencies - 17,337 - 17,337 Totals $ 20,000 $ 176,428 $ - $ 196,428 Equity Method Investment Our investment in an equity affiliate, which is recorded within other noncurrent assets on our condensed consolidated balance sheets, represents an international investment in a private company. As of September 30, 2019, our investment in an equity affiliate equated to a 30.7%, or $2.6 million, non-controlling interest in CCKF, a Dublin-based educational technology company providing intelligent systems to power the delivery of individualized and personalized learning. During each of the quarters ended September 30, 2019 and 2018, we recorded less than $0.1 million of gain and during the years to date ended September 30, 2019 and September 30, 2018, we recorded less than $0.1 million of gain and $0.1 million of loss, respectively, related to our proportionate investment in CCKF within miscellaneous income on our unaudited condensed consolidated statements of income and comprehensive income. We make periodic operating maintenance payments related to proprietary rights that we use in our intelli path ® Maintenance Fee Payments For the quarter ended September 30, 2019 $ 338 For the quarter ended September 30, 2018 $ 355 For the year to date ended September 30, 2019 $ 1,045 For the year to date ended September 30, 2018 $ 1,108 Credit Agreement On December 27, 2018, the Company; its wholly-owned subsidiary, CEC Educational Services, LLC; and the subsidiary guarantors thereunder, entered into a credit agreement with BMO Harris Bank N.A. (“BMO Harris”) |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenue Recognition | 5 . Disaggregation of Revenue The following tables disaggregate our revenue by major source (dollars in thousands): For the Quarter Ended September 30, 2019 For the Quarter Ended September 30, 2018 CTU AIU Corporate and Other (3) Total CTU AIU Corporate and Other (3) Total Tuition $ 90,256 $ 56,383 $ - $ 146,639 $ 89,121 $ 50,349 $ 64 $ 139,534 Technology fees 4,789 2,360 - 7,149 2,823 1,953 - 4,776 Other miscellaneous fees (1) 384 119 - 503 426 145 1 572 Total tuition and fees 95,429 58,862 - 154,291 92,370 52,447 65 144,882 Other revenue (2) 609 45 14 668 745 57 6 808 Total revenue $ 96,038 $ 58,907 $ 14 $ 154,959 $ 93,115 $ 52,504 $ 71 $ 145,690 For the Year to Date Ended September 30, 2019 For the Year to Date Ended September 30, 2018 CTU AIU Corporate and Other (3) Total CTU AIU Corporate and Other (3) Total Tuition $ 273,777 $ 171,954 $ - $ 445,731 $ 269,146 $ 148,134 $ 555 $ 417,835 Technology fees 12,828 7,129 - 19,957 8,554 5,577 - 14,131 Other miscellaneous fees (1) 1,271 339 - 1,610 1,415 335 20 1,770 Total tuition and fees 287,876 179,422 - 467,298 279,115 154,046 575 433,736 Other revenue (2) 1,774 137 44 1,955 1,873 158 24 2,055 Total revenue $ 289,650 $ 179,559 $ 44 $ 469,253 $ 280,988 $ 154,204 $ 599 $ 435,791 __________________ (1) Other miscellaneous fees include graduation fees and activity fees. ( 2 ) Other revenue primarily includes contract training revenue and bookstore and laptop sales. ( 3 ) Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. Performance Obligations Our revenue, which is derived primarily from academic programs taught to students who attend our institutions, is generally segregated into two categories: (1) tuition and fees and (2) other. Tuition and fees represent costs to our students for educational services provided by our institutions. Our institutions charge tuition and fees at varying amounts, depending on the institution, the type of program and specific curriculum. Our institutions bill students a single charge that covers tuition, fees and required program materials, such as textbooks and supplies, which we treat as a single performance obligation. Generally, we bill student tuition at the beginning of each academic term, and recognize the tuition as revenue on a straight-line basis over the academic term, which includes any applicable externship period. As part of a student’s course of instruction, certain fees, such as technology fees and graduation fees, are billed to students. These fees are earned over the applicable term and are not considered separate performance obligations. Other revenue, which consists primarily of contract training revenue and bookstore sales, is billed and recognized as goods are delivered or services are performed. Contract training revenue results from individual training courses that are stand-alone courses and not part of a degree or certificate program. Bookstore sales are primarily initiated by the student and are not included in the enrollment agreement at the onset of a student’s entrance to the institution. These types of sales constitute a separate performance obligation from classroom instruction. Our institutions’ academic year is generally at least 30 weeks in length but varies both by institution and program of study and is divided by academic terms. Academic terms are determined by regulatory requirements mandated by the federal government and/or applicable accrediting body, which also vary by institution and program. Academic terms are determined by start dates, which vary by institution and program and are generally 10 – 11 weeks in length. Contract Assets For each term, the portion of tuition and fee payments received from students but not yet earned is recorded as deferred revenue and reported as a current liability on our condensed consolidated balance sheets, as we expect to earn these revenues within the next year. A contract asset is recorded for each student for the current term for which they are enrolled for the amount charged for the current term that has not yet been received as payment and to which we do not have the unconditional right to receive payment because the student has not reached the point in the student’s current academic term at which the amount billed is no longer refundable to the student. On a student by student basis, the contract asset is offset against the deferred revenue balance for the current term and the net deferred revenue balance is reflected within current liabilities on our condensed consolidated balance sheets. Due to the short-term nature of our academic terms, the contract asset balance which exists at the beginning of each quarter will no longer be a contract asset at the end of that quarter. The decrease in contract asset balances are a result of one of the following: it becomes a student receivable balance once a student reaches the point in a student’s academic term where the amount billed is no longer refundable to the student; a refund to withdrawn students for the portion entitled to be refunded under each institutions’ refund policy; we receive funds to apply against the contract asset balance; or a student makes a change in the number of classes they are enrolled which may cause an adjustment to their previously billed amount. As of the end of each quarter, a new contract asset is determined on a student by student basis based on the most recently started term and a student’s progress within that term as compared to the date at which the student is no longer entitled to a refund under each institution’s refund policy. The amount of contract assets which are being offset with deferred revenue balances as of September 30, 2019 and December 31, 2018 were as follows (dollars in thousands): As of September 30, 2019 December 31, 2018 Gross deferred revenue $ 35,611 $ 51,694 Gross contract assets (11,827 ) (19,343 ) Deferred revenue, net $ 23,784 $ 32,351 Deferred Revenue Changes in our deferred revenue balances for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): For the Quarter Ended September 30, 2019 For the Quarter Ended September 30, 2018 CTU AIU Corporate and Other (2) Total CTU AIU Corporate and Other (2) Total Gross deferred revenue, July 1, $ 25,825 $ 19,976 $ - $ 45,801 $ 23,754 $ 13,436 $ 70 $ 37,260 Revenue earned from balances existing as of July 1, (23,375 ) (16,970 ) - (40,345 ) (21,533 ) (11,341 ) (47 ) (32,921 ) Billings during period (1) 96,863 47,310 - 144,173 93,277 73,852 63 167,192 Revenue earned for new billings during the period (72,054 ) (41,892 ) - (113,946 ) (70,837 ) (41,106 ) (18 ) (111,961 ) Other adjustments (146 ) 74 - (72 ) (266 ) (500 ) (25 ) (791 ) Gross deferred revenue, September 30, $ 27,113 $ 8,498 $ - $ 35,611 $ 24,395 $ 34,341 $ 43 $ 58,779 For the Year to Date Ended September 30, 2019 For the Year to Date Ended September 30, 2018 CTU AIU Corporate and Other (2) Total CTU AIU Corporate and Other (2) Total Gross deferred revenue, January 1, $ 24,250 $ 27,444 $ - $ 51,694 $ 23,933 $ 15,507 $ 104 $ 39,544 Revenue earned from balances existing as of January 1, (22,289 ) (21,779 ) - (44,068 ) (22,192 ) (14,310 ) (104 ) (36,606 ) Billings during period (1) 289,803 159,711 - 449,514 279,374 173,244 558 453,176 Revenue earned for new billings during the period (265,587 ) (157,643 ) - (423,230 ) (256,923 ) (139,736 ) (471 ) (397,130 ) Other adjustments 936 765 - 1,701 203 (364 ) (44 ) (205 ) Gross deferred revenue, September 30, $ 27,113 $ 8,498 $ - $ 35,611 $ 24,395 $ 34,341 $ 43 $ 58,779 ______________ (1) Billings during period includes adjustments for prior billings. ( 2 ) Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. Cash Receipts Our students finance costs through a variety of funding sources, including, among others, federal loan and grant programs, institution al payment plans, employer reimburs ement, Veterans’ Administration and other military funding and grants, private and institutional scholarships and cash payments. Cash receipts from government related sources are typically receiv ed during the current academic term . We typically receive funds after the end of a n academic term for students who receive employer reimbursements. Students who have not applied for any type of financial aid generally set up a payment plan with the institution and make payments on a monthly basis per the terms of the payment plan. If a student withdraws from one of our institutions prior to the completion of the academic term, we refund the portion of tuition and fees already paid that, pursuant to our refund policy and applicable federal and state law and accrediting agency standards, we are not entitled to retain. Generally, the amount to be refunded to a student is calculated based upon the percent of the term attended and the amount of tuition and fees paid by the student as of their withdrawal date. In certain circumstances, we have recognized revenue for students who have withdrawn that we are not entitled to retain. We have estimated a reserve for these limited circumstances based on historical evidence in the amount of $1.1 million and $0.9 million as of September 30, 2019 and December 31, 2018, respectively. Students are typically entitled to a partial refund through approximately halfway of their term. Pursuant to each institution’s policy, once a student reaches the point in the term where no refund is given, the student would not have a refund due if withdrawing from the institution subsequent to that date. Management reassesses collectability when a student withdraws from the institution and has unpaid tuition charges for the current term which the institution is entitled to retain per the applicable refund policy. Such unpaid charges do not meet the threshold of reasonably collectible and are recognized as revenue in accordance with ASC Topic 606 when cash is received and the contract is terminated and neither party has further performance obligations. We have no remaining performance obligations for students who have withdrawn from our institutions, and once the refund calculation is performed and funds are returned to the student, if applicable under our refund policy, no further consideration is due back to the student. We recognized $0.4 million of revenue for each of the quarters ended September 30, 2019 and 2018, and $0.9 million and $1.1 million for the years to date ended September 30, 2019 and 2018, respectively, for payments received from withdrawn students. Significant Judgments We analyze revenue recognition on a portfolio approach under ASC Topic 606. Significant judgment is utilized in determining the appropriate portfolios to assess for meeting the criteria to recognize revenue under ASC Topic 606. We have determined that all of our students can be grouped into one portfolio. Based on our past experience, students at different campuses, in different programs or with different funding all behave similarly. Enrollment agreements all contain similar terms, refund policies are similar across all institutions and all students work with the campus to obtain some type of funding, for example, Title IV Program funds, Veterans Administration funds, military funding, employer reimbursement or self-pay. We have significant historical data for our students which allows us to analyze collectability. We do not expect that revenue earned for the portfolio is significantly different as compared to revenue that would be earned if we were to assess each student contract separately. Significant judgment is also required to assess collectability, particularly as it relates to students seeking funding under Title IV Programs. Because students are required to provide documentation, and in some cases extensive documentation, to the Department of Education to be eligible and approved for funding, the timeframe for this process can sometimes span between 90 to 120 days. We monitor the progress of students through the eligibility and approval process and assess collectability for the portfolio each reporting period to monitor that the collectability threshold is met. For the quarters and years to date ended September 30, 2019 and 2018, we received a majority of our institutions’ cash receipts for tuition payments from various government agencies as well as our corporate partnerships which represents a substantial portion of our consolidated revenues and are all low risk of collectability. |
