Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Dec. 31, 2022 | Jan. 26, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Dec. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-13988 | |
Entity Registrant Name | Adtalem Global Education Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-3150143 | |
Entity Address, Address Line One | 500 West Monroe Street | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60661 | |
City Area Code | 312 | |
Local Phone Number | 651-1400 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 45,450,785 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000730464 | |
Amendment Flag | false | |
New York Stock Exchange | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common stock, $0.01 par value per share | |
Trading Symbol | ATGE | |
Security Exchange Name | NYSE | |
NYSE Chicago | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common stock, $0.01 par value per share | |
Trading Symbol | ATGE | |
Security Exchange Name | CHX |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | |||
Cash and cash equivalents | $ 207,776 | $ 346,973 | $ 275,420 |
Restricted cash | 2,234 | 964 | 1,224 |
Accounts receivable, net | 99,542 | 81,635 | 92,744 |
Prepaid expenses and other current assets | 113,564 | 126,467 | 166,722 |
Current assets held for sale | 0 | 0 | 74,397 |
Total current assets | 423,116 | 556,039 | 610,507 |
Noncurrent assets: | |||
Property and equipment, net | 275,617 | 289,926 | 301,666 |
Operating lease assets | 175,097 | 177,995 | 155,356 |
Deferred income taxes | 52,460 | 51,093 | 61,536 |
Intangible assets, net | 838,873 | 873,577 | 923,701 |
Goodwill | 961,262 | 961,262 | 960,058 |
Other assets, net | 116,613 | 119,283 | 117,621 |
Noncurrent assets held for sale | 0 | 0 | 529,328 |
Total noncurrent assets | 2,419,922 | 2,473,136 | 3,049,266 |
Total assets | 2,843,038 | 3,029,175 | 3,659,773 |
Current liabilities: | |||
Accounts payable | 71,189 | 57,140 | 65,422 |
Accrued payroll and benefits | 42,465 | 66,642 | 52,086 |
Accrued liabilities | 93,705 | 98,124 | 134,585 |
Deferred revenue | 115,658 | 144,840 | 124,347 |
Current operating lease liabilities | 48,445 | 50,781 | 54,845 |
Current portion of long-term debt | 0 | 0 | 8,500 |
Current liabilities held for sale | 0 | 0 | 57,690 |
Total current liabilities | 371,462 | 417,527 | 497,475 |
Noncurrent liabilities: | |||
Long-term debt | 693,781 | 838,908 | 1,599,538 |
Long-term operating lease liabilities | 166,496 | 177,045 | 155,827 |
Deferred income taxes | 26,676 | 25,554 | 27,127 |
Other liabilities | 61,901 | 65,074 | 58,040 |
Noncurrent liabilities held for sale | 0 | 0 | 32,086 |
Total noncurrent liabilities | 948,854 | 1,106,581 | 1,872,618 |
Total liabilities | 1,320,316 | 1,524,108 | 2,370,093 |
Commitments and contingencies (Note 19) | |||
Redeemable noncontrolling interest | 0 | 0 | 1,790 |
Shareholders' equity: | |||
Common stock, $0.01 par value per share, 200,000 shares authorized; 45,443, 45,177, and 49,797 shares outstanding as of December 31, 2022, June 30, 2022, and December 31, 2021, respectively | 822 | 818 | 817 |
Additional paid-in capital | 561,376 | 521,848 | 542,296 |
Retained earnings | 2,349,146 | 2,322,810 | 1,964,954 |
Accumulated other comprehensive loss | (2,227) | (960) | (634) |
Treasury stock, at cost, 36,713, 36,619, and 31,908 shares as of December 31, 2022, June 30, 2022, and December 31, 2021, respectively | (1,386,395) | (1,339,449) | (1,219,543) |
Total shareholders' equity | 1,522,722 | 1,505,067 | 1,287,890 |
Total liabilities and shareholders' equity | $ 2,843,038 | $ 3,029,175 | $ 3,659,773 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | |||
Common Stock, Par Value | $ 0.01 | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 200,000 | 200,000 | 200,000 |
Common Stock, Shares Outstanding | 45,443 | 45,177 | 49,797 |
Treasury Stock, Shares | 36,713 | 36,619 | 31,908 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 363,302 | $ 371,198 | $ 717,861 | $ 660,268 |
Operating cost and expense: | ||||
Cost of educational services | 159,303 | 180,420 | 318,948 | 332,470 |
Student services and administrative expense | 140,668 | 153,597 | 289,009 | 283,033 |
Restructuring expense | 1,363 | 3,387 | 16,428 | 6,481 |
Business acquisition and integration expense | 15,941 | 9,060 | 24,356 | 35,613 |
Total operating cost and expense | 317,275 | 346,464 | 648,741 | 657,597 |
Operating income | 46,027 | 24,734 | 69,120 | 2,671 |
Other income (expense): | ||||
Interest expense | (15,589) | (25,929) | (33,349) | (73,322) |
Other (expense) income, net | (2,574) | 861 | (1,007) | 1,739 |
Income (loss) from continuing operations before income taxes | 27,864 | (334) | 34,764 | (68,912) |
(Provision for) benefit from income taxes | (4,247) | 39,368 | (5,301) | 30,764 |
Income (loss) from continuing operations | 23,617 | 39,034 | 29,463 | (38,148) |
Discontinued operations: | ||||
Income (loss) from discontinued operations before income taxes | 524 | 4,159 | (2,914) | (1,891) |
Gain (loss) on disposal of discontinued operations before income taxes | 185 | 0 | (3,174) | 0 |
(Provision for) benefit from income taxes | (182) | (25,340) | 2,961 | (112) |
Income (loss) from discontinued operations | 527 | (21,181) | (3,127) | (2,003) |
Net income (loss) | $ 24,144 | $ 17,853 | $ 26,336 | $ (40,151) |
Basic: | ||||
Continuing operations | $ 0.52 | $ 0.78 | $ 0.65 | $ (0.77) |
Discontinued operations | 0.01 | (0.43) | (0.07) | (0.04) |
Total basic earnings (loss) per share | 0.53 | 0.36 | 0.58 | (0.81) |
Diluted: | ||||
Continuing operations | 0.51 | 0.78 | 0.64 | (0.77) |
Discontinued operations | 0.01 | (0.42) | (0.07) | (0.04) |
Total diluted earnings (loss) per share | $ 0.52 | $ 0.36 | $ 0.57 | $ (0.81) |
Weighted-average shares outstanding: | ||||
Basic shares | 45,425 | 49,776 | 45,350 | 49,719 |
Diluted shares | 46,121 | 50,237 | 46,232 | 49,719 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | ||||
Net income (loss) | $ 24,144 | $ 17,853 | $ 26,336 | $ (40,151) |
Other comprehensive income (loss), net of tax | ||||
Gain (loss) on foreign currency translation adjustments | 0 | 106 | (1,267) | 36 |
Comprehensive income (loss) before reclassification | 24,144 | 17,959 | 25,069 | (40,115) |
Reclassification adjustment for loss on interest rate swap | 0 | 0 | 0 | 6,695 |
Comprehensive income (loss) | $ 24,144 | $ 17,959 | $ 25,069 | $ (33,420) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating activities: | ||
Net income (loss) | $ 26,336 | $ (40,151) |
Loss from discontinued operations | 3,127 | 2,003 |
Income (loss) from continuing operations | 29,463 | (38,148) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Stock-based compensation expense | 8,113 | 13,931 |
Amortization and impairments to operating lease assets | 28,612 | 24,421 |
Depreciation | 21,461 | 22,130 |
Amortization of intangible assets | 34,704 | 47,150 |
Amortization and write-off of debt discount and issuance costs | 6,819 | 19,985 |
Provision for bad debts | 14,275 | 12,577 |
Deferred income taxes | (245) | (9,331) |
Loss on disposals, accelerated depreciation, and impairments to property and equipment | 3,483 | 266 |
Gain on extinguishment of debt | (71) | 0 |
Loss on investment | 5,000 | 0 |
Changes in assets and liabilities: | ||
Accounts receivable | (25,045) | (33,765) |
Prepaid expenses and other current assets | 227 | (29,686) |
Accounts payable | 13,233 | (8,304) |
Accrued payroll and benefits | (24,145) | (26,594) |
Accrued liabilities | (4,849) | (10,524) |
Deferred revenue | (29,182) | 44,582 |
Operating lease liabilities | (25,923) | (23,027) |
Other assets and liabilities | (13,654) | (24,631) |
Net cash provided by (used in) operating activities-continuing operations | 42,276 | (18,968) |
Net cash (used in) provided by operating activities-discontinued operations | (862) | 20,062 |
Net cash provided by operating activities | 41,414 | 1,094 |
Investing activities: | ||
Capital expenditures | (9,747) | (14,772) |
Payment for purchase of business, net of cash and restricted cash acquired | 0 | (1,488,054) |
Net cash used in investing activities-continuing operations | (9,747) | (1,502,826) |
Net cash used in investing activities-discontinued operations | 0 | (2,199) |
Payment for working capital adjustment for sale of business | (3,174) | 0 |
Net cash used in investing activities | (12,921) | (1,505,025) |
Financing activities: | ||
Proceeds from exercise of stock options | 1,422 | 8,200 |
Employee taxes paid on withholding shares | (4,108) | (2,518) |
Proceeds from stock issued under Colleague Stock Purchase Plan | 289 | 244 |
Payment on equity forward contract | (13,162) | 0 |
Proceeds from long-term debt | 0 | 850,000 |
Repayments of long-term debt | (150,861) | (291,000) |
Payment of debt discount and issuance costs | 0 | (49,553) |
Net cash (used in) provided by financing activities | (166,420) | 515,373 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0 | 36 |
Net decrease in cash, cash equivalents and restricted cash | (137,927) | (988,522) |
Cash, cash equivalents and restricted cash at beginning of period | 347,937 | 1,313,616 |
Cash, cash equivalents and restricted cash at end of period | 210,010 | 325,094 |
Less: cash, cash equivalents and restricted cash of discontinued operations at end of period | 0 | 48,450 |
Cash, cash equivalents and restricted cash of continuing operations at end of period | 210,010 | 276,644 |
Non-cash investing and financing activities: | ||
Accrued capital expenditures | $ 5,209 | $ 3,247 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock [Member] | Total |
Balance at the beginning of period at Jun. 30, 2021 | $ 811 | $ 519,826 | $ 2,005,105 | $ (7,365) | $ (1,217,307) | $ 1,301,070 |
Balance at the beginning of period (in shares) at Jun. 30, 2021 | 81,099 | 31,846 | ||||
Net income (loss) | (40,151) | (40,151) | ||||
Other comprehensive loss, net of tax | 36 | 36 | ||||
Reclassification adjustment for loss on interest rate swap | 6,695 | 6,695 | ||||
Stock-based compensation | 14,287 | 14,287 | ||||
Net activity from stock-based compensation awards | $ 6 | 8,194 | $ (2,518) | 5,682 | ||
Net activity from stock-based compensation awards (in shares) | 606 | 69 | ||||
Proceeds from stock issued under Colleague Stock Purchase Plan | (11) | $ 282 | 271 | |||
Proceeds from stock issued under Colleague Stock Purchase Plan (in shares) | (7) | |||||
Balance at the end of period at Dec. 31, 2021 | $ 817 | 542,296 | 1,964,954 | (634) | $ (1,219,543) | $ 1,287,890 |
Balance at the end of period (in shares) at Dec. 31, 2021 | 81,705 | 31,908 | 49,797 | |||
Balance at the beginning of period at Sep. 30, 2021 | $ 817 | 537,402 | 1,947,101 | (740) | $ (1,219,399) | $ 1,265,181 |
Balance at the beginning of period (in shares) at Sep. 30, 2021 | 81,656 | 31,903 | ||||
Net income (loss) | 17,853 | 17,853 | ||||
Other comprehensive loss, net of tax | 106 | 106 | ||||
Reclassification adjustment for loss on interest rate swap | 0 | |||||
Stock-based compensation | 4,381 | 4,381 | ||||
Net activity from stock-based compensation awards | 514 | $ (290) | 224 | |||
Net activity from stock-based compensation awards (in shares) | 49 | 9 | ||||
Proceeds from stock issued under Colleague Stock Purchase Plan | (1) | $ 146 | 145 | |||
Proceeds from stock issued under Colleague Stock Purchase Plan (in shares) | (4) | |||||
Balance at the end of period at Dec. 31, 2021 | $ 817 | 542,296 | 1,964,954 | (634) | $ (1,219,543) | $ 1,287,890 |
Balance at the end of period (in shares) at Dec. 31, 2021 | 81,705 | 31,908 | 49,797 | |||
Balance at the beginning of period at Jun. 30, 2022 | $ 818 | 521,848 | 2,322,810 | (960) | $ (1,339,449) | $ 1,505,067 |
Balance at the beginning of period (in shares) at Jun. 30, 2022 | 81,796 | 36,619 | 45,177 | |||
Net income (loss) | 26,336 | $ 26,336 | ||||
Other comprehensive loss, net of tax | (1,267) | (1,267) | ||||
Reclassification adjustment for loss on interest rate swap | 0 | |||||
Stock-based compensation | 8,113 | 8,113 | ||||
Net activity from stock-based compensation awards | $ 4 | 1,418 | $ (4,108) | (2,686) | ||
Net activity from stock-based compensation awards (in shares) | 360 | 103 | ||||
Proceeds from stock issued under Colleague Stock Purchase Plan | (3) | $ 324 | 321 | |||
Proceeds from stock issued under Colleague Stock Purchase Plan (in shares) | (9) | |||||
Settlement of equity forward contract | 30,000 | $ (43,162) | (13,162) | |||
Balance at the end of period at Dec. 31, 2022 | $ 822 | 561,376 | 2,349,146 | (2,227) | $ (1,386,395) | $ 1,522,722 |
Balance at the end of period (in shares) at Dec. 31, 2022 | 82,156 | 36,713 | 45,443 | |||
Balance at the beginning of period at Sep. 30, 2022 | $ 821 | 529,229 | 2,325,002 | (2,227) | $ (1,342,786) | $ 1,510,039 |
Balance at the beginning of period (in shares) at Sep. 30, 2022 | 82,099 | 36,703 | ||||
Net income (loss) | 24,144 | 24,144 | ||||
Reclassification adjustment for loss on interest rate swap | 0 | |||||
Stock-based compensation | 1,968 | 1,968 | ||||
Net activity from stock-based compensation awards | $ 1 | 180 | $ (622) | (441) | ||
Net activity from stock-based compensation awards (in shares) | 57 | 15 | ||||
Proceeds from stock issued under Colleague Stock Purchase Plan | (1) | $ 175 | 174 | |||
Proceeds from stock issued under Colleague Stock Purchase Plan (in shares) | (5) | |||||
Settlement of equity forward contract | 30,000 | $ (43,162) | (13,162) | |||
Balance at the end of period at Dec. 31, 2022 | $ 822 | $ 561,376 | $ 2,349,146 | $ (2,227) | $ (1,386,395) | $ 1,522,722 |
Balance at the end of period (in shares) at Dec. 31, 2022 | 82,156 | 36,713 | 45,443 |
Nature of Operations
