Exhibit 99.1
DeVry Education Group Announces Second-Quarter 2015 Results
DOWNERS GROVE, Ill.--(BUSINESS WIRE)--February 5, 2015--DeVry Education Group (NYSE:DV), a global provider of educational services, today reported academic, operational and financial results for its fiscal second quarter that ended Dec. 31, 2014. DeVry Group also reported enrollment results at Chamberlain College of Nursing, Carrington College, DeVry Medical International, and DeVry University and its Keller Graduate School of Management.
Academic and operational accomplishments:
- Chamberlain College of Nursing opened new campuses in Las Vegas and the Detroit area in January 2015
- Chamberlain received a 10-year re-accreditation of its Bachelor of Science in Nursing degree program and an additional programmatic accreditation for its Doctor of Nursing Practice from the Commission on Collegiate Nursing Education
- DeVry Brasil announced the acquisitions of Faculdade Ideal (Faci) and Damásio Educacional
- Becker Professional Education launched a Certified Management Accountant® exam review program in India and announced a partnership with the American Medical Student Association (AMSA) to help prepare medical students for the United States Medical Licensing Examination®
Selected financial data for the three months ended Dec. 31, 2014:
- Revenue decreased 1.3 percent to $484.9 million
- Segment revenue for Medical and Healthcare grew 12.4 percent
- Segment revenue for International and Professional Education decreased 0.3 percent
- Segment revenue for Business, Technology and Management decreased 12.3 percent
- Reported net income of $42.4 million, compared to net income of $48.2 million last year; net income from continuing operations and excluding special items was $49.0 million versus $52.0 million in the prior year
- Reported diluted earnings per share of $0.65 compared to diluted earnings per share of $0.74 last year; earnings per share excluding special items was $0.75 versus in $0.80 in the prior year period
Selected financial data for the six months ended Dec. 31, 2014:
- Revenue increased 0.5 percent to $946.9 million
- Segment revenue for Medical and Healthcare grew 14.7 percent
- Segment revenue for International and Professional Education grew 8.8 percent
- Segment revenue for Business, Technology and Management declined 12.3 percent
- Reported net income of $62.9 million, compared to net income of $41.0 million last year; net income from continuing operations and excluding special items was $79.8 million versus $66.2 million in the prior year
- Reported diluted earnings per share of $0.96 compared to diluted earnings per share of $0.63 last year; earnings per share excluding special items was $1.22 versus in $1.02 in the prior year period
- Operating cash flow of $92.3 million compared to $113.1 million last year
- Cash and cash equivalents of $380.0 million as of Dec. 31, 2014, compared to $262.0 million as of Dec. 31, 2013
- On track to achieve at least $90 million of value creation primarily in the Business, Technology and Management segment
The second quarter fiscal year 2015 results contained an after-tax charge of $6.5 million related to real estate consolidations, primarily at DeVry University. (See ''Use of Non-GAAP Financial Information and Supplemental Reconciliation Schedule'').
“While challenges remain at DeVry University, DeVry Group continued to see growth in new students during the second quarter,” said Daniel Hamburger, DeVry Group’s president and CEO. “We continued our global diversification in healthcare, international and professional education with the opening of new locations at Chamberlain, two acquisitions in Brazil, and new partnerships at Becker Professional Education.”
Operating Highlights
Medical and Healthcare Segment
During the quarter, segment revenue of $214.0 million increased 12.4 percent compared to the prior year. Excluding special charges, segment operating income declined 2.9 percent to $38.1 million versus the previous year. For the six-month period, revenue increased 14.7 percent to $420.0 million and segment operating income, excluding special charges, rose 18.5 percent to $76.4 million versus prior year.
DeVry Medical International
Revenue for the quarter at DeVry Medical International grew 4 percent. In the January 2015 term, new students decreased 3.8 percent to 560 compared to 582 students for prior year semester. Total students decreased 7.9 percent to 6,146 compared to 6,673 students in the same semester last year.
Chamberlain College of Nursing
For the quarter, Chamberlain grew its revenue by nearly 30 percent, primarily driven by solid enrollment growth in its post-licensure programs.
For the November 2014 session, new students grew 9.5 percent to 2,137 students, compared to 1,952 in the previous year. Total students increased 32.3 percent to 20,807, compared to 15,732 in the prior year.
For the January 2015 session, new students grew 5.7 percent to 3,702 students, compared to 3,501 in the previous year. Total students increased 27.1 percent to 23,055, compared to 18,136 in the prior year.
Chamberlain recently opened new locations in Las Vegas and the Detroit area. It now has 16 locations and will open one more campus in North Brunswick, New Jersey, in the fourth quarter of fiscal 2015.
