Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 03, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Document Transition Report | false | ||
Entity File Number | 000-51371 | ||
Entity Registrant Name | LINCOLN EDUCATIONAL SERVICES CORP | ||
Entity Central Index Key | 0001286613 | ||
Entity Incorporation, State or Country Code | NJ | ||
Entity Tax Identification Number | 57-1150621 | ||
Entity Address, Address Line One | 14 Sylvan Way, Suite A | ||
Entity Address, City or Town | Parsippany | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 07054 | ||
City Area Code | 973 | ||
Local Phone Number | 736-9340 | ||
Title of 12(b) Security | Common Stock, no par value per share | ||
Trading Symbol | LINC | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 150,533,404 | ||
Entity Common Stock, Shares Outstanding | 31,512,401 | ||
Auditor Firm ID | 34 | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Morristown, New Jersey |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 46,074 | $ 83,307 |
Restricted cash | 4,213 | 0 |
Short-term investments | 14,758 | 0 |
Accounts receivable, less allowance of $28,560 and $26,837 at December 31, 2022 and 2021, respectively | 37,175 | 26,159 |
Inventories | 2,618 | 2,721 |
Prepaid expenses and other current assets | 4,738 | 4,881 |
Assets held for sale | 4,559 | 4,559 |
Total current assets | 114,135 | 121,627 |
PROPERTY, EQUIPMENT AND FACILITIES - At cost, net of accumulated depreciation and amortization of $146,367 and $153,335 at December 31, 2022 and 2021, respectively | 23,940 | 23,119 |
OTHER ASSETS: | ||
Noncurrent receivables, less allowance of $6,810 and $5,084 at December 31, 2022 and 2021, respectively | 22,734 | 20,028 |
Deferred income taxes, net | 22,312 | 23,708 |
Operating lease right-of-use assets | 93,097 | 91,487 |
Goodwill | 14,536 | 14,536 |
Other assets, net | 812 | 794 |
Total other assets | 153,491 | 150,553 |
TOTAL ASSETS | 291,566 | 295,299 |
CURRENT LIABILITIES: | ||
Unearned tuition | 24,154 | 25,405 |
Accounts payable | 10,496 | 12,297 |
Accrued expenses | 8,653 | 15,669 |
Income taxes payable | 2,055 | 1,017 |
Current portion of operating lease liabilities | 9,631 | 11,479 |
Other short-term liabilities | 31 | 15 |
Total current liabilities | 55,020 | 65,882 |
NONCURRENT LIABILITIES: | ||
Pension plan liabilities | 668 | 1,607 |
Long-term portion of operating lease liabilities | 91,001 | 86,410 |
Total liabilities | 146,689 | 153,899 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY: | ||
Common stock, no par value - authorized 100,000,000 shares at December 31, 2022 and 2021, issued and outstanding 31,147,925 shares | 49,072 | 141,377 |
Additional paid-in capital | 45,540 | 32,439 |
Treasury stock at cost - zero and 5,910,541 shares at December 31, 2022 and 2021 | 0 | (82,860) |
Retained earnings | 51,225 | 39,702 |
Accumulated other comprehensive loss | (960) | (1,240) |
Total stockholders' equity | 144,877 | 129,418 |
TOTAL LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS EQUITY | 291,566 | 295,299 |
Series A Convertible Preferred Stock [Member] | ||
SERIES A CONVERTIBLE PREFERRED STOCK | ||
Preferred stock, no par value - authorized 10,000,000 shares at December 31, 2022 and 2021, issued and outstanding Series A convertible preferred stock, zero shares at December 31, 2022 and 12,700 shares at December 31, 2021. | $ 0 | $ 11,982 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
CURRENT ASSETS: | |||
Accounts receivable, allowance | $ 28,560 | $ 26,837 | |
PROPERTY, EQUIPMENT AND FACILITIES - accumulated depreciation and amortization | [1] | 146,367 | 153,335 |
OTHER ASSETS: | |||
Noncurrent receivables, allowance | $ 6,810 | $ 5,084 | |
STOCKHOLDERS' EQUITY: | |||
Common stock, par value (in dollars per share) | $ 0 | $ 0 | |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | |
Common stock, shares issued (in shares) | 31,147,925 | 27,000,687 | |
Common stock, shares outstanding (in shares) | 31,147,925 | 27,000,687 | |
Treasury stock, shares (in shares) | 0 | 5,910,541 | |
Series A Convertible Preferred Stock [Member] | |||
SERIES A CONVERTIBLE PREFERRED STOCK | |||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 | |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | |
Preferred stock, shares issued (in shares) | 0 | 12,700 | |
Preferred stock, shares outstanding (in shares) | 0 | 12,700 | |
[1]Includes net impairment charge |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||
REVENUE | $ 348,287 | $ 335,336 |
COSTS AND EXPENSES: | ||
Educational services and facilities | 148,746 | 138,931 |
Selling, general and administrative | 182,391 | 168,923 |
Gain on sale of assets | (177) | (22,479) |
Impairment of long-lived assets | 1,049 | 700 |
Total costs and expenses | 332,009 | 286,075 |
OPERATING INCOME | 16,278 | 49,261 |
OTHER: | ||
Interest income | 318 | 0 |
Interest expense | (160) | (2,015) |
INCOME BEFORE INCOME TAXES | 16,436 | 47,246 |
PROVISION FOR INCOME TAXES | 3,802 | 12,528 |
NET INCOME | 12,634 | 34,718 |
PREFERRED STOCK DIVIDENDS | 1,111 | 1,219 |
INCOME AVAILABLE TO COMMON SHAREHOLDERS | $ 11,523 | $ 33,499 |
Basic | ||
Basic income per share (in dollars per share) | $ 0.36 | $ 1.04 |
Diluted | ||
Net income per share (in dollars per share) | $ 0.36 | $ 1.04 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 25,879,483 | 25,080,789 |
Diluted (in shares) | 25,879,483 | 25,080,789 |
CONSOLIDATED STATEMENTS OF OTHE
CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
CONDENSED CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME [Abstract] | |||
Net income | $ 12,634 | $ 34,718 | |
Other comprehensive income | |||
Derivative qualifying as a cash flow hedge, net of taxes (nil) | 0 | 878 | |
Employee pension plan adjustments, net of taxes | [1] | 280 | 2,047 |
Comprehensive income | $ 12,914 | $ 37,643 | |
[1]Taxes related to pension plan adjustments were $ 0.1 0.7 |
CONSOLIDATED STATEMENTS OF OT_2
CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Other comprehensive income | ||
Derivative qualifying as a cash flow hedge, taxes | $ 0 | $ 0 |
Employee pension plan adjustments, taxes | $ 100 | $ 700 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Loss [Member] | Total | Preferred Stock [Member] Series A Convertible Preferred Stock [Member] |
BALANCE at Dec. 31, 2020 | $ 141,377 | $ 30,512 | $ (82,860) | $ 6,203 | $ (4,165) | $ 91,067 | $ 11,982 |
BALANCE (in shares) at Dec. 31, 2020 | 26,476,329 | 12,700 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | $ 0 | 0 | 0 | 34,718 | 0 | 34,718 | $ 0 |
Preferred stock dividend | 0 | 0 | 0 | (1,219) | 0 | (1,219) | 0 |
Employee pension plan adjustments | 0 | 0 | 0 | 0 | 2,047 | 2,047 | 0 |
Derivative qualifying as cash flow hedge | 0 | 0 | 0 | 0 | 878 | 878 | 0 |
Stock-based compensation expense | |||||||
Restricted stock | $ 0 | 2,889 | 0 | 0 | 0 | 2,889 | $ 0 |
Restricted stock (in shares) | 679,331 | 0 | |||||
Net share settlement for equity-based compensation | $ 0 | (962) | 0 | 0 | 0 | (962) | $ 0 |
Net share settlement for equity-based compensation (in shares) | (154,973) | 0 | |||||
BALANCE at Dec. 31, 2021 | $ 141,377 | 32,439 | (82,860) | 39,702 | (1,240) | 129,418 | $ 11,982 |
BALANCE (in shares) at Dec. 31, 2021 | 27,000,687 | 12,700 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | $ 0 | 0 | 0 | 12,634 | 0 | 12,634 | $ 0 |
Preferred stock dividend | 0 | 0 | 0 | (1,111) | 0 | (1,111) | 0 |
Preferred Stock Conversion | $ 0 | 11,982 | 0 | 0 | 0 | 11,982 | $ (11,982) |
Preferred Stock Conversion (in shares) | 5,381,356 | (12,700) | |||||
Employee pension plan adjustments | $ 0 | 0 | 0 | 0 | 280 | 280 | $ 0 |
Derivative qualifying as cash flow hedge | 0 | ||||||
Stock-based compensation expense | |||||||
Restricted stock | $ 0 | 3,111 | 0 | 0 | 0 | 3,111 | $ 0 |
Restricted stock (in shares) | 606,950 | 0 | |||||
Cancellation of treasury stock amount | $ (82,860) | 0 | 82,860 | 0 | 0 | 0 | $ 0 |
Share repurchase | $ (9,445) | 0 | 0 | 0 | 0 | (9,445) | $ 0 |
Stock repurchase (in shares) | (1,572,414) | 0 | |||||
Net share settlement for equity-based compensation | $ 0 | (1,992) | 0 | 0 | 0 | (1,992) | $ 0 |
Net share settlement for equity-based compensation (in shares) | (268,654) | 0 | |||||
BALANCE at Dec. 31, 2022 | $ 49,072 | $ 45,540 | $ 0 | $ 51,225 | $ (960) | $ 144,877 | $ 0 |
BALANCE (in shares) at Dec. 31, 2022 | 31,147,925 | 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 12,634 | $ 34,718 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 6,362 | 7,140 |
Amortization of deferred finance fees | 0 | 136 |
Write-off of deferred finance fees | 0 | 485 |
Deferred income taxes | 1,294 | 12,010 |
Gain on sale of assets | (177) | (22,479) |
Impairment of long-lived assets | 1,049 | 700 |
Fixed asset donations | (408) | (2,058) |
Provision for doubtful accounts | 34,915 | 26,794 |
Stock-based compensation expense | 3,111 | 2,889 |
(Increase) decrease in assets: | ||
Accounts receivable | (48,637) | (26,497) |
Inventories | 103 | (327) |
Prepaid expenses and current assets | (11) | (1,235) |
Other assets | 450 | (487) |
Increase (decrease) in liabilities: | ||
Accounts payable | (2,033) | (3,677) |
Accrued expenses | (7,016) | (1,023) |
Unearned tuition | (1,251) | 1,952 |
Income taxes payable | 1,038 | 526 |
Other liabilities | (541) | (2,120) |
Total adjustments | (11,752) | (7,271) |
Net cash provided by operating activities | 882 | 27,447 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (8,986) | (7,531) |
Proceeds from sale of property and equipment | 2,390 | 45,379 |
Purchase of short-term investment | (14,758) | 0 |
Net cash (used in) provided by investing activities | (21,354) | 37,848 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments on borrowings | 0 | (17,833) |
Net share settlement for equity-based compensation | (1,992) | (962) |
Dividend payment for preferred stock | (1,111) | (1,219) |
Share repurchase | (9,445) | 0 |
Net cash used in financing activities | (12,548) | (20,014) |
NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (33,020) | 45,281 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH-Beginning of year | 83,307 | 38,026 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH-End of year | 50,287 | 83,307 |
Cash paid during the year for: | ||
Interest | 171 | 1,532 |
Income taxes | 1,471 | 737 |
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Liabilities accrued for or noncash purchases of property and equipment | $ 1,300 | $ 2,649 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Activities —Lincoln Educational Services Corporation and its subsidiaries (collectively, the “Company”, “we”, “our”, and “us”, as applicable) provide diversified career-oriented post-secondary education to recent high school graduates and working adults. The Company, which currently operates 22 schools in 14 states, offers programs in skilled trades (which include HVAC, welding and computerized numerical control and electrical and electronic systems technology, among other programs), automotive technology, healthcare services (which include nursing, dental assistant and medical administrative assistant, among other programs), hospitality services (which include culinary, therapeutic massage, cosmetology and aesthetics) and information technology. The schools operate under Lincoln Technical Institute, Lincoln College of Technology, Lincoln Culinary Institute, and Euphoria Institute of Beauty Arts and Sciences and associated brand names. Most of the campuses serve major metropolitan markets and each typically offers courses in multiple areas of study. Five of the campuses are destination schools, which attract students from across the United States and, in some cases, from abroad. The Company’s other campuses primarily attract students from their local communities and surrounding areas. All of the campuses are nationally accredited and are eligible to participate in federal financial aid programs by the U.S. Department of Education (“DOE”) and applicable state education agencies and accrediting commissions which allow students to apply for and access federal student loans as well as other forms of financial aid. Our business is organized into three reportable business segments: (a) Transportation and Skilled Trades, (b) Healthcare and Other Professions (“HOPS”), and (c) Transitional, which refers to campuses that have been marked for closing and are currently being taught out. On November 3, 2022, the Board of Directors approved a plan to close the Somerville, Massachusetts campus by the end of 2023. As of December 31, 2022, the Somerville campus is the only campus classified in the Transitional Segment. On June 30, 2022, the Company executed a lease for a 55,000 square foot facility to house a second Atlanta, Georgia area campus. The build-out is continuing to advance according to plan. For the year ended December 31, 2022, the Company incurred approximately $0.4 million in capital expenditures, mostly relating to architectural fees and approximately $0.3 million in rent. Liquidity As of December 31, 2022, the Company had $50.3 million in cash and cash equivalents and restricted cash, in addition to $14.8 million in short-term investments compared to $83.3 million cash and cash equivalents in the prior year. and thereafter for the foreseeable future . Principles of Consolidation —The accompanying consolidated financial statements include the accounts of Lincoln Educational Services Corporation and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Cash and Cash Equivalents —Cash and cash equivalents include all cash balances and highly-liquid short-term investments, which contain original maturities within three months of purchase. Pursuant to the DOE’s cash management requirements, the Company retains funds from financial aid programs under Title IV of the Higher Education Act of 1965 in segregated cash management accounts. The segregated accounts do not require a restriction on use of the cash and, as such, these amounts are classified as cash and cash equivalents on the consolidated balance sheets. Restricted Cash Short-term investments Accounts Receivable —The Company reports accounts receivable at net realizable value, which is equal to the gross receivable less an estimated allowance for uncollectible accounts. Noncurrent accounts receivable represents amounts due from graduates in excess of 12 months from the balance sheet date. Allowance for Uncollectible Accounts —Based upon experience and judgment, an allowance is established for uncollectible accounts with respect to tuition receivables. In establishing the allowance for uncollectible accounts, the Company considers, among other things, current and expected economic conditions, a student’s status (in-school or out-of-school), whether or not a student is currently making payments, and overall collection history. Changes in trends in any of these areas may impact the allowance for uncollectible accounts. The receivables balances of withdrawn students with delinquent obligations are reserved for based on our collection history. Inventories —Inventories consist mainly of textbooks, computers, tools and supplies. Inventories are valued at the lower of cost or market on a first-in, first-out basis. Property, Equipment and Facilities — Depreciation and Amortization Advertising Costs —Costs related to advertising are expensed as incurred and are approximately $35.0 million and $33.1 million for the years ended December 31, 2022 and 2021, respectively. These amounts are included in selling, general and administrative expenses in the consolidated statements of operations. Goodwill — Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired. Lincoln tests goodwill for impairment annually, in the fourth quarter of each year, unless there are events or changes in circumstances that indicate an impairment may have occurred. Impairment may result from deterioration in performance, adverse market conditions, adverse changes in laws or regulations, the restriction of activities associated with the acquired business, and/or a variety of other circumstances. If we determine that impairment has occurred, we record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. As of December 31, 2022, goodwill was approximately $14.5 million, or 5.0%, of our total assets. The goodwill is allocated among nine reporting units within the Transportation and Skilled Trades Segment. Impairment of Long-Lived Assets — The Company reviews the carrying value of its long-lived assets and identifiable intangibles for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. For other long-lived assets, including right-of-use (“ROU”) When we perform the quantitative impairment test for long-lived assets, we examine estimated future cash flows using Level 3 inputs. These cash flows are evaluated by using weighted probability techniques as well as comparisons of past performance against projections. Assets may also be evaluated by identifying independent market values. If the Company determines that an asset’s carrying value is impaired, it will record a write-down of the carrying value of the asset and charge the impairment as an operating expense in the period in which the determination is made . Concentration of Credit Risk —Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of temporary cash investments. The Company places its cash and cash equivalents with high credit quality financial institutions. The Company’s cash balances with financial institutions typically exceed the Federal Deposit Insurance Corporation (“FDIC”) limit of $0.25 million. The Company’s cash balances on deposit as of December 31, 2022, exceeded the balance insured by the FDIC by approximately $39.2 million. The Company has not experienced any losses to date on its invested cash. The Company extends credit for tuition and fees to many of its students. The credit risk with respect to these accounts receivable is mitigated by the students’ participation in federally funded financial aid programs unless students withdraw prior to the receipt of federal funds for those students. In addition, the remaining tuition receivables are primarily comprised of smaller individual amounts due from students. With respect to student receivables, the Company had no significant concentrations of credit risk as of each of December 31, 2022 and 2021, respectively. Use of Estimates in the Preparation of Financial Statements —The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. On an ongoing basis, the Company evaluates the estimates and assumptions, including those used to determine the incremental borrowing rate to calculate lease liabilities and ROU assets, lease term to calculate lease cost, revenue recognition, bad debts, impairments, fixed assets, income taxes, benefit plans and certain accruals. Actual results could differ from those estimates. Income Taxes — The Company assesses our deferred tax asset to determine whether all or any portion of the asset is more likely than not unrealizable. A valuation allowance is required to be established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized. Our assessment considers whether there has been sufficient income in recent years and whether sufficient income is expected in future years in order to utilize the deferred tax asset. In evaluating the realizability of deferred income tax assets, the Company considered, among other things, historical levels of income, expected future income, the expected timing of the reversals of existing temporary reporting differences, and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Significant judgment is required in determining the future tax consequences of events that have been recognized in our consolidated financial statements and/or tax returns. Differences between anticipated and actual outcomes of these future tax consequences could have a material impact on the Company’s consolidated financial position or results of operations. Changes in, among other things, income tax legislation, statutory income tax rates, or future income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause our income tax provision to vary significantly among financial reporting periods. On August 16, 2022, the Inflation Reduction Act (the “Inflation Act”) was enacted and signed into law. The Inflation Act is a budget reconciliation package that includes significant changes relating to tax, climate change, energy, and health care. The tax provisions include, among other items, a corporate alternative minimum tax of 15%, an excise tax of 1% on corporate stock buy-backs, energy-related tax credits, and additional IRS funding. The Company does not expect the tax provisions of the Inflation Act to have a material impact to our consolidated financial statements. We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the fiscal years ended December 31, 2022 and 2021, we did not record any interest and penalties expense associated with uncertain tax positions, as we do not have any uncertain tax positions. Start-up Costs — Costs related to the start of new campuses are expensed as incurred. New Accounting Pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. This amendment introduced the requirement for an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with the requirements of FASB Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”, rather than at fair value. For public business entities, the amendments in ASU 2021-08 are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provided temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provided optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. It was intended to help stakeholders during the global market-wide reference rate transition period. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope” which clarified that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures. In August 2020, the FASB issued ASU 2020-06, “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”. This ASU simplified the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The ASU removed separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature and hence most of the instruments will be accounted for as a single model (either debt or equity). The ASU also states that entities must apply the if-converted method to all convertible instruments for calculation of diluted EPS and the treasury stock method is no longer available. An entity can use either a full or modified retrospective approach to adopt the ASU’s guidance. ASU No. 2020-06 is effective for the Company as a smaller reporting company for fiscal years beginning after December 15, 2023, and for interim periods within those fiscal years. For convertible instruments that include a down-round feature, entities may early adopt the amendments that apply to the down-round features if they have not yet adopted the amendments in ASU 2017-11. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures as the Company currently has no financial instruments that are in the scope of this ASU. In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments impairment of certain financial instruments, including trade receivables, from an “incurred loss” to a “current expected credit loss” model. Further, the FASB issued ASU No. 2019-04, ASU No. 2019-05 and ASU 2019-11 to provide additional guidance on the credit losses standard. In November 2019, FASB issued ASU No. 2019-10, “Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)” “Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842)” |
FINANCIAL AID AND REGULATORY CO
FINANCIAL AID AND REGULATORY COMPLIANCE | 12 Months Ended |
Dec. 31, 2022 | |
FINANCIAL AID AND REGULATORY COMPLIANCE [Abstract] | |
FINANCIAL AID AND REGULATORY COMPLIANCE | 2. FINANCIAL AID AND REGULATORY COMPLIANCE Financial Aid The Company’s schools and students participate in a variety of government-sponsored financial aid programs that assist students in paying for the cost of their education. The largest source of such support is the federal programs of student financial assistance under Title IV of the Higher Education Act of 1965, as amended, commonly referred to as the Title IV Programs, which are administered by the DOE. During the fiscal years ended December 31, 2022 and 2021, approximately 74% and 75%, respectively, of net revenues on a cash basis were indirectly derived from funds distributed under Title IV Programs. For the fiscal years ended December 31, 2022 and 2021, the Company calculated that no individual DOE reporting entity received more than 90% of its revenue, determined on a cash basis pursuant to DOE regulations, from the Title IV Program funds. The Company’s calculations may be subject to review by the DOE. Under DOE regulations, a proprietary institution that derives more than 90% of its total revenue from the Title IV Programs for two two Regulatory Compliance All institutions participating in Title IV Programs must satisfy specific standards of financial responsibility. The DOE evaluates institutions for compliance with these standards each year, based on the institution’s annual audited financial statements, as well as following a change in ownership resulting in a change of control of the institution. The most significant financial responsibility measurement is the institution ’ • the equity ratio, which measures the institution ’ • the primary reserve ratio, which measures the institution ’ • the net income ratio, which measures the institution ’ The DOE assigns a strength factor to the results of each of these ratios on a scale from negative 1.0 to positive 3.0, with negative 1.0 reflecting financial weakness and positive 3.0 reflecting financial strength. The DOE then assigns a weighting percentage to each ratio and adds the weighted scores for the three ratios together to produce a composite score for the institution. The composite score must be at least 1.5 for the institution to be deemed financially responsible without the need for further oversight. If an institution’s composite score is below 1.5, but is at least 1.0, it is in a category denominated by the DOE as “the zone.” Under the DOE regulations, institutions that are in the zone typically may be permitted by the DOE to continue to participate in the Title IV Programs by choosing one of two alternatives: 1) the “Zone Alternative” under which an institution is required to make disbursements to students under the Heightened Cash Monitoring 1 (“HCM1”) payment method, or a different payment method other than the advance payment method, and to notify the DOE within 10 days after the occurrence of certain oversight and financial events or 2) submit a letter of credit to the DOE equal to 50 percent of the Title IV Program funds received by the institution during its most recent fiscal year. The DOE permits an institution to participate under the “Zone Alternative” for a period of up to three reimbursement payment methods, the HCM1 payment method typically does not require schools to submit documentation to the DOE and wait for DOE approval before drawing down Title IV Program funds. Effective July 1, 2016, a school under HCM1, HCM2 or reimbursement payment methods must also pay any credit balances due to a student before drawing down funds for the amount of those disbursements from the DOE, even if the student or parent provides written authorization for the school to hold the credit balance. If an institution’s composite score is below 1.0, the institution is considered by the DOE to lack financial responsibility. If the DOE determines that an institution does not satisfy the DOE’s financial responsibility standards, depending on its composite score and other factors, that institution may establish its eligibility to participate in the Title IV Programs on an alternative basis by, among other things: • posting a letter of credit in an amount equal to at least 50% of the total Title IV Program funds received by the institution during the institution ’ • posting a letter of credit in an amount equal to at least 10% of the Title IV Program funds received by the institution during its most recently completed fiscal year accepting provisional certification; complying with additional DOE monitoring requirements and agreeing to receive Title IV Program funds under an arrangement other than the DOE’s standard advance funding arrangement. For the 2022 and 2021 fiscal years, we calculated our composite score to be 2.9 and 3.0, respectively. These scores are subject to determination by the DOE based on its review of our consolidated audited financial statements for the 2022 and 2021 fiscal years, but we believe it is likely that the DOE will determine that our institutions comply with the composite score requirement. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 12 Months Ended |
Dec. 31, 2022 | |
NET INCOME PER SHARE [Abstract] | |
NET INCOME PER SHARE | 3. NET INCOME PER SHARE The Company presents basic and diluted income per common share using the two-class method which requires all outstanding Series A Preferred Stock (“Series A Preferred Stock”) and unvested Restricted Stock that contain rights to non-forfeitable dividends and therefore participate in undistributed income with common shareholders to be included in computing income per common share. Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of Common Stock and participating security. The remaining undistributed income is then allocated to Common Stock and participating securities, based on their respective rights to receive dividends. Series A Preferred Stock and unvested Restricted Stock contain non-forfeitable rights to dividends on an if-converted basis and on the same basis as common shares, respectively, and are considered participating securities. The Series A Preferred Stock and unvested Restricted Stock are not included in the computation of basic income per common share in periods in which we have a net loss, as the Series A Preferred Stock and unvested Restricted Stock are not contractually obligated to share in our net losses. However, the cumulative dividends on Series A Preferred Stock for the period decreases the income or increases the net loss allocated to common shareholders unless the dividend is paid in the period. Basic income per common share has been computed by dividing net income allocated to common shareholders by the weighted-average number of common shares outstanding. The basic and diluted net income amounts are the same for the years ended December 31, 2022 and 2021 as a result of the anti-dilutive impact of the potentially dilutive securities. The Company uses the more dilutive method of calculating the diluted income per share by applying the more dilutive of either (a) the treasury stock method, if-converted method, or (b) the two-class method in its diluted income per common share calculation. Potentially dilutive shares are determined by applying the treasury stock method to the assumed exercise of outstanding stock options and the assumed vesting of restricted stock. Potentially dilutive shares issuable upon conversion of the Series A Preferred Stock are calculated using the if-converted method. On November 30, 2022, the Company exercised in full its right of mandatory conversion of the Company’s Series A Preferred Stock. In connection with the conversion, each share of Series A Preferred Stock has been cancelled and converted into 423,729 shares of the Company’s Common Stock, no par value per share. Shares of Series A Preferred Stock are no longer outstanding and all rights of the holders to receive future dividends have been terminated. As a result of the conversion, the aggregate 12,700 shares of Series A Preferred Stock outstanding were converted into 5,381,356 shares of Common Stock. The following is a reconciliation of the numerator and denominator of the diluted net income per share computations for the periods presented below: Year Ended December 31, (in thousands, except share data) 2022 2021 Numerator: Net income $ 12,634 $ 34,718 Less: preferred stock dividend (1,111 ) (1,219 ) Less: allocation to preferred stockholders (1,753 ) (5,601 ) Less: allocation to restricted stockholders (559 ) (1,796 ) Net income allocated to common stockholders $ 9,211 $ 26,102 Basic net income per share: Denominator: Weighted average common shares outstanding 25,879,483 25,080,789 Basic net income per share $ 0.36 $ 1.04 Diluted net income per share: Denominator: Weighted average number of: Common shares outstanding 25,879,483 25,080,789 Dilutive potential common shares outstanding: Series A preferred stock - - Unvested restricted stock - - Stock options - - Dilutive shares outstanding 25,879,483 25,080,789 Diluted net income per share $ 0.36 $ 1.04 The following table summarizes the potential weighted average shares of Common Stock that were excluded from the determination of our diluted shares outstanding as they were anti-dilutive: Year Ended December 31, 2022 2021 Series A preferred stock - 5,381,356 Unvested restricted stock 516,233 825,569 516,233 6,206,925 |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE RECOGNITION [Abstract] | |
REVENUE RECOGNITION | 4. REVENUE RECOGNITION Substantially all of our revenues are considered to be revenues from contracts with students. We determine standalone selling price based on the price at which the distinct services or goods are sold separately. The related accounts receivable balances are recorded in our balance sheets as student accounts receivable. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not have any transaction price allocated to unsatisfied performance obligations other than in our unearned tuition. We record revenue for students who withdraw from our schools only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Unearned tuition represents contract liabilities primarily related to our tuition revenue. We have assessed the costs incurred to obtain a contract with a student and determined them to be immaterial. Unearned tuition in the amount of $24.2 million and $25.4 million is recorded in the current liabilities section of the accompanying consolidated balance sheets as of December 31, 2022 and 2021, respectively. The change in this contract liability balance during the fiscal year ended December 31, 2022 is the result of payments received in advance of satisfying performance obligations, offset by revenue recognized during that period. Revenue recognized for the fiscal year ended December 31, 2022 that was included in the contract liability balance at the beginning of the year was $24.6 million. The following table depicts the timing of revenue recognition by segment: Year ended December 31, 2022 Transportation and Skilled Trades Segment Healthcare and Other Professions Segment Transitional Segment Consolidated Timing of Revenue Recognition Services transferred at a point in time $ 15,523 $ 5,911 $ 288 $ 21,722 Services transferred over time 234,382 85,624 6,559 326,565 Total revenues $ 249,905 $ 91,535 $ 6,847 $ 348,287 Year ended December 31, 2021 Transportation and Skilled Trades Segment Healthcare and Other Professions Segment Transitional Segment Consolidated Timing of Revenue Recognition Services transferred at a point in time $ 17,393 $ 5,402 $ 284 $ 23,079 Services transferred over time 223,138 82,596 6,523 312,257 Total revenues $ 240,531 $ 87,998 $ 6,807 $ 335,336 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
LEASES [Abstract] | |
LEASES | 5. LEASES The Company determines if an arrangement is a lease at inception. The Company considers any contract where there is an identified asset as to which the Company has the right to control its use in determining whether the contract contains a lease. An operating lease ROU asset represents the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are to be recognized at the commencement date based on the present value of lease payments over the lease term. As all of the Company’s operating leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available on the commencement date in determining the present value of lease payments. We estimate the incremental borrowing rate based on a yield curve analysis, utilizing the interest rate derived from the fair value analysis of our credit facility and adjusting it for factors that appropriately reflect the profile of secured borrowing over the expected term of the lease. The operating lease ROU assets include any lease payments made prior to the rent commencement date and exclude lease incentives. Our leases have remaining lease terms of one year to 19 years. Lease terms may include options to extend the lease term used in determining the lease obligation when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments are recognized on a straight-line basis over the lease term for operating leases. See Note 7 which discusses the sale leaseback transaction relating to the Company’s Denver and Grand Prairie campuses which closed on October 29, 2021. On June 30, 2022, the Company executed a lease for approximately 55,000 square feet of space to serve as the Company’s new campus, in Atlanta, Georgia. The lease term commenced in August 2022, with total payments due over the lease term, on an undiscounted basis of $12.2 million over the 12-year initial lease term. The lease contains two five-year renewal options that may be exercised by the Company at the end of the initial lease term. The Company had no involvement in the construction or design of the underlying asset and was not deemed to be in control of the asset prior to the lease commencement date. During the six months ended December 31, 2022, the Company incurred approximately $0.4 million in capital expenditures, mostly relating to architectural fees and approximately $0.3 million in rent. Our operating lease cost for the fiscal years ended December 31, 2022 and 2021 was $18.9 million and $15.8 million, respectively. Our variable lease cost was less than $0.1 million and zero for the fiscal years ended December 31, 2022 and 2021, respectively. The net change in ROU asset and operating lease liability is included in other assets in the consolidated cash flows for the fiscal years ended December 31, 2022 and 2021. Supplemental cash flow information and non-cash activity related to our operating leases are as follows: December 31, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of operating lease liabilities $ 18,443 $ 15,404 Non-cash activity: Lease liabilities arising from obtaining right-of-use assets $ 13,820 $ 45,456 During the year ended December 31, 2022, the Company entered into four new leases and one lease modification that resulted in noncash re-measurement of the related ROU asset and operating lease liability of $13.8 million. This re-measurement includes the Atlanta, Georgia location, the lease of which commenced in August 2022. Weighted-average remaining lease term and discount rate for our operating leases is as follows: Year Ended December 31, 2022 2021 Weighted-average remaining lease term 11.23 years 11.47 years Weighted-average discount rate 7.12 % 7.67 % Maturities of lease liabilities by fiscal year for our operating leases as of December 31, 2022 are as follows: Year ending December 31, 2023 $ 16,283 2024 17,257 2025 15,319 2026 12,816 2027 9,532 Thereafter 69,499 Total lease payments 140,706 Less: imputed interest (40,074 ) Present value of lease liabilities $ 100,632 |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2022 | |
GOODWILL [Abstract] | |