Nature of Operations | 6 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | 1. Nature of Operations In this Quarterly Report on Form 10-Q, Adtalem Global Education Inc., together with its subsidiaries, is collectively referred to as “Adtalem,” “we,” “our,” “us,” or similar references. Adtalem is a national leader in post-secondary education and a leading provider of professional talent to the healthcare industry. Our schools consist of Chamberlain University (“Chamberlain”), Walden University (“Walden”), the American University of the Caribbean School of Medicine (“AUC”), Ross University School of Medicine (“RUSM”), and Ross University School of Veterinary Medicine (“RUSVM”). AUC, RUSM, and RUSVM is collectively referred to as the “medical and veterinary schools.” See Note 20 “Segment Information” for information on our reportable segments. Beginning in the second quarter of fiscal year 2022, Adtalem eliminated its Financial Services segment when the Association of Certified Anti-Money Laundering Specialists (“ACAMS”), Becker Professional Education (“Becker”), OnCourse Learning (“OCL”), and EduPristine were classified as discontinued operations and assets held for sale. In accordance with U.S. generally accepted accounting principles (“GAAP”), we have classified the ACAMS, Becker, OCL, and EduPristine entities as “Held for Sale” and “Discontinued Operations” in all periods presented as applicable. As a result, all financial results, disclosures, and discussions of continuing operations in this Quarterly Report on Form 10-Q exclude ACAMS, Becker, OCL, and EduPristine operations, unless otherwise noted. On March 10, 2022, we completed the sale of ACAMS, Becker, and OCL and on June 17, 2022, we completed the sale of EduPristine. In addition, we continue to incur costs associated with ongoing litigation and settlements related to the DeVry University divestiture, which was completed during fiscal year 2019, and are classified as expense within discontinued operations. See Note 4 “Discontinued Operations and Assets Held for Sale” for additional information. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation A full listing of our significant accounting policies is described in Note 2 “Summary of Significant Accounting Policies” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022 (“2022 Form 10-K”). We have prepared the accompanying unaudited consolidated financial statements in accordance with GAAP for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (which are normal and recurring in nature) considered necessary for a fair presentation have been included. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. These consolidated financial statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto included in our 2022 Form 10-K. We use the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations. Certain prior period amounts have been reclassified for consistency with the current period presentation. Other (expense) income, net in the Consolidated Statements of Income (Loss) consists of interest income of $2.4 million and $4.0 million in the three and six months ended December 31, 2022, respectively, interest income of $0.9 million and $1.7 million in the three and six months ended December 31, 2021, respectively, and investment impairment of $5.0 million in the three and six months ended December 31, 2022. Business acquisition and integration expense was $15.9 million and $24.4 million in the three and six months ended December 31, 2022, respectively, and $9.1 million and $35.6 million in the three and six months ended December 31, 2021, respectively. These are transaction costs associated with acquiring Walden and costs associated with integrating Walden into Adtalem. In addition, during the first quarter of fiscal year 2023, we initiated transformation initiatives to accelerate growth and organizational agility. Certain costs relating to this transformation are included in business acquisition and integration costs in the Consolidated Statements of Income (Loss). Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Although our current estimates contemplate current conditions, including, but not limited to, the impact of (i) the novel coronavirus (“COVID-19”) pandemic, (ii) rising interest rates, and (iii) labor and material cost increases and shortages, and how we anticipate them to change in the future, as appropriate, it is reasonably possible that actual conditions could differ from what was anticipated in those estimates, which could materially affect our results of operations and financial condition. On March 11, 2020, the COVID-19 outbreak was declared a pandemic by the World Health Organization, which recommended containment and mitigation measures worldwide. COVID-19 and the response of governmental and public health organizations in dealing with the pandemic included restricting general activity levels within communities, the economy, and operations of our customers. While we have experienced an impact to our business, operations, and financial results as a result of the COVID-19 pandemic, it may have even more far-reaching impacts on many aspects of our operations including the impact on customer behaviors, business operations, our employees, and the market in general. The extent to which the COVID-19 pandemic ultimately impacts our business, financial condition, results of operations, cash flows, and liquidity may differ from management’s current estimates due to inherent uncertainties regarding the duration and further spread of COVID-19, actions taken to contain the virus, the efficacy and distribution of the vaccines, as well as, how quickly and to what extent normal economic and operating conditions can resume. Recent Accounting Standards Recently adopted accounting standards In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-08: “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” The amendments require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We adopted this guidance on July 1, 2022 and will apply the guidance to any future business combinations. Recently issued accounting standards not yet adopted In March 2022, the FASB issued ASU No. 2022-02: “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.” The guidance was issued as improvements to ASU No. 2016-13. The vintage disclosure changes are relevant to Adtalem and require an entity to disclose current-period gross write-offs by year of origination for financing receivables. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The amendments should be applied prospectively. Early adoption of the amendments is permitted, including adoption in an interim period. Management expects to implement this guidance effective July 1, 2023. The amendments will impact our disclosures but will not otherwise impact Adtalem’s Consolidated Financial Statements. We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our Consolidated Financial Statements. |
Acquisitions
Acquisitions | 6 Months Ended |
Dec. 31, 2022 | |
Acquisitions [Abstract] | |
Acquisitions | 3. Acquisitions Walden University On August 12, 2021, Adtalem completed the acquisition of 100% of the equity interest of Walden for $1,488.1 million, net of cash and restricted cash of $83.4 million. Adtalem funded the purchase with the $800.0 million in Notes (as defined in Note 13 “Debt”), the $850.0 million Term Loan B (as defined in Note 13 “Debt”), and available cash on hand. Walden offers more than 100 online certificate, bachelor’s, master’s, and doctoral degrees. The acquisition furthers Adtalem’s growth strategy as a national leader in post-secondary education and leading provider of professional talent to the healthcare industry. The operations of Walden are included in Adtalem’s Walden reportable segment (see Note 20 “Segment Information”). The results of Walden’s operations have been included in the Consolidated Financial Statements of Adtalem since the date of acquisition, which included revenue of $140.6 million and $209.2 million and net loss of $1.8 million and $10.5 million from the operations of Walden for the three and six months ended December 31, 2021, respectively. In addition, we incurred acquisition-related costs of $22.3 The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in thousands): August 12, 2021 Assets acquired: Cash and cash equivalents $ 65,010 Restricted cash 18,389 Accounts receivable 22,091 Prepaid expenses and other current assets 8,819 Property and equipment 25,882 Operating lease assets 6,096 Deferred income taxes 59 Intangible assets 833,351 Goodwill 651,052 Other assets, net 21,316 Total assets acquired 1,652,065 Liabilities assumed: Accounts payable 31,971 Accrued payroll and benefits 25,639 Accrued liabilities 1,620 Deferred revenue 10,958 Current operating lease liabilities 1,983 Long-term operating lease liabilities 4,343 Other liabilities 4,098 Total liabilities assumed 80,612 Net assets acquired $ 1,571,453 The fair value of the assets acquired includes accounts receivable of $22.1 million. The gross amount due under contracts is $37.9 million, of which $15.8 million was expected to be uncollectible. Goodwill, which represents the excess of the purchase price over the fair value of the net assets acquired, was all assigned to the Walden reporting unit and reportable segment. The entire goodwill amount is tax deductible. Factors that contributed to a purchase price resulting in the recognition of goodwill includes Walden’s strategic fit into Adtalem’s healthcare educator strategy, the reputation of the Walden brand as a leader in online education industry, and potential future growth opportunity. Of the $833.4 million of acquired intangible assets, $495.8 million was assigned to Title IV eligibility and accreditations and $119.6 million was assigned to trade names, each of which has been determined not to be subject to amortization. The values and estimated useful lives of other intangible assets acquired are as follows (in thousands): August 12, 2021 Value Estimated Assigned Useful Life Student relationships $ 161,900 3 years Curriculum $ 56,091 5 years The Title IV eligibility and accreditations intangible asset was valued using the with and without method of the income approach. The student relationships intangible asset was valued using the multi-period excess earnings method. The trade name intangible asset was valued using the relief-from-royalty method. The curriculum intangible asset was valued using the cost to replace method. Significant judgments and assumptions were used in these valuations. We applied judgment which involved the use of significant assumptions with respect to the discount rate and recovery period for the Title IV eligibility and accreditations intangible asset and royalty rate and discount rate for the trade name intangible asset. We also applied judgment which involved the use of assumptions, including the discount rate and EBITDA margin for the student relationships intangible asset and labor rates and hours and obsolescence rate for the curriculum intangible asset. The following unaudited pro forma financial information summarizes our results of operations as though the acquisition occurred on July 1, 2020 (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2021 2021 Revenue $ 371,198 $ 729,507 Net income $ 29,535 $ 14,842 The unaudited pro forma financial information includes adjustments to reflect the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied from July 1, 2020, with the consequential tax effects. The unaudited pro forma financial information also includes adjustments to reflect the additional interest expense on the debt we issued to fund the acquisition (see Note 13 “Debt” for additional information). As the ticking fees are representative of the historical interest expense incurred by Adtalem on the Term Loan B from the period of February 12, 2021 to August 12, 2021 and the unaudited pro forma financial information for fiscal year 2021 has been adjusted to include interest expense assuming the Term Loan B had been entered into as of July 1, 2020, we have made a further adjustment to remove the ticking fees recognized in the unaudited pro forma financial information for the six months ended December 31, 2021 (see Note 13 “Debt” for additional information on ticking fees). Had the Term Loan B been drawn upon on July 1, 2020, none of the ticking fees would have been incurred and, accordingly, the inclusion of such amounts would be duplicative to the interest expense incurred by Adtalem on a pro forma basis. The acquisition transaction costs we incurred in connection with the Walden acquisition are reflected in the unaudited pro forma financial information results for fiscal year 2021. This unaudited pro forma financial information is for informational purposes only. It does not reflect the integration of the business or any synergies that may result from the acquisition. As such, it is not indicative of the results of operations that would have been achieved had the acquisition been consummated on July 1, 2020. In addition, the unaudited pro forma financial information amounts are not indicative of future operating results. |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale | 6 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations and Assets Held for Sale | 4. Discontinued Operations and Assets Held for Sale On December 11, 2018, Adtalem completed the sale of DeVry University to Cogswell Education, LLC (“Cogswell”) for de minimis consideration. As the sale represented a strategic shift that had a major effect on Adtalem’s operations and financial results, DeVry University is presented in Adtalem’s Consolidated Financial Statements as a discontinued operation. The purchase agreement includes an earn-out entitling Adtalem to payments of up to $20.0 million over a ten-year period payable based on DeVry University’s free cash flow. Adtalem received $4.1 million and $2.9 million during the second quarter of fiscal year 2023 and the second quarter of fiscal year 2022, respectively, related to the earn-out, resulting in a total of $7.0 million being received thus far. In connection with the closing of the sale, Adtalem loaned to DeVry University $10.0 million under the terms of the promissory note, dated as of December 11, 2018 (the “ DeVry Note”). The DeVry Note bore interest at a rate of 4% per annum, payable annually in arrears, and had a maturity date of January 1, 2022. We received the loan repayment of $10.0 million during the third quarter of fiscal year 2022. The DeVry Note is included on the Consolidated Balance Sheets in prepaid expenses and other current assets as of December 31, 2021. Adtalem has retained certain leases associated with DeVry University operations. Adtalem remains the primary lessee on these leases and subleases to DeVry University. In addition, Adtalem owns the buildings for certain DeVry University operating and administrative office locations and leases space to DeVry University under one-year operating leases, renewable annually at DeVry University’s option with the exception of one lease which expires in December 2023. Adtalem records the proceeds from these leases and subleases as an offset to operating costs. Adtalem also assigned certain leases to DeVry University but remains contingently liable under these leases. On March 10, 2022, Adtalem completed the sale of ACAMS, Becker, and OCL to Wendel Group and Colibri Group (“Purchaser”), pursuant to the Equity Purchase Agreement (“Purchase Agreement”) dated January 24, 2022. Pursuant to the terms and subject to the conditions set forth in the Purchase Agreement, Adtalem sold the issued and outstanding shares of ACAMS, Becker, and OCL to the Purchaser for $962.7 million, net of cash of $21.5 million, subject to certain post-closing adjustments. In addition, on June 17, 2022, Adtalem completed the sale of EduPristine for de minimis consideration, which resulted in a transfer of $1.9 million in cash. We recorded a gain of $0.2 million and a loss of $3.2 million in the three and six months ended December 31, 2022, respectively, for post-closing working capital adjustments to the initial sales price for ACAMS, Becker, and OCL, which is included in gain (loss) on disposal of discontinued operations before income taxes in the Consolidated Statements of Income (Loss). These divestitures are the culmination of a long-term strategy to sharpen the focus of our portfolio and enhance our ability to address the rapidly growing and unmet demand for healthcare