Student Receivables
Student Receivables | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Student Receivables | 6. STUDENT RECEIVABLES Student receivables represent funds owed to us in exchange for the educational services provided to a student. Student receivables are reflected net of an allowance for doubtful accounts at the end of the reporting period. Student receivables, net, are reflected on our condensed consolidated balance sheets as components of both current and non-current assets. We do not accrue interest on past due student receivables; interest is recorded only upon collection. Generally, a student receivable balance is written off once it reaches greater than 90 days past due. Although we analyze past due receivables, it is not practical to provide an aging of our non-current student receivable balances as a result of the methodology utilized in determining our earned student receivable balances. Student receivables are recognized on our condensed consolidated balance sheets as they are deemed earned over the course of a student’s program and/or term, and therefore cash collections are not applied against specifically dated transactions. Our standard student receivable allowance estimation methodology considers a number of factors that, based on our collection experience, we believe have an impact on our repayment risk and ability to collect student receivables. Changes in the trends in any of these factors may impact our estimate of the allowance for doubtful accounts. These factors include, but are not limited to: internal repayment history, repayment practices of previous extended payment programs, changes in the current economic, legislative or regulatory environments and the ability to complete the federal financial aid process with the student s . These factors are monitored and assessed on a regular basis. Overall, our allowance estimation process for student receivables is validated by trending analysis and comparing estimated and actual performance. Student Receivables Under Extended Payment Plans As of September 30, 2019 and December 31, 2018, the amount of non-current student receivables under payment plans that are longer than 12 months in duration, net of allowance for doubtful accounts, was $1.1 million and $0.9 million, respectively. Student Receivables Valuation Allowance Changes in our current and non-current receivables allowance for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): Balance, Beginning of Period Charges to Expense (1) Amounts Written-off Balance, End of Period For the quarter ended September 30, 2019 $ 30,730 $ 8,888 $ (10,621 ) $ 28,997 For the quarter ended September 30, 2018 $ 24,268 $ 7,932 $ (8,649 ) $ 23,551 For the year to date ended September 30, 2019 $ 24,836 $ 32,042 $ (27,881 ) $ 28,997 For the year to date ended September 30, 2018 $ 22,534 $ 21,675 $ (20,658 ) $ 23,551 (1) Charges to expense include an offset for recoveries of amounts previously written off of $0.6 million and $1.8 million for the quarters ended September 30, 2019 and 2018, respectively, and $2.0 million and $4.3 million for the years to date ended September 30, 2019 and 2018, respectively. Fair Value Measurements The carrying amount reported in our condensed consolidated balance sheets for the current portion of student receivables approximates fair value because of the nature of these financial instruments as they generally have short maturity periods. It is not practicable to estimate the fair value of the non-current portion of student receivables, since observable market data is not readily available, and no reasonable estimation methodology exists. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | 7. LEASES We lease most of our administrative and educational facilities under non-cancelable operating leases expiring at various dates through 2028. Lease terms generally range from five to ten years with one to four renewal options for extended terms. In most cases, we are required to make additional payments under facility operating leases for taxes, insurance and other operating expenses incurred during the operating lease period, which are typically variable in nature. We determine if a contract contains a lease when the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Upon identification and commencement of a lease, we establish a right of use (“ROU”) Contract components A lease component is defined as an asset within the lease contract that a lessee can benefit from the use of and is not highly dependent or interrelated with other assets in the arrangement. A lease contract may contain multiple lease components. A non-lease component is defined as a component of the lease that transfers a good or service for the underlying asset, such as maintenance services. We have determined that all of our leases contain one lease component related to the building and land. We have determined that treating the land together with the building as one lease component would not result in a significant difference from accounting for them as separate lease components. Additionally, we have elected the practical expedient to include both the lease component and the non-lease component as a single component when accounting for each lease and calculating the resulting lease liability and ROU asset. Any remaining contract consideration, such as property taxes and insurance, that does not meet the definition of a lease component or non-lease component would be allocated to the single lease component based on our election. Lease liability and ROU asset The lease liability represents future lease payments for lease and non-lease components discounted for present value. Lease payments that may be included in the lease liability include fixed payments, variable lease payments that are based on an index or rate and payments for penalties for terminating the lease if the lessee is reasonably certain to utilize a termination option, among others. Certain of our leases contain rent escalation clauses that are specifically stated in the lease and these are included in the calculation of the lease liability. Variable lease payments for lease and non-lease components which are not based on an index or rate are excluded from the calculation of the lease liability and are recognized in the statement of income and comprehensive income during the period incurred. The ROU asset consists of the amount of the initial measurement of the lease liability and adjusted for any lease incentives, including rent abatements and tenant improvement allowances, and any initial direct costs incurred by the lessee. The ROU asset is amortized over the remaining lease term on a straight-line basis and recorded within educational services and facilities on our unaudited condensed consolidated statements of income and comprehensive income. Lease term The lease term is determined by taking into account the initial period as stated in the lease contract and adjusted for any renewal options that the company is reasonably certain to exercise as well as any period of time that the lessee has control of the space before the stated initial term of the lease. If we determine that we are reasonably certain to exercise a termination option, the lease term is then adjusted to account for the expected termination date. Quantitative lease information Quantitative information related to leases is presented in the following table (dollars in thousands): For the Quarter Ended September 30, 2019 For the Year to Date Ended September 30, 2019 Lease expenses (1) Fixed lease expenses - operating (1) $ 3,046 $ 9,751 Variable lease expenses - operating (1) 2,196 6,830 Sublease income (1) (1,075 ) (3,332 ) Total lease expenses (1) 4,167 13,249 Other information Gross operating cash flows for operating leases (2) $ (7,400 ) $ (25,503 ) Operating cash flows from subleases (2) 1,112 3,417 As of September 30, 2019 Weighted average remaining lease term (in months) – operating leases 79 Weighted average discount rate – operating leases 5.2 % __________________ (1) Lease expense and sublease income represent the amount recorded within our unaudited condensed consolidated statement of income and comprehensive income. Variable lease amounts represent expenses recognized as incurred which are not included in the lease liability. Fixed lease expenses and sublease income are recorded on a straight-line basis over the lease term and therefore are not necessarily representative of cash payments during the same period. (2) Cash flows are presented on a consolidated basis, including continuing and discontinued operations, and represent cash payments for fixed and variable lease costs. Gross Lease Obligations As of September 30, 2019, future minimum lease payments under operating leases which are included in lease liabilities on our condensed consolidated balance sheet for continuing operations are as follows (dollars in thousands): Operating Leases Total 2019 (1) $ 2,451 2020 17,390 2021 13,505 2022 11,331 2023 and thereafter 35,821 Total $ 80,498 Less: imputed interest 13,485 Present value of future minimum lease payments 67,013 Less: current lease liabilities 12,109 Non-current lease liabilities $ 54,904 __________________ (1) Amounts provided are for liabilities remaining as of September 30, 2019. As of December 31, 2018, future minimum lease payments under operating leases for continuing and discontinued operations were as follows (dollars in thousands): Operating Leases Continuing Operations Discontinued Operations Total 2019 (1) $ 21,076 $ 808 $ 21,884 2020 17,728 - 17,728 2021 12,070 - 12,070 2022 8,638 - 8,638 2023 and thereafter 22,298 - 22,298 Total $ 81,810 $ 808 $ 82,618 __________________ (1) Amounts include payments due associated with executed early terminations of real estate leases and represent payments for the full year 2019. Subleases For certain of our leased locations, primarily those related to our closed campuses, we have vacated the facility and have fully or partially subleased the space. For each sublease that has been entered into, we remain the guarantor under the lease and therefore become the intermediate lessor. We have 12 subleases within eight leased facilities with terms ranging from two to four years. We have recognized sublease income of $1.1 million and $3.3 million for the quarter and year to date ended September 30, 2019, respectively, as on offset to lease expense on our unaudited condensed consolidated statement of income and comprehensive income. As of September 30, 2019, future minimum sublease rental income under operating leases, which will decrease our future minimum lease payments presented above, is as follows (dollars in thousands): Operating Subleases Total 2019 (1) $ 649 2020 2,765 2021 1,081 2022 777 2023 and thereafter 330 Total $ 5,602 _____________________ (1) Sublease receivables remaining as of September 30, 2019. S ignificant Judgments and Assumptions We utilize discount rates to determine the net present value of our gross lease obligations when calculating the lease liability and related ROU asset. In cases in which the rate implicit in the lease is readily determinable, we utilize that discount rate for purposes of the net present value calculation. In most cases, our lease agreements do not have a discount rate that is readily determinable and therefore we utilize an estimate of our incremental borrowing rate. Our incremental borrowing rate is determined at lease commencement or lease modification and represents the rate of interest we would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Of our nine leases related to our ongoing operations which consist of administrative offices and university locations, we are not reasonably certain that we will extend or terminate any of those leases. For the eight remaining leases that have been vacated related to our closed campuses, we are not reasonably certain to exercise any options to extend or terminate any leases. Transition to ASC 842 Upon transition to ASC 842 as of January 1, 2019, the following beginning balances were restated within our condensed consolidated balance sheet (dollars in thousands): December 31, 2018 Impact of Modified Retrospective Adoption of ASC 842 January 1, 2019 Post ASC 842 Adoption Prepaid expenses (1) $ 7,771 $ (1,502 ) $ 6,269 Right of use asset - 45,963 45,963 Deferred income tax assets, net 81,628 (325 ) 81,303 Assets of discontinued operations, non-current 178 57 235 Lease liability - operating, current - 18,656 18,656 Other accrued expenses, current (1) 19,668 (5,950 ) 13,718 Liabilities of discontinued operations, current 536 57 593 Lease liability - operating, non-current - 48,238 48,238 Deferred rent obligations (1) 12,745 (12,745 ) - Other liabilities, non-current (1) 17,493 (5,098 ) 12,395 Accumulated deficit (2) (52,946 ) 1,035 (51,911 ) __________________ (1) Balances as of December 31, 2018 that related to prepaid rent, remaining lease obligations for vacated spaces and deferred rent obligations were offset with the ROU asset as of January 1, 2019. ( 2 ) Certain leases resulted in a negative ROU asset upon transition to ASC 842 related to vacated spaces that had liabilities previously established. Those leases that resulted in a negative ROU asset were recorded as an adjustment, net of tax, to accumulated deficit within stockholders equity on our condensed consolidated balance sheet as of January 1, 2019. We elected to adopt the relief provisions under ASC 842. ASC 842 offers relief from implementing the transition provisions by permitting an entity to elect not to reassess: • whether any expired or existing contract is a lease or contains a lease, • the lease classification of any expired or existing leases, and • initial direct costs for any existing leases. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Contingencies Disclosure [Abstract] | |