During the quarter, Chamberlain received a re-accreditation of its Bachelor of Science in Nursing degree program for a period of 10 years and an additional programmatic accreditation from the Commission on Collegiate Nursing Education for its Doctor of Nursing Practice degree program for a period of five years.
Carrington College
Revenue at Carrington College grew nearly 1 percent during the quarter. For the three-month period ending Dec. 31, 2014, new students increased 14.4 percent to 1,951, compared to 1,706 in the previous year. Total students grew 1.2 percent to 7,444, compared to 7,358 in the prior year period. The increase in new students was related to the timing of session start dates in the current period compared to the prior year.
International and Professional Education Segment
During the quarter, segment revenue of $61.2 million declined 0.3 percent compared to the prior year. Segment operating income decreased 33.2 percent to $10.5 million versus the previous year. The decrease was largely driven by an expected shift in Becker revenue as described below. For the six-month period, revenue increased 8.8 percent to $114.4 million and segment operating income decreased 5.2 percent to $15.2 million compared to prior year.
DeVry Brasil
Revenue at DeVry Brasil increased 22 percent during the quarter. DeVry Brasil announced the acquisitions of Faci and Damásio Educacional.
Located in Belém, Pará in northern Brazil, Faci serves approximately 2,500 students and offers undergraduate programs in high-demand career fields such as law, education, accounting, technology and engineering. The acquisition was completed on Jan. 2, 2015.
Damásio is a leader in bar exam test preparation with a network of approximately 220 learning centers located in many major cities throughout Brazil. In addition, Damásio operates a highly-regarded law school at three campuses in Sao Paulo and Rio de Janeiro. In total, these institutions serve more than 50,000 students. The acquisition was completed on Feb. 2, 2015.
Becker Professional Education
During the quarter, Becker revenue declined by 26 percent. The decrease was primarily the result of a shift of revenue into the first fiscal quarter given the launch of Becker One, the new curriculum delivery system that allows students to receive content updates on a continuous basis versus once a year.
During the quarter, Becker Professional Education launched a Certified Management Accountant exam review course in India to further establish our position as a worldwide provider of high-quality professional education. It also announced a new partnership with the American Medical Student Association to help prepare medical students for the United States Medical Licensing Examination.
Business, Technology, and Management Segment
Segment revenue of $210.3 million declined 12.3 percent compared to the prior year. Excluding special items, operating income of $11.1 million increased 11.9 percent compared to the prior year. For the six-month period, revenue was $414.0 million compared to $472.2 million in the previous year and the segment operating income was $11.2 million compared to $4.9 million in the prior year, excluding special items.
DeVry University and its Keller Graduate School of Management
For the November 2014 session at DeVry University, new undergraduate students decreased 12.9 percent to 4,201 compared to 4,824 in the previous year. Total undergraduate students decreased 12.6 percent to 38,235 versus 43,726 for the session a year ago. January 2015 new undergraduate students decreased 12.8 percent to 4,282 compared to 4,911 in the previous year. Total undergraduate students decreased 15.9 percent to 37,922 versus 45,097 for the January session a year ago.
At the graduate level, including Keller Graduate School of Management, total coursetakers in the November session decreased 9.8 percent to 15,136 versus 16,778 for the same session a year ago. For the January session, total graduate coursetakers decreased 12.8 percent to 15,108 versus 17,322 for the same session a year ago.
During the quarter, DeVry University continued to execute its turnaround and transformation plan driven by its new leadership team. Key elements of the plan include enhancing the institution’s programmatic focus, better communicating its value proposition to students and employers, and reducing its cost structure through workforce reductions and real estate consolidations.
Balance Sheet/Cash Flow
For the first six months, DeVry Group generated $92.3 million of operating cash flow. As of Dec. 31, 2014, cash and cash equivalents totaled $380.0 million.
Conference Call and Webcast Information
DeVry Group will hold a conference call to discuss its fiscal 2015 second-quarter financial results on Feb. 5, 2015 at 4 p.m. Central Time (5 p.m. Eastern Time). The conference call will be led by Daniel Hamburger, president and chief executive officer, Tim Wiggins, chief financial officer and Patrick Unzicker, chief accounting officer.
For those wishing to participate by telephone, dial 877-506-6380 (domestic) or 412-902-6690 (international). Please say “DeVry Group Call”. DeVry Group will also broadcast the conference call via webcast. Interested parties may access the webcast through the Investor Relations section of DeVry Group's website, or http://services.choruscall.com/links/dv150205.html.
Please access the website at least 15 minutes prior to the start of the call to register, download and install any necessary audio software.