professionals in the U.S. As these sales represented a strategic shift that had a major effect on Adtalem’s operations and financial results, these businesses previously included in our former Financial Services segment are presented in Adtalem’s Consolidated Financial Statements as discontinued operations. In accordance with GAAP, we have classified ACAMS, Becker, OCL, and EduPristine entities as “Held for Sale” and “Discontinued Operations” in all periods presented as applicable. The following is a summary of balance sheet information of assets and liabilities reported as held for sale as of December 31, 2021, which includes ACAMS, Becker, OCL, and EduPristine (in thousands): December 31, 2021 Assets: Current assets: Cash and cash equivalents $ 48,450 Accounts receivable, net 21,960 Prepaid expenses and other current assets 3,987 Total current assets held for sale 74,397 Noncurrent assets: Property and equipment, net 14,065 Operating lease assets 1,172 Intangible assets, net 133,777 Goodwill 376,165 Other assets, net 4,149 Total noncurrent assets held for sale 529,328 Total assets held for sale $ 603,725 Liabilities: Current liabilities: Accounts payable $ 14,242 Accrued payroll and benefits 7,551 Accrued liabilities 3,752 Deferred revenue 31,017 Current operating lease liabilities 1,128 Total current liabilities held for sale 57,690 Noncurrent liabilities: Long-term operating lease liabilities 342 Deferred income taxes 30,827 Other liabilities 917 Total noncurrent liabilities held for sale 32,086 Total liabilities held for sale $ 89,776 The following is a summary of income statement information of operations reported as discontinued operations, which includes ACAMS, Becker, OCL, and EduPristine operations through the date of each respective sale, a gain (loss) from post-closing working capital adjustments, and activity related to the DeVry University divestiture, which includes litigation and settlement costs we continue to incur and the earn-outs we received (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue $ — $ 53,082 $ — $ 112,339 Operating cost and expense: Cost of educational services — 8,914 — 19,974 Student services and administrative expense (524) 39,060 2,914 93,307 Restructuring expense — 949 — 949 Total operating cost and expense (524) 48,923 2,914 114,230 Income (loss) from discontinued operations before income taxes 524 4,159 (2,914) (1,891) Gain (loss) on disposal of discontinued operations before income taxes 185 — (3,174) — (Provision for) benefit from income taxes (182) (25,340) 2,961 (112) Income (loss) from discontinued operations $ 527 $ (21,181) $ (3,127) $ (2,003) |
Revenue
Revenue | 6 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 5. Revenue Revenue is recognized when control of the promised goods or services is transferred to our customers (students), in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The following tables disaggregate revenue by source (in thousands): Three Months Ended December 31, 2022 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 141,396 $ 131,940 $ 87,197 $ 360,533 Other — — 2,769 2,769 Total $ 141,396 $ 131,940 $ 89,966 $ 363,302 Six Months Ended December 31, 2022 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 276,801 $ 262,841 $ 172,711 $ 712,353 Other — — 5,508 5,508 Total $ 276,801 $ 262,841 $ 178,219 $ 717,861 Three Months Ended December 31, 2021 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 139,121 $ 140,627 $ 88,500 $ 368,248 Other — — 2,950 2,950 Total $ 139,121 $ 140,627 $ 91,450 $ 371,198 Six Months Ended December 31, 2021 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 274,760 $ 209,244 $ 170,975 $ 654,979 Other — — 5,289 5,289 Total $ 274,760 $ 209,244 $ 176,264 $ 660,268 In addition, see Note 20 “Segment Information” for a disaggregation of revenue by geographical region. Performance Obligations and Revenue Recognition Tuition and fees Other Arrangements for payment are agreed to prior to registration of the student’s first academic term. The majority of U.S. students obtain Title IV or other financial aid resulting in institutions receiving a significant amount of the transaction price at the beginning of the academic term. Students not utilizing Title IV or other financial aid funding may pay after the academic term is complete. Transaction Price Revenue, or transaction price, is measured as the amount of consideration expected to be received in exchange for transferring goods or services. Students may receive discounts, scholarships, or refunds, which gives rise to variable consideration. The amounts of discounts or scholarships are applied to individual student accounts when such amounts are awarded. Therefore, the transaction price is reduced directly by these discounts or scholarships from the amount of the standard tuition rate charged. Upon withdrawal, a student may be eligible to receive a refund, or partial refund, the amount of which is dependent on the timing of the withdrawal during the academic term. If a student withdraws prior to completing an academic term, federal and state regulations and accreditation criteria permit Adtalem to retain only a set percentage of the total tuition received from such student, which varies with, but generally equals or exceeds, the percentage of the academic term completed by such student. Payment amounts received by Adtalem in excess of such set percentages of tuition are refunded to the student or the appropriate funding source. For contracts with similar characteristics and historical data on refunds, the expected value method is applied in determining the variable consideration related to refunds. Estimates of Adtalem’s expected refunds are determined at the outset of each academic term, based upon actual refunds in previous academic terms. Reserves related to refunds are presented as refund liabilities within accrued liabilities on the Consolidated Balance Sheets. All refunds are netted against revenue during the applicable academic term. Management reassesses collectability on a student-by-student basis throughout the period revenue is recognized. This reassessment is based upon new information and changes in facts and circumstances relevant to a student’s ability to pay. Management also reassesses collectability when a student withdraws from the institution and has unpaid tuition charges. Such unpaid charges do not meet the threshold of reasonably collectible and are recognized as revenue on a cash basis. We believe it is probable that no significant reversal will occur in the amount of cumulative revenue recognized when the uncertainty associated with the variable consideration is subsequently resolved. Therefore, the estimate of variable consideration is not constrained. Contract Balances Students are billed at the beginning of each academic term and payment is due at that time. Adtalem’s performance obligation is to provide educational services in the form of instruction during the academic term. As instruction is provided, deferred revenue is reduced. A significant portion of student payments are from Title IV financial aid and other programs and are generally received during the first month of the respective academic term. For students utilizing Adtalem’s credit extension programs (see Note 9 “Accounts Receivable and Credit Losses”), payments are generally received after the academic term, and the corresponding performance obligation, is complete. When payments are received, accounts receivable is reduced. Revenue of $0.7 million and $141.4 million was recognized during the second quarter and first six months of fiscal year 2023, respectively, that was included in the deferred revenue balance at the beginning of fiscal year 2023. No revenue was recognized during the second quarter of fiscal year 2022 and $68.8 million of revenue was recognized in the first six months of fiscal year 2022, that was included in the deferred revenue balance at the beginning of fiscal year 2022. Revenue recognized from performance obligations that were satisfied or partially satisfied in prior periods was not material. The difference between the opening and closing balances of deferred revenue includes decreases from revenue recognized during the period, increases from charges related to the start of academic terms beginning during the period, and increases from payments received related to academic terms commencing after the end of the reporting period. In addition, for fiscal year 2022, the difference between the opening and closing balances of deferred revenue included an increase from the Walden acquisition. Practical Expedients As our performance obligations have an original expected duration of one year or less, we have applied the practical expedient |
Restructuring Charges
Restructuring Charges | 6 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | 6. Restructuring Charges During the second quarter and first six months of fiscal year 2023, Adtalem recorded restructuring charges primarily driven by real estate consolidations at Walden, Medical and Veterinary, and Adtalem’s home office resulting in impairments on operating lease assets and property and equipment. During the second quarter and first six months ended of fiscal year 2022, Adtalem recorded restructuring charges primarily driven by workforce reductions and contract terminations related to synergy actions with regards to the Walden acquisition and Adtalem’s home office real estate consolidations. When estimating costs of exiting lease space, estimates are made which could differ materially from actual results and may result in additional restructuring charges or reversals in future periods. Termination benefit charges represent severance pay and benefits for employees impacted by workforce reductions. Adtalem’s home office is classified as “Home Office and Other” in Note 20 “Segment Information.” Pre-tax restructuring charges by segment were as follows (in thousands): Three Months Ended December 31, 2022 Six Months Ended December 31, 2022 Real Estate and Other Termination Benefits Total Real Estate and Other Termination Benefits Total Chamberlain $ — $ — $ — $ 818 $ — $ 818 Walden 41 — 41 3,067 54 3,121 Medical and Veterinary 87 — 87 6,913 — 6,913 Home Office and Other 557 678 1,235 4,626 950 5,576 Total $ 685 $ 678 $ 1,363 $ 15,424 $ 1,004 $ 16,428 Three Months Ended December 31, 2021 Six Months Ended December 31, 2021 Real Estate and Other Termination Benefits Total Real Estate and Other Termination Benefits Total Chamberlain $ 263 $ 72 $ 335 $ 263 $ 72 $ 335 Walden — 1,791 1,791 — 1,791 1,791 Medical and Veterinary 62 126 188 62 126 188 Home Office and Other 657 416 1,073 1,646 2,521 4,167 Total $ 982 $ 2,405 $ 3,387 $ 1,971 $ 4,510 $ 6,481 The following table summarizes the separation and restructuring plan activity for fiscal years 2022 and 2023, for which cash payments are required (in thousands): Liability balance as of June 30, 2021 $ — Increase in liability (separation and other charges) 11,851 Reduction in liability (payments and adjustments) (11,038) Liability balance as of June 30, 2022 813 Increase in liability (separation and other charges) 1,004 Reduction in liability (payments and adjustments) (616) Liability balance as of December 31, 2022 $ 1,201 The liability balance of $1.2 million is recorded as accrued liabilities on the Consolidated Balance Sheets as of December 31, 2022. We continue to incur restructuring charges or reversals related to exiting leased space from previous restructuring activities. |
Income Taxes
Income Taxes | 6 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes Our income tax provisions from continuing operations were $4.2 million and $5.3 million in the three and six months ended December 31, 2022, respectively, and our income tax benefits from continuing operations were $39.4 million and $30.8 million in the three and six months ended December 31, 2021, respectively. The three and six months ended December 31, 2022 resulted in income tax provisions compared to income tax benefits in the year-ago periods primarily due to the impacts recognized in the year-ago periods related to the Walden acquisition. The income tax expenses reflect the U.S. federal tax rate of 21% adjusted for taxes related to global intangible low-taxed income (“GILTI”), state and local taxes, benefits of the foreign rate differences, and benefits associated with local tax incentives. Three of Adtalem’s businesses benefit from local tax incentives: AUC, which operates in St. Maarten, RUSM, which operates in Barbados, and RUSVM, which operates in St. Kitts. AUC’s effective tax rate reflects benefits derived from investment incentives. RUSM and RUSVM each have agreements with their respective domestic governments that exempt them from local income taxation. RUSM has an exemption in Barbados until 2039. RUSVM has an exemption in St. Kitts until 2037. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Dec. 31, 2022 | |
Earnings per Share | |
Earnings per Share | 8. Earnings per Share As a result of incurring a net loss from continuing operations for the six months ended December 31, 2021, potential common stock of 447 thousand shares were excluded from diluted loss per share because the effect would have been antidilutive. As further described in Note 15 “Share Repurchases,” on March 14, 2022, we entered into an accelerated share repurchase (“ASR”) agreement to repurchase $150.0 million of common stock. For purposes of calculating earnings per share for the periods presented, Adtalem reflected the ASR agreement as a repurchase of Adtalem common stock and as a forward contract indexed to its own common stock. Based on the volume-weighted average price of Adtalem’s common stock per the terms of the ASR agreement, common stock of 153 thousand shares were contingently issuable by Adtalem under the ASR agreement and were included in the diluted earnings per share calculation for the six months ended December 31, 2022 because the effect would have been dilutive. As of December 31, 2022 no shares were contingently issuable under the ASR agreement. Certain shares related to stock awards were excluded from the computation of earnings per share because the effect would have been antidilutive. The following table sets forth the computations of basic and diluted earnings per share and antidilutive shares (in thousands, except per share data): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Numerator: Net income (loss): Continuing operations $ 23,617 $ 39,034 $ 29,463 $ (38,148) Discontinued operations 527 (21,181) (3,127) (2,003) Net income (loss) $ 24,144 $ 17,853 $ 26,336 $ (40,151) Denominator: Weighted-average basic shares outstanding 45,425 49,776 45,350 49,719 Effect of dilutive stock awards 696 461 729 — Effect of ASR — — 153 — Weighted-average diluted shares outstanding 46,121 50,237 46,232 49,719 Earnings (loss) per share: Basic: Continuing operations $ 0.52 $ 0.78 $ 0.65 $ (0.77) Discontinued operations $ 0.01 $ (0.43) $ (0.07) $ (0.04) Total basic earnings (loss) per share $ 0.53 $ 0.36 $ 0.58 $ (0.81) Diluted: Continuing operations $ 0.51 $ 0.78 $ 0.64 $ (0.77) Discontinued operations $ 0.01 $ (0.42) $ (0.07) $ (0.04) Total diluted earnings (loss) per share $ 0.52 $ 0.36 $ 0.57 $ (0.81) Weighted-average antidilutive shares 365 1,336 421 1,254 |