GOODWILL | 6. GOODWILL Changes in the carrying amount of goodwill during the fiscal years ended December 31, 2022 and 2021 are as follows: Gross Goodwill Balance Accumulated Impairment Losses Net Goodwill Balance Balance as of January 1, 2021 $ 117,176 $ 102,640 $ 14,536 Adjustments - - - Balance as of December 31, 2021 117,176 102,640 14,536 Adjustments - - - Balance as of December 31, 2022 $ 117,176 $ 102,640 $ 14,536 When we perform our annual goodwill impairment assessment we have the option to perform a qualitative assessment based on a number of factors impacting our reporting units (step 0). When a qualitative assessment is performed, a number of factors are evaluated to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Our qualitative assessment is subjective. It includes a review of macroeconomic and industry factors, review of financial and non-financial performance measures, including projected student starts and assessment of adverse events that may negatively impact a reporting units carrying value. Adverse events would include, but are not limited to, difficulty in accessing capital, a greater competitive environment, decline in market-dependent multiples or metrics, regulatory or political developments, change in key personnel, strategy, or customers, or litigation. If we conclude based on our qualitative review that it is more likely than not that the fair value of the reporting unit is less than the carrying value, we proceed with a quantitative impairment test. However, in 2022 it was deemed more appropriate to perform a quantitative goodwill impairment test as a number of factors changed in an unfavorable direction. When we perform our quantitative impairment test we believe the most critical assumptions and estimates in determining the estimated fair value of our reporting units include, but are not limited to, future tuition revenues, operating costs, working capital changes, capital expenditures and a discount rate. The assumptions used in determining our expected future cash flows consider various factors such as historical operating trends particularly in student enrollment and pricing and long-term operating strategies and initiatives. If we determine that quantitative tests are necessary, we determine the fair value of each reporting unit using an equal weighting of the discounted cash flow model and the market approach, or if required, we will evaluate other asset value-based approaches. Our judgment is necessary in forecasting future cash flows and operating results, critical assumptions include growth rates, changes in operating costs, capital expenditures, changes in weighted average costs of capital, and the fair value of an asset based on the price that would be received in a current transaction to sell the asset. Additionally, we obtain independent market metrics for the industry and our peers to assist in the development of these key assumptions. This process is consistent with our internal forecasts and operating plans. On December 31, 2022 we conducted our annual test for goodwill impairment and determined we did not have an impairment. As of each of December 31, 2022, and 2021, the goodwill balance of $14.5 million, respectively is related to the Transportation and Skilled Trades segment. |
PROPERTY SALE AGREEMENTS
PROPERTY SALE AGREEMENTS | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY SALE AGREEMENTS [Abstract] | |
PROPERTY SALE AGREEMENTS | 7. PROPERTY SALE AGREEMENTS Property Sale Agreement - Nashville, Tennessee Campus On September 24, 2021, Nashville Acquisition, LLC, a subsidiary of the Company (“Nashville Acquisition”), entered into a Contract for the Purchase of Real Estate (the “Nashville Contract”) to sell the property located at 524 Gallatin Avenue, Nashville, Tennessee 37206, at which the Company operates its Nashville campus, to SLC Development, LLC, a subsidiary of Southern Land Company (“SLC”), for an aggregate sale price of $34.5 million, subject to customary adjustments at closing. The Company intends to relocate its Nashville campus to a more efficient and technologically advanced facility in the Nashville metropolitan area but has not yet identified a location. The Company and SLC have agreed to an extension of the due diligence period under the Nashville Contract. Consequently, subject to satisfactory completion of the due diligence, this transaction is expected to close during the second quarter of 2023. During the extension of the diligence period, non-refundable payments have been and continue to be made to the Company by SLC which are expected to total approximately $1.1 million in the aggregate through March 1, 2023. The payments will be applied towards the purchase price, assuming that a closing occurs. As of December 31, 2022, the Company had received approximately $0.5 million in non-refundable payments from SLC. The Nashville, Tennessee property is currently classified as assets held for sale in the consolidated balance sheet for the fiscal years ended December 31, 2022 and 2021, respectively. Sale-Leaseback Transaction - Denver, Colorado and Grand Prairie, Texas Campuses On September 24, 2021, Lincoln Technical Institute, Inc. and LTI Holdings, LLC, each a wholly-owned subsidiary of the Company (collectively, “Lincoln”), entered into an Agreement for Purchase and Sale of Property for the sale of the properties located at 11194 E. 45th Avenue, Denver, Colorado 80239 and 2915 Alouette Drive, Grand Prairie, Texas 75052, at which the Company operates its Denver and Grand Prairie campuses, respectively, to LNT Denver (Multi) LLC, a subsidiary of LCN Capital Partners (“LNT”), for an aggregate sale price of $46.5 million, subject to customary adjustments at closing. Closing of the sale occurred on October 29, 2021. Concurrently with the consummation of the sale, the parties entered into a triple-net lease agreement for each of the properties pursuant to which the properties are being leased back to Lincoln Technical Institute, Inc. for a 20-year term at an initial annual base rent, payable quarterly in advance, of approximately $2.6 million for the first year with annual 2.00% increases thereafter and includes four subsequent five-year renewal options in which the base rent is reset at the commencement of each renewal term at then current fair market rent for the first year of each renewal term with annual 2.00% increases thereafter in each such renewal term. The lease, in each case, provides Lincoln with a right of first offer should LNT wish to sell the property. The Company has provided a guaranty of the financial and other obligations of Lincoln Technical Institute, Inc. under each lease. The Company evaluated factors in ASC Topic 606, “Revenue from Contracts with Customers”, to conclude that the transaction qualified as a sale. This included analyzing the right of first offer clause to determine whether it represents a repurchase agreement that would preclude the transaction from being accounted for as a successful sale. At the consummation of the sale, the Company recognized a gain on sale of assets of $22.5 million. Additionally, the Company evaluated factors in ASC Topic 842, “Leases”, and concluded that the newly created leases met the definition of an operating lease. The Company also recorded ROU asset and lease liabilities of $40.1 million. The sale leaseback transaction consummated in 2021, provided the Company with net proceeds of approximately $45.4 million, with the proceeds partially used for the repayment of the Company’s outstanding term loan of $16.2 million and swap termination fee of $0.5 million. |
PROPERTY, EQUIPMENT AND FACILIT
PROPERTY, EQUIPMENT AND FACILITIES | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND FACILITIES [Abstract] | |
PROPERTY, EQUIPMENT AND FACILITIES | 8. PROPERTY, EQUIPMENT AND FACILITIES Property, equipment and facilities consist of the following: At December 31, Useful life (years) 2022 2021 Land - $ 52 $ 645 Buildings and improvements (a) 1-25 86,031 88,060 Equipment, furniture and fixtures 1-7 82,585 85,441 Vehicles 3 751 751 Construction in progress (a) - 888 1,557 170,307 176,454 Less accumulated depreciation and amortization (a) (146,367 ) (153,335 ) $ 23,940 $ 23,119 (a) Includes net impairment charge On December 31, 2022, as a result of impairment testing it was determined that there was a long-lived asset impairment of $1.0 million. The impairment was the result of an assessment of the current market value, as compared to the current carrying value of the assets. In addition to the $0.4 million impairment charge noted above, the additional $0.6 million impairment charge was related to the Company’s ROU asset. Further, on December 31, 2021, as a result of impairment testing it was determined that there was an impairment of our property in Suffield, Connecticut of $0.7 million. The impairment was the result of an assessment of the current market value, obtained via third-party engagement, as compared to the current carrying value of the assets. The carrying value for the Suffield, Connecticut property was approximately $2.9 million. The fair value estimate provided indicated that the current value of the property was approximately $2.2 million. As such, the aforementioned $0.7 million impairment was recorded and the assets carrying value reduced. This property was sold during the second quarter of 2022, generating net proceeds of approximately $2.4 million and resulting in a gain on sale of asset of $0.2 million. There were no other long-lived asset impairments for the year ended December 31, 2021. The increase in property, equipment and facilities is mainly due to investments in new programs including expansion in addition to the buildout of the new Atlanta, Georgia campus. Gross property, equipment and facilities and accumulated depreciation and amortization are down as a result of the sale of our Suffield, Connecticut property during the second quarter of 2022. Depreciation and amortization expense of property, equipment and facilities was $6.4 million and $7.1 million for the years ended December 31, 2022 and 2021, respectively. |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2022 | |
ACCRUED EXPENSES [Abstract] | |
ACCRUED EXPENSES | 9. ACCRUED EXPENSES Accrued expenses consist of the following: At December 31, 2022 2021 Accrued compensation and benefits $ 5,451 $ 11,662 Accrued real estate taxes 1,812 1,732 Other accrued expenses 1,390 2,275 $ 8,653 $ 15,669 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2022 | |
LONG-TERM DEBT [Abstract] | |
LONG-TERM DEBT | 10. LONG-TERM DEBT Credit Facility On November 14, 2019, the Company entered into a senior secured credit agreement (the “Credit Agreement”) with its lender, Sterling National Bank (the “Lender”), providing for borrowing in the aggregate principal amount of up to $60 million (the “Credit Facility”). Initially, the Credit Facility was comprised of four facilities: (1) a $20 million senior secured term loan maturing on December 1, 2024 (the “Term Loan”), with monthly interest and principal payments based on a 120-month amortization with the outstanding balance due on the maturity date; (2) a $10 million senior secured delayed draw term loan maturing on December 1, 2024 (the “Delayed Draw Term Loan”), with monthly interest payments for the first 18 months and thereafter monthly payments of interest and principal based on a 120-month amortization and all balances due on the maturity date; (3) a $15 million senior secured committed revolving line of credit providing a sublimit of up to $10 million for standby letters of credit maturing on November 13, 2022 (the “Revolving Loan”), with monthly payments of interest only; and (4) a $15 million senior secured non-restoring line of credit maturing on January 31, 2021 (the “Line of Credit Loan”). At the closing of the Credit Facility, the Company entered into a swap transaction with the Lender for 100% of the principal balance of the Term Loan maturing on the same date as the Term Loan. Under the terms of the Credit Facility accrued interest on each loan was payable monthly in arrears with the Term Loan and the Delayed Draw Term Loan bearing interest at a floating interest rate based on the then one-month London Interbank Offered Rate (“LIBOR”) plus 3.50% and subject to a LIBOR interest rate floor of 0.25% if there was no swap agreement. Revolving Loans bore interest at a floating interest rate based on the then LIBOR plus an indicative spread determined by the Company’s leverage as defined in the Credit Agreement or, if the borrowing of a Revolving Loan was to be repaid within 30 days of such borrowing, the Revolving Loan accrued interest at the Lender’s prime rate plus 0.50% with a floor of 4.0%. Line of Credit Loans bore interest at a floating interest rate based on the Lender’s prime rate of interest. Letters of credit issued under the Revolving Loan reduced, on a dollar-for-dollar basis, the availability of borrowings under the Revolving Loan. Letters of credit were charged an annual fee equal to (i) an applicable margin determined by the leverage ratio of the Company less (ii) 0.25%, paid quarterly in arrears, in addition to the Lender’s customary fees for issuance, amendment and other standard fees. Borrowings under the Line of Credit Loan were secured by cash collateral. The Lender received an unused facility fee of 0.50% per annum payable quarterly in arrears on the unused portions of the Revolving Loan and the Line of Credit Loan. In addition to the foregoing, the Credit Agreement contained customary representations, warranties, and affirmative and negative covenants (including financial covenants that (i) restricted capital expenditures, (ii) restricted leverage, (iii) required maintaining minimum tangible net worth, (iv) required maintaining a minimum fixed charge coverage ratio and (v) required the maintenance of a minimum of $5 million in quarterly average aggregate balances on deposit with the Lender, which, if not maintained, would result in the assessment of a quarterly fee of $12,500), as well as events of default customary for facilities of this type. The Credit Agreement also limited the payment of cash dividends during the first 24 months of the agreement to $1.7 million but an amendment to the Credit Agreement entered into on November 10, 2020 raised the cash dividend limit to $2.3 million in such 24 month period to increase the amount of permitted cash dividends that the Company could pay on its Series A Preferred Stock. As further discussed below, the Credit Facility was secured by a first priority lien in favor of the Lender on substantially all of the personal property owned by the Company, as well as a pledge of the stock and other equity in the Company’s subsidiaries and mortgages on parcels of real property owned by the Company in Colorado, Tennessee and Texas, at which three of the Company’s schools are located, as well as a former school property owned by the Company located in Connecticut. On September 23, 2021, in connection with entering into the agreements relating to the sale leaseback transaction for the Company’s Denver, Grand Prairie and Nashville campuses (collectively, the “Property Transactions”), the Company and certain of its subsidiaries entered into a Consent and Waiver Letter Agreement (the “Consent Agreement”) to the Company’s Credit Agreement with its Lender. The Consent Agreement provides the Lender’s consent to the Property Transactions and waives certain covenants in the Credit Agreement, subject to certain specified conditions. In addition, in connection with the consummation of the Property Transactions, the Lender released its mortgages and other liens on the subject-properties upon the Company’s payment in full of the outstanding principal and accrued interest on the Term Loan and any swap obligations arising from any swap transaction. Upon the consummation of the Property Transactions on October 29, 2021 the Company paid the Lender approximately $16.7 million in repayment of the Term Loan and the swap termination fee and no further borrowings may be made under the Term Loan or the Delayed Draw Term Loan. Further, during the second quarter of 2022, the Company sold a property located in Suffield, Connecticut for net proceeds of approximately $2.4 million. Prior to the consummation of the transaction, Lincoln obtained consent from the Lender to enter into the sale of this property. Pursuant to certain amendments and modifications to the Credit Agreement and other loan documents, the Term Loan and the Delayed Draw Term Loan were paid off in full and on January 21, 2021, the Line of Credit expired by the terms, conditions and provisions of the Credit Agreement. On November 4, 2022, the Company agreed with its Lender to terminate the Credit Agreement and the remaining Revolving Loan. The Lender agreed to allow the Company’s existing letters of credit to remain outstanding provided that they are cash collateralized and, as of December 31, 2022, the letters of credit in the aggregate outstanding principal amount of $4.0 million remained outstanding, were cash collateralized and classified as restricted cash on the consolidated balance sheet. As of December 31, 2022, the Company did not have a credit facility and did not have any debt outstanding. The Company expects to negotiate a new credit facility in the second quarter of 2023. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY [Abstract] | |
STOCKHOLDERS' EQUITY | 11. STOCKHOLDERS’ EQUITY Common Stock Holders of our Common Stock are entitled to receive dividends when and as declared by our Board of Directors and have the right to one vote per share on all matters requiring shareholder approval. The Company has not declared or paid any cash dividends on our Common Stock since the Company’s Board of Directors discontinued our quarterly cash dividend program in February 2015. The Company has no current intentions to resume the payment of cash dividends in the foreseeable future. Preferred Stock On November 30, 2022, the Company exercised in full its right of mandatory conversion of the Company’s Series A Preferred Stock. In connection with the conversion, each share of Series A Preferred Stock has been cancelled and converted into the right to receive 423,729 shares of the Company’s Common Stock, no par value per share. Shares of the Series A Preferred Stock are no longer outstanding and all rights of the holders to receive future dividends have terminated. As a result of the conversion, the aggregate 12,700 shares of Series A Preferred Stock outstanding were converted into 5,381,356 shares of Common Stock. Dividends Dividends on the Series A Preferred Stock (“Series A Dividends”), at the initial annual rate of 9.6% is to be paid, in arrears, from the date of issuance quarterly on each December 31, March 31, June 30 and September 30 with September 30, 2020 being the first dividend payment date. As of December 31, 2022, we have paid $1.1 million in cash dividends on the outstanding shares of Series A Preferred Stock. With the exercise of the mandatory conversion of the Company’s Series A Preferred Stock there will not be any additional dividend payment related to the Series A Preferred Stock going forward. Dividends are included in the consolidated balance sheets within additional paid-in-capital when the Company maintains an accumulated deficit. Treasury Stock On May 24, 2022, the Board of Directors authorized the cancellation of 5,910,541 shares of Treasury Stock, which reduced Treasury Stock and Common Stock by $82.9 million. Restricted Stock The Company currently has three stock incentive plans: a Long-Term Incentive Plan (the “LTIP”), a Non-Employee Directors Restricted Stock Plan (the “Non-Employee Directors Plan”) and the Lincoln Educational Services Corporation 2020 Incentive Compensation Plan (the “2020 Plan”). 