DeVry Group will archive a telephone replay of the call until Feb. 27, 2015. To access the replay, dial 877-344-7529 (domestic) or 412-317-0088 (international), passcode 10058845. To access the webcast replay, please visit DeVry Group's website, or http://services.choruscall.com/links/dv150205.html.
About DeVry Education Group
The purpose of DeVry Education Group is to empower its students to achieve their educational and career goals. DeVry Education Group Inc. (NYSE: DV; member S&P MidCap 400 Index) is a global provider of educational services and the parent organization of American University of the Caribbean School of Medicine, Becker Professional Education, Carrington College, Chamberlain College of Nursing, DeVry Brasil, DeVry University and its Keller Graduate School of Management, Ross University School of Medicine and Ross University School of Veterinary Medicine. These institutions offer a wide array of programs in healthcare, business, technology, accounting, finance, and law. For more information, please visit www.devryeducationgroup.com.
Certain statements contained in this release concerning DeVry Group's future performance, including those statements concerning DeVry Group's expectations or plans, may constitute forward-looking statements subject to the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as DeVry Group or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Actual results may differ materially from those projected or implied by these forward-looking statements. Potential risks, uncertainties and other factors that could cause results to differ are described more fully in Item 1A, "Risk Factors," in DeVry Group's most recent Annual Report on Form 10-K for the year ending June 30, 2014 and filed with the Securities and Exchange Commission (SEC) on August 27, 2014 and its most recent Form 10-Q for the quarter ending December 31, 2014 and filed with the SEC on February 5, 2015.
Selected Operating Data (in thousands, except per share data) | |||||||||
| Second Quarter | |||||||||
| FY 2015 | FY 2014 | Change | |||||||
| Revenue | $484,880 | $491,269 | -1.3% | ||||||
| Income from Continuing Operations | $42,802 | $49,328 | -13.2% | ||||||
| Net Income | $42,413 | $48,155 | -11.9% | ||||||
| Earnings/(Loss) per Share (diluted) | |||||||||
| Continuing Operations | $0.65 | $0.75 | -13.3% | ||||||
| Discontinued Operations | -- | ($0.01) | NM | ||||||
| Number of common shares (diluted) | 65,470 | 64,719 | +1.2% | ||||||
| Six Months | |||||||||
| FY 2015 | FY 2014 | Change | |||||||
| Revenue | $946,924 | $942,181 | +0.5% | ||||||
| Income from Continuing Operations | $63,239 | $57,479 | +10.0% | ||||||
| Net Income | $62,853 | $41,023 | +53.2% | ||||||
| Earnings /(Loss) per Share (diluted) | |||||||||
| Continuing Operations | $0.96 | $0.88 | +9.1% | ||||||
| Discontinued Operations | -- | ($0.25) | NM | ||||||
| Number of common shares (diluted) | 65,488 | 64,616 | +1.4% | ||||||
Use of Non-GAAP Financial Information and Supplemental Reconciliation Schedule
During the second quarter and first six months of fiscal year 2015, DeVry Group recorded restructuring charges related to real estate consolidations and workforce reductions at DeVry University and real estate consolidations at Chamberlain College of Nursing and Carrington College in order to align its cost structure with enrollments. During the second quarter and first six months of fiscal 2014, DeVry Group recorded restructuring charges primarily related to workforce reductions and real estate consolidations at DeVry University, Carrington College and the DeVry Group home office. DeVry Group also recorded the operating results of its Advanced Academics reporting unit as discontinued operations. DeVry Group recorded a gain from the sale of a former DeVry University campus in Decatur, Georgia, during the first quarter of fiscal year 2014. The following table illustrates the effects of restructuring charges and gain on the sale of assets on DeVry