Accounts Receivable and Credit
Accounts Receivable and Credit Losses | 6 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable and Credit Losses | 9. Accounts Receivable and Credit Losses We categorize our accounts receivable balances as trade receivables or financing receivables. Our trade receivables relate to student balances occurring in the normal course of business. Trade receivables have a term of less than one year and are included in accounts receivable, net on our Consolidated Balance Sheets. Our financing receivables relate to credit extension programs where the student is provided payment terms in excess of one year with their respective school and are included in accounts receivable, net and other assets, net on our Consolidated Balance Sheets. The classification of our accounts receivable balances was as follows (in thousands): December 31, 2022 Gross Allowance Net Trade receivables, current $ 124,433 $ (27,516) $ 96,917 Financing receivables, current 6,060 (3,435) 2,625 Accounts receivable, current $ 130,493 $ (30,951) $ 99,542 Financing receivables, current $ 6,060 $ (3,435) $ 2,625 Financing receivables, noncurrent 39,043 (12,610) 26,433 Total financing receivables $ 45,103 $ (16,045) $ 29,058 June 30, 2022 Gross Allowance Net Trade receivables, current $ 109,882 $ (30,897) $ 78,985 Financing receivables, current 6,116 (3,466) 2,650 Accounts receivable, current $ 115,998 $ (34,363) $ 81,635 Financing receivables, current $ 6,116 $ (3,466) $ 2,650 Financing receivables, noncurrent 36,265 (11,425) 24,840 Total financing receivables $ 42,381 $ (14,891) $ 27,490 December 31, 2021 Gross Allowance Net Trade receivables, current $ 111,538 $ (21,335) $ 90,203 Financing receivables, current 7,252 (4,711) 2,541 Accounts receivable, current $ 118,790 $ (26,046) $ 92,744 Financing receivables, current $ 7,252 $ (4,711) $ 2,541 Financing receivables, noncurrent 39,534 (12,999) 26,535 Total financing receivables $ 46,786 $ (17,710) $ 29,076 Our financing receivables relate to credit extension programs available to students at Chamberlain, AUC, RUSM, and RUSVM. These credit extension programs are designed to assist students who are unable to completely cover educational costs consisting of tuition, fees, and books, and are available only after all other student financial assistance has been applied toward those purposes. In addition, AUC, RUSM, and RUSVM allow students to finance their living expenses. Repayment plans for financing agreements are developed to address the financial circumstances of the particular student. Interest charges at rates from 3.0% to 12.0% per annum accrue each month on the unpaid balance once a student withdraws or graduates from a program. Most students are required to begin repaying their loans while they are still in school with a minimum payment level designed to demonstrate their capability to repay, which reduces the possibility of over borrowing. Payments may increase upon completing or departing school. After a student leaves school, the student typically will have a monthly installment repayment plan. Credit Quality The primary credit quality indicator for our financing receivables is delinquency. Balances are considered delinquent when contractual payments on the loan become past due. We write-off financing receivable balances after they have been sent to a third party collector, the timing of which varies by the institution granting the loan, but in most cases is when the financing agreement is at least 181 days past due. Payments are applied first to outstanding interest and then to the unpaid principal balance. The credit quality analysis of financing receivables as of December 31, 2022 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2019 2020 2021 2022 2023 Total 1-30 days past due $ 362 $ 264 $ 141 $ 483 $ 1,183 $ 1,327 $ 3,760 31-60 days past due 78 64 — 385 316 493 1,336 61-90 days past due 144 49 37 25 756 40 1,051 91-120 days past due 58 — 37 448 207 — 750 121-150 days past due 38 122 45 301 80 — 586 Greater than 150 days past due 7,739 961 663 2,430 811 — 12,604 Total past due 8,419 1,460 923 4,072 3,353 1,860 20,087 Current 6,357 1,018 997 6,645 3,549 6,450 25,016 Financing receivables, gross $ 14,776 $ 2,478 $ 1,920 $ 10,717 $ 6,902 $ 8,310 $ 45,103 The credit quality analysis of financing receivables as of June 30, 2022 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2018 2019 2020 2021 2022 Total 1-30 days past due $ 104 $ 140 $ 114 $ 191 $ 699 $ 782 $ 2,030 31-60 days past due 278 38 214 145 691 332 1,698 61-90 days past due 58 29 217 8 668 273 1,253 91-120 days past due 97 139 113 45 670 14 1,078 121-150 days past due 17 30 20 41 206 81 395 Greater than 150 days past due 6,978 876 1,077 683 1,596 377 11,587 Total past due 7,532 1,252 1,755 1,113 4,530 1,859 18,041 Current 4,687 2,229 1,483 1,167 8,910 5,864 24,340 Financing receivables, gross $ 12,219 $ 3,481 $ 3,238 $ 2,280 $ 13,440 $ 7,723 $ 42,381 The credit quality analysis of financing receivables as of December 31, 2021 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2018 2019 2020 2021 2022 Total 1-30 days past due $ 306 $ 118 $ 240 $ 30 $ 1,222 $ 370 $ 2,286 31-60 days past due 46 219 5 117 434 310 1,131 61-90 days past due 64 290 39 11 560 27 991 91-120 days past due — 28 18 152 372 — 570 121-150 days past due 587 13 155 — 328 102 1,185 Greater than 150 days past due 8,885 1,755 1,242 879 1,594 — 14,355 Total past due 9,888 2,423 1,699 1,189 4,510 809 20,518 Current 6,053 2,454 1,933 1,384 11,160 3,284 26,268 Financing receivables, gross $ 15,941 $ 4,877 $ 3,632 $ 2,573 $ 15,670 $ 4,093 $ 46,786 Allowance for Credit Losses The allowance for credit losses represents an estimate of the lifetime expected credit losses inherent in our accounts receivable balances as of each balance sheet date. In evaluating the collectability of all our accounts receivable balances, we utilize historical events, current conditions, and reasonable and supportable forecasts about the future. For our trade receivables, we primarily use historical loss rates based on an aging schedule and a student’s status to determine the allowance for credit losses. As these trade receivables are short-term in nature, management believes a student’s status provides the best credit loss estimate, while also factoring in delinquency. Students still attending classes, recently graduated, or current on payments are more likely to pay than those who are inactive due to being on a leave of absence, withdrawing from school, or not current on payments. For our financing receivables, we primarily use historical loss rates based on an aging schedule. As these financing receivables are based on long-term financing agreements offered by Adtalem, management believes that delinquency provides the best credit loss estimate. As the financing receivable balances become further past due, it is less likely we will receive payment, causing our estimate of credit losses to increase. The following tables provide a rollforward of the allowance for credit losses (in thousands): Three Months Ended December 31, 2022 Six Months Ended December 31, 2022 Trade Financing Total Trade Financing Total Beginning balance $ 32,882 $ 15,624 $ 48,506 $ 30,897 $ 14,891 $ 45,788 Write-offs (14,712) (397) (15,109) (20,176) (616) (20,792) Recoveries 1,848 32 1,880 4,256 34 4,290 Provision for credit losses 7,498 786 8,284 12,539 1,736 14,275 Ending balance $ 27,516 $ 16,045 $ 43,561 $ 27,516 $ 16,045 $ 43,561 Three Months Ended December 31, 2021 Six Months Ended December 31, 2021 Trade Financing Total Trade Financing Total Beginning balance $ 16,497 $ 17,064 $ 33,561 $ 11,559 $ 16,832 $ 28,391 Write-offs (2,816) (209) (3,025) (4,548) (746) (5,294) Recoveries 2,104 17 2,121 3,354 17 3,371 Provision for credit losses 5,550 838 6,388 10,970 1,607 12,577 Ending balance $ 21,335 $ 17,710 $ 39,045 $ 21,335 $ 17,710 $ 39,045 Allowance for bad debts on short-term and long-term receivables as of December 31, 2022, June 30, 2022, and December 31, 2021 was $43.6 million, $45.8 million, and $39.0 million, respectively. Other Financing Receivables In connection with the sale of DeVry University, Adtalem loaned $10.0 million to DeVry University under the terms of the DeVry Note. The DeVry Note bore interest at a rate of 4% per annum, payable annually in arrears, and had a maturity date of January 1, 2022. We received the loan payment of $10.0 million during the third quarter of fiscal year 2022. The DeVry Note is included on the Consolidated Balance Sheets in prepaid expenses and other current assets as of December 31, 2021. On July 31, 2019, Adtalem sold its Chicago, Illinois, campus facility to DePaul College Prep Foundation (“DePaul College Prep”). In connection with the sale, Adtalem holds a mortgage from DePaul College Prep for $46.8 million. The mortgage is due on July 31, 2024 as a balloon payment and bears interest at a rate of 4% per annum, payable monthly. The carrying value of the DePaul College Prep loan receivable is included in other assets, net on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021 is $44.6 million, $44.0 million, and $43.3 million, respectively, and is determined by discounting the future cash flows using an average of current rates for similar arrangements, which is estimated at 7% per annum. Management has evaluated the collectability of this note and has determined no reserve is necessary. |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Dec. 31, 2022 | |
Property, Plant And Equipment [Abstract] | |
Property and Equipment, Net | 10. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, June 30, December 31, 2022 2022 2021 Land $ 44,476 $ 44,478 $ 44,478 Building 333,024 342,236 337,721 Equipment 232,114 268,352 268,783 Construction in progress 11,885 11,188 12,337 Property and equipment, gross 621,499 666,254 663,319 Accumulated depreciation (345,882) (376,328) (361,653) Property and equipment, net $ 275,617 $ 289,926 $ 301,666 On July 31, 2019, Adtalem sold its Chicago, Illinois, campus facility to DePaul College Prep for $52.0 million. Adtalem received $5.2 million of cash at the time of closing and holds a mortgage, secured by the property, from DePaul College Prep for $46.8 million. The mortgage is due on July 31, 2024 as a balloon payment and bears interest at a rate of 4% per annum, payable monthly. The buyer has an option to make prepayments. Due to Adtalem’s involvement with financing the sale, the transaction did not qualify as a sale for accounting purposes. Adtalem continues to maintain the assets associated with the sale on the Consolidated Balance Sheets. We recorded a note receivable of $40.3 million and a financing payable of $45.5 million at the time of the sale, which were classified as other assets, net and other liabilities, respectively, on the Consolidated Balance Sheets. See Note 9 “Accounts Receivable and Credit Losses” for a discussion on the discounting of the note receivable. |
Leases
Leases | 6 Months Ended |
Dec. 31, 2022 | |
Lessee Disclosure [Abstract] | |
Leases | 11. Leases We determine if a contract contains a lease at inception. We have entered into operating leases for academic sites, housing facilities, and office space which expire at various dates through December 2034, most of which include options to terminate for a fee or extend the leases for an additional five-year period. The lease term includes the noncancelable period of the lease, as well as any periods for which we are reasonably certain to exercise extension options. We elected to account for lease and non-lease components (e.g., common-area maintenance costs) as a single lease component for all operating leases. Leases with an initial term of 12 months or less are not recorded on the Consolidated Balance Sheets. We have not entered into any financing leases. Operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets represent our right to use an underlying asset during the lease term. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. Operating lease assets are adjusted for any prepaid or accrued lease payments, lease incentives, initial direct costs, and impairments. Our incremental borrowing rate is utilized in determining the present value of the lease payments based upon the information available at the commencement date. Our incremental borrowing rate is determined using a secured borrowing rate for the same currency and term as the associated lease. Operating lease expense is recognized on a straight-line basis over the lease term. As of December 31, 2022, we entered into two additional operating leases that have not yet commenced. One lease is expected to commence during the third quarter of fiscal year 2023, has a 10-year lease term, and will result in an additional operating lease asset asset The components of lease cost were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Operating lease cost $ 11,595 $ 14,362 $ 23,970 $ 28,587 Sublease income (3,516) (3,494) (7,086) (6,832) Total lease cost $ 8,079 $ 10,868 $ 16,884 $ 21,755 Maturities of lease liabilities by fiscal year as of December 31, 2022 were as follows (in thousands): Operating Fiscal Year Leases 2023 (remaining) $ 30,312 2024 55,548 2025 45,078 2026 32,245 2027 29,769 Thereafter 63,355 Total lease payments 256,307 Less: imputed interest (41,366) Present value of lease liabilities $ 214,941 Lease term and discount rate were as follows: December 31, 2022 Weighted-average remaining operating lease term (years) 5.7 Weighted-average operating lease discount rate 5.8% Supplemental disclosures of cash flow information related to leases were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Cash paid for amounts in the measurement of operating lease liabilities (net of sublease receipts) $ 12,390 $ 13,525 $ 24,818 $ 26,728 Operating lease assets obtained in exchange for operating lease liabilities $ 13,038 $ 205 $ 13,038 $ 6,316 Adtalem maintains agreements to lease either a portion or the full space of two facilities owned by Adtalem to DeVry University with various expiration dates through December 2023. Adtalem maintains agreements to sublease either a portion or the full leased space at 10 of its operating lease locations. Most of these subleases are a result of Adtalem retaining leases associated with restructured lease activities at DeVry University and Carrington College prior to their divestitures during fiscal year 2019. All sublease expirations with DeVry University and Carrington College coincide with Adtalem’s original head lease expiration dates. At that time, Adtalem will be relieved of its obligations. In addition, Adtalem has entered into subleases with non-affiliated entities for vacated or partially vacated space from restructuring activities. Adtalem’s sublease agreements expire at various dates through December 2025. We record sublease income as an offset against our lease expense