Contingencies | 8. CONTINGENCIES An accrual for estimated legal fees and settlements of $37.5 million and $6.1 million at September 30, 2019 and December 31, 2018, respectively, is presented within current liabilities – other accrued expenses on our condensed consolidated balance sheets. We record a liability when we believe that it is both probable that a loss will be incurred and the amount of loss can be reasonably estimated. We evaluate, at least quarterly, developments in our legal matters that could affect the amount of liability that was previously accrued, and make adjustments as appropriate. Significant judgment is required to determine both probability and the estimated amount. We may be unable to estimate a possible loss or range of possible loss due to various reasons, including, among others: (1) if the damages sought are indeterminate; (2) if the proceedings are in early stages; (3) if there is uncertainty as to the outcome of pending appeals, motions, or settlements; (4) if there are significant factual issues to be determined or resolved; and (5) if there are novel or unsettled legal theories presented. In such instances, there is considerable uncertainty regarding the ultimate resolution of such matters, including a possible eventual loss, if any. We are, or were, a party to the following legal proceedings that we consider to be outside the scope of ordinary routine litigation incidental to our business. Oregon Arbitrations. There were approximately 310 remaining active individual arbitration claims which were filed against Western Culinary Institute, Ltd. from March through July 2018, all of which are being administered by the American Arbitration Association. These individual arbitrations involve students who attended WCI from approximately 2008 to 2010. Each arbitration seeks monetary damages and alleges that WCI made a variety of misrepresentations to the individual student filing the arbitration, relating generally to WCI’s placement statistics, students’ employment prospects upon graduation from WCI, the value and quality of an education at WCI, and the amount of tuition students could expect to pay as compared to salaries they could expect to earn after graduation. The institution is no longer in operation and closed in 2017. The Company entered into a letter of intent as of September 26, 2019 to settle these approximately 310 remaining individual arbitration claims. The settlement, which will be in the form of a class settlement, is for a total amount of $7.1 million which includes all attorneys’ fees and costs. On October 9, 2019, a motion to certify the settlement class was filed in circuit court in Oregon. The Company makes no admission of liability pursuant to the terms of the settlement. The settlement is subject to final court approval. Payment of the $7.1 million will be made after final court approval, which the Company currently expects to occur in the first quarter of 2020. Unless they opt out, all claims against the Company alleged in the cases by settlement class members will be dismissed with prejudice. The Company will have the option of withdrawing from the settlement if a specified number of individuals opt out of the settlement. The Company’s financial statements for the quarter ended September 30, 2019 reflect a reserve of $7.1 million related to this matter. The one-time settlement expense is expected to result in substantial net savings for the Company compared to the significant long-term cost of participating in multiple individual arbitrations. FTC . As previously disclosed, on July 26, 2019, the Company and certain operating subsidiaries executed a settlement agreement (the ) with the U.S. Federal Trade Commission (“ ”) to resolve the inquiry commenced by the FTC on August 20, 2015. The FTC Agreement which is in the form of a Stipulation as to Entry of an Order for Permanent Injunction and Monetary Judgment became effective upon its entry as an Order in the United States District Court of the Northern District of Illinois on October 9, 2019. As of September 30, 2019, the Company’s condensed consolidated balance sheet reflects restricted cash of approximately $30.0 million held in an escrow account and a reserve of $30.0 million related to this matter. The escrow account funds were distributed to the FTC after entry of the district court’s Order. Other . In addition to the legal proceedings and other matters described above, we receive informal requests from state attorneys general and other government agencies relating to specific complaints they have received from students or former students which seek information about the student, our programs, and other matters relating to our activities in the relevant state. These requests can be broad and time consuming to respond to, and there is a risk that they could expand and/or lead to a formal inquiry or investigation into our practices in a particular state. We are also subject to a variety of other claims, lawsuits, arbitrations and investigations that arise from time to time out of the conduct of our business, including, but not limited to, matters involving prospective students, students or graduates, alleged violations of the Telephone Consumer Protection Act, both individually and on behalf of a putative class, and employment matters. While we currently believe that these additional matters, individually or in aggregate, will not have a material adverse impact on our financial position, cash flows or results of operations, these additional matters are subject to inherent uncertainties, and management’s view of these matters may change in the future. Were an unfavorable final outcome to occur in any one or more of these matters, there exists the possibility of a material adverse impact on our business, reputation, financial position and cash flows. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. INCOME TAXES The determination of the annual effective tax is based upon a number of significant estimates and judgments, including the estimated annual pretax income in each tax jurisdiction in which we operate and the ongoing development of tax planning strategies during the year. In addition, our provision for income taxes can be impacted by changes in tax rates or laws, the finalization of tax audits and reviews, as well as other factors that cannot be predicted with certainty. As such, there can be significant volatility in interim tax provisions. The following is a summary of our provision for income taxes and effective tax rate from continuing operations (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Pretax income $ 26,046 $ 20,157 $ 59,422 $ 53,343 Provision for income taxes $ 7,653 $ 5,089 $ 16,362 $ 11,527 Effective rate 29.4 % 25.2 % 27.5 % 21.6 % As of December 31, 2018, a valuation allowance of $48.0 million was maintained with respect to our foreign tax credits, state net operating losses and Illinois edge credits. During the quarter ended June 30, 2019, the valuation allowance was reduced by $0.8 million to reflect the results of a Florida income tax audit and the realizability of that state’s net operating loss carryforward. After considering both positive and negative evidence related to the realization of the deferred tax assets, we have determined that it is necessary to continue to maintain a $47.2 million valuation allowance against our foreign tax credits, state net operating losses and Illinois edge credits as of September 30, 2019. The effective tax rate for the quarter and year to date ended September 30, 2019 reflects the tax effect of the partial non-deductibility of the FTC settlement, which increased the effective tax rate for the quarter and year to date by 5.7% and 6.5%, respectively. The effective tax rate for the quarter and year to date ended September 30, 2019 was impacted by the tax effect of stock-based compensation and net adjustments that increased the state deferred tax asset. The year to date effective tax rate also includes the release of previously recorded tax reserves. The effect of these discrete items decreased the current effective tax rate for the quarter and year to date by 2.4% and 4.8%, respectively. For the quarter and year to date ended September 30, 2018, the effective tax rate reflects the tax effect of expenses that are not deductible for tax purposes and other adjustments which on a relative basis are a higher percentage of projected full-year earnings. The effective rate for the quarter and year to date ended September 30, 2018 includes the impact of tax reserves, the tax effect of stock-based compensation and adjustments to increase the state deferred tax asset. The effect of these discrete items decreased the effective tax rate for the quarter and year to date by 2.7% and 5.2%, respectively. We estimate that it is reasonably possible that the gross liability for unrecognized tax benefits for a variety of uncertain tax positions will decrease by up to $1.6 million in the next twelve months as a result of the completion of various tax audits currently in process and the expiration of the statute of limitations in several jurisdictions. The income tax rate for the quarter and year to date ended September 30, 2019 does not take into account the possible reduction of the liability for unrecognized tax benefits. The impact of a reduction to the liability will be treated as a discrete item in the period the reduction occurs. We recognize interest and penalties related to unrecognized tax benefits in tax expense. As of September 30, 2019, we had accrued $1.8 million as an estimate for reasonably possible interest and accrued penalties. Our tax returns are routinely examined by federal, state and local tax authorities and these audits are at various stages of completion at any given time. The Internal Revenue Service has completed its examination of our U.S. income tax returns through our tax year ended December 31, 2014. Accumulated Other Comprehensive Income Effective January 1, 2019, the Company adopted ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“AOCI”) |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation | 10. SHARE-BASED COMPENSATION Overview of Share-Based Compensation Plans The Career Education Corporation 2016 Incentive Compensation Plan (the “ 2016 Plan As of September 30, 2019, we estimate that compensation expense of approximately $16.0 million will be recognized over the next four years for all unvested share-based awards that have been granted to participants, including stock options and restricted stock units to be settled in shares of stock but excluding restricted stock units to be settled in cash and cash-based performance unit awards and excludes any estimates of forfeitures. This amount generally does not include expense associated with performance-based restricted stock unit awards granted in the fourth quarter of 2018 as the Company does not currently believe it is probable that it will meet the performance goals. Stock Options. The exercise price of stock options granted under each of the plans is equal to the fair market value of our common stock on the date of grant. Employee stock options generally become exercisable 25% per year over a four-year service period beginning on the date of grant and expire ten years from the date of grant. Non-employee directors’ stock options expire ten years from the date of grant and generally become 100% exercisable after the first anniversary of the grant date. Grants of stock options are generally only subject to the service conditions discussed previously. Stock option activity during the year to date ended September 30, 2019 under all of our plans was as follows (options in thousands): Options Weighted Average Exercise Price Outstanding as of December 31, 2018 2,818 $ 9.59 Granted 42 21.29 Exercised (194 ) 5.73 Cancelled (164 ) 22.62 Outstanding as of September 30, 2019 2,502 $ 9.23 Exercisable as of September 30, 2019 1,947 $ 9.01 Restricted Stock Units to be Settled in Stock. Restricted stock units to be settled in shares of stock which are not “performance-based” generally vest 25% per year over a four-year service period. Restricted stock units which are “performance-based” are subject to performance or market conditions