Group’s operating income. Management believes that the non-GAAP disclosure of operating income excluding these special items provides investors with useful supplemental information regarding the underlying business trends and performance of DeVry Group’s ongoing operations and is useful for period-over-period comparisons of such operations given the special nature of the restructuring charges and gain on the sale of assets. DeVry Group uses these supplemental financial measures internally in its management and budgeting process. However, these non-GAAP financial measures should be viewed in addition to, and not as a substitute for, DeVry Group’s reported results prepared in accordance with GAAP. The following table reconciles these non-GAAP measures to the most directly comparable GAAP information (in thousands, except per share data):
| Non-GAAP Earnings Disclosure | |||||||||||||||
| PRELIMINARY | ||||||||||||||||
| For The Three Months | For The Six Months | |||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Net Income | $ | 42,413 | $ | 48,155 | $ | 62,853 | $ | 41,023 | ||||||||
| Earnings per Share (Diluted) | $ | 0.65 | $ | 0.74 | $ | 0.96 | $ | 0.63 | ||||||||
| Discontinued Operations (net of tax) | $ | - | $ | 920 | $ | - | $ | 16,248 | ||||||||
| Effect on Earnings per Share (Diluted) | $ | - | $ | 0.01 | $ | - | $ | 0.25 | ||||||||
| Restructuring Expenses (net of tax) | $ | 6,537 | $ | 2,877 | $ | 16,989 | $ | 10,057 | ||||||||
| Effect on Earnings per Share (Diluted) | $ | 0.10 | $ | 0.04 | $ | 0.26 | $ | 0.16 | ||||||||
| Gain on Sale of Assets (net of tax) | $ | - | $ | - | $ | - | $ | (1,167 | ) | |||||||
| Effect on Earnings per Share (Diluted) | $ | - | $ | - | $ | - | $ | (0.02 | ) | |||||||
| Net Income from Continuing Operations | ||||||||||||||||
| Excluding the Restructuring Expense and | ||||||||||||||||
| Gain on Sale of Assets (Diluted) | $ | 48,950 | $ | 51,952 | $ | 79,842 | $ | 66,161 | ||||||||
| Earnings per Share from Continuing Operations | ||||||||||||||||
| Excluding the Restructuring Expense and | ||||||||||||||||
| Gain on Sale of Assets (Diluted) | $ | 0.75 | $ | 0.80 | $ | 1.22 | $ | 1.02 | ||||||||
Shares used in Diluted EPS Calculation | 65,470 | 64,719 | 65,488 | 64,616 | ||||||||||||
Enrollment Results | ||||||||
| FY2015 | FY2014 | % Change | ||||||
| DeVry Education Group Student Enrollments | ||||||||
| New students(1) | 17,308 | 16,272 | +6.4% | |||||
| Total students(1) | 120,713 | 120,798 | -0.1% | |||||
| Chamberlain College of Nursing | ||||||||
| November Session | ||||||||
| New students | 2,137 | 1,952 | +9.5% | |||||
| Total students | 20,807 | 15,732 | +32.3% | |||||
| January Session | ||||||||
| New students | 3,702 | 3,501 | +5.7% | |||||
| Total students | 23,055 | 18,136 | +27.1% | |||||
| Carrington College | ||||||||
| 3 months ending December 31, 2014 | ||||||||
| New students | 1,951 | 1,706 | +14.4% | |||||
| Total students | 7,444 | 7,358 | +1.2% | |||||
| DeVry Medical International | ||||||||
| January Term | ||||||||
| New students | 560 | 582 | -3.8% | |||||
| Total students | 6,146 | 6,673 | -7.9% | |||||
| DeVry University | ||||||||
| Undergraduate – November Session | ||||||||
| New students | 4,201 | 4,824 | -12.9% | |||||
| Total students | 38,235 | 43,726 | -12.6% | |||||
| Undergraduate – January Session | ||||||||
| New students | 4,282 | 4,911 | -12.8% | |||||
| Total students | 37,922 | 45,097 | -15.9% | |||||
| Graduate – November Session | ||||||||
| Coursetakers(2) | 15,136 | 16,778 | -9.8% | |||||
| Graduate – January Session | ||||||||
| Coursetakers(2) | 15,108 | 17,322 | -12.8% | |||||
| 1) | Includes the most recently reported enrollments at DeVry Group’s degree-granting institutions. | ||
| 2) | The term “coursetaker” refers to the number of courses taken by a student. Thus one student taking two courses equals two coursetakers. | ||
Chart 1: DeVry Education Group Fiscal 2015 Announcements & Events
| April 23, 2015 | Fiscal 2015 Third Quarter Results | |