2020 Plan On March 26, 2020, the Board adopted the 2020 Plan to provide an incentive to certain directors, officers, employees and consultants of the Company to align their interests in the Company’s success with those of its shareholders through the grant of equity-based awards. On June 16, 2020, the shareholders of the Company approved the 2020 Plan. The 2020 Plan is administered by the Compensation Committee of the Board, or such other qualified committee appointed by the Board, who will, among other duties, have full power and authority to take all actions and to make all determinations required or provided for under the 2020 Plan. Pursuant to the 2020 Plan, the Company may grant options, share appreciation rights, restricted shares, restricted share units, incentive stock options and nonqualified stock options. The Plan has a duration of 10 years. Subject to adjustment as described in the 2020 Plan, the aggregate number of shares of Common Stock available for issuance under the 2020 Plan was 840,807 shares. LTIP Under the LTIP, certain employees have received awards of restricted shares of Common Stock based on service and performance. The number of shares granted to each employee is based on the amount of the award and the fair market value of a share of Common Stock on the date of grant. Non-Employee Directors Plan Pursuant to the Non-Employee Directors Plan, each non-employee director of the Company receives an annual award of Restricted Shares of Common Stock on the date of the Company’s annual meeting of shareholders. The number of shares granted to each non-employee director is based on the fair market value of a share of Common Stock on that date. The Restricted Shares vest on the first anniversary of the grant date. There is no restriction on the right to vote or the right to receive dividends with respect to any of such Restricted Shares. For the fiscal years ended December 31, 2022 and 2021, the Company completed a net share settlement for 276,274 and 154,973 Restricted Shares, respectively, on behalf of certain employees that participate in the LTIP upon the vesting of the Restricted Shares pursuant to the terms of the LTIP. The net share settlement was in connection with income taxes incurred on Restricted Shares that vested and were transferred to the employees during 2022 and/or 2021, creating taxable income for the employees. At the employees’ request, the Company will pay these taxes on behalf of the employees in exchange for the employees returning an equivalent value of restricted shares to the Company. These transactions resulted in a decrease of $2.0 million and $1.0 million for each of the years ended December 31, 2022 and 2021, respectively, to equity on the consolidated balance sheets as the cash payment of the taxes effectively was a repurchase of the restricted shares granted in previous years. The following is a summary of transactions pertaining to Restricted Stock: Shares Weighted Average Grant Date Fair Value Per Share Nonvested restricted stock outstanding at December 31, 2020 1,572,159 $ 2.77 Granted 679,331 5.99 Cancelled - - Vested (507,644 ) 3.30 Nonvested restricted stock outstanding at December 31, 2021 1,743,846 3.89 Granted 606,950 7.21 Cancelled - - Vested (802,530 ) 4.18 Nonvested restricted stock outstanding at December 31, 2022 1,548,266 5.18 The Restricted Stock expense for the fiscal years ended December 31, 2022 and 2021 was $3.1 million and $2.9 million, respectively. The unrecognized Restricted Stock expense as of December 31, 2022 and 2021 was $7.9 million and $4.4 million, respectively. As of December 31, 2022, outstanding Restricted Shares under the LTIP had aggregate intrinsic value of $8.9 million. Stock Options The fair value of the stock options used to compute stock-based compensation is the estimated present value at the date of grant using the Black-Scholes option pricing model. The following is a summary of transactions pertaining to stock options: Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding January 1, 2020 116,000 $ 10.56 1.83 years $ - Cancelled (35,000 ) 16.95 - - Outstanding December 31, 2020 81,000 7.79 1.17 years - Cancelled - - - Outstanding December 31, 2021 81,000 7.79 0.17 years - Cancelled (81,000 ) 7.79 - Outstanding December 31, 2022 - - - - Vested as of December 31, 2022 - - - - Exercisable as of December 31, 2022 - - - - As of December 31, 2022, there was no unrecognized pre-tax compensation expense. Share Repurchase Program On May 24, 2022, the Company announced that its Board of Directors had authorized a share repurchase program of up to $30.0 million of the Company’s outstanding Common Stock. The repurchase program was authorized for 12 months. Pursuant to the program, purchases may be made, from time to time, in open-market transactions at prevailing market prices, in privately negotiated transactions or by other means as determined by the Company’s management and in accordance with applicable federal securities laws. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements and market conditions. The Company retains the right to limit, terminate or extend the share repurchase program at any time without prior notice. During the fiscal year ended December 31, 2022, the Company repurchased 1,572,414 shares of its Common Stock at an aggregate cost of approximately $9.4 million. These shares were subsequently canceled and recorded as a reduction of Common Stock. On February 27, 2023, the Board of Director extended the share repurchase program for an additional 12 months and authorized the repurchase of an additional $10 million of the Company’s Common Stock, for an aggregate of up to $30.6 million in additional repurchases. |
PENSION PLAN
PENSION PLAN | 12 Months Ended |
Dec. 31, 2022 | |
PENSION PLAN [Abstract] | |
PENSION PLAN | 12. PENSION PLAN The Company sponsors a noncontributory defined benefit pension plan covering substantially all of the Company’s union employees. Benefits are provided based on employees’ years of service and earnings. This plan was frozen on December 31, 1994 for non-union employees. The following table sets forth the plan’s funded status and amounts recognized in the consolidated financial statements: Year Ended December 31, 2022 2021 CHANGES IN BENEFIT OBLIGATIONS: Benefit obligation-beginning of year $ 22,557 $ 24,358 Service cost 37 37 Interest cost 542 492 Actuarial gain (4,661 ) (989 ) Benefits paid (1,362 ) (1,341 ) Benefit obligation at end of year 17,113 22,557 CHANGE IN PLAN ASSETS: Fair value of plan assets-beginning of year 20,950 20,106 Actual return on plan assets (3,143 ) 2,185 Benefits paid (1,362 ) (1,341 ) Fair value of plan assets-end of year 16,445 20,950 BENEFIT OBLIGATION IN EXCESS OF FAIR VALUE FUNDED STATUS: $ (668 ) $ (1,607 ) For the fiscal year ended December 31, 2022, the actuarial gain of $4.7 million was due to the increase in the discount rate from 2.50% to 4.90%. Amounts recognized in the consolidated balance sheets consist of: At December 31, 2022 2021 Noncurrent liabilities $ (668 ) $ (1,607 ) Amounts recognized in accumulated other comprehensive loss consist of: Year Ended December 31, 2022 2021 Accumulated loss $ (2,480 ) $ (2,862 ) Deferred income taxes 1,520 1,622 Accumulated other comprehensive loss $ (960 ) $ (1,240 ) The accumulated benefit obligation was $17.1 million and $22.6 million at December 31, 2022 and 2021, respectively. The following table provides the components of net periodic cost for the plan: Year Ended December 31, 2022 2021 COMPONENTS OF NET PERIODIC BENEFIT COST Service cost $ 37 $ 37 Interest cost 542 492 Expected return on plan assets (1,217 ) (1,021 ) Recognized net actuarial loss 81 640 Net periodic benefit (income) cost $ (557 ) $ 148 The estimated net income and prior service cost for the plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next year is less than $0.1 million. The following tables present plan assets using the fair value hierarchy as of December 31, 2022 and 2021, respectively. The fair value hierarchy has three levels based on the reliability of inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using observable prices that are based on inputs not quoted in active markets but observable by market data, while Level 3 includes the fair values estimated using significant non-observable inputs. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Total Equity securities $ 4,692 $ - $ - $ 4,692 Fixed income 6,130 - - 6,130 International equities 3,650 - - 3,650 Real estate 1,301 - - 1,301 Cash and equivalents 672 - - 672 Balance at December 31, 2022 $ 16,445 $ - $ - $ 16,445 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Total Equity securities $ 6,322 $ - $ - $ 6,322 Fixed income 7,811 - - 7,811 International equities 5,180 - - 5,180 Real estate 900 - - 900 Cash and equivalents 737 - - 737 Balance at December 31, 2021 $ 20,950 $ - $ - $ 20,950 Fair value of total plan assets by major asset category as of December 31: 2022 2021 Equity securities 29 % 30 % Fixed income 37 % 37 % International equities 22 % 25 % Real estate 8 % 4 % Cash and equivalents 4 % 4 % Total 100 % 100 % Weighted-average assumptions used to determine benefit obligations as of December 31: 2022 2021 Discount rate 4.90 % 2.50 % Rate of compensation increase 2.50 % 2.50 % Weighted-average assumptions used to determine net periodic pension cost for years ended December 31: 2022 2021 Discount rate 4.90 % 2.50 % Rate of compensation increase 2.50 % 2.50 % Long-term rate of return 6.75 % 6.00 % As this plan was frozen to non-union employees on December 31, 1994, the difference between the projected benefit obligation and accumulated benefit obligation is not significant in any year. The Company invests plan assets based on a total return on investment approach, pursuant to which the plan assets include a diversified blend of equity and fixed income investments toward a goal of maximizing the long-term rate of return without assuming an unreasonable level of investment risk. The Company determines the level of risk based on an analysis of plan liabilities, the extent to which the value of the plan assets satisfies the plan liabilities and the plan’s financial condition. The investment policy includes target allocations ranging from 30% to 70% for equity investments, 20% to 60% for fixed income investments and 0% to 10% for cash equivalents. The equity portion of the plan assets represents growth and value stocks of small, medium and large companies. The Company measures and monitors the investment risk of the plan assets both on a quarterly basis and annually when the Company assesses plan liabilities. The Company uses a building block approach to estimate the long-term rate of return on plan assets. This approach is based on the capital markets assumption that the greater the volatility, the greater the return over the long term. An analysis of the historical performance of equity and fixed income investments, together with current market factors such as the inflation and interest rates, are used to help make the assumptions necessary to estimate a long-term rate of return on plan assets. Once this estimate is made, the Company reviews the portfolio of plan assets and makes adjustments thereto that the Company believes are necessary to reflect a diversified blend of equity and fixed income investments that is capable of achieving the estimated long-term rate of return without assuming an unreasonable level of investment risk. The Company also compares the portfolio of plan assets to those of other pension plans to help assess the suitability and appropriateness of the plan’s investments. The Company does not expect to make contributions to the plan in 2023. However, after considering the funded status of the plan, movements in the discount rate, investment performance and related tax consequences, the Company may choose to make additional contributions to the plan in any given year. The total amount of the Company’s contributions paid under its pension plan was zero for each of the fiscal years ended December 31, 2022 and 2021, respectively. Information about the expected benefit payments for the plan is as follows: Year Ending December 31, 2023 $ 1,347 2024 1,367 2025 1,360 2026 1,366 2027 1,356 Years 2028-2032 6,486 The Company has a 401(k) defined contribution plan for all eligible employees. Employees may contribute up to 25% of their compensation into the plan. The Company may contribute up to an additional 30% of the employee’s contributed amount up to 6% of compensation. For each of the fiscal years ended December 31, 2022 and 2021, the Company’s expense for the 401(k) plan amounted to $0.7 million. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | 13. INCOME TAXES Components of the provision for income taxes were as follows: Year Ended December 31, 2022 2021 Current: Federal $ 1,864 $ 665 State 644 535 Total 2,508 1,200 Deferred: Federal 767 8,468 State 527 2,860 Total 1,294 11,328 Total provision $ 3,802 $ 12,528 Effective Tax rate The reconciliation of the effective tax rate to the U.S. Statutory Federal Income tax rate was: Year Ended December 31, 2022 2021 Income before taxes $ 16,436 $ 47,246 Expected tax $ 3,452 21.0 % $ 9,922 21.0 % State tax (net of federal benefit) 925 5.6 % 2,682 5.7 % Other (575 ) -3.5 % (76 ) -0.2 % Total $ 3,802 23.1 % $ 12,528 26.5 % Deferred Taxes The components of the non-current deferred tax assets (liabilities) were as follows: At December 31, 2022 2021 Gross noncurrent deferred tax assets (liabilities) Lease liability $ 26,897 $ 26,142 Depreciation 9,531 10,551 Allowance for bad debts 9,454 8,525 Net operating loss carryforwards 1,957 2,394 Accrued benefits - 656 Stock-based compensation 541 641 Pension plan liabilities 179 429 Other intangibles 39 70 Accrued expenses 67 - Goodwill (1,469 ) (1,267 ) Right-of-use asset (24,884 ) (24,433 ) Noncurrent deferred tax assets, net $ 22,312 $ 23,708 As of December 31, 2022, the Company had gross NOL of $34.2 million for state tax purposes and none for federal. While some states follow federal NOL which can be carried forward indefinitely, majority of the state NOLs expires in 2033 and ending in 2037 if not utilized . As of December 31, 2021, the Company had gross NOL of $1.2 million and $37.6 million for federal and state tax purposes , respectively. The federal NOLs can be carried forward indefinitely Utilization of the NOL carryforwards may be subject to a substantial limitation due to ownership change limitations that may occur in the future, as required by Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), as well as similar state and foreign provisions. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain shareholders or public groups. |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE [Abstract] | |
FAIR VALUE | 14. FAIR VALUE The accounting framework for determining fair value includes a hierarchy for ranking the quality and reliability of the information used to measure fair value, which enables the reader of the financial statements to assess the inputs used to develop those measurements. The fair value hierarchy consists of three tiers: Level 1: Defined as quoted market prices in active markets for identical assets or liabilities. Level 2: Defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, model-based valuation techniques for which all significant assumptions are observable in the market or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Defined as unobservable inputs that are not corroborated by market data. The Company measures the fair value of money market funds using Level 1 inputs. As of December 31, 2022, the Company has two treasury bills, one with a maturity date of three months or less, classified as cash equivalents. The second The following table presents the fair value of the financial instruments measured on a recurring basis as of December 31, 2022. December 31, 2022 Carrying Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Amount (Level 1) (Level 2) (Level 3) Total C ash equivalents Money market fund $ 18,160 $ 18,160 $ - $ - $ 18,160 Treasury bill 10,383 10,383 - - 10,383 Short-term investments : Treasury bill 14,758 14,758 - - 14,758 Total cash equivalents and short-term investment s $ 43,301 $ 43,301 $ - $ - $ 43,301 There were no financial instrumets measured on a recurring basis as of December 31, 2021. The carrying amount of the Company’s financial instruments, including cash equivalents, short-term investments, prepaid expenses and other current assets, accrued expenses and other short-term liabilities approximate fair value due to the short-term nature of these items. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2022 | |
SEGMENT REPORTING [Abstract] | |
SEGMENT REPORTING | 15. SEGMENT REPORTING We operate our business in three reportable operating segments: (a) the Transportation and Skilled Trades segment; (b) the Healthcare and Other Professions segment and (c) the Transitional segment. Our reportable operating segments have been determined based on a method by which we now evaluate performance and allocate resources. Each reportable operating segment represents a group of post-secondary education providers that offer a variety of degree and non-degree academic programs. These segments are organized by key market segments to enhance operational alignment within each segment to more effectively execute our strategic plan. Each of the Company’s schools is a reporting unit and an operating segment. Our operating segments are described below. Transportation and Skilled Trades Healthcare and Other Professions Transitional – The Transitional segment refers to businesses that are currently being taught-out. As of December 31, 2022, the only campus classified in the Transitional segment is the Somerville, Massachusetts campus, which has been marked for closure and is expected to be fully taught-out as of December 31, 2023. We evaluate segment performance based on operating results. Adjustments to reconcile segment results to consolidated results are included under the caption “Corporate,” which primarily includes unallocated corporate activity. Summary financial information by reporting segment is as follows: For the Year Ended December 31, Revenue Operating Income (Loss) 2022 % of Total 2021 % of Total 2022 2021 Transportation and Skilled Trades $ 249,905 71.8 % $ 240,531 71.7 % $ 42,335 $ 52,055 Healthcare and Other Professions 91,535 26.3 % 87,998 26.2 % 7,189 11,740 Transitional 6,847 2.0 % 6,807 2.0 % (430 ) 105 Corporate - 0.0 % - 0.0 % (32,816 ) (14,639 ) Total $ 348,287 100 % $ 335,336 100 % $ 16,278 $ 49,261 Total Assets December 31, 2022 December 31, 2021 Transportation and Skilled Trades $ 153,369 $ 156,531 Healthcare and Other Professions 37,104 31,160 Transitional 1,498 2,799 Corporate 99,595 104,809 Total $ 291,566 $ 295,299 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 16. COMMITMENTS AND CONTINGENCIES Litigation and Regulatory Matters — In April 2021, the Company received communication from the U.S. Department of Education (the “DOE”) indicating that the DOE was in receipt of a number of borrower defense applications containing allegations concerning our schools and requiring that the DOE undertake a fact-finding process pursuant to DOE regulations. Among other things, the communication outlines a process by which the DOE would provide to us the applications and provide us the opportunity to submit responses to them. Further, the communication outlines certain information requests, relating to the period between 2007 and 2013, in connection with the DOE’s preliminary review of the borrower defense applications. Based upon publicly available information, it appears that the DOE has undertaken similar reviews of other educational institutions which have also been the subject of various borrower defense applications. We have received the borrower application claims and have completed the process of thoroughly reviewing and responding to each borrower application as well as providing information in response to the DOE’s requests. We are not able to predict the outcome of the DOE’s review at this time. If the DOE disagrees with our legal and factual grounds for contesting the applications, the DOE may impose liabilities on the Company based on the discharge of the loans at issue in the pending applications, which could have a material adverse effect on our business and results of operations. If the proposed Borrower Defense to Repayment regulations take effect on July 1, 2023, and if any or all of the Borrower Defense to Repayment applications remain pending, the DOE could attempt to apply the new regulations to the pending applications which could increase the likelihood of the DOE granting the application because the proposed regulations are more favorable to borrowers. In August 2022, the Company received a communication from the DOE regarding a single borrower defense application submitted on behalf of a group of students who were enrolled in a single educational program at two of our schools in Massachusetts between 2010 and 2013. We have responded to the DOE’s letter, notwithstanding the absence of a response to our request for additional information about the student claims. We are waiting for the DOE’s reply to our response and to our request for information concerning the student claims. We are not able to predict the outcome of the DOE’s review at this time. If the DOE disagrees with our legal and factual grounds for contesting the application, the DOE may impose liabilities on the Company based on the discharge of the loans at issue in the pending application which could have a material adverse effect on