that, even if the requisite service period is met, may reduce the number of units of restricted stock that vest at the end of the requisite service period or result in all units being forfeited. The performance-based restricted stock units generally vest three years after the grant date. The following table summarizes information with respect to all outstanding restricted stock units to be settled in shares of stock under our plans during the year to date ended September 30, 2019 (units in thousands): Restricted Stock Units to be Settled in Shares of Stock Units Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2018 (1) 2,017 $ 12.70 Granted 428 21.31 Vested (493 ) 6.11 Forfeited (23 ) 11.42 Outstanding as of September 30, 2019 1,929 $ 16.31 __________________ (1) The weighted average grant-date fair value per unit as of December 31, 2018 reflects an adjusted fair value per unit from $10.59 to $12.70 due to the modification of grants approved by the Board of Directors during the current quarter for our performance-based grants granted on December 14, 2018 . Deferred Stock Units to be Settled in Stock. The following table summarizes information with respect to all deferred stock units during the year to date ended September 30, 2019 (units in thousands): Deferred Stock Units to be Settled in Shares Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2018 (1) 76 $ 4.44 Granted - - Vested (2) (3 ) 5.56 Forfeited - - Outstanding as of September 30, 2019 (1) 73 $ 4.39 (1) Includes vested but unreleased awards. These awards are included in total outstanding awards until they are released under the terms of the agreement. (2) Includes previously vested awards which were released during the current period. Restricted Stock Units to be Settled in Cash. Restricted stock units to be settled in cash generally vest 25% per year over a four-year service period beginning on the date of grant. Cash-settled restricted stock units are recorded as liabilities as the expense is recognized and the fair value for these awards is determined at each period end date with changes in fair value recorded in our unaudited condensed consolidated statements of income and comprehensive income in the current period. Cash-settled restricted stock units are settled with a cash payment for each unit vested equal to the closing price on the vesting date. Cash-settled restricted stock units are not included in common shares reserved for issuance or available for issuance under the 2016 Plan The following table summarizes information with respect to all cash-settled restricted stock units during the year to date ended September 30, 2019 (units in thousands): Restricted Stock Units to be Settled in Cash Outstanding as of December 31, 2018 213 Granted - Vested (125 ) Forfeited (2 ) Outstanding as of September 30, 2019 86 Upon vesting, based on the conditions set forth in the award agreements, these units will be settled in cash. We valued these units in accordance with the guidance set forth by FASB ASC Topic 718 – Compensation-Stock Compensation and recognized $ 1.8 million and $ 2.0 million of expense for the years to date ended September 3 0 , 201 9 and September 3 0 , 2018, respectively, for all cash-settled restricted stock units , of which $ 0.3 million and $ 0.4 million was recorded during the quarters to date ended September 30, 2019 and September 30, 2018, respectively . Stock-Based Compensation Expense. Total stock-based compensation expense for the quarters and years to date ended September 30, 2019 and 2018 for all types of awards was as follows (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, Award Type 2019 2018 2019 2018 Stock options $ 400 $ 516 $ 1,260 $ 1,423 Restricted stock units settled in stock 1,113 924 2,651 2,707 Restricted stock units settled in cash 340 435 1,777 1,997 Total stock-based compensation expense $ 1,853 $ 1,875 $ 5,688 $ 6,127 Performance Unit Awards. Performance unit awards granted during 2017 are long-term incentive, cash-based awards. Payment of these awards is based upon a calculation of Total Shareholder Return (“ ”) of CEC as compared to TSR across a specified peer group of our competitors over a three-year performance period ending on December 31, 2019. These awards are recorded as liabilities as the expense is recognized and the fair value for these awards is determined at each period end date with changes in fair value recorded in our unaudited condensed consolidated statements of income and comprehensive income in the current period. We recorded $2.9 million and $2.5 million of expense related to these awards for the years to date September 30, 2019 and September 30, 2018, respectively, with $0.8 million and $0.9 million of expense for the quarters ended September 30, 2019 and September 30, 2018, respectively. |
Weighted Average Common Shares
Weighted Average Common Shares | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Weighted Average Common Shares | 11. WEIGHTED AVERAGE COMMON SHARES Basic net income per share is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares assuming dilution. Dilutive common shares outstanding is computed using the Treasury Stock Method and reflects the additional shares that would be outstanding if dilutive stock options were exercised and restricted stock units were settled for common shares during the period. The weighted average number of common shares used to compute basic and diluted net income per share for the quarters and years to date ended September 30, 2019 and 2018 were as follows: For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Basic common shares outstanding 70,142 69,737 70,029 69,542 Common stock equivalents 2,000 2,053 1,872 1,883 Diluted common shares outstanding 72,142 71,790 71,901 71,425 For the quarters and years to date ended September 30, 2019 and 2018, certain unexercised stock option awards are excluded from our computations of diluted earnings per share, as these shares were out-of-the-money and their effect would have been anti-dilutive. The anti-dilutive options that were excluded from our computations of diluted earnings per share were 0.3 million and 0.8 million shares for the quarters ended September 30, 2019 and 2018, respectively, and 0.7 million and 0.8 million shares for the years to date ended September 30, 2019 and 2018, respectively. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | 12. SEGMENT REPORTING Our segments are determined in accordance with FASB ASC Topic 280— Segment Reporting ♦ Colorado Technical University (CTU) places a strong focus on providing industry-relevant degree programs to meet the needs of our non-traditional students for career advancement and of employers for a well-educated workforce and offers academic programs in the career-oriented disciplines of business studies, nursing, computer science, engineering, information systems and technology, cybersecurity, criminal justice and healthcare management. Students pursue their degrees through fully-online programs, local campuses and blended formats which combine campus-based and online education. As of September 3 0 , 201 9 , students enrolled at CTU represented approximately 62 % of our total enrollments. Approximately 94 % of CTU’s enrollments are fully online. ♦ American InterContinental University (AIU) focuses on helping non-traditional students get the degree they need to move forward in their career as efficiently as possible and offers academic programs in the career-oriented disciplines of business studies, information technologies, education and criminal justice. Students pursue their degrees through fully-online programs, local campuses and blended formats which combine campus-based and online education. As of September 30, 2019, students enrolled at AIU represented approximately 38% of our total enrollments. Approximately 94% of AIU’s enrollments are fully online. Summary financial information by reporting segment is as follows (dollars in thousands): For the Quarter Ended September 30, Revenue Operating Income (Loss) 2019 % of Total 2018 % of Total 2019 2018 CTU $ 96,038 62.0 % $ 93,115 63.9 % $ 29,926 $ 26,261 AIU 58,907 38.0 % 52,504 36.0 % 7,341 1,070 Total University Group 154,945 100.0 % 145,619 100.0 % 37,267 27,331 Corporate and Other (1) 14 NM 71 0.0 % (12,973 ) (8,048 ) Total $ 154,959 100.0 % $ 145,690 100.0 % $ 24,294 $ 19,283 For the Year to Date Ended September 30, Revenue Operating Income (Loss) 2019 % of Total 2018 % of Total 2019 2018 CTU (2) $ 289,650 61.7 % $ 280,988 64.5 % $ 71,730 $ 80,562 AIU (3) 179,559 38.3 % 154,204 35.4 % 11,436 3,621 Total University Group 469,209 100.0 % 435,192 99.9 % 83,166 84,183 Corporate and Other (1) 44 NM 599 0.1 % (28,717 ) (33,068 ) Total $ 469,253 100.0 % $ 435,791 100.0 % $ 54,449 $ 51,115 Total Assets as of (4) September 30, 2019 December 31, 2018 CTU $ 100,527 $ 76,713 AIU 79,039 59,133 Total University Group 179,566 135,846 Corporate and Other (1) 419,063 346,469 Discontinued Operations 178 178 Total $ 598,807 $ 482,493 (1) Corporate and Other includes results of operations for closed campuses. A reserve of $7.1 million was recorded during the current quarter within Corporate and Other for the Oregon arbitration matter related to previously closed campuses. (2) A reserve of $18.6 million was recorded within CTU related to the FTC settlement during the year to date ended September 30, 2019. (3) A reserve of $11.4 million was recorded within AIU related to the FTC settlement during the year to date ended September 30, 2019. ( 4 ) Total assets do not include intercompany receivable or payable activity between institutions and corporate and investments in subsidiaries. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2019 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations | 13. DISCONTINUED OPERATIONS As of September 30, 2019, the results of operations for campuses that have ceased operations prior to 2015 are presented within discontinued operations. Prior to January 1, 2015, our teach-out campuses met the criteria for discontinued operations upon completion of their teach-out as defined under FASB ASC Topic 205 – Presentation of Financial Statements disposal are classified within discontinued operations, among other criteria. Since the January 2015 effective date of the updated guidance within ASC Topic 360, we have not had any campuses that met the criteria to be considered a discontinued operation. Results of Discontinued Operations The summary of unaudited results of operations for our discontinued operations for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Total operating expenses $ 208 $ 277 $ 775 $ 922 Loss before income tax $ (208 ) $ (277 ) $ (775 ) $ (922 ) Benefit from income tax (49 ) (66 ) (181 ) (216 ) Loss from discontinued operations, net of tax $ (159 ) $ (211 ) $ (594 ) $ (706 ) Assets and Liabilities of Discontinued Operations Assets and liabilities of discontinued operations on our condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018 include the following (dollars in thousands): September 30, December 31, 2019 2018 Assets: Non-current assets: Deferred income tax assets, net 178 178 Total assets of discontinued operations $ 178 $ 178 Liabilities: Current liabilities: Accounts payable and accrued expenses $ 3 $ 51 Remaining lease obligations - 485 Total current liabilities 3 536 Total liabilities of discontinued operations $ 3 $ 536 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Investments | Investments consist of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands): September 30, 2019 Gross Unrealized Cost Gain (Loss) Fair Value Short-term investments (available for sale): Municipal bonds $ 1,078 $ 3 $ - $ 1,081 Non-governmental debt securities 212,120 490 (54 ) 212,556 Treasury and federal agencies 20,788 4 (14 ) 20,778 Total short-term investments (available for sale) 233,986 497 (68 ) 234,415 December 31, 2018 Gross Unrealized Cost Gain (Loss) Fair Value Short-term investments (available for sale): Non-governmental debt securities $ 179,393 $ 35 $ (337 ) $ 179,091 Treasury and federal agencies 17,417 5 (85 ) 17,337 Total short-term investments (available for sale) $ 196,810 $ 40 $ (422 ) $ 196,428 |
Investments Measured at Fair Value on Recurring Basis | Investments measured at fair value on a recurring basis subject to the disclosure requirements of FASB ASC Topic 820 – Fair Value Measurements As of September 30, 2019 Level 1 Level 2 Level 3 Total Municipal bonds $ - $ 1,081 $ - $ 1,081 Non-governmental debt securities 15,000 197,556 - 212,556 Treasury and federal agencies - 20,778 - 20,778 Totals $ 15,000 $ 219,415 $ - $ 234,415 As of December 31, 2018 Level 1 Level 2 Level 3 Total Non-governmental debt securities $ 20,000 $ 159,091 $ - $ 179,091 Treasury and federal agencies - 17,337 - 17,337 Totals $ 20,000 $ 176,428 $ - $ 196,428 |