| August 13, 2015 | Fiscal 2015 Fourth Quarter and Year-End Results | |
| DEVRY EDUCATION GROUP INC. | |||||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| PRELIMINARY | |||||||||||||||||
| December 31, | June 30, | December 31, | |||||||||||||||
| 2014 | 2014 | 2013 | |||||||||||||||
| (Dollars in thousands, except for share | |||||||||||||||||
| and par value amounts) | |||||||||||||||||
ASSETS | |||||||||||||||||
Current Assets | |||||||||||||||||
| Cash and Cash Equivalents | $ | 379,965 | $ | 358,188 | $ | 262,034 | |||||||||||
| Marketable Securities and Investments | 3,520 | 3,448 | 3,263 | ||||||||||||||
| Restricted Cash | 10,534 | 8,347 | 11,873 | ||||||||||||||
| Accounts Receivable, Net | 89,318 | 132,621 | 117,812 | ||||||||||||||
| Deferred Income Taxes, Net | 45,104 | 39,679 | 31,169 | ||||||||||||||
| Prepaid Expenses and Other | 44,338 | 34,808 | 49,594 | ||||||||||||||
| Total Current Assets | 572,779 | 577,091 | 475,745 | ||||||||||||||
Land, Buildings and Equipment | |||||||||||||||||
| Land | 63,261 | 68,185 | 66,539 | ||||||||||||||
| Buildings | 467,330 | 464,944 | 429,463 | ||||||||||||||
| Equipment | 492,716 | 488,322 | 472,944 | ||||||||||||||
| Construction In Progress | 26,666 | 17,405 | 44,115 | ||||||||||||||
| 1,049,973 | 1,038,856 | 1,013,061 | |||||||||||||||
| Accumulated Depreciation | (506,984 | ) | (483,019 | ) | (455,018 | ) | |||||||||||
| Land, Buildings and Equipment, Net | 542,989 | 555,837 | 558,043 | ||||||||||||||
Other Assets | |||||||||||||||||
| Intangible Assets, Net | 289,160 | 294,932 | 293,720 | ||||||||||||||
| Goodwill | 519,748 | 519,879 | 514,757 | ||||||||||||||
| Perkins Program Fund, Net | 13,450 | 13,450 | 13,450 | ||||||||||||||
| Other Assets | 29,740 | 36,447 | 33,398 | ||||||||||||||
| Total Other Assets | 852,098 | 864,708 | 855,325 | ||||||||||||||
| TOTAL ASSETS | $ | 1,967,866 | $ | 1,997,636 | $ | 1,889,113 | |||||||||||
LIABILITIES | |||||||||||||||||
Current Liabilities | |||||||||||||||||
| Accounts Payable | $ | 55,737 | $ | 52,260 | $ | 62,721 | |||||||||||
| Accrued Salaries, Wages and Benefits | 73,460 | 94,501 | 77,447 | ||||||||||||||
| Accrued Expenses | 69,427 | 70,891 | 69,259 | ||||||||||||||
| Deferred and Advance Tuition | 66,356 | 99,160 | 97,725 | ||||||||||||||
| Total Current Liabilities | 264,980 | 316,812 | 307,152 | ||||||||||||||
Other Liabilities | |||||||||||||||||
| Deferred Income Taxes, Net | 48,339 | 47,921 | 59,941 | ||||||||||||||
| Deferred Rent and Other | 90,533 | 93,117 | 91,054 | ||||||||||||||
| Total Other Liabilities | 138,872 | 141,038 | 150,995 | ||||||||||||||
| TOTAL LIABILITIES | 403,852 | 457,850 | 458,147 | ||||||||||||||
| NONCONTROLLING INTEREST | 8,139 | 6,393 | 5,975 | ||||||||||||||
SHAREHOLDERS' EQUITY | |||||||||||||||||
| Common Stock, $0.01 par value, 200,000,000 Shares Authorized; | |||||||||||||||||
| 63,840,000, 63,624,000 and 63,332,000 Shares issued | |||||||||||||||||
| and outstanding at December 31, 2014, June 30, 2014 | |||||||||||||||||
| and December 31, 2013, respectively. | 769 | 753 | 752 | ||||||||||||||
| Additional Paid-in Capital | 338,710 | 320,703 | 304,807 | ||||||||||||||
| Retained Earnings | 1,731,976 | 1,682,071 | 1,599,985 | ||||||||||||||
| Accumulated Other Comprehensive Loss | (44,066 | ) | (15,394 | ) | (25,573 | ) | |||||||||||
| Treasury Stock, at Cost (12,022,000, 11,655,000 and 11,661,000 | |||||||||||||||||
| Shares, Respectively) | (471,514 | ) | (454,740 | ) | (454,980 | ) | |||||||||||
| TOTAL SHAREHOLDERS' EQUITY | 1,555,875 | 1,533,393 | 1,424,991 | ||||||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 1,967,866 | $ | 1,997,636 | $ | 1,889,113 | |||||||||||
| DEVRY EDUCATION GROUP INC. | ||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||||||
| (Dollars in Thousands Except for Per Share Amounts) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| PRELIMINARY | ||||||||||||||||||||||