recorded on the head lease. For leases which Adtalem vacated or partially vacated space, we recorded estimated restructuring charges in prior periods. Actual results may differ from these estimates, which could result in additional restructuring charges or reversals in future periods. Future minimum lease and sublease rental income under these agreements as of December 31, 2022, were as follows (in thousands): Fiscal Year Amount 2023 (remaining) $ 7,920 2024 10,261 2025 5,121 2026 2,038 Total lease and sublease rental income $ 25,340 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 12. Goodwill and Intangible Assets The table below summarizes goodwill balances by reporting unit (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 4,716 $ 4,716 $ 4,716 Walden 651,052 651,052 649,848 AUC 68,321 68,321 68,321 RUSM and RUSVM 237,173 237,173 237,173 Total $ 961,262 $ 961,262 $ 960,058 The table below summarizes goodwill balances by reportable segment (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 4,716 $ 4,716 $ 4,716 Walden 651,052 651,052 649,848 Medical and Veterinary 305,494 305,494 305,494 Total $ 961,262 $ 961,262 $ 960,058 The table below summarizes the changes in goodwill balances by reportable segment (in thousands): Medical and Chamberlain Walden Veterinary Total June 30, 2021 $ 4,716 $ — $ 305,494 $ 310,210 Acquisition — 649,848 — 649,848 December 31, 2021 4,716 649,848 305,494 960,058 Purchase accounting adjustments — 1,204 — 1,204 June 30, 2022 4,716 651,052 305,494 961,262 December 31, 2022 $ 4,716 $ 651,052 $ 305,494 $ 961,262 Amortizable intangible assets consisted of the following (in thousands): December 31, 2022 June 30, 2022 December 31, 2021 Gross Carrying Accumulated Gross Carrying Accumulated Gross Carrying Accumulated Weighted-Average Amount Amortization Amount Amortization Amount Amortization Amortization Period Student relationships $ 161,900 $ (116,551) $ 161,900 $ (87,457) $ 161,900 $ (42,943) 3 Years Curriculum 56,091 (15,427) 56,091 (9,817) 56,091 (4,207) 5 Years Total $ 217,991 $ (131,978) $ 217,991 $ (97,274) $ 217,991 $ (47,150) Indefinite-lived intangible assets consisted of the following (in thousands): December 31, June 30, December 31, 2022 2022 2021 Walden trade name $ 119,560 $ 119,560 $ 119,560 AUC trade name 17,100 17,100 17,100 Ross trade name 5,100 5,100 5,100 Chamberlain Title IV eligibility and accreditations 1,200 1,200 1,200 Walden Title IV eligibility and accreditations 495,800 495,800 495,800 AUC Title IV eligibility and accreditations 100,000 100,000 100,000 Ross Title IV eligibility and accreditations 14,100 14,100 14,100 Total $ 752,860 $ 752,860 $ 752,860 The table below summarizes the indefinite-lived intangible asset balances by reportable segment (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 1,200 $ 1,200 $ 1,200 Walden 615,360 615,360 615,360 Medical and Veterinary 136,300 136,300 136,300 Total $ 752,860 $ 752,860 $ 752,860 Amortization expense for amortized intangible assets was $16.2 million and $34.7 million in the three and six months ended December 31, 2022, respectively, and $30.7 million and $47.2 million in the three and six months ended December 31, 2021, respectively. Future intangible asset amortization expense, by reporting unit, is expected to be as follows (in thousands): Fiscal Year Walden 2023 (remaining) $ 26,535 2024 35,644 2025 11,220 2026 11,220 2027 1,394 Total $ 86,013 Curriculum is amortized on a straight-line basis. Student relationships is amortized based on the estimated retention of the students and giving consideration to the revenue and cash flow associated with these existing students. Indefinite-lived intangible assets related to trade names and Title IV eligibility and accreditations are not amortized, as there are no legal, regulatory, contractual, economic or other factors that limit the useful life of these intangible assets to the reporting entity. Goodwill and indefinite-lived intangibles are not amortized, but are tested for impairment annually and when an event occurs or circumstances change such that it is more likely than not that an impairment may exist. Our annual testing date is May 31. Adtalem has four reporting units that contain goodwill. These reporting units constitute components for which discrete financial information is available and regularly reviewed by segment management. If the carrying amount of a reporting unit containing the goodwill exceeds the fair value of that reporting unit, an impairment loss is recognized to the extent the fair value of the reporting unit goodwill is less than the carrying amount of the goodwill, up to the amount of goodwill recorded. In analyzing the results of operations and business conditions of all four reporting units, it was determined that no triggering event had occurred that would indicate the carrying value of a reporting unit had exceeded its fair value as of December 31, 2022. Adtalem has four reporting units that contain indefinite-lived intangible assets. For indefinite-lived intangible assets, management first analyzes qualitative factors, including results of operations and business conditions of the four reporting units that contain indefinite-lived intangible assets, significant changes in cash flows at the individual indefinite-lived intangible asset level, if applicable, as well as how much previously calculated fair values exceed carrying values to determine if it is more likely than not that the intangible assets associated with these reporting units have been impaired. In qualitatively assessing the indefinite-lived intangible assets of the four reporting units, it was determined that it was more likely than not that these assets’ fair values exceeded their carrying values as of December 31, 2022. These interim triggering event conclusions were based on the fact that the annual impairment review of Adtalem’s reporting units and indefinite-lived intangible assets resulted in no impairments as of the end of fiscal year 2022, and that no interim events or deviations from planned operating results occurred as of December 31, 2022 that would cause management to reassess these conclusions. The recent increase in interest rates has not resulted in a significant enough change to the discount rate used to value Adtalem’s reporting units and indefinite-lived intangible assets that would result in a triggering event based on how much previously calculated fair values exceed carrying values. We have not yet experienced significant inflationary pressures on wages or other costs of delivering our educational services, so no significant decreases in long-term cash flow projections are anticipated based on these factors. Should inflation persist in the overall economy, cost increases could affect our projections in the future to the point where a triggering event would exist and require reassessment of the fair values of goodwill and intangible assets and potential impairments. Although the COVID-19 pandemic is expected to have a negative effect on the operating results of all four reporting units that contain goodwill and indefinite-lived intangible assets, at this time none of the effects are considered significant enough to create a triggering event. The effects are currently projected to be short-term and would not significantly decrease long-term cash flow projections; however, should economic conditions continue to deteriorate, the revenue and operating results could also deteriorate to the point where a triggering event would exist and require reassessment of the fair values of goodwill and intangible assets and potential impairments. Determining the fair value of a reporting unit or an intangible asset involves the use of significant estimates and assumptions. Management bases its fair value estimates on assumptions it believes to be reasonable at the time, but such assumptions are subject to inherent uncertainty. Actual results may differ from those estimates, which could lead to future impairments of goodwill or intangible assets. |
Debt
Debt | 6 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | 13. Debt Long-term debt consisted of the following senior secured credit facilities (in thousands): December 31, June 30, December 31, 2022 2022 2021 Total debt: Senior Secured Notes due 2028 $ 404,950 $ 405,882 $ 800,000 Term Loan B 303,333 453,333 850,000 Total principal payments due 708,283 859,215 1,650,000 Unamortized debt discount and issuance costs (14,502) (20,307) (41,962) Total amount outstanding 693,781 838,908 1,608,038 Less current portion: Term Loan B — — (8,500) Noncurrent portion $ 693,781 $ 838,908 $ 1,599,538 Scheduled future maturities of long-term debt were as follows (in thousands): Maturity Fiscal Year Payments 2023 (remaining) $ — 2024 — 2025 — 2026 — 2027 — Thereafter 708,283 Total $ 708,283 Senior Secured Notes due 2028 On March 1, 2021, Adtalem Escrow Corporation (the “Escrow Issuer”), a wholly-owned subsidiary of Adtalem, issued $800.0 million aggregate principal amount of 5.50% Senior Secured Notes due 2028 (the “Notes”), which mature on March 1, 2028, pursuant to an indenture, dated as of March 1, 2021 (the “Indenture”), by and between the Escrow Issuer and U.S. Bank National Association, as trustee and notes collateral agent. The Notes were sold within the U.S. only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and outside the U.S. to non-U.S. persons in reliance on Regulation S under the Securities Act. The Escrow Issuer deposited the net proceeds of the offering, along with certain additional funds, into a segregated depositary account (the “Escrow Account”). On August 12, 2021, Adtalem used the net proceeds of the offering, along with other financing sources, to finance the purchase price paid in connection with the Walden acquisition, repay the then existing $291.0 million senior secured term loan B, and to pay related acquisition fees and expenses. On August 12, 2021, the Escrow Issuer merged with and into Adtalem, with Adtalem continuing as the surviving corporation (the “Escrow Merger”), and Adtalem assumed all of the Escrow Issuer's obligations under the Notes, the Indenture, any supplemental indentures thereto, the applicable collateral documents, and the other applicable documents (the “Assumption”) and subject to the satisfaction of certain other conditions, the net proceeds from the offering and the other additional funds were released from the Escrow Account to the Issuer or its designee. The term “Issuer” refers (a) prior to the Assumption, to the Escrow Issuer and (b) from and after the Assumption, to Adtalem. The Notes were issued at 100.0% of their par value. The Notes bear interest at a rate of 5.50% per year, payable semi-annually in arrears on March 1 and September 1 of each year, commencing on September 1, 2021, to holders of record on the preceding February 15 and August 15, as the case may be. The Notes were initially the senior secured obligations of the Escrow Issuer, secured only by the amounts deposited in the Escrow Account. As of August 12, 2021, the Notes are guaranteed by certain of Adtalem’s subsidiaries that are borrowers or guarantors under its senior secured credit facilities and certain of its other senior indebtedness, subject to certain exceptions (the “Guarantors”). As of August 12, 2021, the Notes are secured, subject to permitted liens and certain other exceptions, by first priority liens on the same collateral that secures the obligations under Adtalem’s senior secured credit facilities. At any time prior to March 1, 2024, the Issuer may redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus a make-whole premium set forth in the Indenture and accrued and unpaid interest, if any, to, but not including, the redemption date. The Issuer may redeem the Notes, in whole or in part, at any time on or after March 1, 2024 at redemption prices equal to 102.75%, 101.375% and 100% of the principal amount of the Notes redeemed if the redemption occurs during the twelve-month periods beginning on March 1 of the years 2024, 2025, and 2026 and thereafter, respectively, in each case plus accrued and unpaid interest, if any, thereon to, but not including, the applicable redemption date. In addition, at any time prior to March 1, 2024, the Issuer may redeem up to 40% of the aggregate principal amount of the Notes at a redemption price equal to 105.5% of the aggregate principal amount of the Notes redeemed, plus accrued and unpaid interest, if any, to, but not including, the redemption date, with the net cash proceeds the Issuer receives from one or more qualifying equity offerings. On April 11, 2022, we repaid $373.3 million of Notes at a price equal to 100% of the principal amount of the Notes. During June 2022, we repurchased on the open market an additional $20.8 million of Notes at a price equal to approximately 90% of the principal amount of the Notes. This debt was subsequently retired. During the first quarter of fiscal year 2023, we repurchased on the open market an additional $0.9 million of Notes at a price equal to approximately 92% of the principal amount of the Notes, resulting in a gain on extinguishment of debt of $0.1 million recorded within interest expense in the Consolidated Statements of Income (Loss) for the six months ended December 31, 2022. This debt was subsequently retired. Accrued interest on the Notes of $7.4 million, $7.4 million, and $14.7 million is recorded within accrued liabilities on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021, respectively. Credit Agreement On February 12, 2021, Adtalem placed an $850.0 million senior secured term loan (“Term Loan B”) into the loan market to provide future funding for the Walden acquisition. For 30 days beginning on March 15, 2021, Adtalem began accruing ticking fees at 50% of the applicable 4.5% margin. Beginning on April 14, 2021 and until the closing date of the Term Loan B, Adtalem accrued ticking fees at a rate equal to LIBOR plus a 4.5% margin, subject to a LIBOR floor of 0.75%. All ticking fees were paid at the time of the Term Loan B closing date, on August 12, 2021, and are recorded within interest expense as accrued in the Consolidated Statements of Income (Loss). On August 12, 2021, Adtalem replaced the Prior Credit Agreement (as defined below) by entering into its new credit agreement (the “Credit Agreement”) that provides for (1) a $850.0 million senior secured term loan with a maturity date of August 12, 2028 and (2) a $400.0 million senior secured revolving loan facility (“Revolver”) with a maturity date of August 12, 2026. We refer to the Term Loan B and Revolver collectively as the “Credit Facility.” The Revolver has availability for letters of credit and currencies other than U.S. dollars of up to $400.0 million. Term Loan B Borrowings under the Term Loan B bear interest at Adtalem’s option at a rate per annum equal to LIBOR, subject to a LIBOR floor of 0.75%, plus an applicable margin ranging from 4.00% to 4.50% for eurocurrency term loan borrowings or 3.00% to 3.50% for alternative base rate (“ABR”) borrowings depending on Adtalem’s