Schedule of Maintenance Fee Payment to CCKF | We make periodic operating maintenance payments related to proprietary rights that we use in our intelli path ® Maintenance Fee Payments For the quarter ended September 30, 2019 $ 338 For the quarter ended September 30, 2018 $ 355 For the year to date ended September 30, 2019 $ 1,045 For the year to date ended September 30, 2018 $ 1,108 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Summary of Disaggregation of Revenue by Major Source | The following tables disaggregate our revenue by major source (dollars in thousands): For the Quarter Ended September 30, 2019 For the Quarter Ended September 30, 2018 CTU AIU Corporate and Other (3) Total CTU AIU Corporate and Other (3) Total Tuition $ 90,256 $ 56,383 $ - $ 146,639 $ 89,121 $ 50,349 $ 64 $ 139,534 Technology fees 4,789 2,360 - 7,149 2,823 1,953 - 4,776 Other miscellaneous fees (1) 384 119 - 503 426 145 1 572 Total tuition and fees 95,429 58,862 - 154,291 92,370 52,447 65 144,882 Other revenue (2) 609 45 14 668 745 57 6 808 Total revenue $ 96,038 $ 58,907 $ 14 $ 154,959 $ 93,115 $ 52,504 $ 71 $ 145,690 For the Year to Date Ended September 30, 2019 For the Year to Date Ended September 30, 2018 CTU AIU Corporate and Other (3) Total CTU AIU Corporate and Other (3) Total Tuition $ 273,777 $ 171,954 $ - $ 445,731 $ 269,146 $ 148,134 $ 555 $ 417,835 Technology fees 12,828 7,129 - 19,957 8,554 5,577 - 14,131 Other miscellaneous fees (1) 1,271 339 - 1,610 1,415 335 20 1,770 Total tuition and fees 287,876 179,422 - 467,298 279,115 154,046 575 433,736 Other revenue (2) 1,774 137 44 1,955 1,873 158 24 2,055 Total revenue $ 289,650 $ 179,559 $ 44 $ 469,253 $ 280,988 $ 154,204 $ 599 $ 435,791 __________________ (1) Other miscellaneous fees include graduation fees and activity fees. ( 2 ) Other revenue primarily includes contract training revenue and bookstore and laptop sales. ( 3 ) Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. |
Summary of Contract Assets Offset with Deferred Revenue Balances | The amount of contract assets which are being offset with deferred revenue balances as of September 30, 2019 and December 31, 2018 were as follows (dollars in thousands): As of September 30, 2019 December 31, 2018 Gross deferred revenue $ 35,611 $ 51,694 Gross contract assets (11,827 ) (19,343 ) Deferred revenue, net $ 23,784 $ 32,351 |
Changes in Deferred Revenue Balances | Changes in our deferred revenue balances for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): For the Quarter Ended September 30, 2019 For the Quarter Ended September 30, 2018 CTU AIU Corporate and Other (2) Total CTU AIU Corporate and Other (2) Total Gross deferred revenue, July 1, $ 25,825 $ 19,976 $ - $ 45,801 $ 23,754 $ 13,436 $ 70 $ 37,260 Revenue earned from balances existing as of July 1, (23,375 ) (16,970 ) - (40,345 ) (21,533 ) (11,341 ) (47 ) (32,921 ) Billings during period (1) 96,863 47,310 - 144,173 93,277 73,852 63 167,192 Revenue earned for new billings during the period (72,054 ) (41,892 ) - (113,946 ) (70,837 ) (41,106 ) (18 ) (111,961 ) Other adjustments (146 ) 74 - (72 ) (266 ) (500 ) (25 ) (791 ) Gross deferred revenue, September 30, $ 27,113 $ 8,498 $ - $ 35,611 $ 24,395 $ 34,341 $ 43 $ 58,779 For the Year to Date Ended September 30, 2019 For the Year to Date Ended September 30, 2018 CTU AIU Corporate and Other (2) Total CTU AIU Corporate and Other (2) Total Gross deferred revenue, January 1, $ 24,250 $ 27,444 $ - $ 51,694 $ 23,933 $ 15,507 $ 104 $ 39,544 Revenue earned from balances existing as of January 1, (22,289 ) (21,779 ) - (44,068 ) (22,192 ) (14,310 ) (104 ) (36,606 ) Billings during period (1) 289,803 159,711 - 449,514 279,374 173,244 558 453,176 Revenue earned for new billings during the period (265,587 ) (157,643 ) - (423,230 ) (256,923 ) (139,736 ) (471 ) (397,130 ) Other adjustments 936 765 - 1,701 203 (364 ) (44 ) (205 ) Gross deferred revenue, September 30, $ 27,113 $ 8,498 $ - $ 35,611 $ 24,395 $ 34,341 $ 43 $ 58,779 ______________ (1) Billings during period includes adjustments for prior billings. ( 2 ) Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. |
Student Receivables (Tables)
Student Receivables (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Changes in Current and Non-Current Receivables Allowance | Changes in our current and non-current receivables allowance for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): Balance, Beginning of Period Charges to Expense (1) Amounts Written-off Balance, End of Period For the quarter ended September 30, 2019 $ 30,730 $ 8,888 $ (10,621 ) $ 28,997 For the quarter ended September 30, 2018 $ 24,268 $ 7,932 $ (8,649 ) $ 23,551 For the year to date ended September 30, 2019 $ 24,836 $ 32,042 $ (27,881 ) $ 28,997 For the year to date ended September 30, 2018 $ 22,534 $ 21,675 $ (20,658 ) $ 23,551 (1) Charges to expense include an offset for recoveries of amounts previously written off of $0.6 million and $1.8 million for the quarters ended September 30, 2019 and 2018, respectively, and $2.0 million and $4.3 million for the years to date ended September 30, 2019 and 2018, respectively. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Lessee Lease Description [Line Items] | |
Schedule of Quantitative Information and Other Information Related to Leases | Quantitative information related to leases is presented in the following table (dollars in thousands): For the Quarter Ended September 30, 2019 For the Year to Date Ended September 30, 2019 Lease expenses (1) Fixed lease expenses - operating (1) $ 3,046 $ 9,751 Variable lease expenses - operating (1) 2,196 6,830 Sublease income (1) (1,075 ) (3,332 ) Total lease expenses (1) 4,167 13,249 Other information Gross operating cash flows for operating leases (2) $ (7,400 ) $ (25,503 ) Operating cash flows from subleases (2) 1,112 3,417 As of September 30, 2019 Weighted average remaining lease term (in months) – operating leases 79 Weighted average discount rate – operating leases 5.2 % __________________ (1) Lease expense and sublease income represent the amount recorded within our unaudited condensed consolidated statement of income and comprehensive income. Variable lease amounts represent expenses recognized as incurred which are not included in the lease liability. Fixed lease expenses and sublease income are recorded on a straight-line basis over the lease term and therefore are not necessarily representative of cash payments during the same period. (2) Cash flows are presented on a consolidated basis, including continuing and discontinued operations, and represent cash payments for fixed and variable lease costs. |
Schedule of Future Minimum Lease Payments under Operating Leases Included in Lease Liabilities for Continuing and Discontinued Operations | As of September 30, 2019, future minimum lease payments under operating leases which are included in lease liabilities on our condensed consolidated balance sheet for continuing operations are as follows (dollars in thousands): Operating Leases Total 2019 (1) $ 2,451 2020 17,390 2021 13,505 2022 11,331 2023 and thereafter 35,821 Total $ 80,498 Less: imputed interest 13,485 Present value of future minimum lease payments 67,013 Less: current lease liabilities 12,109 Non-current lease liabilities $ 54,904 __________________ (1) Amounts provided are for liabilities remaining as of September 30, 2019. As of December 31, 2018, future minimum lease payments under operating leases for continuing and discontinued operations were as follows (dollars in thousands): Operating Leases Continuing Operations Discontinued Operations Total 2019 (1) $ 21,076 $ 808 $ 21,884 2020 17,728 - 17,728 2021 12,070 - 12,070 2022 8,638 - 8,638 2023 and thereafter 22,298 - 22,298 Total $ 81,810 $ 808 $ 82,618 __________________ (1) Amounts include payments due associated with executed early terminations of real estate leases and represent payments for the full year 2019. |
Schedule of Future Minimum Sublease Rental Income under Operating Leases | As of September 30, 2019, future minimum sublease rental income under operating leases, which will decrease our future minimum lease payments presented above, is as follows (dollars in thousands): Operating Subleases Total 2019 (1) $ 649 2020 2,765 2021 1,081 2022 777 2023 and thereafter 330 Total $ 5,602 _____________________ (1) Sublease receivables remaining as of September 30, 2019. |
ASC 842 [Member] | |
Lessee Lease Description [Line Items] | |
Schedule of Transition to ASC 842 on Condensed Consolidated Balance Sheet | Upon transition to ASC 842 as of January 1, 2019, the following beginning balances were restated within our condensed consolidated balance sheet (dollars in thousands): December 31, 2018 Impact of Modified Retrospective Adoption of ASC 842 January 1, 2019 Post ASC 842 Adoption Prepaid expenses (1) $ 7,771 $ (1,502 ) $ 6,269 Right of use asset - 45,963 45,963 Deferred income tax assets, net 81,628 (325 ) 81,303 Assets of discontinued operations, non-current 178 57 235 Lease liability - operating, current - 18,656 18,656 Other accrued expenses, current (1) 19,668 (5,950 ) 13,718 Liabilities of discontinued operations, current 536 57 593 Lease liability - operating, non-current - 48,238 48,238 Deferred rent obligations (1) 12,745 (12,745 ) - Other liabilities, non-current (1) 17,493 (5,098 ) 12,395 Accumulated deficit (2) (52,946 ) 1,035 (51,911 ) __________________ (1) Balances as of December 31, 2018 that related to prepaid rent, remaining lease obligations for vacated spaces and deferred rent obligations were offset with the ROU asset as of January 1, 2019. ( 2 ) Certain leases resulted in a negative ROU asset upon transition to ASC 842 related to vacated spaces that had liabilities previously established. Those leases that resulted in a negative ROU asset were recorded as an adjustment, net of tax, to accumulated deficit within stockholders equity on our condensed consolidated balance sheet as of January 1, 2019. |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Summary of Provision for Income Taxes and Effective Tax Rate from Continuing Operations | The following is a summary of our provision for income taxes and effective tax rate from continuing operations (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Pretax income $ 26,046 $ 20,157 $ 59,422 $ 53,343 Provision for income taxes $ 7,653 $ 5,089 $ 16,362 $ 11,527 Effective rate 29.4 % 25.2 % 27.5 % 21.6 % |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Schedule of Deferred Stock Units to be Settled in Shares | The following table summarizes information with respect to all deferred stock units during the year to date ended September 30, 2019 (units in thousands): Deferred Stock Units to be Settled in Shares Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2018 (1) 76 $ 4.44 Granted - - Vested (2) (3 ) 5.56 Forfeited - - Outstanding as of September 30, 2019 (1) 73 $ 4.39 (1) Includes vested but unreleased awards. These awards are included in total outstanding awards until they are released under the terms of the agreement. (2) Includes previously vested awards which were released during the current period. |
Schedule of Restricted Stock Units to be Settled in Cash | The following table summarizes information with respect to all cash-settled restricted stock units during the year to date ended September 30, 2019 (units in thousands): Restricted Stock Units to be Settled in Cash Outstanding as of December 31, 2018 213 Granted - Vested (125 ) Forfeited (2 ) Outstanding as of September 30, 2019 86 |
Summary of Total Stock Based Compensation Expense | Stock-Based Compensation Expense. Total stock-based compensation expense for the quarters and years to date ended September 30, 2019 and 2018 for all types of awards was as follows (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, Award Type 2019 2018 2019 2018 Stock options $ 400 $ 516 $ 1,260 $ 1,423 Restricted stock units settled in stock 1,113 924 2,651 2,707 Restricted stock units settled in cash 340 435 1,777 1,997 Total stock-based compensation expense $ 1,853 $ 1,875 $ 5,688 $ 6,127 |
Restricted Stock Units [Member] | |
Schedule of Information with Respect to all Outstanding Restricted Stock | The following table summarizes information with respect to all outstanding restricted stock units to be settled in shares of stock under our plans during the year to date ended September 30, 2019 (units in thousands): Restricted Stock Units to be Settled in Shares of Stock Units Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2018 (1) 2,017 $ 12.70 Granted 428 21.31 Vested (493 ) 6.11 Forfeited (23 ) 11.42 Outstanding as of September 30, 2019 1,929 $ 16.31 __________________ (1) The weighted average grant-date fair value per unit as of December 31, 2018 reflects an adjusted fair value per unit from $10.59 to $12.70 due to the modification of grants approved by the Board of Directors during the current quarter for our performance-based grants granted on December 14, 2018 . |
Employee Stock Option [Member] | |
Summary of Stock Option Activity | Stock option activity during the year to date ended September 30, 2019 under all of our plans was as follows (options in thousands): Options Weighted Average Exercise Price Outstanding as of December 31, 2018 2,818 $ 9.59 Granted 42 21.29 Exercised (194 ) 5.73 Cancelled (164 ) 22.62 Outstanding as of September 30, 2019 2,502 $ 9.23 Exercisable as of September 30, 2019 1,947 $ 9.01 |
Weighted Average Common Shares