| For The Three Months | For The Six Months | |||||||||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
| REVENUE: | ||||||||||||||||||||||
| Tuition | $ | 453,609 | $ | 457,888 | $ | 875,482 | $ | 877,205 | ||||||||||||||
| Other Educational | 31,271 | 33,381 | 71,442 | 64,976 | ||||||||||||||||||
| Total Revenue | 484,880 | 491,269 | 946,924 | 942,181 | ||||||||||||||||||
| OPERATING COST AND EXPENSE: | ||||||||||||||||||||||
| Cost of Educational Services | 250,809 | 242,997 | 497,140 | 484,732 | ||||||||||||||||||
| Student Services and Administrative Expense | 174,913 | 185,046 | 352,666 | 374,205 | ||||||||||||||||||
| Gain on Sale of Assets | - | - | - | (1,918 | ) | |||||||||||||||||
| Restructuring Expense | 10,188 | 4,664 | 23,505 | 16,329 | ||||||||||||||||||
| Total Operating Cost and Expense | 435,910 | 432,707 | 873,311 | 873,348 | ||||||||||||||||||
| Operating Income | 48,970 | 58,562 | 73,613 | 68,833 | ||||||||||||||||||
| INTEREST INCOME: | ||||||||||||||||||||||
| Interest Income | 300 | 310 | 697 | 893 | ||||||||||||||||||
| Interest Expense | (352 | ) | (1,052 | ) | (745 | ) | (2,052 | ) | ||||||||||||||
| Net Interest (Expense) Income | (52 | ) | (742 | ) | (48 | ) | (1,159 | ) | ||||||||||||||
| Income from Continuing Operations Before Income Taxes | 48,918 | 57,820 | 73,565 | 67,674 | ||||||||||||||||||
| Income Tax Provision | (6,116 | ) | (8,492 | ) | (10,326 | ) | (10,195 | ) | ||||||||||||||
| Income from Continuing Operations | 42,802 | 49,328 | 63,239 | 57,479 | ||||||||||||||||||
| DISCONTINUED OPERATIONS: | ||||||||||||||||||||||
| Loss from Operations of Divested Component | - | (1,387 | ) | - | (17,711 | ) | ||||||||||||||||
| Income Tax Benefit | - | 467 | - | 1,463 | ||||||||||||||||||
| Loss on Discontinued Operations | - | (920 | ) | - | (16,248 | ) | ||||||||||||||||
| NET INCOME | 42,802 | 48,408 | 63,239 | 41,231 | ||||||||||||||||||
| Net Income Attributable to Noncontrolling Interest | (389 | ) | (253 | ) | (386 | ) | (208 | ) | ||||||||||||||
| NET INCOME ATTRIBUTABLE TO DEVRY EDUCATION GROUP | $ | 42,413 | $ | 48,155 | $ | 62,853 | $ | 41,023 | ||||||||||||||
| AMOUNTS ATTRIBUTABLE TO DEVRY EDUCATION GROUP: | ||||||||||||||||||||||
| Income from Continuing Operations, Net of Income Taxes | 42,413 | 49,075 | 62,853 | 57,271 | ||||||||||||||||||
| Loss from Discontinued Operations, Net of Income Taxes | - | (920 | ) | - | (16,248 | ) | ||||||||||||||||
| NET INCOME ATTRIBUTABLE TO DEVRY EDUCATION GROUP | $ | 42,413 | $ | 48,155 | $ | 62,853 | $ | 41,023 | ||||||||||||||
| EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE | ||||||||||||||||||||||
| TO DEVRY EDUCATION GROUP SHAREHOLDERS | ||||||||||||||||||||||
| Basic | ||||||||||||||||||||||
| Continuing Operations | $ | 0.66 | $ | 0.76 | $ | 0.97 | $ | 0.89 | ||||||||||||||
| Discontinued Operations | - | (0.01 | ) | - | (0.25 | ) | ||||||||||||||||
| $ | 0.66 | $ | 0.75 | $ | 0.97 | $ | 0.64 | |||||||||||||||
| Diluted | ||||||||||||||||||||||
| Continuing Operations | $ | 0.65 | $ | 0.75 | $ | 0.96 | $ | 0.88 | ||||||||||||||
| Discontinued Operations | - | (0.01 | ) | - | (0.25 | ) | ||||||||||||||||
| $ | 0.65 | $ | 0.74 | $ | 0.96 | $ | 0.63 | |||||||||||||||
| Cash Dividend Declared per Common Share | $ | 0.18 | $ | 0.17 | $ | 0.18 | $ | 0.17 | ||||||||||||||
| DEVRY EDUCATION GROUP INC. | ||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||
| (Unaudited) | ||||||||||||
| PRELIMINARY | ||||||||||||
| For The Six Months | ||||||||||||
| Ended December 31, | ||||||||||||
| 2014 | 2013 | |||||||||||
| (Dollars in Thousands) | ||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||
| Net Income | $63,239 | $41,231 | ||||||||||
| Loss from Discontinued Operations | - | 16,248 | ||||||||||
| Adjustments to Reconcile Net Income to Net | ||||||||||||
| Cash Provided by Operating Activities: | ||||||||||||
| Stock-Based Compensation Expense | 9,530 | 9,860 | ||||||||||
| Depreciation | 41,362 | 40,719 | ||||||||||
| Amortization | 1,293 | 3,590 | ||||||||||