net first lien leverage ratio for such period. As of December 31, 2022, the interest rate for borrowings under the Term Loan B facility was 8.39%, which approximated the effective interest rate. The proceeds of the Term Loan B were used, among other things, to finance the Walden acquisition, refinance Adtalem’s Prior Credit Agreement (as defined below), and pay fees and expenses related to the Walden acquisition. The Term Loan B originally required quarterly installment payments of $2.125 million beginning on March 31, 2022. On March 11, 2022, we made a prepayment of $396.7 million on the Term Loan B. With that prepayment, we are no longer required to make quarterly installment payments. We made additional Term Loan B prepayments of $100.0 million and $50.0 million on September 22, 2022 and November 22, 2022, respectively. Interest on our Term Loan B and the Revolver is set based on LIBOR, which is based on observable market transactions. The U.K. Financial Conduct Authority, which regulates LIBOR, has announced that no new contracts referencing LIBOR are allowed. In addition, publication of one-week and two-month LIBOR rates ceased on December 31, 2021; however, all other LIBOR tenors will be published through June 30, 2023. The Credit Agreement provides guidance surrounding the implementation of a replacement benchmark rate, however the specific replacement benchmark rate has not been identified. We expect to amend the Credit Agreement during fiscal year 2023 to transition from LIBOR to the Secured Overnight Financing Rate (“SOFR”). Revolver Borrowings under the Revolver bear interest at a rate per annum equal to LIBOR, subject to a LIBOR floor of 0.75%, plus an applicable margin ranging from 3.75% to 4.25% for LIBOR borrowings or 2.75% to 3.25% for ABR borrowings depending on Adtalem’s net first lien leverage ratio for such period. The Credit Agreement requires payment of a commitment fee equal to 0.25% as of December 31, 2022, of the undrawn portion of the Revolver. The commitment fee expense is recorded within interest expense in the Consolidated Statements of Income (Loss). The amount undrawn under the Revolver was $400.0 million as of December 31, 2022. Prior Credit Agreement On April 13, 2018, Adtalem entered into a credit agreement (the “Prior Credit Agreement”) that provided for (1) a $300.0 million senior secured term loan (“Prior Term Loan B”), which was set to mature on April 13, 2025 and (2) a $300.0 million revolving facility (“Prior Revolver”), which was set to mature on April 13, 2023. We refer to the Prior Term Loan B and Prior Revolver collectively as the “Prior Credit Facility.” Prior Term Loan B For eurocurrency rate loans, Prior Term Loan B interest was equal to LIBOR or a LIBOR-equivalent rate plus 3%. For base rate loans, Prior Term Loan B interest was equal to the base rate plus 2%. The Prior Term Loan B required quarterly installment payments of $750,000, with the balance due at maturity on April 13, 2025. On March 24, 2020, we executed a pay-fixed, receive-variable interest rate swap agreement (the “Swap”) with a multinational financial institution to mitigate risks associated with the variable interest rate on our Prior Term Loan B debt. We paid interest at a fixed rate of 0.946% and received variable interest of one-month LIBOR (subject to a minimum of 0.00%), on a notional amount equal to the amount outstanding under the Prior Term Loan B. The effective date of the Swap was March 31, 2020 and settlements with the counterparty occurred on a monthly basis. The Swap was set to terminate on February 28, 2025. During the operating term of the Swap, the annual interest rate on the amount of the Prior Term Loan B was fixed at 3.946% (including the impact of the 3% interest rate margin on LIBOR loans) for the applicable interest rate period. The Swap was designated as a cash flow hedge and as such, changes in its fair value were recognized in accumulated other comprehensive loss on the Consolidated Balance Sheets and were reclassified into the Consolidated Statements of Income (Loss) within interest expense in the periods in which the hedged transactions affected earnings. On July 29, 2021, prior to refinancing our Credit Agreement (as discussed above), we settled and terminated the Swap for $4.5 million, which resulted in a charge to interest expense in the six months ended December 31, 2021. Prior Revolver Prior Revolver interest was equal to LIBOR or a LIBOR-equivalent rate for eurocurrency rate loans or a base rate, plus an applicable margin based on Adtalem’s consolidated leverage ratio, as defined in the Prior Credit Agreement. The applicable margin ranged from 1.75% to 2.75% for eurocurrency rate loans and from 0.75% to 1.75% for base rate loans. Debt Discount and Issuance Costs The Term Loan B was issued at a price of 99% of its principal amount, resulting in an original issue discount of 1%. The debt discount and issuance costs related to the Notes and Term Loan B are capitalized and presented as a direct deduction from the face amount of the debt, while the debt issuance costs related to the Revolver are classified as other assets, net on the Consolidated Balance Sheets. The debt discount and issuance costs are amortized as interest expense over seven years for the Notes and Term Loan B and over five years for the Revolver. The remaining $6.0 million of unamortized debt issuance costs related to the Prior Credit Facility and the $10.3 million of debt issuances costs associated with an unused bridge facility, which was in place should the permanent financing not have been obtained, were expensed in interest expense in the Consolidated Statements of Income (Loss) in the six months ended December 31, 2021. In addition, based on the $100.0 million and $50.0 million Term Loan B prepayments on September 22, 2022 and November 22, 2022, respectively, we expensed $1.4 million and $4.3 million in interest expense in the Consolidated Statements of Income (Loss) in the three and six months ended December 31, 2022, respectively, which was the proportionate amount of the remaining unamortized debt discount and issuance costs related to the Term Loan B as of the prepayment dates. The following table summarizes the unamortized debt discount and issuance costs activity for the six months ended December 31, 2022 (in thousands): Notes Term Loan B Revolver Total Unamortized debt discount and issuance costs as of June 30, 2022 $ 6,725 $ 13,582 $ 8,383 $ 28,690 Amortization of debt discount and issuance costs (560) (948) (1,014) (2,522) Debt discount and issuance costs write-off (15) (4,282) — (4,297) Unamortized debt discount and issuance costs as of December 31, 2022 $ 6,150 $ 8,352 $ 7,369 $ 21,871 Letters of Credit Adtalem had a surety-backed letter of credit outstanding of $84.0 million as of December 31, 2022, in favor of the U.S. Department of Education (“ED”) on behalf of Walden, which allows Walden to participate in Title IV programs. On January 18, 2023, we received a letter from ED, requesting Adtalem to provide a letter of credit in the amount of $76.1 million related to ED’s review of the Same Day Balance Sheet, which is the consolidated Adtalem balance sheet as of August 12, 2021, the date of the Walden acquisition. The letter of credit is to be provided within 45 calendar days from the date of this letter. Adtalem had a letter of credit of $68.4 million, which was posted in the second quarter of fiscal year 2017 in relation to a settlement with the Federal Trade Commission (“FTC”) and required the letter of credit to be equal to the greater of 10% of DeVry University’s annual Title IV disbursements or $68.4 million for a five-year period. Adtalem continued to post the letter of credit in relation to the settlement with the FTC on behalf of DeVry University and was reimbursed by DeVry University for 2.00% of the outstanding amount of this letter of credit. This letter of credit expired during the second quarter of fiscal year 2022. Interest Expense The components of interest expense were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Notes interest expense $ 5,568 $ 11,000 $ 11,165 $ 22,000 Term Loan B interest expense 6,450 11,405 13,451 17,603 Term Loan B ticking fees — — — 5,330 Prior Term Loan B interest expense — — — 1,272 Term Loan B debt discount and issuance costs write-off 1,402 — 4,282 — Notes issuance costs write-off — — 15 — Gain on extinguishment of debt — — (71) — Unused bridge fee — — — 10,329 Prior Credit Facility issuance costs write-off — — — 6,000 Swap settlement — — — 4,525 Amortization of debt discount and issuance costs 1,190 2,127 2,522 3,656 Other 979 1,397 1,985 2,607 Total interest expense $ 15,589 $ 25,929 $ 33,349 $ 73,322 Covenants and Guarantees The Credit Agreement and Notes contain customary covenants, including restrictions on our restricted subsidiaries’ ability to merge and consolidate with other companies, incur indebtedness, grant liens or security interest on assets, make acquisitions, loans, advances or investments, or sell or otherwise transfer assets. Under the terms of the Credit Agreement, beginning on the fiscal quarter ending December 31, 2021 and through December 31, 2023, Adtalem is required to maintain a Total Net Leverage Ratio of equal to or less than 4.00 to 1.00, which requirement reduces to 3.25 to 1.00 for the fiscal quarter ending March 31, 2024 and thereafter. The Total Net Leverage Ratio under the Credit Agreement is defined as the ratio of (a) the aggregate principal amount of Consolidated Debt (as defined in the Credit Agreement) of Adtalem and its subsidiaries as of the last day of the most recently ended Test Period (as defined in the Credit Agreement) minus Obligations under the Credit Agreement are secured by a first-priority lien on substantially all of the assets of Adtalem and certain of its domestic wholly owned subsidiaries (the “Subsidiary Guarantors”), which Subsidiary Guarantors also guarantee the obligations of Adtalem under the Credit Agreement, subject to certain exceptions. The Credit Agreement contains customary affirmative and negative covenants customary for facilities of its type, which, among other things, generally limit (with certain exceptions): mergers, amalgamations, or consolidations; the incurrence of additional indebtedness (including guarantees); the incurrence of additional liens; the sale, assignment, lease, conveyance or transfer of assets; certain investments; dividends and stock redemptions or repurchases in excess of certain amounts; transactions with affiliates; engaging in materially different lines of business; payments and modifications of indebtedness or the governing documents of Adtalem or any Subsidiary Guarantor; and other activities customarily restricted in such agreements. The Credit Agreement contains customary events of default for facilities of this type. If an event of default under the Credit Agreement occurs and is continuing, the commitments thereunder may be terminated and the principal amount outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable. The Term Loan B requires mandatory prepayments equal to the net cash proceeds from an asset sale or disposition which is not reinvested in assets within one-year from the date of disposition if the asset sale or disposition is in excess of $20.0 million, among other mandatory prepayment terms (see the Credit Agreement, as filed under Form 8-K dated August 12, 2021, for additional information and term definitions). With the $396.7 million prepayment on March 11, 2022 on the Term Loan B, the $394.1 million prepayment on the Notes during the fourth quarter of fiscal year 2022, and the $100.0 million prepayment on September 22, 2022 on the Term Loan B, we satisfied the mandatory prepayment requirement resulting from the sale proceeds received from the sale of the Financial Services segment. No other mandatory prepayments have been required since the execution of the Credit Agreement. The Notes contain covenants that limit the ability of the Issuer and each of the Guarantors to incur or guarantee additional debt or issue disqualified stock or preferred stock; pay dividends and make other distributions on, or redeem or repurchase, capital stock; make certain investments; incur certain liens; enter into transactions with affiliates; consolidate, merge, sell or otherwise dispose of all or substantially all of its assets; create certain restrictions on the Guarantors to make dividends or other payments to Adtalem; designate restricted subsidiaries as unrestricted subsidiaries; and transfer or sell certain assets. These covenants are subject to a number of important exceptions and qualifications. The Indenture and the Notes also provide for certain customary events of default which, if any of them occurs, would permit or require the principal of and accrued interest on the Notes to become or be declared due and payable or would allow the trustee or the holders of at least 25% in principal amount of the then outstanding Notes to declare the principal of and accrued and unpaid interest, if any, on all the Notes to be due and payable by notice in writing to the Issuer and, upon such declaration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. Adtalem was in compliance with the debt covenants related to the Credit Agreement and the Notes covenants as of December 31, 2022. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interest | 6 Months Ended |
Dec. 31, 2022 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | 14. Redeemable Noncontrolling Interest Prior to the third quarter of fiscal year 2022, Adtalem maintained a 69% ownership interest in EduPristine with the remaining 31% owned by Kaizen Management Advisors (“Kaizen”), an India-based private equity firm. Beginning on March 26, 2020, Adtalem had the right to exercise a call option and purchase any remaining EduPristine stock from Kaizen. Likewise, Kaizen had the right to exercise a put option and sell up to 33% of its remaining ownership interest in EduPristine to Adtalem. Beginning on March 26, 2022, Kaizen had the right to exercise a put option and sell its remaining ownership interest in EduPristine to Adtalem. During the third quarter of fiscal year 2022, Adtalem purchased the remaining ownership interest in EduPristine from Kaizen for $1.8 million, resulting in Adtalem owning 100% of EduPristine. Subsequently, Adtalem sold EduPristine in its entirety on June 17, 2022 (see Note 4 “Discontinued Operations and Assets Held for Sale” for additional information). Since the put option was out of the control of Adtalem, authoritative guidance required the redeemable noncontrolling interest, which included the value of the put option, to be displayed outside of the equity section of the Consolidated Balance Sheets. |
Share Repurchases
Share Repurchases | 6 Months Ended |
Dec. 31, 2022 | |
Dividends And Share Repurchase Program [Abstract] | |