Weighted Average Common Shares (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Summary of Weighted Average Numbers of Common Shares Used to Compute Basic and Diluted Net Income Per Share | The weighted average number of common shares used to compute basic and diluted net income per share for the quarters and years to date ended September 30, 2019 and 2018 were as follows: For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Basic common shares outstanding 70,142 69,737 70,029 69,542 Common stock equivalents 2,000 2,053 1,872 1,883 Diluted common shares outstanding 72,142 71,790 71,901 71,425 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Summary Financial Information by Reporting Segment | Summary financial information by reporting segment is as follows (dollars in thousands): For the Quarter Ended September 30, Revenue Operating Income (Loss) 2019 % of Total 2018 % of Total 2019 2018 CTU $ 96,038 62.0 % $ 93,115 63.9 % $ 29,926 $ 26,261 AIU 58,907 38.0 % 52,504 36.0 % 7,341 1,070 Total University Group 154,945 100.0 % 145,619 100.0 % 37,267 27,331 Corporate and Other (1) 14 NM 71 0.0 % (12,973 ) (8,048 ) Total $ 154,959 100.0 % $ 145,690 100.0 % $ 24,294 $ 19,283 For the Year to Date Ended September 30, Revenue Operating Income (Loss) 2019 % of Total 2018 % of Total 2019 2018 CTU (2) $ 289,650 61.7 % $ 280,988 64.5 % $ 71,730 $ 80,562 AIU (3) 179,559 38.3 % 154,204 35.4 % 11,436 3,621 Total University Group 469,209 100.0 % 435,192 99.9 % 83,166 84,183 Corporate and Other (1) 44 NM 599 0.1 % (28,717 ) (33,068 ) Total $ 469,253 100.0 % $ 435,791 100.0 % $ 54,449 $ 51,115 Total Assets as of (4) September 30, 2019 December 31, 2018 CTU $ 100,527 $ 76,713 AIU 79,039 59,133 Total University Group 179,566 135,846 Corporate and Other (1) 419,063 346,469 Discontinued Operations 178 178 Total $ 598,807 $ 482,493 (1) Corporate and Other includes results of operations for closed campuses. A reserve of $7.1 million was recorded during the current quarter within Corporate and Other for the Oregon arbitration matter related to previously closed campuses. (2) A reserve of $18.6 million was recorded within CTU related to the FTC settlement during the year to date ended September 30, 2019. (3) A reserve of $11.4 million was recorded within AIU related to the FTC settlement during the year to date ended September 30, 2019. ( 4 ) Total assets do not include intercompany receivable or payable activity between institutions and corporate and investments in subsidiaries. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Summary Results of Operations for Discontinued Operations | The summary of unaudited results of operations for our discontinued operations for the quarters and years to date ended September 30, 2019 and 2018 were as follows (dollars in thousands): For the Quarter Ended September 30, For the Year to Date Ended September 30, 2019 2018 2019 2018 Total operating expenses $ 208 $ 277 $ 775 $ 922 Loss before income tax $ (208 ) $ (277 ) $ (775 ) $ (922 ) Benefit from income tax (49 ) (66 ) (181 ) (216 ) Loss from discontinued operations, net of tax $ (159 ) $ (211 ) $ (594 ) $ (706 ) |
Assets and Liabilities of Discontinued Operations on Condensed Consolidated Balance Sheets | Assets and liabilities of discontinued operations on our condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018 include the following (dollars in thousands): September 30, December 31, 2019 2018 Assets: Non-current assets: Deferred income tax assets, net 178 178 Total assets of discontinued operations $ 178 $ 178 Liabilities: Current liabilities: Accounts payable and accrued expenses $ 3 $ 51 Remaining lease obligations - 485 Total current liabilities 3 536 Total liabilities of discontinued operations $ 3 $ 536 |
Description of the Company - Ad
Description of the Company - Additional Information (Detail) | Sep. 30, 2019University |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of regionally-accredited universities | 2 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2019Segment | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of reporting segments | 2 |
Financial Instruments - Summary
Financial Instruments - Summary of Investments (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Short-term, Municipal Bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total short-term investments (available for sale), Cost | $ 1,078 | |
Total short-term investments (available for sale), Gross Unrealized Gain | 3 | |
Total short-term investments (available for sale), Fair value | 1,081 | |
Short-term, Non-governmental Debt Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total short-term investments (available for sale), Cost | 212,120 | $ 179,393 |
Total short-term investments (available for sale), Gross Unrealized Gain | 490 | 35 |
Total short-term investments (available for sale), Gross Unrealized (Loss) | (54) | (337) |
Total short-term investments (available for sale), Fair value | 212,556 | 179,091 |
Short-term, Treasury and Federal Agencies [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total short-term investments (available for sale), Cost | 20,788 | 17,417 |
Total short-term investments (available for sale), Gross Unrealized Gain | 4 | 5 |
Total short-term investments (available for sale), Gross Unrealized (Loss) | (14) | (85) |
Total short-term investments (available for sale), Fair value | 20,778 | 17,337 |
Short-term Investments [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total short-term investments (available for sale), Cost | 233,986 | 196,810 |
Total short-term investments (available for sale), Gross Unrealized Gain | 497 | 40 |
Total short-term investments (available for sale), Gross Unrealized (Loss) | (68) | (422) |
Total short-term investments (available for sale), Fair value | $ 234,415 | $ 196,428 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 27, 2018 | |
Financial Instruments [Line Items] | ||||||
Period cash equivalents and short-term investments have been in continuous unrealized gain (loss) position, years, maximum | 1 year | |||||
Credit Agreement [Member] | Revolving Credit Facility [Member] | BMO Harris Bank N.A. ("BMO Harris") [Member] | ||||||
Financial Instruments [Line Items] | ||||||
Revolving credit facility | $ 50,000,000 | |||||
Percentage of cash and marketable securities deposited with bank collateral for securitization | 100.00% | 100.00% | ||||
Credit facility borrowings | $ 0 | $ 0 | $ 0 | |||
Revolving credit facility maturity date | Jan. 20, 2022 | |||||
CCKF [Member] | ||||||
Financial Instruments [Line Items] | ||||||
Percentage of investment in equity affiliate | 30.70% | 30.70% | ||||
Non controlling interest | $ 2,600,000 | $ 2,600,000 | ||||
Gain (loss) from investment in affiliate | $ (100,000) | |||||
CCKF [Member] | Maximum [Member] | ||||||
Financial Instruments [Line Items] | ||||||
Gain (loss) from investment in affiliate | $ 100,000 | $ 100,000 | $ 100,000 |
Financial Instruments - Investm
Financial Instruments - Investments Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | $ 234,415 | $ 196,428 |
Fair Value Measurements on Recurring Basis [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 234,415 | 196,428 |
Fair Value Measurements on Recurring Basis [Member] | Municipal Bonds [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 1,081 | |
Fair Value Measurements on Recurring Basis [Member] | Non-governmental Debt Securities [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 212,556 | 179,091 |
Fair Value Measurements on Recurring Basis [Member] | Treasury and Federal Agencies [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 20,778 | 17,337 |
Fair Value Measurements on Recurring Basis [Member] | Level 1 [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 15,000 | 20,000 |
Fair Value Measurements on Recurring Basis [Member] | Level 1 [Member] | Non-governmental Debt Securities [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 15,000 | 20,000 |
Fair Value Measurements on Recurring Basis [Member] | Level 2 [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 219,415 | 176,428 |
Fair Value Measurements on Recurring Basis [Member] | Level 2 [Member] | Municipal Bonds [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 1,081 | |
Fair Value Measurements on Recurring Basis [Member] | Level 2 [Member] | Non-governmental Debt Securities [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | 197,556 | 159,091 |
Fair Value Measurements on Recurring Basis [Member] | Level 2 [Member] | Treasury and Federal Agencies [Member] | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Total investments at fair value | $ 20,778 | $ 17,337 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Maintenance Fee Payment to CCKF (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Related Party Transactions [Abstract] | ||||
Maintenance Fee Payments | $ 338 | $ 355 | $ 1,045 | $ 1,108 |
Revenue Recognition - Summary o
Revenue Recognition - Summary of Disaggregation of Revenue by Major Source (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | $ 154,959 | $ 145,690 | $ 469,253 | $ 435,791 | |||
University Group [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 154,945 | 145,619 | 469,209 | 435,192 | |||
University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 96,038 | 93,115 | 289,650 | [1] | 280,988 | [1] | |
University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 58,907 | 52,504 | 179,559 | [2] | 154,204 | [2] | |
Corporate and Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [3],[4] | 14 | 71 | 44 | 599 | ||
Tuition [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 146,639 | 139,534 | 445,731 | 417,835 | |||
Tuition [Member] | University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 90,256 | 89,121 | 273,777 | 269,146 | |||
Tuition [Member] | University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 56,383 | 50,349 | 171,954 | 148,134 | |||
Tuition [Member] | Corporate and Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [4] | 64 | 555 | ||||
Technology Fees [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 7,149 | 4,776 | 19,957 | 14,131 | |||
Technology Fees [Member] | University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 4,789 | 2,823 | 12,828 | 8,554 | |||
Technology Fees [Member] | University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 2,360 | 1,953 | 7,129 | 5,577 | |||
Other Miscellaneous Fees [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [5] | 503 | 572 | 1,610 | 1,770 | ||
Other Miscellaneous Fees [Member] | University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [5] | 384 | 426 | 1,271 | 1,415 | ||
Other Miscellaneous Fees [Member] | University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [5] | 119 | 145 | 339 | 335 | ||
Other Miscellaneous Fees [Member] | Corporate and Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [4],[5] | 1 | 20 | ||||
Tuition and Fees [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 154,291 | 144,882 | 467,298 | 433,736 | |||
Tuition and Fees [Member] | University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 95,429 | 92,370 | 287,876 | 279,115 | |||
Tuition and Fees [Member] | University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | 58,862 | 52,447 | 179,422 | 154,046 | |||
Tuition and Fees [Member] | Corporate and Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [4] | 65 | 575 | ||||
Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [6] | 668 | 808 | 1,955 | 2,055 | ||
Other [Member] | University Group [Member] | CTU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [6] | 609 | 745 | 1,774 | 1,873 | ||
Other [Member] | University Group [Member] | AIU [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [6] | 45 | 57 | 137 | 158 | ||
Other [Member] | Corporate and Other [Member] | |||||||
Disaggregation Of Revenue [Line Items] | |||||||
Total revenue | [4],[6] | $ 14 | $ 6 | $ 44 | $ 24 | ||
[1] | A reserve of $18.6 million was recorded within CTU related to the FTC settlement during the year to date ended September 30, 2019. | ||||||
[2] | A reserve of $11.4 million was recorded within AIU related to the FTC settlement during the year to date ended September 30, 2019. | ||||||
[3] | Corporate and Other includes results of operations for closed campuses. A reserve of $7.1 million was recorded during the current quarter within Corporate and Other for the Oregon arbitration matter related to previously closed campuses. | ||||||
[4] | Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. | ||||||
[5] | Other miscellaneous fees include graduation fees and activity fees. | ||||||
[6] | Other revenue primarily includes contract training revenue and bookstore and laptop sales. |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019USD ($)Portfolio | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)Portfolio | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Revenue Recognition [Line Items] | |||||
Length of academic year | 210 days | ||||
Revenue recognized estimated reserve based on historical evidence | $ 1.1 | $ 1.1 | $ 0.9 | ||
ASC Topic 606 [Member] | |||||
Revenue Recognition [Line Items] | |||||
Revenue recognized for payments received from withdrawn students | $ 0.4 | $ 0.4 | $ 0.9 | $ 1.1 | |
Number of portfolio for revenue recognition | Portfolio | 1 | 1 | |||
Minimum [Member] | |||||
Revenue Recognition [Line Items] | |||||
Length of academic terms | 70 days | ||||
Minimum [Member] | ASC Topic 606 [Member] | |||||
Revenue Recognition [Line Items] | |||||
Days required for documentation to be eligible and approved for funding | 90 days | ||||
Maximum [Member] | |||||
Revenue Recognition [Line Items] | |||||
Length of academic terms | 77 days | ||||
Maximum [Member] | ASC Topic 606 [Member] | |||||
Revenue Recognition [Line Items] | |||||