| Provision for Refunds and Uncollectible Accounts | 45,627 | 37,274 | ||||||||||
| Deferred Income Taxes | (2,996 | ) | 1,699 | |||||||||
| Loss on Disposals of Land, Buildings and Equipment | 2,430 | 1,333 | ||||||||||
| Unrealized Loss on Assets Held for Sale | - | 244 | ||||||||||
| Realized Gain on Sale of Assets | - | (1,918 | ) | |||||||||
| Changes in Assets and Liabilities, Net of Effects from | ||||||||||||
| Acquisitions and Divestitures of Businesses: | ||||||||||||
| Restricted Cash | (2,187 | ) | (4,854 | ) | ||||||||
| Accounts Receivable | (6,367 | ) | (17,170 | ) | ||||||||
| Prepaid Expenses And Other | (540 | ) | 1,338 | |||||||||
| Accounts Payable | 3,481 | 7,592 | ||||||||||
| Accrued Salaries, Wages, Expenses and Benefits | (29,795 | ) | (23,279 | ) | ||||||||
| Deferred and Advance Tuition | (32,768 | ) | (589 | ) | ||||||||
| Net Cash Provided by Operating Activities-Continuing Operations | 92,309 | 113,318 | ||||||||||
| Net Cash Provided by Operating Activities-Discontinued Operations | - | (197 | ) | |||||||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 92,309 | 113,121 | ||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||
| Capital Expenditures | (43,061 | ) | (33,426 | ) | ||||||||
| Payment for Purchase of Business, Net of Cash Acquired | (9,649 | ) | (12,343 | ) | ||||||||
| Marketable Securities Purchased | (140 | ) | (106 | ) | ||||||||
| Cash Received from Sale of Assets | 6,100 | 8,662 | ||||||||||
| NET CASH USED IN INVESTING ACTIVITIES | (46,750 | ) | (37,213 | ) | ||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||
| Proceeds from Exercise of Stock Options | 5,380 | 3,576 | ||||||||||
| Proceeds from Stock issued Under Employee Stock Purchase Plan | 674 | 708 | ||||||||||
| Repurchase of Common Stock for Treasury | (11,541 | ) | - | |||||||||
| Cash Dividends Paid | (11,639 | ) | (10,941 | ) | ||||||||
| Payments of Seller Financed Obligations | (4,097 | ) | (2,138 | ) | ||||||||
| NET CASH USED IN FINANCING ACTIVITIES | (21,223 | ) | (8,795 | ) | ||||||||
| Effects of Exchange Rate Differences | (2,559 | ) | (2,223 | ) | ||||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 21,777 | 64,890 | ||||||||||
| Cash and Cash Equivalents at Beginning of Period | 358,188 | 197,144 | ||||||||||
| Cash and Cash Equivalents at End of Period | $379,965 | $262,034 | ||||||||||
| DEVRY EDUCATION GROUP INC. | ||||||||||||||||||||||||
SEGMENT INFORMATION | ||||||||||||||||||||||||
| (Dollars in Thousands) | ||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||
| PRELIMINARY | ||||||||||||||||||||||||
| For The Three Months | For The Six Months | |||||||||||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||
| 2014 | 2013 | (Decrease) | 2014 | 2013 | (Decrease) | |||||||||||||||||||
| REVENUE: | ||||||||||||||||||||||||
| Medical and Healthcare | $ | 213,985 | $ | 190,447 | 12.4 | % | $ | 419,997 | $ | 366,303 | 14.7 | % | ||||||||||||
| International and Professional Education | 61,224 | 61,430 | -0.3 | % | 114,427 | 105,151 | 8.8 | % | ||||||||||||||||
| Business, Technology and Management | 210,337 | 239,913 | -12.3 | % | 413,978 | 472,222 | -12.3 | % | ||||||||||||||||
| Intersegment Elimination | (666 | ) | (521 | ) | NM | (1,478 | ) | (1,495 | ) | NM | ||||||||||||||
| Total Consolidated Revenue | 484,880 | 491,269 | -1.3 | % | 946,924 | 942,181 | 0.5 | % | ||||||||||||||||
| OPERATING INCOME (LOSS) (NOTE 1): | ||||||||||||||||||||||||
| Medical and Healthcare | 36,858 | 34,408 | 7.1 | % | 74,501 | 58,983 | 26.3 | % | ||||||||||||||||
| International and Professional Education | 10,491 | 15,700 | -33.2 | % | 15,229 | 16,072 | -5.2 | % | ||||||||||||||||
| Business, Technology and Management | 2,172 | 9,947 | -78.2 | % | (10,296 | ) | (1,114 | ) | NM | |||||||||||||||
| Reconciling Items: | ||||||||||||||||||||||||
| Home Office and Other | (551 | ) | (1,493 | ) | NM | (5,821 | ) | (5,108 | ) | NM | ||||||||||||||