our business and results of operations. On June 22, 2022, the DOE and the plaintiffs in a lawsuit before a federal court in California submitted a proposed settlement agreement to the court. The plaintiffs contend, among other things, that the DOE failed to timely decide and resolve Borrower Defense to Repayment applications submitted to the DOE. If approved, the settlement would result in full discharge and refund payments to covered student borrowers who have asserted a Borrower Defense to Repayment to the DOE and whose borrower defense claims have not yet been granted or denied on the merits. The lawsuit, Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.), is a class action filed on June 25, 2019 against the DOE in the U.S. District Court for the Northern District of California submitted by a group of students, none of whom attended any of our institutions. We were not a party to the lawsuit when it was filed. The plaintiffs requested that the court compel the DOE to start approving or denying the pending applications. The court granted class certification and defined the class of plaintiffs generally to include all people who borrowed a Title IV Direct loan or FFEL loan, who have asserted a Borrower Defense to Repayment claim to the DOE, and whose borrower defense claim has not been granted or denied on the merits. We have not received notice or confirmation directly from the DOE of the number of student borrowers who have submitted Borrower Defense to Repayment claims related to our institutions. The proposed settlement agreement includes a long list of institutions, including Lincoln Technical Institute and Lincoln College of Technology. Under the proposed settlement, the DOE would agree to discharge loans and refund all prior loan payments to each class member with loan debt associated with an institution on the list (which includes our institutions), including borrowers whose applications the DOE previously denied after October 30, 2019. The DOE and the plaintiffs stated in a court filing that this provision is intended to provide for automatic relief for students at the listed schools which the DOE estimates to total 200,000 class members. We anticipate that the DOE believes that the class includes the borrowers with claims to which we have submitted responses to the DOE although it is possible that the class also includes borrowers with claims for which we have not received notice from the DOE or an opportunity to respond. The parties also stated that the DOE has determined that attendance at one of the institutions on the list justifies presumptive relief based on strong indicia regarding substantial misconduct by the institutions, whether credibly alleged or in some instances proven, and the high rate of class members with applications related to the listed schools. The proposed settlement agreement provides a separate process for reviewing claims associated with schools that are not on the list. It is unclear whether the DOE would seek to impose liabilities on us or other schools or take other actions or impose other sanctions on us or other schools based on relief provided to students under the proposed settlement agreement (particularly if the DOE provides relief without evaluating or accounting for legal and factual information provided to the DOE by us and other schools or without providing us and other schools with notice and an opportunity to respond to some of the claims). In July 2022, the Company and certain other school companies submitted motions to intervene in the lawsuit in order to protect our interests in the finalization and implementation of any settlement agreement that the court might approve. We noted in the motion that the proposed settlement agreement introduced, for the first time, the prospect that the DOE would “automatically” and fully discharge loans and refund payments to student borrowers without adjudication of the merits of the students’ borrower-defense applications in accordance with the DOE’s borrower-defense regulations and without ensuring that we and other institutions can defend against allegations asserted in individual borrower-defense applications. In addition, we also asserted that it would be unlawful and inappropriate if the DOE sought recoupment against us based on loans that were forgiven under the proposed settlement agreement without providing us with an opportunity to address the claims or accounting for our responses to the claims already submitted which we believe is required by the regulations. We also asserted that the lawsuit and the potential loan discharges could result in reputational harm to us and our institutions and could result in other actions against us by other federal and state agencies or by current and former students. The court granted preliminary approval of the proposed settlement agreement on August 4, 2022, and also granted our motion for permissive intervention for the purpose of objecting to and opposing the class action settlement. On September 22, 2022, the DOE and the plaintiffs filed a joint motion for final approval of the settlement. In that joint motion, the DOE and the plaintiffs reported that approximately 179,000 new borrower defense applications had been submitted to the DOE as of September 20, 2022. We and the three other intervenor schools filed briefs opposing final approval. In an Order dated November 16, 2022, District Court Judge William Alsup granted final approval of the settlement agreement. Subsequently, we, and two other school companies that intervened, filed notices of appeal and asked the district court to stay the settlement from taking effect until the appeals were decided and the district court did temporarily stay any loan discharges and refunds under the settlement pending the decision. Plaintiffs and the DOE thereafter filed oppositions to our stay request and, after a hearing, the district court denied our stay request, but extended the temporary stay of loan discharges and refunds associated with the three school companies for seven days to allow us to file a motion for a stay with the U.S. Court of Appeals for the Ninth Circuit. On February 27, 2023, we and the two other school companies that appealed filed a joint motion for a stay with the Ninth Circuit which we expect the plaintiffs and the DOE will oppose. We expect that the Ninth Circuit will decide our stay motion in the coming weeks. Regardless of the outcome of our stay request, we intend to ask the Ninth Circuit to overturn the district court’s judgment approving the final settlement. If the settlement agreement is upheld on appeal, or if the courts deny our stay requests, the DOE is expected to automatically approve all of the pending borrower defense applications concerning us that were submitted to the DOE on or before June 22, 2022 and to provide such automatic approval without evaluating or accounting for any of the legal or factual grounds that we provided for contesting the applications that were provided to us. The DOE may or may not attempt to seek recoupment from applicable schools relating to approval of borrower defense applications. If the DOE approves borrower defense applications concerning us and attempts to recoup from us the loan amounts in the approved applications, we would consider our options for challenging the legal and factual bases for such actions. The settlement also requires the DOE to review borrower defense applications submitted after June 22, 2022 and before November 16, 2022 within 36 months of the final settlement date. If the DOE grants some or all of these applications, the DOE also could attempt to recoup from us the loan amounts relating to these applications as well. We cannot predict whether the settlement will be upheld on appeal, what actions the DOE might take if the settlement is upheld on appeal (including the ultimate timing or amount of borrower defense applications the DOE may grant in the future and the timing or amount of any possible liabilities that the DOE may seek to recover from the Company, if any), or what the outcome of our challenges to such actions will be, but such actions could have a material adverse effect on our business and results of operations. On June 7, 2022, the Massachusetts Attorney General’s Office (“AGO”) issued a civil investigative demand (“CID”) indicating its intention to investigate possible unfair or deceptive methods, acts, or practices in violation of state law relating to allegations against our Massachusetts school to such effect in connection with that school’s policies regarding fee refunds and associated disclosures to students and prospective students. The CID has requested that we provide to the AGO certain documentation generally from the period from January 1, 2020 to the present. We have provided the documents requested and are cooperating with the investigation. We are not able to predict the outcome or materiality of the foregoing matters at this time. In addition to these matters, in the ordinary conduct of our business, we are subject to additional periodic lawsuits, investigations, regulatory proceedings and other claims, including, but not limited to, claims involving students or graduates, routine employment matters and business disputes. We cannot predict the ultimate resolution of these lawsuits, investigations, regulatory proceedings and other claims asserted against us, but we do not believe that any of these matters will have a material adverse effect on our business, financial condition, results of operations or cash flows. S tudent Financing Plans — Executive Employment Agreements Surety Bonds |
COVID-19 PANDEMIC AND CARES ACT
COVID-19 PANDEMIC AND CARES ACT | 12 Months Ended |
Dec. 31, 2022 | |
COVID-19 PANDEMIC AND CARES ACT [Abstract] | |
COVID-19 PANDEMIC AND CARES ACT | 17. COVID-19 PANDEMIC AND CARES ACT The Company began seeing the impact of the global COVID-19 pandemic on its business in early March 2020 and some effects of the pandemic have continued. The spread of COVID-19 has had an unprecedented impact on higher educational institutions across the country, including our schools, and has led to the closure of campuses and the transition of academic programs from in-person instruction to online, remote learning and back. The impact for the Company primarily related to transitioning classes from in-person, hands-on learning to online, remote learning which resulted in, among other things, additional expenses. Further, related to this transition, some students were placed on leave of absence as they could not complete their externships and some students chose not to participate in online learning. As a result, certain programs were extended due to restricted access to externship sites and classroom labs which did not have a material impact on our consolidated financial statements. In accordance with phased re-opening as applied on a state-by-state basis, all of our schools have now re-opened and the majority of the students who were on leave of absence or had deferred their programs returned to school to finish their programs. In response to the COVID-19 pandemic, in 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law, providing a $2 trillion federal economic relief package of financial assistance and other relief to individuals and businesses impacted by the pandemic. Among other things, the CARES Act includes a $14 billion Higher Education Emergency Relief Fund (“HEERF”) for the DOE to distribute directly to institutions of higher education. The DOE has allocated funds to each institution of higher education based on a formula contained in the CARES Act. The formula is heavily weighted toward institutions with large numbers of Pell Grant recipients. The DOE allocated $27.4 million to our schools distributed in two equal installments and required them to be utilized by April 30, 2021 and May 14, 2021, respectively. As of September 30, 2021, the Company had distributed the full $13.7 million of its first installment as emergency grants to students and has utilized the full $13.7 million of its second installment. Proceeds from the second installment for permitted expenses were primarily utilized to either offset original expenses incurred or to reduce student accounts receivable, driving a decrease in bad debt expense. Both uses resulted in a decrease in our selling, general and administrative expenses. Institutions are required to use at least half of the HEERF funds for emergency grants to students for expenses related to disruptions in campus operations (e.g., food, housing, etc.). The law requires institutions receiving funds to continue to the greatest extent practicable to pay its employees and contractors during the period of any disruptions or closures related to the COVID-19 emergency which the Company has done. The Company was also permitted to defer payment of FICA payroll taxes through January 1, 2021 and did so but, pursuant to requirements of the deferment, repaid 50% of the deferred payments in January 2022, and in accordance with the deferment repaid the remaining 50% in January 2023. In December 2020, the Consolidated Appropriations Act, 2021 was enacted which included the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (“CRRSAA”). The CRRSAA provided an additional $81.9 billion to the Education Stabilization Fund including $22.7 billion for the HEERF, which were originally created by the CARES Act in March 2020. The higher education provisions of the CRRSAA are intended in part to provide additional financial assistance benefitting students and their postsecondary institutions in the wake of the spread of COVID-19 across the country and its impact on higher educational institutions. In March 2021, the $1.9 trillion American Rescue Plan Act of 2021 (“ARPA”) was signed into law. Among other things, the ARPA provides $40 billion in relief funds that will go directly to colleges and universities with $395.8 million going to for-profit institutions. The DOE has allocated a total of $24.4 million to our schools from the funds made available under CRRSAA and ARPA. As of December 31, 2022, the Company has drawn down and distributed to our students $14.8 million of these allocated funds. The remainder of the funds are on hold by the DOE and we are not expecting to receive any of those funds. Failure to comply with requirements for the usage and reporting of these funds could result in requirements to repay some or all of the allocated funds and |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 12 Months Ended |
Dec. 31, 2022 | |
SUBSEQUENT EVENT [Abstract] | |
SUBSEQUENT EVENT | 18. SUBSEQUENT EVENT On February 27, 2023, the Company announced that the Board of Directors authorized the continuation of the share repurchase program originally established on May 24, 2022 for repurchases of up to $30 million of the Company’s outstanding Common Stock over a twelve-month period. To date, the Company has made repurchases of approximately $9.4 million of its Common Stock. The Board extended the share repurchase program for an additional 12 months and authorized the repurchase of an additional $10 million of the Company’s Common Stock, for an aggregate of up to $30.6 million in additional repurchases. Purchases may be made, from time to time, in open-market transactions at prevailing market prices, in privately negotiated transactions or by other means as determined by the Company’s management and in accordance with applicable federal securities laws. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements and market conditions. The Company retains the right to limit, terminate or extend the share repurchase program at any time without prior notice. |
Schedule II-Valuation and Quali
Schedule II-Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2022 | |
Schedule II-Valuation and Qualifying Accounts [Abstract] | |
Schedule II-Valuation and Qualifying Accounts | LINCOLN EDUCATIONAL SERVICES CORPORATION Schedule II—Valuation and Qualifying Accounts (in thousands) Description Balance at Beginning of Period Charged to Expense Accounts Written-off Balance at End of Period Allowance accounts for the year ended: December 31, 2022 Student receivable allowance $ 31,921 $ 34,915 $ (31,466 ) $ 35,370 December 31, 2021 Student receivable allowance $ 28,639 $ 26,794 $ (23,512 ) $ 31,921 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Business Activities | Business Activities —Lincoln Educational Services Corporation and its subsidiaries (collectively, the “Company”, “we”, “our”, and “us”, as applicable) provide diversified career-oriented post-secondary education to recent high school graduates and working adults. The Company, which currently operates 22 schools in 14 states, offers programs in skilled trades (which include HVAC, welding and computerized numerical control and electrical and electronic systems technology, among other programs), automotive technology, healthcare services (which include nursing, dental assistant and medical administrative assistant, among other programs), hospitality services (which include culinary, therapeutic massage, cosmetology and aesthetics) and information technology. The schools operate under Lincoln Technical Institute, Lincoln College of Technology, Lincoln Culinary Institute, and Euphoria Institute of Beauty Arts and Sciences and associated brand names. Most of the campuses serve major metropolitan markets and each typically offers courses in multiple areas of study. Five of the campuses are destination schools, which attract students from across the United States and, in some cases, from abroad. The Company’s other campuses primarily attract students from their local communities and surrounding areas. All of the campuses are nationally accredited and are eligible to participate in federal financial aid programs by the U.S. Department of Education (“DOE”) and applicable state education agencies and accrediting commissions which allow students to apply for and access federal student loans as well as other forms of financial aid. Our business is organized into three reportable business segments: (a) Transportation and Skilled Trades, (b) Healthcare and Other Professions (“HOPS”), and (c) Transitional, which refers to campuses that have been marked for closing and are currently being taught out. On November 3, 2022, the Board of Directors approved a plan to close the Somerville, Massachusetts campus by the end of 2023. As of December 31, 2022, the Somerville campus is the only campus classified in the Transitional Segment. On June 30, 2022, the Company executed a lease for a 55,000 square foot facility to house a second Atlanta, Georgia area campus. The build-out is continuing to advance according to plan. For the year ended December 31, 2022, the Company incurred approximately $0.4 million in capital expenditures, mostly relating to architectural fees and approximately $0.3 million in rent. |
Liquidity | Liquidity As of December 31, 2022, the Company had $50.3 million in cash and cash equivalents and restricted cash, in addition to $14.8 million in short-term investments compared to $83.3 million cash and cash equivalents in the prior year. and thereafter for the foreseeable future . |
Principles of Consolidation | Principles of Consolidation —The accompanying consolidated financial statements include the accounts of Lincoln Educational Services Corporation and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. |
Cash and Cash Equivalents | Cash and Cash Equivalents —Cash and cash equivalents include all cash balances and highly-liquid short-term investments, which contain original maturities within three months of purchase. Pursuant to the DOE’s cash management requirements, the Company retains funds from financial aid programs under Title IV of the Higher Education Act of 1965 in segregated cash management accounts. The segregated accounts do not require a restriction on use of the cash and, as such, these amounts are classified as cash and cash equivalents on the consolidated balance sheets. |
Restricted Cash | Restricted Cash |
Short-term investments | Short-term investments |