Days required for documentation to be eligible and approved for funding | 120 days |
Revenue Recognition - Summary_2
Revenue Recognition - Summary of Contract Assets Offset with Deferred Revenue Balances (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Revenue Recognition [Abstract] | ||||||
Gross deferred revenue | $ 35,611 | $ 45,801 | $ 51,694 | $ 58,779 | $ 37,260 | $ 39,544 |
Gross contract assets | (11,827) | (19,343) | ||||
Deferred revenue, net | $ 23,784 | $ 32,351 |
Revenue Recognition - Changes i
Revenue Recognition - Changes in Deferred Revenue Balances (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Deferred Revenue Arrangement [Line Items] | |||||
Gross deferred revenue, beginning balance | $ 45,801 | $ 37,260 | $ 51,694 | $ 39,544 | |
Revenue earned from balances existing | (40,345) | (32,921) | (44,068) | (36,606) | |
Billings during period | [1] | 144,173 | 167,192 | 449,514 | 453,176 |
Revenue earned for new billings during the period | (113,946) | (111,961) | (423,230) | (397,130) | |
Other adjustments | (72) | (791) | 1,701 | (205) | |
Gross deferred revenue, ending balance | 35,611 | 58,779 | 35,611 | 58,779 | |
University Group [Member] | CTU [Member] | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Gross deferred revenue, beginning balance | 25,825 | 23,754 | 24,250 | 23,933 | |
Revenue earned from balances existing | (23,375) | (21,533) | (22,289) | (22,192) | |
Billings during period | [1] | 96,863 | 93,277 | 289,803 | 279,374 |
Revenue earned for new billings during the period | (72,054) | (70,837) | (265,587) | (256,923) | |
Other adjustments | (146) | (266) | 936 | 203 | |
Gross deferred revenue, ending balance | 27,113 | 24,395 | 27,113 | 24,395 | |
University Group [Member] | AIU [Member] | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Gross deferred revenue, beginning balance | 19,976 | 13,436 | 27,444 | 15,507 | |
Revenue earned from balances existing | (16,970) | (11,341) | (21,779) | (14,310) | |
Billings during period | [1] | 47,310 | 73,852 | 159,711 | 173,244 |
Revenue earned for new billings during the period | (41,892) | (41,106) | (157,643) | (139,736) | |
Other adjustments | 74 | (500) | 765 | (364) | |
Gross deferred revenue, ending balance | $ 8,498 | 34,341 | $ 8,498 | 34,341 | |
Corporate and Other [Member] | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Gross deferred revenue, beginning balance | [2] | 70 | 104 | ||
Revenue earned from balances existing | [2] | (47) | (104) | ||
Billings during period | [1],[2] | 63 | 558 | ||
Revenue earned for new billings during the period | [2] | (18) | (471) | ||
Other adjustments | [2] | (25) | (44) | ||
Gross deferred revenue, ending balance | [2] | $ 43 | $ 43 | ||
[1] | Billings during period includes adjustments for prior billings. | ||||
[2] | Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. |
Student Receivables - Additiona
Student Receivables - Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Student receivables, net of allowance for doubtful accounts | $ 1,131 | $ 942 |
Minimum [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Student receivables write-off period, days past due | 90 days |
Student Receivables - Changes i
Student Receivables - Changes in Current and Non-Current Receivables Allowance (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Receivables [Abstract] | |||||
Balance, Beginning of Period | $ 30,730 | $ 24,268 | $ 24,836 | $ 22,534 | |
Charges to Expense | [1] | 8,888 | 7,932 | 32,042 | 21,675 |
Amounts Written-off | (10,621) | (8,649) | (27,881) | (20,658) | |
Balance, End of Period | $ 28,997 | $ 23,551 | $ 28,997 | $ 23,551 | |
[1] | Charges to expense include an offset for recoveries of amounts previously written off of $0.6 million and $1.8 million for the quarters ended September 30, 2019 and 2018, respectively, and $2.0 million and $4.3 million for the years to date ended September 30, 2019 and 2018, respectively. |
Student Receivables - Changes_2
Student Receivables - Changes in Current and Non-Current Receivables Allowance (Parenthetical) (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Receivables [Abstract] | ||||
Recoveries of amounts previously written off | $ 0.6 | $ 1.8 | $ 2 | $ 4.3 |
Leases - Additional Information
Leases - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($)LeaseFacility | |||
Lessee Lease Description [Line Items] | ||||
Operating leases expiration date | 2028 | |||
Number of subleases | 12 | |||
Number of facilities leased | Facility | 8 | |||
Sublease income | $ | $ 1,075 | [1] | $ 3,332 | [1] |
Number of leases related to ongoing operations | 9 | |||
Number of remaining leases related to Closed campuses | 8 | |||
Minimum [Member] | ||||
Lessee Lease Description [Line Items] | ||||
Lease term range, years | 5 years | 5 years | ||
Number of renewal options for extended terms | 1 year | 1 year | ||
Operating sublease term | 2 years | |||
Maximum [Member] | ||||
Lessee Lease Description [Line Items] | ||||
Lease term range, years | 10 years | 10 years | ||
Number of renewal options for extended terms | 4 years | 4 years | ||
Operating sublease term | 4 years | |||
[1] | Lease expense and sublease income represent the amount recorded within our unaudited condensed consolidated statement of income and comprehensive income. Variable lease amounts represent expenses recognized as incurred which are not included in the lease liability. Fixed lease expenses and sublease income are recorded on a straight-line basis over the lease term and therefore are not necessarily representative of cash payments during the same period. |
Leases - Schedule of Quantitati
Leases - Schedule of Quantitative Information Related to Leases (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |||
Lease expenses | ||||
Fixed lease expenses - operating | $ 3,046 | [1] | $ 9,751 | [1] |
Variable lease expenses - operating | 2,196 | [1] | 6,830 | [1] |
Sublease income | (1,075) | [1] | (3,332) | [1] |
Total lease expenses | 4,167 | [1] | 13,249 | [1] |
Other information | ||||
Gross operating cash flows for operating leases | (7,400) | [2] | (25,503) | [2] |
Operating cash flows from subleases | $ 1,112 | [2] | $ 3,417 | [2] |
Weighted average remaining lease term (in months) – operating leases | 79 months | 79 months | ||
Weighted average discount rate – operating leases | 5.20% | 5.20% | ||
[1] | Lease expense and sublease income represent the amount recorded within our unaudited condensed consolidated statement of income and comprehensive income. Variable lease amounts represent expenses recognized as incurred which are not included in the lease liability. Fixed lease expenses and sublease income are recorded on a straight-line basis over the lease term and therefore are not necessarily representative of cash payments during the same period. | |||
[2] | Cash flows are presented on a consolidated basis, including continuing and discontinued operations, and represent cash payments for fixed and variable lease costs. |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments under Operating Leases Included in Lease Liabilities for Continuing and Discontinued Operations (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Lessee Lease Description [Line Items] | |||
Operating Leases, 2019 | [1] | $ 21,884 | |
Operating Leases, 2020 | 17,728 | ||
Operating Leases, 2021 | 12,070 | ||
Operating Leases, 2022 | 8,638 | ||
Operating Leases, 2023 and thereafter | 22,298 | ||
Operating Leases, Total | 82,618 | ||
Less: current lease liabilities | $ 12,109 | ||
Non-current lease liabilities | 54,904 | ||
Continuing Operation [Member] | |||
Lessee Lease Description [Line Items] | |||
Operating Leases, remainder of 2019 | [2] | 2,451 | |
Operating Leases, 2019 | [1] | 21,076 | |
Operating Leases, 2020 | 17,390 | 17,728 | |
Operating Leases, 2021 | 13,505 | 12,070 | |
Operating Leases, 2022 | 11,331 | 8,638 | |
Operating Leases, 2023 and thereafter | 35,821 | 22,298 | |
Operating Leases, Total | 80,498 | 81,810 | |
Less: imputed interest | 13,485 | ||
Present value of future minimum lease payments | 67,013 | ||
Less: current lease liabilities | 12,109 | ||
Non-current lease liabilities | $ 54,904 | ||
Discontinued Operations [Member] | |||
Lessee Lease Description [Line Items] | |||
Operating Leases, 2019 | [1] | 808 | |
Operating Leases, Total | $ 808 | ||
[1] | Amounts include payments due associated with executed early terminations of real estate leases and represent payments for the full year 2019. | ||
[2] | Amounts provided are for liabilities remaining as of September 30, 2019. |
Leases - Schedule of Future M_2
Leases - Schedule of Future Minimum Sublease Rental Income under Operating Leases (Detail) $ in Thousands | Sep. 30, 2019USD ($) | |
Leases [Abstract] | ||
Operating Subleases, 2019 | $ 649 | [1] |
Operating Subleases, 2020 | 2,765 | |
Operating Subleases, 2021 | 1,081 | |
Operating Subleases, 2022 | 777 | |
Operating Subleases, 2023 and thereafter | 330 | |
Operating Subleases, Total | $ 5,602 | |
[1] | Sublease receivables remaining as of September 30, 2019. |
Leases - Schedule of Transition
Leases - Schedule of Transitions to ASC 842 on Condensed Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | ||
Leases [Line Items] | |||||
Prepaid expenses | $ 7,645 | $ 7,771 | [1] | ||
Right of use asset | 52,016 | ||||
Deferred income tax assets, net | 65,363 | 81,628 | |||
Assets of discontinued operations, non-current | 178 | 178 | |||
Lease liability - operating, current | 12,109 | ||||
Other accrued expenses, current | 46,610 | 19,668 | [1] | ||
Liabilities of discontinued operations, current | 3 | 536 | |||
Lease liability - operating, non-current | 54,904 | ||||
Deferred rent obligations | [1] | 12,745 | |||
Other liabilities, non-current | 9,819 | 17,493 | [1] | ||
Accumulated deficit | $ (9,445) | $ (52,946) | [2] | ||
ASC 842 [Member] | |||||
Leases [Line Items] | |||||
Prepaid expenses | [1] | $ 6,269 | |||
Right of use asset | 45,963 | ||||
Deferred income tax assets, net | 81,303 | ||||
Assets of discontinued operations, non-current | 235 | ||||
Lease liability - operating, current | 18,656 | ||||
Other accrued expenses, current | [1] | 13,718 | |||
Liabilities of discontinued operations, current | 593 | ||||
Lease liability - operating, non-current | 48,238 | ||||
Other liabilities, non-current | [1] | 12,395 | |||
Accumulated deficit | [2] | (51,911) | |||
ASC 842 [Member] | Impact of Modified Retrospective Adoption of ASC 842 [Member] | |||||
Leases [Line Items] | |||||
Prepaid expenses | [1] | (1,502) | |||
Right of use asset | 45,963 | ||||
Deferred income tax assets, net | (325) | ||||
Assets of discontinued operations, non-current | 57 | ||||
Lease liability - operating, current | 18,656 | ||||
Other accrued expenses, current | [1] | (5,950) | |||
Liabilities of discontinued operations, current | 57 | ||||
Lease liability - operating, non-current | 48,238 | ||||
Deferred rent obligations | [1] | (12,745) | |||
Other liabilities, non-current | [1] | (5,098) | |||
Accumulated deficit | [2] | $ 1,035 | |||
[1] | Balances as of December 31, 2018 that related to prepaid rent, remaining lease obligations for vacated spaces and deferred rent obligations were offset with the ROU asset as of January 1, 2019. | ||||
[2] | Certain leases resulted in a negative ROU asset upon transition to ASC 842 related to vacated spaces that had liabilities previously established. Those leases that resulted in a negative ROU asset were recorded as an adjustment, net of tax, to accumulated deficit within stockholders equity on our condensed consolidated balance sheet as of January 1, 2019. |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) $ in Millions | 5 Months Ended | ||
Jul. 31, 2018Claim | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | |
Loss Contingencies [Line Items] | |||
Number of arbitration claims filed | Claim | 310 | ||
Settlement reserve | $ 7.1 | ||
Escrow account | 30 | ||
Escrow reserve | 30 | ||
Other Accrued Expenses [Member] | |||
Loss Contingencies [Line Items] | |||
Accrual for legal fees and settlements | $ 37.5 | $ 6.1 |
Income Taxes - Summary of Provi
Income Taxes - Summary of Provision for Income Taxes and Effective Tax Rate from Continuing Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Pretax income | $ 26,046 | $ 20,157 | $ 59,422 | $ 53,343 |
Provision for income taxes | $ 7,653 | $ 5,089 | $ 16,362 | $ 11,527 |
Effective rate | 29.40% | 25.20% | 27.50% | 21.60% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||||||
Net deferred income tax assets | $ 47.2 | $ 47.2 | $ 48 | |||
Reduction in valuation allowance | $ 0.8 | |||||
Effective tax rate increased | 5.70% | 6.50% | ||||
Decrease in effective tax rate | 2.40% | 2.70% | 4.80% | 5.20% | ||
Decrease in unrecognized tax positions | $ 1.6 | $ 1.6 | ||||
Interest and penalties | $ 1.8 | $ 1.8 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares issuable upon exercise of outstanding options | 2,502,000 | 2,502,000 | 2,818,000 | |||
Estimated pretax compensation expense | $ 16 | $ 16 | ||||
Expiration period in years | 4 years | |||||
Service period in years | 4 years | |||||
Restricted stock units settled in shares exercisable in percentage | 25.00% | |||||
Restricted stock units settled in cash exercisable in percentage | 25.00% | |||||
Stock compensation and recognized liability | 0.3 | $ 0.4 | $ 1.8 | $ 2 | ||