| Total Consolidated Operating Income | 48,970 | 58,562 | -16.4 | % | 73,613 | 68,833 | 6.9 | % | ||||||||||||||||
| INTEREST INCOME: | ||||||||||||||||||||||||
| Interest Income | 300 | 310 | -3.2 | % | 697 | 893 | -21.9 | % | ||||||||||||||||
| Interest Expense | (352 | ) | (1,052 | ) | -66.5 | % | (745 | ) | (2,052 | ) | -63.7 | % | ||||||||||||
| Net Interest Income | (52 | ) | (742 | ) | -93.0 | % | (48 | ) | (1,159 | ) | -95.9 | % | ||||||||||||
| Total Consolidated Income before Income Taxes | ||||||||||||||||||||||||
| and Noncontrolling Interest | $ | 48,918 | $ | 57,820 | -15.4 | % | $ | 73,565 | $ | 67,674 | 8.7 | % | ||||||||||||
| Note 1 - Segment Operating Income (Loss) has been adjusted in both periods to reflect intangible asset amortization expense at the segment level. This amortization expense had previously been disclosed as a Reconciling Item. | |
During the second quarter and first six months of fiscal year 2015, DeVry Group recorded restructuring charges related to workforce reductions and real estate consolidations at DeVry University which is part of the Business, Technology and Management segment and real estate consolidations at Chamberlain College of Nursing and Carrington College which are part of the Medical and Healthcare segment in order to align its cost structure with enrollments. During the second quarter and first six months of fiscal year 2014, DeVry Group recorded restructuring charges primarily related to workforce reductions and real estate consolidations at DeVry University, Carrington College and the DeVry Group home office in order to align its cost structure with enrollments. DeVry Group recorded a gain from the sale of a former DeVry University campus in Decatur, Georgia, during the first six months of fiscal year 2014. The following table illustrates the effects of restructuring charges and gain on the sale of assets on DeVry Group’s operating income. Management believes that the non-GAAP disclosure of operating income excluding these special items provides investors with useful supplemental information regarding the underlying business trends and performance of DeVry Group’s ongoing operations and is useful for period-over-period comparisons of such operations given the special nature of the restructuring charges and gain on the sale of assets. DeVry Group uses these supplemental financial measures internally in its management and budgeting process. However, these non-GAAP financial measures should be viewed in addition to, and not as a substitute for, DeVry Group’s reported results prepared in accordance with GAAP. The following table reconciles these non-GAAP measures to the most directly comparable GAAP information (in thousands): | |
| For The Three Months | For The Six Months | |||||||||||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||
| 2014 | 2013 | (Decrease) | 2014 | 2013 | (Decrease) | |||||||||||||||||||
| Medical and Healthcare Operating Income | $ | 36,858 | $ | 34,408 | 7.1 | % | $ | 74,501 | $ | 58,983 | 26.3 | % | ||||||||||||
| Restructuring Charge | 1,234 | 4,803 | NM | 1,918 | 5,522 | NM | ||||||||||||||||||
| Medical and Healthcare Operating Income | ||||||||||||||||||||||||
| Excluding Restructuring Charge | $ | 38,092 | $ | 39,211 | -2.9 | % | $ | 76,419 | $ | 64,505 | 18.5 | % | ||||||||||||
| Business, Technology and Management Operating Income | $ | 2,172 | $ | 9,947 | -78.2 | % | $ | (10,296 | ) | $ | (1,114 | ) | 824.2 | % | ||||||||||
| Restructuring Charge | 8,914 | (40 | ) | NM | 21,517 | 7,910 | NM | |||||||||||||||||
| Gain on Sale of Assets | - | - | - | - | (1,918 | ) | NM | |||||||||||||||||
| Business, Technology and Management Operating Income | ||||||||||||||||||||||||
| Excluding Restructuring Charge and Gain on Sale of Assets | $ | 11,086 | $ | 9,907 | 11.9 | % | $ | 11,221 | $ | 4,878 | 130.0 | % | ||||||||||||
CONTACT:
DeVry Education Group
Investor Contact:
Joan Walter, 630-353-3800
jwalter@devrygroup.com
or
Media Contact:
Larry Larsen, 312-497-0655
llarsen@greentarget.com