Accounts Receivable | Accounts Receivable —The Company reports accounts receivable at net realizable value, which is equal to the gross receivable less an estimated allowance for uncollectible accounts. Noncurrent accounts receivable represents amounts due from graduates in excess of 12 months from the balance sheet date. |
Allowance for Uncollectible Accounts | Allowance for Uncollectible Accounts —Based upon experience and judgment, an allowance is established for uncollectible accounts with respect to tuition receivables. In establishing the allowance for uncollectible accounts, the Company considers, among other things, current and expected economic conditions, a student’s status (in-school or out-of-school), whether or not a student is currently making payments, and overall collection history. Changes in trends in any of these areas may impact the allowance for uncollectible accounts. The receivables balances of withdrawn students with delinquent obligations are reserved for based on our collection history. |
Inventories | Inventories —Inventories consist mainly of textbooks, computers, tools and supplies. Inventories are valued at the lower of cost or market on a first-in, first-out basis. |
Property, Equipment and Facilities - Depreciation and Amortization | Property, Equipment and Facilities — Depreciation and Amortization |
Advertising Costs | Advertising Costs —Costs related to advertising are expensed as incurred and are approximately $35.0 million and $33.1 million for the years ended December 31, 2022 and 2021, respectively. These amounts are included in selling, general and administrative expenses in the consolidated statements of operations. |
Goodwill | Goodwill — Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired. Lincoln tests goodwill for impairment annually, in the fourth quarter of each year, unless there are events or changes in circumstances that indicate an impairment may have occurred. Impairment may result from deterioration in performance, adverse market conditions, adverse changes in laws or regulations, the restriction of activities associated with the acquired business, and/or a variety of other circumstances. If we determine that impairment has occurred, we record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. As of December 31, 2022, goodwill was approximately $14.5 million, or 5.0%, of our total assets. The goodwill is allocated among nine reporting units within the Transportation and Skilled Trades Segment. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets — The Company reviews the carrying value of its long-lived assets and identifiable intangibles for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. For other long-lived assets, including right-of-use (“ROU”) When we perform the quantitative impairment test for long-lived assets, we examine estimated future cash flows using Level 3 inputs. These cash flows are evaluated by using weighted probability techniques as well as comparisons of past performance against projections. Assets may also be evaluated by identifying independent market values. If the Company determines that an asset’s carrying value is impaired, it will record a write-down of the carrying value of the asset and charge the impairment as an operating expense in the period in which the determination is made . |
Concentration of Credit Risk | Concentration of Credit Risk —Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of temporary cash investments. The Company places its cash and cash equivalents with high credit quality financial institutions. The Company’s cash balances with financial institutions typically exceed the Federal Deposit Insurance Corporation (“FDIC”) limit of $0.25 million. The Company’s cash balances on deposit as of December 31, 2022, exceeded the balance insured by the FDIC by approximately $39.2 million. The Company has not experienced any losses to date on its invested cash. The Company extends credit for tuition and fees to many of its students. The credit risk with respect to these accounts receivable is mitigated by the students’ participation in federally funded financial aid programs unless students withdraw prior to the receipt of federal funds for those students. In addition, the remaining tuition receivables are primarily comprised of smaller individual amounts due from students. With respect to student receivables, the Company had no significant concentrations of credit risk as of each of December 31, 2022 and 2021, respectively. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements —The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. On an ongoing basis, the Company evaluates the estimates and assumptions, including those used to determine the incremental borrowing rate to calculate lease liabilities and ROU assets, lease term to calculate lease cost, revenue recognition, bad debts, impairments, fixed assets, income taxes, benefit plans and certain accruals. Actual results could differ from those estimates. |
Income Taxes | Income Taxes — The Company assesses our deferred tax asset to determine whether all or any portion of the asset is more likely than not unrealizable. A valuation allowance is required to be established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized. Our assessment considers whether there has been sufficient income in recent years and whether sufficient income is expected in future years in order to utilize the deferred tax asset. In evaluating the realizability of deferred income tax assets, the Company considered, among other things, historical levels of income, expected future income, the expected timing of the reversals of existing temporary reporting differences, and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Significant judgment is required in determining the future tax consequences of events that have been recognized in our consolidated financial statements and/or tax returns. Differences between anticipated and actual outcomes of these future tax consequences could have a material impact on the Company’s consolidated financial position or results of operations. Changes in, among other things, income tax legislation, statutory income tax rates, or future income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause our income tax provision to vary significantly among financial reporting periods. On August 16, 2022, the Inflation Reduction Act (the “Inflation Act”) was enacted and signed into law. The Inflation Act is a budget reconciliation package that includes significant changes relating to tax, climate change, energy, and health care. The tax provisions include, among other items, a corporate alternative minimum tax of 15%, an excise tax of 1% on corporate stock buy-backs, energy-related tax credits, and additional IRS funding. The Company does not expect the tax provisions of the Inflation Act to have a material impact to our consolidated financial statements. We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the fiscal years ended December 31, 2022 and 2021, we did not record any interest and penalties expense associated with uncertain tax positions, as we do not have any uncertain tax positions. |
Start-up Costs | Start-up Costs — Costs related to the start of new campuses are expensed as incurred. |
New Accounting Pronouncements | New Accounting Pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. This amendment introduced the requirement for an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with the requirements of FASB Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”, rather than at fair value. For public business entities, the amendments in ASU 2021-08 are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provided temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provided optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. It was intended to help stakeholders during the global market-wide reference rate transition period. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope” which clarified that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures. In August 2020, the FASB issued ASU 2020-06, “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”. This ASU simplified the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The ASU removed separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature and hence most of the instruments will be accounted for as a single model (either debt or equity). The ASU also states that entities must apply the if-converted method to all convertible instruments for calculation of diluted EPS and the treasury stock method is no longer available. An entity can use either a full or modified retrospective approach to adopt the ASU’s guidance. ASU No. 2020-06 is effective for the Company as a smaller reporting company for fiscal years beginning after December 15, 2023, and for interim periods within those fiscal years. For convertible instruments that include a down-round feature, entities may early adopt the amendments that apply to the down-round features if they have not yet adopted the amendments in ASU 2017-11. The Company has evaluated the ASU and has determined that there is no impact on its consolidated financial statements and related disclosures as the Company currently has no financial instruments that are in the scope of this ASU. In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments impairment of certain financial instruments, including trade receivables, from an “incurred loss” to a “current expected credit loss” model. Further, the FASB issued ASU No. 2019-04, ASU No. 2019-05 and ASU 2019-11 to provide additional guidance on the credit losses standard. In November 2019, FASB issued ASU No. 2019-10, “Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)” “Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842)” |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
NET INCOME PER SHARE [Abstract] | |
Reconciliation of Numerator and Denominator of Diluted Net Income Per Share Computations | The following is a reconciliation of the numerator and denominator of the diluted net income per share computations for the periods presented below: Year Ended December 31, (in thousands, except share data) 2022 2021 Numerator: Net income $ 12,634 $ 34,718 Less: preferred stock dividend (1,111 ) (1,219 ) Less: allocation to preferred stockholders (1,753 ) (5,601 ) Less: allocation to restricted stockholders (559 ) (1,796 ) Net income allocated to common stockholders $ 9,211 $ 26,102 Basic net income per share: Denominator: Weighted average common shares outstanding 25,879,483 25,080,789 Basic net income per share $ 0.36 $ 1.04 Diluted net income per share: Denominator: Weighted average number of: Common shares outstanding 25,879,483 25,080,789 Dilutive potential common shares outstanding: Series A preferred stock - - Unvested restricted stock - - Stock options - - Dilutive shares outstanding 25,879,483 25,080,789 Diluted net income per share $ 0.36 $ 1.04 |
Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the potential weighted average shares of Common Stock that were excluded from the determination of our diluted shares outstanding as they were anti-dilutive: Year Ended December 31, 2022 2021 Series A preferred stock - 5,381,356 Unvested restricted stock 516,233 825,569 516,233 6,206,925 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE RECOGNITION [Abstract] | |
Depicts Timing of Revenue Recognition by Segment | The following table depicts the timing of revenue recognition by segment: Year ended December 31, 2022 Transportation and Skilled Trades Segment Healthcare and Other Professions Segment Transitional Segment Consolidated Timing of Revenue Recognition Services transferred at a point in time $ 15,523 $ 5,911 $ 288 $ 21,722 Services transferred over time 234,382 85,624 6,559 326,565 Total revenues $ 249,905 $ 91,535 $ 6,847 $ 348,287 Year ended December 31, 2021 Transportation and Skilled Trades Segment Healthcare and Other Professions Segment Transitional Segment Consolidated Timing of Revenue Recognition Services transferred at a point in time $ 17,393 $ 5,402 $ 284 $ 23,079 Services transferred over time 223,138 82,596 6,523 312,257 Total revenues $ 240,531 $ 87,998 $ 6,807 $ 335,336 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LEASES [Abstract] | |
Supplemental Cash Flow Information and Non-cash Activity Related to Operating Leases | Supplemental cash flow information and non-cash activity related to our operating leases are as follows: December 31, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of operating lease liabilities $ 18,443 $ 15,404 Non-cash activity: Lease liabilities arising from obtaining right-of-use assets $ 13,820 $ 45,456 |
Weighted Average Remaining Lease Term and Discount Rate | Weighted-average remaining lease term and discount rate for our operating leases is as follows: Year Ended December 31, 2022 2021 Weighted-average remaining lease term 11.23 years 11.47 years Weighted-average discount rate 7.12 % 7.67 % |
Maturities of Lease Liabilities | Maturities of lease liabilities by fiscal year for our operating leases as of December 31, 2022 are as follows: Year ending December 31, 2023 $ 16,283 2024 17,257 2025 15,319 2026 12,816 2027 9,532 Thereafter 69,499 Total lease payments 140,706 Less: imputed interest (40,074 ) Present value of lease liabilities $ 100,632 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
GOODWILL [Abstract] | |
Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill during the fiscal years ended December 31, 2022 and 2021 are as follows: Gross Goodwill Balance Accumulated Impairment Losses Net Goodwill Balance Balance as of January 1, 2021 $ 117,176 $ 102,640 $ 14,536 Adjustments - - - Balance as of December 31, 2021 117,176 102,640 14,536 Adjustments - - - Balance as of December 31, 2022 $ 117,176 $ 102,640 $ 14,536 |
PROPERTY, EQUIPMENT AND FACIL_2
PROPERTY, EQUIPMENT AND FACILITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND FACILITIES [Abstract] | |
Property, Equipment and Facilities | Property, equipment and facilities consist of the following: At December 31, Useful life (years) 2022 2021 Land - $ 52 $ 645 Buildings and improvements (a) 1-25 86,031 88,060 Equipment, furniture and fixtures 1-7 82,585 85,441 Vehicles 3 751 751 Construction in progress (a) - 888 1,557 170,307 176,454 Less accumulated depreciation and amortization (a) (146,367 ) (153,335 ) $ 23,940 $ 23,119 (a) Includes net impairment charge |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
ACCRUED EXPENSES [Abstract] | |
Accrued Expenses | Accrued expenses consist of the following: At December 31, 2022 2021 Accrued compensation and benefits $ 5,451 $ 11,662 Accrued real estate taxes 1,812 1,732 Other accrued expenses 1,390 2,275 $ 8,653 $ 15,669 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY [Abstract] | |
Transactions Pertaining to Restricted Stock | The following is a summary of transactions pertaining to Restricted Stock: Shares Weighted Average Grant Date Fair Value Per Share Nonvested restricted stock outstanding at December 31, 2020 1,572,159 $ 2.77 Granted 679,331 5.99 Cancelled - - Vested (507,644 ) 3.30 Nonvested restricted stock outstanding at December 31, 2021 1,743,846 3.89 Granted 606,950 7.21 Cancelled - - Vested (802,530 ) 4.18 Nonvested restricted stock outstanding at December 31, 2022 1,548,266 5.18 |
Transactions Pertaining to Option Plans | The fair value of the stock options used to compute stock-based compensation is the estimated present value at the date of grant using the Black-Scholes option pricing model. The following is a summary of transactions pertaining to stock options: Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding January 1, 2020 116,000 $ 10.56 1.83 years $ - Cancelled (35,000 ) 16.95 - - Outstanding December 31, 2020 81,000 7.79 1.17 years - Cancelled - - - Outstanding December 31, 2021 81,000 7.79 0.17 years - Cancelled (81,000 ) 7.79 - Outstanding December 31, 2022 - - - - Vested as of December 31, 2022 - - - - Exercisable as of December 31, 2022 - - - - |
PENSION PLAN (Tables)
PENSION PLAN (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PENSION PLAN [Abstract] | |
Plan's Funded Status | The following table sets forth the plan’s funded status and amounts recognized in the consolidated financial statements: Year Ended December 31, 2022 2021 CHANGES IN BENEFIT OBLIGATIONS: Benefit obligation-beginning of year $ 22,557 $ 24,358 Service cost 37 37 Interest cost 542 492 Actuarial gain (4,661 ) (989 ) Benefits paid (1,362 ) (1,341 ) Benefit obligation at end of year 17,113 22,557 CHANGE IN PLAN ASSETS: Fair value of plan assets-beginning of year 20,950 20,106 Actual return on plan assets (3,143 ) 2,185 Benefits paid (1,362 ) (1,341 ) Fair value of plan assets-end of year 16,445 20,950 BENEFIT OBLIGATION IN EXCESS OF FAIR VALUE FUNDED STATUS: $ (668 ) $ (1,607 ) |
Amounts Recognized in Consolidated Balance Sheets | Amounts recognized in the consolidated balance sheets consist of: At December 31, 2022 2021 Noncurrent liabilities $ (668 ) $ (1,607 ) |
Amounts Recognized in Accumulated Other Comprehensive Loss | Amounts recognized in accumulated other comprehensive loss consist of: Year Ended December 31, 2022 2021 Accumulated loss $ (2,480 ) $ (2,862 ) Deferred income taxes 1,520 1,622 Accumulated other comprehensive loss $ (960 ) $ (1,240 ) |
Components of Net Periodic Cost for Plan | The following table provides the components of net periodic cost for the plan: Year Ended December 31, 2022 2021 COMPONENTS OF NET PERIODIC BENEFIT COST Service cost $ 37 $ 37 Interest cost 542 492 Expected return on plan assets (1,217 ) (1,021 ) Recognized net actuarial loss 81 640 Net periodic benefit (income) cost $ (557 ) $ 148 |
Plan Assets using Fair Value Hierarchy | The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Total Equity securities $ 4,692 $ - $ - $ 4,692 Fixed income 6,130 - - 6,130 International equities 3,650 - - 3,650 Real estate 1,301 - - 1,301 Cash and equivalents 672 - - 672 Balance at December 31, 2022 $ 16,445 $ - $ - $ 16,445 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Total Equity securities $ 6,322 $ - $ - $ 6,322 Fixed income 7,811 - - 7,811 International equities 5,180 - - 5,180 Real estate 900 - - 900 Cash and equivalents 737 - - 737 Balance at December 31, 2021 $ 20,950 $ - $ - $ 20,950 |
Fair Value of Total Plan Assets by Major Asset Category | Fair value of total plan assets by major asset category as of December 31: 2022 2021 Equity securities 29 % 30 % Fixed income 37 % 37 % International equities 22 % 25 % Real estate 8 % 4 % Cash and equivalents 4 % 4 % Total 100 % 100 % |
Expected Benefit Payments for Plan | Information about the expected benefit payments for the plan is as follows: Year Ending December 31, 2023 $ 1,347 2024 1,367 2025 1,360 2026 1,366 2027 1,356 Years 2028-2032 6,486 |
Benefit Obligations [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Weighted Average Assumptions | Weighted-average assumptions used to determine benefit obligations as of December 31: 2022 2021 Discount rate 4.90 % 2.50 % Rate of compensation increase 2.50 % 2.50 % |
Periodic Pension Cost [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Weighted Average Assumptions | Weighted-average assumptions used to determine net periodic pension cost for years ended December 31: 2022 2021 Discount rate 4.90 % 2.50 % Rate of compensation increase 2.50 % 2.50 % Long-term rate of return 6.75 % 6.00 % |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES [Abstract] | |
Components of the Provision for Income Taxes | Components of the provision for income taxes were as follows: Year Ended December 31, 2022 2021 Current: Federal $ 1,864 $ 665 State 644 535 Total 2,508 1,200 Deferred: Federal 767 8,468 State 527 2,860 Total 1,294 11,328 Total provision $ 3,802 $ 12,528 |
Reconciliation of Effective Tax Rate to U.S. Statutory Federal Income Tax Rate | The reconciliation of the effective tax rate to the U.S. Statutory Federal Income tax rate was: Year Ended December 31, 2022 2021 Income before taxes $ 16,436 $ 47,246 Expected tax $ 3,452 21.0 % $ 9,922 21.0 % State tax (net of federal benefit) 925 5.6 % 2,682 5.7 % Other (575 ) -3.5 % (76 ) -0.2 % Total $ 3,802 23.1 % $ 12,528 26.5 % |