Long-term incentive, cash-based awards | 3 years | |||||
Performance unit award expenses | $ 0.8 | $ 0.9 | $ 2.9 | $ 2.5 | ||
Non-Employee Directors' Stock Options [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Expiration period in years | 10 years | |||||
Employee stock options exercisable in percentage | 100.00% | |||||
Employee Stock Option [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Expiration period in years | 10 years | |||||
Service period in years | 4 years | |||||
Employee Stock Option [Member] | Share-based Compensation Award, Tranche One [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock awards settled in stock exercisable in percentage | 25.00% | |||||
Restricted Stock Units [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of shares to reduce shares available to grant by upon vesting of restricted stock awards and units | 1,929,000 | 1,929,000 | 2,017,000 | [1] | ||
Service period in years | 4 years | |||||
Performance-based Restricted Stock Units [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Service period in years | 3 years | |||||
2016 Incentive Compensation Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common stock subject to awards of stock options or stock appreciation rights payable in shares | 1 | |||||
Common stock subject to any other form of award | 1.35 | |||||
Common stock available for future share-based awards | 1,800,000 | 1,800,000 | ||||
Shares issuable upon exercise of outstanding options | 800,000 | 800,000 | ||||
Number of shares to reduce shares available to grant by upon vesting of restricted stock awards and units | 2,500,000 | 2,500,000 | ||||
2008 Incentive Compensation Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares issuable upon exercise of outstanding options | 1,700,000 | 1,700,000 | ||||
Number of shares to reduce shares available to grant by upon vesting of restricted stock awards and units | 200,000 | 200,000 | ||||
[1] | The weighted average grant-date fair value per unit as of December 31, 2018 reflects an adjusted fair value per unit from $10.59 to $12.70 due to the modification of grants approved by the Board of Directors during the current quarter for our performance-based grants granted on December 14, 2018 . |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Stock Option Activity (Detail) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Beginning balance of Outstanding, Options | shares | 2,818,000 |
Granted, Options | shares | 42,000 |
Exercised, Options | shares | (194,000) |
Cancelled, Options | shares | (164,000) |
Ending balance of Outstanding, Options | shares | 2,502,000 |
Exercisable, Options | shares | 1,947,000 |
Beginning balance of Outstanding, Weighted Average Exercise Price | $ / shares | $ 9.59 |
Granted, Weighted Average Exercise Price | $ / shares | 21.29 |
Exercised, Weighted Average Exercise Price | $ / shares | 5.73 |
Cancelled, Weighted Average Exercise Price | $ / shares | 22.62 |
Ending balance of Outstanding, Weighted Average Exercise Price | $ / shares | 9.23 |
Exercisable, Weighted Average Exercise Price | $ / shares | $ 9.01 |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Information with Respect to all Outstanding Restricted Stock (Detail) - Restricted Stock Units [Member] shares in Thousands | 9 Months Ended | |
Sep. 30, 2019$ / sharesshares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance of Outstanding, Units | shares | 2,017 | [1] |
Granted, Units | shares | 428 | |
Vested, Units | shares | (493) | |
Forfeited, Units | shares | (23) | |
Ending balance of Outstanding, Units | shares | 1,929 | |
Beginning balance of Outstanding, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | $ 12.70 | [1] |
Granted, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 21.31 | |
Vested, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 6.11 | |
Forfeited, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 11.42 | |
Ending balance of Outstanding, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | $ 16.31 | |
[1] | The weighted average grant-date fair value per unit as of December 31, 2018 reflects an adjusted fair value per unit from $10.59 to $12.70 due to the modification of grants approved by the Board of Directors during the current quarter for our performance-based grants granted on December 14, 2018 . |
Share-Based Compensation - Sc_2
Share-Based Compensation - Schedule of Information with Respect to all Outstanding Restricted Stock (Parenthetical) (Detail) - Restricted Stock Units [Member] - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Weighted average grant-date adjusted fair value per unit | $ 16.31 | $ 12.70 | [1] |
Minimum [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Weighted average grant-date adjusted fair value per unit | 10.59 | ||
Maximum [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Weighted average grant-date adjusted fair value per unit | $ 12.70 | ||
[1] | The weighted average grant-date fair value per unit as of December 31, 2018 reflects an adjusted fair value per unit from $10.59 to $12.70 due to the modification of grants approved by the Board of Directors during the current quarter for our performance-based grants granted on December 14, 2018 . |
Share-Based Compensation - Sc_3
Share-Based Compensation - Schedule of Deferred Stock Units to be Settled in Shares (Detail) shares in Thousands | 9 Months Ended | |
Sep. 30, 2019$ / sharesshares | ||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Beginning balance of Outstanding, Deferred Stock Units to be Settled in Shares | shares | 76 | [1] |
Granted, Deferred Stock Units to be Settled in Shares | shares | 0 | |
Vested, Deferred Stock Units to be Settled in Shares | shares | (3) | [2] |
Forfeited, Deferred Stock Units to be Settled in Shares | shares | 0 | |
Ending balance of Outstanding, Deferred Stock Units to be Settled in Shares | shares | 73 | [1] |
Beginning balance of Outstanding, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | $ 4.44 | [1] |
Granted, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 0 | |
Vested, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 5.56 | [2] |
Forfeited, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | 0 | |
Ending balance of Outstanding, Weighted Average Grant-Date Fair Value Per Unit | $ / shares | $ 4.39 | [1] |
[1] | Includes vested but unreleased awards. These awards are included in total outstanding awards until they are released under the terms of the agreement. | |
[2] | Includes previously vested awards which were released during the current period. |
Share-Based Compensation - Sc_4
Share-Based Compensation - Schedule of Restricted Stock Units to be Settled in Cash (Detail) shares in Thousands | 9 Months Ended |
Sep. 30, 2019shares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Beginning balance of Outstanding, Restricted Stock Units to be Settled in Cash | 213 |
Restricted Stock Units to be Settled in Cash, Vested | (125) |
Restricted Stock Units to be Settled in Cash, Forfeited | (2) |
Ending balance of Outstanding, Restricted Stock Units to be Settled in Cash | 86 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Total Stock Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 1,853 | $ 1,875 | $ 5,688 | $ 6,127 |
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 400 | 516 | 1,260 | 1,423 |
Restricted Stock Units Settled in Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 1,113 | 924 | 2,651 | 2,707 |
Restricted Stock Units Settled in Cash [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 340 | $ 435 | $ 1,777 | $ 1,997 |
Weighted Average Common Share_2
Weighted Average Common Shares - Summary of Weighted Average Numbers of Common Shares Used to Compute Basic and Diluted Net Income Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Basic common shares outstanding | 70,142 | 69,737 | 70,029 | 69,542 |
Common stock equivalents | 2,000 | 2,053 | 1,872 | 1,883 |
Diluted common shares outstanding | 72,142 | 71,790 | 71,901 | 71,425 |
Weighted Average Common Share_3
Weighted Average Common Shares - Additional Information (Detail) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Stock Options [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive awards excluded from computations of diluted earnings per share | 0.3 | 0.8 | 0.7 | 0.8 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2019Segment | |
Segment Reporting Information [Line Items] | |
Number of reporting segments | 2 |
CTU [Member] | |
Segment Reporting Information [Line Items] | |
Students enrolled expressed as percentage of enrollment | 62.00% |
CTU [Member] | Fully Online [Member] | |
Segment Reporting Information [Line Items] | |
Percentage of enrollment | 94.00% |
AIU [Member] | |
Segment Reporting Information [Line Items] | |
Students enrolled expressed as percentage of enrollment | 38.00% |
AIU [Member] | Fully Online [Member] | |
Segment Reporting Information [Line Items] | |
Percentage of enrollment | 94.00% |
Segment Reporting - Summary Fin
Segment Reporting - Summary Financial Information by Reporting Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | ||||
Segment Reporting Information [Line Items] | ||||||||
Revenue | $ 154,959 | $ 145,690 | $ 469,253 | $ 435,791 | ||||
Percentage of total revenue | 100.00% | 100.00% | 100.00% | 100.00% | ||||
Operating Income (Loss) | $ 24,294 | $ 19,283 | $ 54,449 | $ 51,115 | ||||
Total Assets | [1] | 598,807 | 598,807 | $ 482,493 | ||||
Discontinued Operations [Member] | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total Assets | [1] | 178 | 178 | 178 | ||||
University Group [Member] | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenue | $ 154,945 | $ 145,619 | $ 469,209 | $ 435,192 | ||||
Percentage of total revenue | 100.00% | 100.00% | 100.00% | 99.90% | ||||
Operating Income (Loss) | $ 37,267 | $ 27,331 | $ 83,166 | $ 84,183 | ||||
Total Assets | [1] | 179,566 | 179,566 | 135,846 | ||||
Corporate and Other [Member] | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenue | [2],[3] | 14 | $ 71 | 44 | $ 599 | |||
Percentage of total revenue | [2] | 0.00% | 0.10% | |||||
Operating Income (Loss) | [2] | (12,973) | $ (8,048) | (28,717) | $ (33,068) | |||
Total Assets | [1],[2] | 419,063 | 419,063 | 346,469 | ||||
CTU [Member] | University Group [Member] | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenue | $ 96,038 | $ 93,115 | $ 289,650 | [4] | $ 280,988 | [4] | ||
Percentage of total revenue | 62.00% | 63.90% | 61.70% | [4] | 64.50% | [4] | ||
Operating Income (Loss) | $ 29,926 | $ 26,261 | $ 71,730 | [4] | $ 80,562 | [4] | ||
Total Assets | [1] | 100,527 | 100,527 | 76,713 | ||||
AIU [Member] | University Group [Member] | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenue | $ 58,907 | $ 52,504 | $ 179,559 | [5] | $ 154,204 | [5] | ||
Percentage of total revenue | 38.00% | 36.00% | 38.30% | [5] | 35.40% | [5] | ||
Operating Income (Loss) | $ 7,341 | $ 1,070 | $ 11,436 | [5] | $ 3,621 | [5] | ||
Total Assets | [1] | $ 79,039 | $ 79,039 | $ 59,133 | ||||
[1] | Total assets do not include intercompany receivable or payable activity between institutions and corporate and investments in subsidiaries. | |||||||
[2] | Corporate and Other includes results of operations for closed campuses. A reserve of $7.1 million was recorded during the current quarter within Corporate and Other for the Oregon arbitration matter related to previously closed campuses. | |||||||
[3] | Revenue recorded within Corporate and Other relates to closed campuses which are now reported within this category. | |||||||
[4] | A reserve of $18.6 million was recorded within CTU related to the FTC settlement during the year to date ended September 30, 2019. | |||||||
[5] | A reserve of $11.4 million was recorded within AIU related to the FTC settlement during the year to date ended September 30, 2019. |
Segment Reporting - Summary F_2
Segment Reporting - Summary Financial Information by Reporting Segment (Parenthetical) (Detail) $ in Millions | Sep. 30, 2019USD ($) |
Segment Reporting Information [Line Items] | |
Settlement reserve | $ 7.1 |
Corporate and Other [Member] | |
Segment Reporting Information [Line Items] | |
Settlement reserve | 7.1 |
CTU [Member] | |
Segment Reporting Information [Line Items] | |
Settlement reserve | 18.6 |
AIU [Member] | |
Segment Reporting Information [Line Items] | |
Settlement reserve | $ 11.4 |
Discontinued Operations - Summa
Discontinued Operations - Summary Results of Operations for Discontinued Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Discontinued Operations And Disposal Groups [Abstract] | ||||
Total operating expenses | $ 208 | $ 277 | $ 775 | $ 922 |
Loss before income tax | (208) | (277) | (775) | (922) |
Benefit from income tax | (49) | (66) | (181) | (216) |
Loss from discontinued operations, net of tax | $ (159) | $ (211) | $ (594) | $ (706) |
Discontinued Operations - Asset
Discontinued Operations - Assets and Liabilities of Discontinued Operations on Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Disposal Group Including Discontinued Operation Balance Sheet Disclosures [Abstract] | ||
Deferred income tax assets, net | $ 178 | $ 178 |
Total assets of discontinued operations | 178 | 178 |
Accounts payable and accrued expenses | 3 | 51 |
Remaining lease obligations | 485 | |
Total current liabilities | 3 | 536 |
Total liabilities of discontinued operations | $ 3 | $ 536 |