Components of Non-current Deferred Tax Assets (Liabilities) | The components of the non-current deferred tax assets (liabilities) were as follows: At December 31, 2022 2021 Gross noncurrent deferred tax assets (liabilities) Lease liability $ 26,897 $ 26,142 Depreciation 9,531 10,551 Allowance for bad debts 9,454 8,525 Net operating loss carryforwards 1,957 2,394 Accrued benefits - 656 Stock-based compensation 541 641 Pension plan liabilities 179 429 Other intangibles 39 70 Accrued expenses 67 - Goodwill (1,469 ) (1,267 ) Right-of-use asset (24,884 ) (24,433 ) Noncurrent deferred tax assets, net $ 22,312 $ 23,708 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE [Abstract] | |
Fair Value of Financial Instruments Measured on Recurring Basis | The following table presents the fair value of the financial instruments measured on a recurring basis as of December 31, 2022. December 31, 2022 Carrying Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Amount (Level 1) (Level 2) (Level 3) Total C ash equivalents Money market fund $ 18,160 $ 18,160 $ - $ - $ 18,160 Treasury bill 10,383 10,383 - - 10,383 Short-term investments : Treasury bill 14,758 14,758 - - 14,758 Total cash equivalents and short-term investment s $ 43,301 $ 43,301 $ - $ - $ 43,301 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SEGMENT REPORTING [Abstract] | |
Financial Information by Reporting Segment | Summary financial information by reporting segment is as follows: For the Year Ended December 31, Revenue Operating Income (Loss) 2022 % of Total 2021 % of Total 2022 2021 Transportation and Skilled Trades $ 249,905 71.8 % $ 240,531 71.7 % $ 42,335 $ 52,055 Healthcare and Other Professions 91,535 26.3 % 87,998 26.2 % 7,189 11,740 Transitional 6,847 2.0 % 6,807 2.0 % (430 ) 105 Corporate - 0.0 % - 0.0 % (32,816 ) (14,639 ) Total $ 348,287 100 % $ 335,336 100 % $ 16,278 $ 49,261 Total Assets December 31, 2022 December 31, 2021 Transportation and Skilled Trades $ 153,369 $ 156,531 Healthcare and Other Professions 37,104 31,160 Transitional 1,498 2,799 Corporate 99,595 104,809 Total $ 291,566 $ 295,299 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Business Activities (Details) $ in Millions | 6 Months Ended | 12 Months Ended |
Dec. 31, 2022 USD ($) State Squarefeet | Dec. 31, 2022 USD ($) Segment Squarefeet State Campus School | |
Business Activities [Abstract] | ||
Number of schools | School | 22 | |
Number of states in which schools operate across the United States | State | 14 | 14 |
Number of campuses treated as destination schools | Campus | 5 | |
Number of reportable segments | Segment | 3 | |
Approximate area of leased school space | Squarefeet | 55,000 | 55,000 |
Capital expenditures | $ 0.4 | $ 0.4 |
Rent paid | $ 0.3 | $ 0.3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Liquidity (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Liquidity [Abstract] | |||
Cash, cash equivalents and restricted cash | $ 50,287 | $ 83,307 | $ 38,026 |
Cash and cash equivalents | 46,074 | 83,307 | |
Short-term investments | $ 14,758 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Cash and Cash Equivalents (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Maximum maturity period for classification of cash equivalents | 3 months |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Short-term Investments (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Minimum [Member] | |
Short-term Investments [Abstract] | |
Maturity period for short-term investments | 3 months |
Maximum [Member] | |
Short-term Investments [Abstract] | |
Maturity period for short-term investments | 12 months |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Advertising Costs (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Advertising Costs [Abstract] | ||
Advertising expense | $ 35 | $ 33.1 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Goodwill (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Unit | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Goodwill [Abstract] | |||
Goodwill | $ 14,536 | $ 14,536 | $ 14,536 |
Percentage of goodwill in total assets | 5% | ||
Transportation and Skilled Trades Segment [Member] | |||
Goodwill [Abstract] | |||
Goodwill | $ 14,500 | $ 14,500 | |
Number of reporting units | Unit | 9 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Concentration of Credit Risk (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Concentration of Credit Risk [Abstract] | |
Federal deposit insurance limit | $ 250 |
Excess cash, FDIC uninsured amount | $ 39,200 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes [Abstract] | ||
Interest and penalties expense | $ 0 | $ 0 |
Uncertain tax positions | $ 0 | $ 0 |
FINANCIAL AID AND REGULATORY _2
FINANCIAL AID AND REGULATORY COMPLIANCE (Details) - Score | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Aid [Abstract] | ||
Percentage of net revenues on cash basis indirectly derived from funds | 74% | 75% |
Maximum specified percentage of net revenues on cash basis indirectly derived from funds | 90% | 90% |
Period over which entity became ineligible after receiving specified percentage as revenue from funds | 2 years | |
Period for which entity may not reapply for eligibility | 2 years | |
Regulatory Compliance [Abstract] | ||
Minimum composite required for financial responsibility | 1.5 | |
Maximum period for institution to participate under the Zone Alternative | 3 years | |
Composite score for financial responsibility | 2.9 | 3 |
Minimum [Member] | ||
Regulatory Compliance [Abstract] | ||
Standard composite score for financial responsibility | (1) | |
Maximum [Member] | ||
Regulatory Compliance [Abstract] | ||
Standard composite score for financial responsibility | 3 | |
U.S. Department of Education [Member] | ||
Regulatory Compliance [Abstract] | ||
Maximum notification period | 10 days | |
Minimum percentage letter of credit amount equal total Title IV Program funds | 50% | |
Minimum percentage Letter of credit amount equal prior years total Title IV Program funds | 10% | |
U.S. Department of Education [Member] | Minimum [Member] | ||
Regulatory Compliance [Abstract] | ||
Minimum composite required for financial responsibility | 1 | |
U.S. Department of Education [Member] | Maximum [Member] | ||
Regulatory Compliance [Abstract] | ||
Minimum composite required for financial responsibility | 1.5 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Nov. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator [Abstract] | |||
Net income | $ 12,634 | $ 34,718 | |
Less: preferred stock dividend | (1,111) | (1,219) | |
Less: allocation to preferred stockholders | (1,753) | (5,601) | |
Less: allocation to restricted stockholders | (559) | (1,796) | |
Net income allocated to common stockholders | $ 9,211 | $ 26,102 | |
Denominator [Abstract] | |||
Weighted average common shares outstanding (in shares) | 25,879,483 | 25,080,789 | |
Basic net income per share (in dollars per share) | $ 0.36 | $ 1.04 | |
Denominator [Abstract] | |||
Weighted average common shares outstanding (in shares) | 25,879,483 | 25,080,789 | |
Dilutive shares outstanding (in shares) | 25,879,483 | 25,080,789 | |
Diluted net income per share (in dollars per share) | $ 0.36 | $ 1.04 | |
Antidilutive Shares [Abstract] | |||
Antidilutive shares excluded from computation of earnings (loss) per share (in shares) | 516,233 | 6,206,925 | |
Unvested Restricted Stock [Member] | |||
Denominator [Abstract] | |||
Dilutive potential common shares outstanding (in shares) | 0 | 0 | |
Antidilutive Shares [Abstract] | |||
Antidilutive shares excluded from computation of earnings (loss) per share (in shares) | 516,233 | 825,569 | |
Stock Options [Member] | |||
Denominator [Abstract] | |||
Dilutive potential common shares outstanding (in shares) | 0 | 0 | |
Common Stock [Member] | |||
Preferred Stock [Abstract] | |||
Number of shares issued upon conversion of preferred stock (in shares) | 423,729 | ||
Stock conversion (in shares) | 5,381,356 | ||
Series A Convertible Preferred Stock [Member] | |||
Preferred Stock [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 | $ 0 |
Shares converted (in shares) | (12,700) | ||
Series A Preferred Stock [Member] | |||
Denominator [Abstract] | |||
Dilutive potential common shares outstanding (in shares) | 0 | 0 | |
Antidilutive Shares [Abstract] | |||
Antidilutive shares excluded from computation of earnings (loss) per share (in shares) | 0 | 5,381,356 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
REVENUE RECOGNITION [Abstract] | ||
Unearned tuition | $ 24,154 | $ 25,405 |
Revenue recognized included in contract liability | 24,600 | |
Disaggregation of Revenue [Abstract] | ||
Revenue | 348,287 | 335,336 |
Services Transferred at a Point in Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 21,722 | 23,079 |
Services Transferred over Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 326,565 | 312,257 |
Transportation and Skilled Trades Segment [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 249,905 | 240,531 |
Transportation and Skilled Trades Segment [Member] | Services Transferred at a Point in Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 15,523 | 17,393 |
Transportation and Skilled Trades Segment [Member] | Services Transferred over Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 234,382 | 223,138 |
Healthcare and Other Professions Segment [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 91,535 | 87,998 |
Healthcare and Other Professions Segment [Member] | Services Transferred at a Point in Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 5,911 | 5,402 |
Healthcare and Other Professions Segment [Member] | Services Transferred over Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 85,624 | 82,596 |
Transitional Segment [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 6,847 | 6,807 |
Transitional Segment [Member] | Services Transferred at a Point in Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 288 | 284 |
Transitional Segment [Member] | Services Transferred over Time [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | $ 6,559 | $ 6,523 |
LEASES (Details)
LEASES (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Squarefeet | Dec. 31, 2022 USD ($) Option Squarefeet Lease | Dec. 31, 2021 USD ($) | Aug. 31, 2022 USD ($) | |
Operating Leases [Abstract] | ||||
Approximate area of leased school space | Squarefeet | 55,000 | 55,000 | ||
Undiscounted lease payments | $ 40,074 | $ 40,074 | $ 12,200 | |
Operating lease term | 12 years | 12 years | ||
Number of renewal options | Option | 2 | |||
Renewal lease term | 5 years | 5 years | ||
Capital expenditures | $ 400 | $ 400 | ||
Rent paid | $ 300 | 300 | ||
Operating lease cost | 18,900 | $ 15,800 | ||
Variable lease cost | 0 | |||
Operating cash flow information [Abstract] | ||||
Cash paid for amounts included in the measurement of operating lease liabilities | 18,443 | 15,404 | ||
Non-cash activity [Abstract] | ||||
Lease liabilities arising from obtaining right-of-use assets | $ 13,820 | $ 45,456 | ||
Number of new leases | Lease | 4 | |||
Number of lease modifications | Lease | 1 | |||
Weighted Average Remaining Lease Term and Discount Rate [Abstract] | ||||
Weighted-average remaining lease term | 11 years 2 months 23 days | 11 years 2 months 23 days | 11 years 5 months 19 days | |
Weighted-average discount rate | 7.12% | 7.12% | 7.67% | |
Maturities of Lease Liabilities [Abstract] | ||||
2023 | $ 16,283 | $ 16,283 | ||
2024 | 17,257 | 17,257 | ||
2025 | 15,319 | 15,319 | ||
2026 | 12,816 | 12,816 | ||
2027 | 9,532 | 9,532 | ||
Thereafter | 69,499 | 69,499 | ||
Total lease payments | 140,706 | 140,706 | ||
Less: imputed interest | (40,074) | (40,074) | $ (12,200) | |
Present value of lease liabilities | $ 100,632 | $ 100,632 | ||
Minimum [Member] | ||||
Operating Leases [Abstract] | ||||
Remaining lease term | 1 year | 1 year | ||
Maximum [Member] | ||||
Operating Leases [Abstract] | ||||
Remaining lease term | 19 years | 19 years | ||
Variable lease cost | $ 100 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in Carrying Amount of Goodwill [Abstract] | |||
Gross goodwill balance | $ 117,176 | $ 117,176 | $ 117,176 |
Accumulated impairment losses | 102,640 | 102,640 | 102,640 |
Net goodwill balance | 14,536 | 14,536 | $ 14,536 |
Adjustments | 0 | 0 | |
Goodwill impairment loss | 0 | ||
Transportation and Skilled Trades [Member] | |||
Changes in Carrying Amount of Goodwill [Abstract] | |||
Net goodwill balance | $ 14,500 | $ 14,500 |
PROPERTY SALE AGREEMENTS, Prope
PROPERTY SALE AGREEMENTS, Property Sale Agreement (Details) - Property Sale Agreement [Member] - USD ($) $ in Millions | 12 Months Ended | |
Sep. 24, 2021 | Dec. 31, 2022 | |
Property Sale Agreement [Abstract] | ||
Sale price of agreement | $ 34.5 | |
Non-refundable amount to be received | $ 1.1 | |
Proceeds from non-refundable payments | $ 0.5 |
PROPERTY SALE AGREEMENTS, Sale-
PROPERTY SALE AGREEMENTS, Sale-Leaseback Transaction (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Oct. 29, 2021 USD ($) Option | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 24, 2021 USD ($) | |
Sale-Leaseback Transaction [Abstract] | |||||
Gain on sale of assets | $ 177 | $ 22,479 | |||
Right of use assets | 93,097 | 91,487 | |||
Lease liabilities | 100,632 | ||||
Net proceeds amount | $ 2,400 | $ 2,390 | $ 45,379 | ||
Colorado/Texas Sale Agreement [Member] | |||||
Sale-Leaseback Transaction [Abstract] | |||||
Sale price of sale-leaseback transaction | $ 46,500 | ||||
Lease agreement term | 20 years | ||||
Initial annual base rent | $ 2,600 | ||||
Percentage of annual increase of rent | 2% | ||||
Number of subsequent renewal options | Option | 4 | ||||
Period of subsequent renewal options | 5 years | ||||
Gain on sale of assets | $ 22,500 | ||||
Right of use assets | 40,100 | ||||
Lease liabilities | 40,100 | ||||
Net proceeds amount | 45,400 | ||||
Repayments of term loan | 16,200 | ||||
Swap termination fee | $ 500 |
PROPERTY, EQUIPMENT AND FACIL_3
PROPERTY, EQUIPMENT AND FACILITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Property, equipment and facilities net [Abstract] | ||||
Property, equipment and facilities, Gross | $ 170,307 | $ 176,454 | ||
Less accumulated depreciation and amortization | [1] | (146,367) | (153,335) | |
Property, equipment and facilities, Net | 23,940 | 23,119 | ||
Impairment of long-lived assets | $ 1,000 | $ 0 | ||
Impairment, Long-Lived Asset, Held-for-Use, Statement of Income or Comprehensive Income [Extensible Enumeration] | Impairment of Long-Lived Assets to be Disposed of | Impairment of Long-Lived Assets to be Disposed of | ||
Impairment of property amount | $ 400 | $ 700 | ||
Impairment of ROU asset | 600 | |||
Carrying value of property amount | 2,900 | |||
Fair value estimate current value of property | 2,200 | |||
Impairment carrying value reduced | 700 | |||
Net proceeds from sale of assets | $ 2,400 | 2,390 | 45,379 | |
Gain on sale of asset | $ 200 | 177 | 22,479 | |
Depreciation and amortization expense | 6,400 | 7,100 | ||
Land [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Property, equipment and facilities, Gross | 52 | 645 | ||
Buildings and Improvements [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Property, equipment and facilities, Gross | [1] | $ 86,031 | 88,060 | |
Buildings and Improvements [Member] | Minimum [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Useful life | [1] | 1 year | ||
Buildings and Improvements [Member] | Maximum [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Useful life | [1] | 25 years | ||
Equipment, Furniture and Fixtures [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Property, equipment and facilities, Gross | $ 82,585 | 85,441 | ||
Equipment, Furniture and Fixtures [Member] | Minimum [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Useful life | 1 year | |||
Equipment, Furniture and Fixtures [Member] | Maximum [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Useful life | 7 years | |||
Vehicles [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Useful life | 3 years | |||
Property, equipment and facilities, Gross | $ 751 | 751 | ||
Construction in Progress [Member] | ||||
Property, equipment and facilities net [Abstract] | ||||
Property, equipment and facilities, Gross | [1] | $ 888 | $ 1,557 | |
[1]Includes net impairment charge |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
ACCRUED EXPENSES [Abstract] | ||
Accrued compensation and benefits | $ 5,451 | $ 11,662 |
Accrued real estate taxes | 1,812 | 1,732 |
Other accrued expenses | 1,390 | 2,275 |
Accrued expenses | $ 8,653 | $ 15,669 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Nov. 11, 2020 USD ($) | Nov. 10, 2020 USD ($) | Nov. 14, 2019 USD ($) Facility | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) School | Dec. 31, 2021 USD ($) | Oct. 29, 2021 USD ($) | |
Long-term debt [Abstract] | |||||||
Net proceeds from sale of assets | $ 2,400 | $ 2,390 | $ 45,379 | ||||
Term Loan [Member] | |||||||
Long-term debt [Abstract] | |||||||
Repayment of term loan and swap termination fee | $ 16,700 | ||||||
Credit Agreement [Member] | |||||||
Long-term debt [Abstract] | |||||||
Minimum quarterly average aggregate balances to be maintained | 5,000 | ||||||
Bank fees if minimum quarterly average aggregate balances is not maintained | $ 12,500 | ||||||
Period of consideration for payment of cash dividend | 24 months | ||||||
Limit on payment of cash dividends | $ 2,300 | $ 1,700 | |||||
Credit Facility [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 60,000 | $ 0 | |||||
Number of facilities available in 2019 credit agreement | Facility | 4 | ||||||
Number of schools in states covered under first priority lien | School | 3 | ||||||
Letters of credit outstanding | $ 4,000 | ||||||
Credit agreement | 0 | ||||||
Credit Facility [Member] | Letter of Credit [Member] | |||||||
Long-term debt [Abstract] | |||||||
Percentage of letter of credit fee, quarterly installment | 0.25% | ||||||
Percentage of letter of credit fee, annual payment | 0.50% | ||||||
Credit Facility [Member] | Term Loan [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 20,000 | $ 0 | |||||
Expiration date of credit facility | Dec. 01, 2024 | ||||||
Line of credit facility, amortization schedule based period for interest and principal payments | 120 months | ||||||
Percentage of swap transaction of principal balance | 100% | ||||||
Line of credit facility, frequency of principal and interest periodic payment | monthly | ||||||
Credit Facility [Member] | Term Loan [Member] | LIBOR [Member] | |||||||
Long-term debt [Abstract] | |||||||
Term of variable rate | 1 month | ||||||
Interest rate on credit facility | 3.50% | ||||||
Credit Facility [Member] | Term Loan [Member] | LIBOR [Member] | Interest Rate Floor [Member] | |||||||
Long-term debt [Abstract] | |||||||
Interest rate on credit facility | 0.25% | ||||||
Credit Facility [Member] | Delayed Draw Term Loan [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 10,000 | $ 0 | |||||
Expiration date of credit facility | Dec. 01, 2024 | ||||||
Line of credit facility, amortization schedule based period for interest and principal payments | 120 months | ||||||
Line of credit facility, monthly interest payment period | 18 months | ||||||
Line of credit facility, frequency of principal and interest periodic payment | monthly | ||||||
Credit Facility [Member] | Delayed Draw Term Loan [Member] | LIBOR [Member] | |||||||
Long-term debt [Abstract] | |||||||
Term of variable rate | 1 month | ||||||
Interest rate on credit facility | 3.50% | ||||||
Credit Facility [Member] | Delayed Draw Term Loan [Member] | LIBOR [Member] | Interest Rate Floor [Member] | |||||||
Long-term debt [Abstract] | |||||||
Interest rate on credit facility | 0.25% | ||||||
Credit Facility [Member] | Credit Agreement [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 15,000 | ||||||
Expiration date of credit facility | Jan. 31, 2021 | ||||||
Credit Facility [Member] | Revolving Loan [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 15,000 | ||||||
Expiration date of credit facility | Nov. 13, 2022 | ||||||
Loan repayment period | 30 days | ||||||
Credit Facility [Member] | Revolving Loan [Member] | Interest Rate Floor [Member] | |||||||
Long-term debt [Abstract] | |||||||
Interest rate on credit facility | 4% | ||||||
Credit Facility [Member] | Revolving Loan [Member] | Prime Rate [Member] | |||||||
Long-term debt [Abstract] | |||||||
Interest rate on credit facility | 0.50% | ||||||
Credit Facility [Member] | Revolving Loan [Member] | Letter of Credit [Member] | |||||||
Long-term debt [Abstract] | |||||||
Line of credit facility, maximum borrowing capacity | $ 10,000 |
STOCKHOLDERS' EQUITY, Common St
STOCKHOLDERS' EQUITY, Common Stock and Preferred Stock (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Nov. 30, 2022 $ / shares shares | May 24, 2022 USD ($) shares | Nov. 14, 2019 | Dec. 31, 2022 USD ($) Vote $ / shares | Dec. 31, 2021 USD ($) $ / shares | |
Dividends [Abstract] | |||||
Dividends paid on shares of Series A preferred stock | $ 1,111 | $ 1,219 | |||
Treasury Stock [Abstract] | |||||
Cancellation of treasury stock amount | $ 0 | ||||
Common Stock [Member] | |||||
Common Stock [Abstract] | |||||
Common stock voting rights per share | Vote | 1 | ||||
Cash dividends declared or paid | $ 0 | ||||
Preferred Stock [Abstract] | |||||
Number of shares issued upon conversion of preferred stock (in shares) | shares | 423,729 | ||||
Stock conversion (in shares) | shares | 5,381,356 | ||||
Treasury Stock [Abstract] | |||||
Cancellation of treasury stock (in shares) | shares | 5,910,541 | ||||
Cancellation of treasury stock amount | $ 82,900 | ||||
Series A Convertible Preferred Stock [Member] | |||||
Preferred Stock [Abstract] | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0 | $ 0 | $ 0 | ||
Shares converted (in shares) | shares | (12,700) | ||||
Dividends [Abstract] | |||||
Dividend rate | 9.60% | ||||
First dividend payment date | Sep. 30, 2020 | ||||
Dividends paid on shares of Series A preferred stock | $ 1,100 |
STOCKHOLDERS' EQUITY, Restricte
STOCKHOLDERS' EQUITY, Restricted Stock and Stock Options (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 USD ($) Plan $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) $ / shares shares | Dec. 31, 2019 USD ($) $ / shares shares | Jun. 16, 2020 shares | |
Stockholders' Equity Note Details [Abstract] | |||||
Number of stock incentive plans | Plan | 3 | ||||
Shares [Abstract] | |||||
Outstanding, beginning balance (in shares) | 81,000 | 81,000 | 116,000 | ||
Canceled (in shares) | (81,000) | 0 | (35,000) | ||
Outstanding, ending balance (in shares) | 0 | 81,000 | 81,000 | 116,000 | |
Vested (in shares) | 0 | ||||
Exercisable (in shares) | 0 | ||||
Weighted Average Exercise Price Per Share [Abstract] | |||||
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 7.79 | $ 7.79 | $ 10.56 | ||
Canceled (in dollars per share) | $ / shares | 7.79 | 16.95 | |||
Outstanding, ending balance (in dollars per share) | $ / shares | 0 | $ 7.79 | $ 7.79 | $ 10.56 | |
Vested (in dollars per share) | $ / shares | 0 | ||||
Exercisable (in dollars per share) | $ / shares | $ 0 | ||||
Weighted Average Remaining Contractual Term [Abstract] | |||||
Outstanding, balance | 2 months 1 day | 1 year 2 months 1 day | 1 year 9 months 29 days | ||
Aggregate Intrinsic Value [Abstract] | |||||
Outstanding, beginning balance | $ | $ 0 | $ 0 | $ 0 | ||
Cancelled | $ | 0 | 0 | 0 | ||
Outstanding, ending balance | $ | 0 | $ 0 | $ 0 | $ 0 | |
Vested | $ | 0 | ||||
Exercisable | $ | $ 0 | ||||
Restricted Stock [Member] | |||||
Shares [Abstract] | |||||
Nonvested restricted stock outstanding, beginning balance (in shares) | 1,743,846 | 1,572,159 | |||
Granted (in shares) | 606,950 | 679,331 | |||
Cancelled (in shares) | 0 | 0 | |||
Vested (in shares) | (802,530) | (507,644) | |||
Nonvested restricted stock outstanding, ending balance (in shares) | 1,548,266 | 1,743,846 | 1,572,159 | ||
Weighted Average Grant Date Fair Value Per Share [Abstract] | |||||
Nonvested restricted stock outstanding, beginning balance (in dollars per share) | $ / shares | $ 3.89 | $ 2.77 | |||
Granted (in dollars per share) | $ / shares | 7.21 | 5.99 | |||
Cancelled (in dollars per share) | $ / shares | 0 | 0 | |||
Vested (in dollars per share) | $ / shares | 4.18 | 3.3 | |||
Nonvested restricted stock outstanding, ending balance (in dollars per share) | $ / shares | $ 5.18 | $ 3.89 | $ 2.77 | ||
Recognized restricted stock expense | $ | $ 3,100 | $ 2,900 | |||
Unrecognized restricted stock expense | $ | 7,900 | $ 4,400 | |||
Stock Options [Member] | |||||
Aggregate Intrinsic Value [Abstract] | |||||
Unrecognized pre-tax compensation expense | $ | $ 0 | ||||
2020 Plan [Member] | |||||
Stockholders' Equity Note Details [Abstract] | |||||
Number of shares available for issuance under incentive plan (in shares) | 840,807 | ||||
2020 Plan [Member] | June 16, 2020 [Member] | |||||
Stockholders' Equity Note Details [Abstract] | |||||
Stock option award issuance, plan duration | 10 years | ||||
LTIP [Member] | |||||
Stockholders' Equity Note Details [Abstract] | |||||
Number of shares available for issuance under incentive plan (in shares) | 2,000,000 | ||||
LTIP [Member] | Restricted Stock [Member] | |||||
Weighted Average Grant Date Fair Value Per Share [Abstract] | |||||
Outstanding restricted shares, intrinsic value | $ | $ 8,900 | ||||
Non Employee Directors Plan [Member] | |||||
Stockholders' Equity Note Details [Abstract] | |||||
Net share settlement for restricted stock (in shares) | 276,274 | 154,973 | |||
Decrease in equity due to payment of tax for employee | $ | $ 2,000 | $ 1,000 |
STOCKHOLDERS' EQUITY, Share Rep
STOCKHOLDERS' EQUITY, Share Repurchase Program (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 27, 2023 | May 24, 2022 | Dec. 31, 2022 | |
Share Repurchase Program [Abstract] | |||
Authorized amount of share repurchase program | $ 30 | ||
Period over which common stock can be repurchased | 12 months | 12 months | |
Number of shares repurchased (in shares) | 1,572,414 | ||
Amount of shares repurchased | $ 9.4 | $ 9.4 | |
Subsequent Event [Member] | |||
Share Repurchase Program [Abstract] | |||
Additional period over which common stock can be repurchased | 12 months | ||
Additional authorized amount of share repurchase program | $ 10 | ||
Additional amount of shares repurchased | $ 30.6 |
PENSION PLAN, Plan's funded sta
PENSION PLAN, Plan's funded status (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CHANGES IN BENEFIT OBLIGATIONS [Roll Forward] | ||
Benefit obligation-beginning of year | $ 22,557 | $ 24,358 |
Service cost | 37 | 37 |
Interest cost | 542 | 492 |
Actuarial gain | (4,661) | (989) |
Benefits paid | (1,362) | (1,341) |
Benefit obligation at end of year | 17,113 | 22,557 |
CHANGE IN PLAN ASSETS [Roll Forward] | ||
Fair value of plan assets-beginning of year | 20,950 | 20,106 |
Actual return on plan assets | (3,143) | 2,185 |
Benefits paid | (1,362) | (1,341) |
Fair value of plan assets-end of year | 16,445 | 20,950 |
BENEFIT OBLIGATION IN EXCESS OF FAIR VALUE FUNDED STATUS: | $ (668) | $ (1,607) |
Discount rate | 4.90% | 2.50% |
PENSION PLAN, Summary (Details)
PENSION PLAN, Summary (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Amounts recognized in the consolidated balance sheets [Abstract] | |||
Noncurrent liabilities | $ (668) | $ (1,607) | |
Amounts recognized in accumulated other comprehensive loss [Abstract] | |||
Accumulated loss | (2,480) | (2,862) | |
Deferred income taxes | 1,520 | 1,622 | |
Accumulated other comprehensive loss | (960) | (1,240) | |
Accumulated benefit obligation | 17,100 | 22,600 | |
COMPONENTS OF NET PERIODIC BENEFIT COST [Abstract] | |||
Service cost | 37 | 37 | |
Interest cost | 542 | 492 | |
Expected return on plan assets | (1,217) | (1,021) | |
Recognized net actuarial loss | 81 | 640 | |
Net periodic benefit (income) cost | $ (557) | $ 148 | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) Excluding Service Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Selling, general and administrative | Selling, general and administrative | |
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 16,445 | $ 20,950 | $ 20,106 |
Fair value of total plan assets by major asset category | 100% | 100% | |
Weighted-average assumptions used to determine benefit obligations [Abstract] | |||
Discount rate | 4.90% | 2.50% | |
Rate of compensation increase | 2.50% | 2.50% | |
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Discount rate | 4.90% | 2.50% | |
Pension contributions | $ 0 | $ 0 | |
Expected benefit payments for the plan [Abstract] | |||
Maximum contribution by employee specified as percentage of compensation | 25% | ||
Additional contribution by employer | 30% | ||
Maximum percentage of compensation contributed by employer as matching contribution | 6% | ||
Compensation expense for the 401(k) plan | $ 700 | 700 | |
Maximum [Member] | |||
COMPONENTS OF NET PERIODIC BENEFIT COST [Abstract] | |||
Amortization of estimated net loss, transition obligation and prior service cost from accumulated other comprehensive income into net periodic benefit cost | 100 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 16,445 | 20,950 | |
Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Equity Securities [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 4,692 | $ 6,322 | |
Fair value of total plan assets by major asset category | 29% | 30% | |
Equity Securities [Member] | Minimum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 30% | ||
Equity Securities [Member] | Maximum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 70% | ||
Equity Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 4,692 | $ 6,322 | |
Equity Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Equity Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Fixed Income [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 6,130 | $ 7,811 | |
Fair value of total plan assets by major asset category | 37% | 37% | |
Fixed Income [Member] | Minimum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 20% | ||
Fixed Income [Member] | Maximum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 60% | ||
Fixed Income [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 6,130 | $ 7,811 | |
Fixed Income [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Fixed Income [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
International Equities [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 3,650 | $ 5,180 | |
Fair value of total plan assets by major asset category | 22% | 25% | |
International Equities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 3,650 | $ 5,180 | |
International Equities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
International Equities [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Real Estate [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 1,301 | $ 900 | |
Fair value of total plan assets by major asset category | 8% | 4% | |
Real Estate [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 1,301 | $ 900 | |
Real Estate [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Real Estate [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Cash and Equivalents [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 672 | $ 737 | |
Fair value of total plan assets by major asset category | 4% | 4% | |
Cash and Equivalents [Member] | Minimum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 0% | ||
Cash and Equivalents [Member] | Maximum [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Target plan asset allocations | 10% | ||
Cash and Equivalents [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 672 | $ 737 | |
Cash and Equivalents [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | 0 | 0 | |
Cash and Equivalents [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Plan assets using the fair value hierarchy [Abstract] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan [Member] | |||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | |||
Discount rate | 4.90% | 2.50% | |
Rate of compensation increase | 2.50% | 2.50% | |
Long-term rate of return | 6.75% | 6% | |
Expected benefit payments for the plan [Abstract] | |||
2023 | $ 1,347 | ||
2024 | 1,367 | ||
2025 | 1,360 | ||
2026 | 1,366 | ||
2027 | 1,356 | ||
Years 2028-2032 | $ 6,486 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current [Abstract] | ||
Federal | $ 1,864 | $ 665 |
State | 644 | 535 |
Total | 2,508 | 1,200 |
Deferred [Abstract] | ||
Federal | 767 | 8,468 |
State | 527 | 2,860 |
Total | 1,294 | 11,328 |
Total provision | 3,802 | 12,528 |
Effective income tax rate reconciliation, amount [Abstract] | ||
Income before taxes | 16,436 | 47,246 |
Expected tax | 3,452 | 9,922 |
State tax (net of federal benefit) | 925 | 2,682 |
Other | (575) | (76) |
Total provision | $ 3,802 | $ 12,528 |
Effective income tax rate reconciliation, percent [Abstract] | ||
Expected tax | 21% | 21% |
State tax (net of federal benefit) | 5.60% | 5.70% |
Other | (3.50%) | (0.20%) |
Total | 23.10% | 26.50% |
Gross noncurrent deferred tax assets (liabilities) [Abstract] | ||
Lease liability | $ 26,897 | $ 26,142 |
Depreciation | 9,531 | 10,551 |
Allowance for bad debts | 9,454 | 8,525 |
Net operating loss carryforwards | 1,957 | 2,394 |
Accrued benefits | 0 | 656 |
Stock-based compensation | 541 | 641 |
Pension plan liabilities | 179 | 429 |
Other intangibles | 39 | 70 |
Accrued expenses | 67 | 0 |
Goodwill | (1,469) | (1,267) |
Right-of-use asset | (24,884) | (24,433) |
Noncurrent deferred tax assets, net | $ 22,312 | 23,708 |
Ownership Change [Abstract] | ||
Net operating loss carryforwards, period of ownership change | 3 years | |
Net operating loss carryforwards, minimum percentage of ownership change | 50% | |
State Tax [Member] | ||
Operating Loss Carryforwards [Abstract] | ||
Net operating losses | $ 34,200 | 37,600 |
Federal Tax [Member] | ||
Operating Loss Carryforwards [Abstract] | ||
Net operating losses | $ 0 | $ 1,200 |
FAIR VALUE (Details)
FAIR VALUE (Details) $ in Thousands | Dec. 31, 2022 USD ($) Investment |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Number of treasury bills | Investment | 2 |
Number of treasury bills classified as cash and cash equivalent | Investment | 1 |
Number of treasury bills classified as a short-term investment | Investment | 1 |
Recurring [Member] | Carrying Amount [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Total cash equivalents and short-term investments | $ 43,301 |
Recurring [Member] | Carrying Amount [Member] | Money Market Fund [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 18,160 |
Recurring [Member] | Carrying Amount [Member] | Treasury Bill [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 10,383 |
Short-term investments | 14,758 |
Recurring [Member] | Fair Value [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Total cash equivalents and short-term investments | 43,301 |
Recurring [Member] | Fair Value [Member] | Money Market Fund [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 18,160 |
Recurring [Member] | Fair Value [Member] | Treasury Bill [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 10,383 |
Short-term investments | 14,758 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Total cash equivalents and short-term investments | 43,301 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value [Member] | Money Market Fund [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 18,160 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value [Member] | Treasury Bill [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 10,383 |
Short-term investments | 14,758 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Fair Value [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Total cash equivalents and short-term investments | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Fair Value [Member] | Money Market Fund [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Fair Value [Member] | Treasury Bill [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 0 |
Short-term investments | 0 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Fair Value [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Total cash equivalents and short-term investments | 0 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Fair Value [Member] | Money Market Fund [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 0 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Fair Value [Member] | Treasury Bill [Member] | |
Fair Value of Financial Instruments Measured on Recurring Basis [Abstract] | |
Cash equivalents | 0 |
Short-term investments | $ 0 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) Segment | Dec. 31, 2021 USD ($) | |
SEGMENT REPORTING [Abstract] | ||
Number of reportable operating segments | Segment | 3 | |
Summary financial information by reporting segment [Abstract] | ||
Revenue | $ 348,287 | $ 335,336 |
Percentage of Total Revenue | 100% | 100% |
Operating Income (Loss) | $ 16,278 | $ 49,261 |
Assets | 291,566 | 295,299 |
Transportation and Skilled Trades [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | 249,905 | 240,531 |
Healthcare and Other Professions [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | 91,535 | 87,998 |
Transitional [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | 6,847 | 6,807 |
Reportable Segments [Member] | Transportation and Skilled Trades [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | $ 249,905 | $ 240,531 |
Percentage of Total Revenue | 71.80% | 71.70% |
Operating Income (Loss) | $ 42,335 | $ 52,055 |
Assets | 153,369 | 156,531 |
Reportable Segments [Member] | Healthcare and Other Professions [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | $ 91,535 | $ 87,998 |
Percentage of Total Revenue | 26.30% | 26.20% |
Operating Income (Loss) | $ 7,189 | $ 11,740 |
Assets | 37,104 | 31,160 |
Reportable Segments [Member] | Transitional [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | $ 6,847 | $ 6,807 |
Percentage of Total Revenue | 2% | 2% |
Operating Income (Loss) | $ (430) | $ 105 |
Assets | 1,498 | 2,799 |
Corporate [Member] | ||
Summary financial information by reporting segment [Abstract] | ||
Revenue | $ 0 | $ 0 |
Percentage of Total Revenue | 0% | 0% |
Operating Income (Loss) | $ (32,816) | $ (14,639) |
Assets | $ 99,595 | $ 104,809 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) School Student Company | Sep. 30, 2022 Application | |
COMMITMENTS AND CONTINGENCIES [Abstract] | ||
Number of schools | School | 2 | |
Estimation of number of students provide for automatic relief for students at listed schools | Student | 200,000 | |
Number of new borrower defense applications that have been submitted | Application | 179,000 | |
Number of school companies | Company | 2 | |
Number of school companies for loan discharge and refund | Company | 3 | |
Number of days to file a appeal | 7 days | |
Period to review borrower defense applications before final settlement date | 36 months | |
Outstanding net loan commitment | $ 30.5 | |
Future employment contract commitments | 7.5 | |
Surety bonds | $ 15.3 |
COVID-19 PANDEMIC AND CARES A_2
COVID-19 PANDEMIC AND CARES ACT (Details) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) Intallment | |
COVID-19 [Abstract] | ||
Total amount expected to be received under CARES Act | $ 27.4 | |
Number of installments used to allocated funds to schools | Intallment | 2 | |
Emergency grants available in first installment under CARES Act | $ 13.7 | |
Utilized amount of permitted expenses | $ 13.7 | |
DOE allocated amount to schools | $ 24.4 | |
Emergency grants distributed to students under CRRSAA and ARPA Act | $ 14.8 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 27, 2023 | May 24, 2022 | Dec. 31, 2022 | |
Share Repurchase Program [Abstract] | |||
Authorized amount of share repurchase program | $ 30 | ||
Period over which common stock can be repurchased | 12 months | 12 months | |
Amount of shares repurchased | $ 9.4 | $ 9.4 | |
Subsequent Event [Member] | |||
Share Repurchase Program [Abstract] | |||
Additional period over which common stock can be repurchased | 12 months | ||
Additional authorized amount of share repurchase program | $ 10 | ||
Additional amount of shares repurchased | $ 30.6 |
Schedule II-Valuation and Qua_2
Schedule II-Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Movement in Valuation Allowances and Reserves [Abstract] | ||
Balance at beginning of period | $ 31,921 | $ 28,639 |
Charged to expense | 34,915 | 26,794 |
Accounts written-off | (31,466) | (23,512) |
Balance at end of period | $ 35,370 | $ 31,921 |