Share Repurchases | 15. Share Repurchases Open Market Share Repurchase Programs On February 4, 2020, we announced that the Board of Directors (the “Board”) authorized Adtalem’s twelfth share repurchase program, which allowed Adtalem to repurchase up to $300.0 million of its common stock through December 31, 2021. The twelfth share repurchase program commenced in January 2021 and expired on December 31, 2021. On March 1, 2022, we announced that the Board authorized Adtalem’s thirteenth share repurchase program, which allows Adtalem to repurchase up to $300.0 million of its common stock through February 25, 2025. We did not make any share repurchases during the three and six months ended December 31, 2022 and 2021. As of December 31, 2022, $300.0 million of authorized share repurchases were remaining under the current share repurchase program. The timing and amount of any future repurchases will be determined based on an evaluation of market conditions and other factors. These repurchases may be made through the open market, including block purchases, in private negotiated transactions, or otherwise. Repurchases will be funded through available cash balances and/or borrowings and may be suspended or discontinued at any time. Shares of stock repurchased under the programs are held as treasury shares. Repurchases under our share repurchase programs reduce the weighted-average number of shares of common stock outstanding for basic and diluted earnings per share calculations. ASR Agreement On March 14, 2022, we entered into an ASR agreement to repurchase $150.0 million of common stock. We received an initial delivery of 4,709,576 On March 14, 2022, we recorded the $150.0 million purchase price of the ASR as a reduction to shareholders’ equity, consisting of a $120.0 million increase in treasury stock and a $30.0 million reduction in additional paid-in capital, which represented an equity forward contract, on the Consolidated Balance Sheets. During the second quarter of fiscal year 2023, the $30.0 million initially recorded as a reduction in additional paid-in capital was reclassified to treasury stock and an additional $13.2 million was recorded in treasury stock, which represented our final cash settlement payment. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Dec. 31, 2022 | |
Comprehensive Income, Net Of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | 16. Accumulated Other Comprehensive Loss The following table shows the changes in accumulated other comprehensive loss by component (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Foreign currency translation adjustments Beginning balance $ (2,227) $ (740) $ (960) $ (670) Gain (loss) on foreign currency translation — 106 (1,267) 36 Ending balance $ (2,227) $ (634) $ (2,227) $ (634) Interest rate swap Beginning balance, gross $ — $ — $ — $ (8,926) Beginning balance, tax effect — — — 2,231 Beginning balance, net of tax — — — (6,695) Reclassification from other comprehensive income — — — 6,695 Ending balance $ — $ — $ — $ — Total ending balance $ (2,227) $ (634) $ (2,227) $ (634) |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Dec. 31, 2022 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | 17. Stock-Based Compensation Adtalem maintains two stock-based incentive plans: the Amended and Restated Incentive Plan of 2005 and the Fourth Amended and Restated Incentive Plan of 2013, which are administered by the Compensation Committee of the Board. Under these plans, directors, key executives, and managerial employees are eligible to receive incentive or nonqualified stock options to purchase shares of Adtalem’s common stock, and also permit the granting of stock appreciation rights, restricted stock units (“RSUs”), performance-based RSUs, and other stock and cash-based compensation. Although options remain outstanding under the 2005 incentive plan, no further grants will be issued under this plan. We issue options generally with a four-year graduated vesting from the grant date and expire ten years from the grant date. The option price under the plans is the fair market value of the shares on the date of the grant. The Compensation Committee of the Board determined to no longer grant stock options beginning with the fiscal year 2023 stock-based grant awards. Stock-based compensation expense is measured at the grant date based on the fair value of the award. Adtalem accounts for stock-based compensation granted to retirement eligible employees that fully vests upon an employee’s retirement under the non-substantive vesting period approach. Under this approach, the entire stock-based compensation expense is recognized at the grant date for stock-based grants issued to retirement eligible employees. For non-retirement eligible employees, stock-based compensation expense is recognized as expense over the employee requisite service period. We account for forfeitures of unvested awards in the period they occur. As of December 31, 2022, 2,871,830 shares were authorized for issuance but not issued or subject to outstanding awards under Adtalem’s stock-based incentive plans. The following is a summary of options activity for the six months ended December 31, 2022: Weighted-Average Remaining Aggregate Number of Weighted-Average Contractual Life Intrinsic Value Options Exercise Price (in years) (in thousands) Outstanding as of July 1, 2022 1,144,372 $ 35.36 Exercised (54,514) 26.08 Expired (1,575) 18.60 Outstanding as of December 31, 2022 1,088,283 35.85 5.9 $ 2,103 Exercisable as of December 31, 2022 813,502 $ 35.81 5.2 $ 1,746 The total intrinsic value of options exercised for the six months ended December 31, 2022 and 2021 was $0.7 million and $6.7 million, respectively. The fair value of Adtalem’s options was estimated using a binomial model. This model uses historical cancellation and exercise experience of Adtalem to determine the option value. It also considers the illiquid nature of employee options during the vesting period. The weighted-average estimated grant date fair value of options granted at market price under Adtalem’s stock-based incentive plans during the first six months of fiscal year 2022 was $14.72 per share. No stock options were granted during the first six months of fiscal year 2023. The fair value of Adtalem’s option grants was estimated assuming the following weighted-average assumptions: Fiscal Year 2022 Expected life (in years) 6.56 Expected volatility 39.99 % Risk-free interest rate 0.94 % Dividend yield 0.00 % The expected life of the options granted is based on the weighted-average exercise life with age and salary adjustment factors from historical exercise behavior. Adtalem’s expected volatility is computed by combining and weighting the implied market volatility, the most recent volatility over the expected life of the option grant, and Adtalem’s long-term historical volatility. During the first six months of fiscal year 2023, Adtalem granted 320,970 RSUs to selected employees and directors, all of which were non-performance-based RSUs. Our annual grant of performance-based RSUs are expected to be granted in the third quarter of fiscal year 2023. We issue performance-based RSUs generally with a three-year cliff vest from the grant date. The final number of shares issued under performance-based RSUs is based on metrics approved by the Compensation Committee of the Board. Prior to fiscal year 2023, we issued non-performance-based RSUs generally with a four-year graduated vesting from the grant date. Beginning in fiscal year 2023, we issue non-performance-based RSUs generally with a three-year graduated vesting from the grant date. The recipient of the non-performance-based RSUs has the right to receive dividend equivalents, if any. This right does not pertain to the performance-based RSUs. The following is a summary of RSU activity for the six months ended December 31, 2022: Weighted-Average Number of Grant Date RSUs Fair Value Unvested as of July 1, 2022 1,171,692 $ 35.05 Granted 320,970 39.87 Vested (305,449) 37.58 Forfeited (70,778) 37.90 Unvested as of December 31, 2022 1,116,435 $ 35.56 The weighted-average estimated grant date fair values of RSUs granted at market price under Adtalem’s stock-based incentive plans during the first six months of fiscal years 2023 and 2022 were $39.87 and $35.46, per share, respectively. Stock-based compensation expense, which is included in student services and administrative expense, and the related income tax benefit were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Stock-based compensation $ 1,968 $ 4,220 $ 8,113 $ 13,931 Income tax benefit (622) (1,074) (2,303) (2,493) Stock-based compensation, net of tax $ 1,346 $ 3,146 $ 5,810 $ 11,438 As of December 31, 2022, $20.7 million of total pre-tax unrecognized stock-based compensation expense related to unvested grants is expected to be recognized over a weighted-average period of 2.3 years. The total fair value of options and RSUs vested during the six months ended December 31, 2022 and 2021 was $13.7 million and $13.0 million, respectively. There was no capitalized stock-based compensation cost as of each of December 31, 2022, June 30, 2022, and December 31, 2021. Adtalem issues new shares of common stock to satisfy option exercises and RSU vests. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 18. Fair Value Measurements Adtalem has elected not to measure any assets or liabilities at fair value other than those required to be measured at fair value on a recurring basis. Assets measured at fair value on a nonrecurring basis include goodwill, intangible assets, and assets of businesses where the long-term value of the operations have been impaired. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The guidance specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. The guidance establishes fair value measurement classifications under the following hierarchy: Level 1 – Level 2 – Observable inputs other than prices included in Level 1, such as quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable in active markets. Level 3 –Model-derived valuations in which one or more significant inputs or significant value-drivers are unobservable. When available, Adtalem uses quoted market prices to determine fair value, and such measurements are classified within Level 1. In cases where market prices are not available, Adtalem makes use of observable market-based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon internally developed models that use, where possible, current market-based parameters such as interest rates and yield curves. These measurements are classified within Level 3. Fair value measurements are classified according to the lowest level input or value-driver that is significant to the valuation. A measurement may therefore be classified within Level 3 even though there may be significant inputs that are readily observable. The carrying value of our cash and cash equivalents approximates fair value because of their short-term nature and is classified as Level 1. Adtalem maintains a rabbi trust with investments in stock and bond mutual funds to fund obligations under a nonqualified deferred compensation plan. The fair value of the investments in the rabbi trust included in prepaid expenses and other current assets on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021 was $18.1 million, $17.8 million, and $21.6 million, respectively. These investments are recorded at fair value based upon quoted market prices using Level 1 inputs. The fair value of the credit extension programs, which approximates its carrying value, included in accounts receivable, net and is classified as Level 2. See Note 9 “Accounts Receivable and Credit Losses” for additional information on these credit extension programs. In connection with the sale of DeVry University, Adtalem loaned $10.0 million to DeVry University under the terms of the DeVry Note. The DeVry Note bore interest at a rate of 4% per annum, payable annually in arrears, and had a maturity date of January 1, 2022. We received the loan repayment of $10.0 million during the third quarter of fiscal year 2022. The fair value of the DeVry Note approximated its carrying value of $10.0 million as of December 31, 2021 and was classified as Level 2. The carrying value is included in prepaid expenses and other current assets on the Consolidated Balance Sheets as of December 31, 2021. On July 31, 2019, Adtalem sold its Chicago, Illinois, campus facility to DePaul College Prep. In connection with the sale, Adtalem holds a mortgage from DePaul College Prep for $46.8 million. The mortgage is due on July 31, 2024 as a balloon payment and bears interest at a rate of 4% per annum, payable monthly. The carrying value of the DePaul College Prep loan receivable, which approximates its fair value, included in other assets, net on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021 is $44.6 million, $44.0 million, and $43.3 million, respectively. Fair value is estimated by discounting the future cash flows using an average of current rates for similar arrangements, which is estimated at 7% per annum and is classified as Level 2. Adtalem has a nonqualified deferred compensation plan for highly compensated employees and its Board members. The participant’s “investments” are in a hypothetical portfolio of investments which are tracked by an administrator. Changes in the fair value of the nonqualified deferred compensation obligation are derived using quoted prices in active markets based on the market price per unit multiplied by the number of units. Total liabilities under the plan included in accrued liabilities on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021 were $14.6 million, $16.3 million, and $21.4 million, respectively. The fair value of the nonqualified deferred compensation obligation is classified as Level 2 because their inputs are derived principally from observable market data by correlation to the hypothetical investments. As of December 31, 2022, June 30, 2022, and December 31, 2021, borrowings under our long-term debt agreements were $708.3 million, $859.2 million, and $1,650.0 million, respectively. The fair value of the Notes was $371.5 million as of December 31, 2022, which is based upon quoted market prices and is classified as Level 1. The fair value of the Term Loan B was $301.6 million as of December 31, 2022, which is based upon quoted market prices in a non-active market and is classified as Level 2. See Note 13 “Debt” for additional information on our long-term debt agreements. As of December 31, 2022, June 30, 2022, and December 31, 2021, there were no assets or liabilities measured at fair value using Level 3 inputs. We recorded an impairment of $5.0 million on an equity investment with no readily determinable fair value within other (expense) income, net in the Consolidated Statements of Income (Loss) in the three and six months ended December 31, 2022 as the carrying value is no longer recoverable. Since initial recognition of the investment, there have been no upward or downward adjustments as a result of observable price changes. Following the impairment, the carrying amount of $5.0 million was reduced to zero . Assets measured at fair value on a nonrecurring basis include goodwill and indefinite-lived intangibles arising from a business combination. These assets are not amortized and charged to expense over time. Instead, goodwill and indefinite-lived intangibles must be reviewed annually for impairment or more frequently if circumstances arise indicating potential impairment. This impairment review was most recently completed as of May 31, 2022. See Note 12 “Goodwill and Intangible Assets” for additional information on the impairment review, including valuation techniques and assumptions. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Dec. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 19. Commitments and Contingencies Adtalem is subject to lawsuits, administrative proceedings, regulatory reviews, and investigations associated with financial assistance programs and other matters arising in the normal conduct of its business. As of December 31, 2022, Adtalem believes it has adequately reserved for potential losses. The following is a description of pending legal and regulatory matters that may be considered other than ordinary, routine, and incidental to the business. Descriptions of certain matters from prior SEC filings may not be carried forward in this report to the extent we believe such matters no longer are required to be disclosed or there has not been, to our knowledge, significant activity relating to them. We have recorded accruals for those matters where management believes a loss is probable and can be reasonably estimated as of December 31, 2022. For those matters for which we have not recorded an accrual, their possible impact on Adtalem’s business, financial condition, or results of operations, cannot be predicted at this time. The continued defense, resolution, or settlement of any of the following matters could require us to expend significant resources and could have a material adverse effect on our business, financial condition, results of operations, and cash flows, and result in the imposition of significant restrictions on us and our ability to operate. On April 13, 2018, a putative class action lawsuit was filed by Nicole Versetto, individually and on behalf of others similarly situated, against Adtalem, DeVry University Inc., and DeVry/New York Inc. (collectively the “Adtalem Parties”) in the Circuit Court of Cook County, Illinois, Chancery Division. The complaint was filed on behalf of herself and three separate classes of similarly situated individuals who were citizens of the State of Illinois and who purchased or paid for a DeVry University program between January 1, 2008 and April 8, 2016. The plaintiff claimed that defendants made false or misleading statements regarding DeVry University’s graduate employment rate and asserts causes of action under the Illinois Uniform Deceptive Trade Practices Act, Illinois Consumer Fraud and Deceptive Trade Practices Act, and Illinois Private Business and Vocational Schools Act, and claims of breach of contract, fraudulent misrepresentation, concealment, negligence, breach of fiduciary duty, conversion, unjust enrichment, and declaratory relief as to violations of state law. The plaintiff sought compensatory, exemplary, punitive, treble, and statutory penalties and damages, including pre-judgment and post-judgment interest, in addition to restitution, declaratory and injunctive relief, and attorneys’ fees. The plaintiff later filed an amended complaint asserting similar claims with a new lead plaintiff, Dave McCormick. After discussions among the parties, the court granted a Motion for Preliminary Approval of Class Action Settlement (the “McCormick Settlement”) on May 28, 2020. In conjunction with the McCormick Settlement, Adtalem was required to establish a settlement fund by placing $44.95 million into an escrow account, which is recorded within prepaid expenses and other current assets on the Consolidated Balance Sheets as of December 31, 2022, June 30, 2022, and December 31, 2021. Adtalem management determined a loss contingency was probable and reasonably estimable. As such, we also recorded a loss contingency accrual of $44.95 million on the Consolidated Balance Sheets as of June 30, 2020 and charged the contingency loss within discontinued operations in the Consolidated Statements of Income (Loss) for the year ended June 30, 2020. As of June 30, 2020, we had anticipated the potential payments related to this loss contingency to be made from the escrow account during fiscal year 2021. We now anticipate the potential payments related to this loss contingency to be made from the escrow account during fiscal year 2023. This loss contingency estimate could differ from actual results and result in additional charges or reversals in future periods. The court issued an order approving the McCormick Settlement on October 7, 2020 and dismissed the action with prejudice. On November 2, 2020, Stoltmann Law Offices filed on behalf of Jose David Valderrama (“Valderrama”), a class member who objected to the terms of the McCormick Settlement, a notice of appeal of the court’s order approving the McCormick Settlement. On November 5, 2020, Richardo Peart (“Peart”), another class member who objected to the terms of the McCormick Settlement, filed a similar notice of appeal. Those appeals were consolidated before the Appellate Court of Illinois, First District and fully briefed. The Appellate Court agreed to stay Valderrama’s and Peart’s appeals of the McCormick Settlement pending the outcome of mediation involving the objections to the McCormick Settlement. The objections were not resolved at a mediation on February 1, 2022. Valderrama’s objection was withdrawn as part of the Stoltmann settlement discussed below. Peart’s objection remained pending a decision by the Appellate Court. On May 4, 2022, the Appellate Court denied Peart’s objection and affirmed the Circuit Court of Cook County’s approval of the McCormick Settlement. Adtalem settled with Peart and the McCormick Settlement is now final. The Circuit Court of Cook County is in the process of administering the $44.95 million settlement fund. In addition to Valderrama, Stoltmann Law Offices represented 552 individuals (“Stoltmann Claimants”) who opted out of the McCormick Settlement and filed claims with the Judicial Arbitration and Mediation Services, Inc. (“JAMS”) alleging fraud-based claims based on DeVry University’s graduate employment statistics. On November 2, 2021, Adtalem and the Stoltmann Law Offices participated in a mediation to resolve the claims of the Stoltmann Claimants. Adtalem and the Stoltmann Law Offices have reached agreement on settlement terms (“Stoltmann Settlement”). The Adtalem Board of Directors approved the Stoltmann Settlement. The settlement amount, $20,375,000, was reduced by $75,000 for each of the Stoltmann Claimants that declined to participate in the settlement. Of Stoltmann’s 552 Claimants, six declined to participate, reducing the settlement amount by $450,000. On February 28, 2022, Adtalem remitted $19,925,000 to the Stoltmann Laws Offices on behalf of the 546 participating Stoltmann Claimants. Of the six Stoltmann Claimants that declined to participate in the settlement, two voluntarily dismissed their arbitrations; one arbitration was stayed at the Claimant’s request; and three Claimants have not recommenced their arbitrations. On March 12, 2021, Travontae Johnson, a current student of Chamberlain, filed a putative class action against Chamberlain in the Circuit Court of Cook County, Illinois, Chancery Division. The plaintiff claims that Chamberlain’s use of Respondus Monitor, an online remote proctoring tool for student examinations, violated the Illinois Biometric Information Privacy Act (“BIPA”), 740 ILCS 14/15. More particularly, the plaintiff claims that Chamberlain required students to use Respondus Monitor, which collected, captured, stored, used, and disclosed students’ biometric identifiers and biometric information without written and informed consent. The plaintiff also alleges that Chamberlain lacked a legally compliant written policy establishing a retention schedule and guidelines for destroying biometric identifiers and biometric information. The potential class purportedly includes all students who took an assessment using the proctoring tool, as a student of Chamberlain in Illinois, at any time from March 12, 2016 through January 20, 2021. The plaintiff and the putative class seek damages in excess of $50,000, attorney’s fees and costs. The plaintiff and class also seek an unspecified amount of enhanced damages based on alleged negligent or reckless conduct by Chamberlain. On June 16, 2021, Chamberlain filed a motion to dismiss plaintiff’s complaint. On June 29, 2021, plaintiff filed an amended complaint. On July 19, 2021, Chamberlain filed its motion to dismiss the amended complaint arguing that plaintiff’s lawsuit is expressly preempted by Title V of the Gramm-Leach-Bliley Act. Chamberlain’s motion is pending. On July 22, 2021, plaintiffs Cheryl Burleigh and Chad Harris (both contributing faculty members at Walden) filed a class action complaint in the Superior Court of Alameda County, California alleging violations of California wage and hour laws by Walden and Laureate Education, Inc. The complaint alleges that Walden’s “per assignment” pay scale results in uncompensated work time for plaintiffs and class members for time spent in trainings and meetings. Plaintiffs also allege that they were not paid for meal and rest breaks, that they were not reimbursed for necessary business expenses, that Walden did not provide wage statements as required by California state law, and that they were not paid wages due upon termination. Plaintiffs also allege derivative claims under California’s Unfair Competition Law. The complaint seeks restitution including pay for uncompensated hours of work, unreimbursed business expenses and interest, liquidated damages, declaratory relief, injunctive relief, penalties, and attorney fees and costs. Walden and Laureate have filed a demurrer. On January 28, 2022, the parties agreed to settle the complaint for an immaterial amount, subject to the approval of the Superior Court of Alameda County, California. The Plaintiffs filed their motion for preliminary approval of the settlement on June 7, 2022. The court issued a preliminary approval Order on July 26, 2022. The court issued an Order of final approval to the settlement on December 12, 2022. Walden remitted an immaterial amount to the class administrator on December 22, 2022. This matter is now final. On January 12, 2022, Walden was served with a complaint filed in the United States District Court for the District of Maryland by Aljanal Carroll, Claudia Provost Charles, and Tiffany Fair against Walden for damages, injunctive relief, and declaratory relief on behalf of themselves and all other similarly-situated individuals alleging violations of Title VI of the Civil Rights Act of 1964, the Equal Credit Opportunity Act, the Minnesota Prevention of Consumer Fraud Act, the Minnesota Uniform Deceptive Trade Practices Act, Minnesota statutes prohibiting false statements in advertising, and for common law fraudulent misrepresentation. Plaintiffs allege that Walden has targeted, deceived, and exploited Black and female Doctor of Business Administration (“DBA”) students by knowingly misrepresenting and understating the number of “capstone” credits required to complete the DBA program and obtain a degree. On March 23, 2022, Walden filed a Motion to Dismiss the Plaintiffs’ claims for failure to state a claim upon which relief can be granted. On November 27, 2022, the Court denied Walden’s motion to dismiss the complaint. Plaintiffs filed an amended complaint to add an additional plaintiff, Tareion Fluker. Walden’s answer to the amended complaint is due February 2, 2023. On June 6, 2022, plaintiff Rajesh Verma filed a lawsuit on behalf of himself and a class of similarly situated individuals in the Circuit Court of the Fourth Judicial Circuit, Duval County Florida, against Walden alleging that Walden was placing telephonic sales calls to persons on the National Do-Not-Call Registry, in violation of the Telephone Consumer Protection Act, 47 U.S.C. § 227, et seq. Although originally filed in state court, Walden removed the case to federal court and filed a motion to dismiss Plaintiff’s complaint. On August 26, 2022, Plaintiff filed a motion to remand Count I of the complaint to state court. Both motions are pending a decision before the U.S. District Court for the Middle District of Florida. The parties are engaged in discovery. As previously disclosed, pursuant to the terms of the Stock Purchase Agreement (“SPA”) by and between Adtalem and Cogswell Education, LLC (“Cogswell”), dated as of December 4, 2017, as amended, Adtalem sold DeVry University to Cogswell and Adtalem agreed to indemnify DeVry University for certain losses up to $340.0 million (the “Liability Cap”). Adtalem has previously disclosed DeVry University related matters that have consumed a portion of the Liability Cap. |
Segment Information
Segment Information | 6 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | 20. Segment Information We present three reportable segments as follows: Chamberlain Walden Medical and Veterinary Certain expenses previously allocated to ACAMS, Becker, OCL, and EduPristine within our former Financial Services segment during the first quarter of fiscal year 2022 have been reclassified to Home Office and Other based on discontinued operations reporting guidance regarding allocation of corporate overhead. Beginning in the second quarter of fiscal year 2022, these costs are being allocated to the Chamberlain, Walden, and Medical and Veterinary segments. These segments are consistent with the method by which the Chief Operating Decision Maker (Adtalem’s President and Chief Executive Officer) evaluates performance and allocates resources. Performance evaluations are based on each segment’s adjusted operating income. Adjusted operating income excludes special items, which consists of deferred revenue adjustment, CEO transition costs, restructuring expense, business acquisition and integration expense, and intangible asset amortization. Adtalem’s management excludes these items from its review of the results of the operating segments for purposes of measuring segment profitability and allocating resources. “Home Office and Other” includes activities not allocated to a reportable segment and is included to reconcile segment results to the Consolidated Financial Statements. Total assets by segment is not presented as our CODM does not review or allocate resources based on segment assets. The accounting policies of the segments are the same as those described in Note 2 “Summary of Significant Accounting Policies.” Summary financial information by reportable segment is as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue: Chamberlain $ 141,396 $ 139,121 $ 276,801 $ 274,760 Walden 131,940 140,627 262,841 209,244 Medical and Veterinary 89,966 91,450 178,219 176,264 Total consolidated revenue $ 363,302 $ 371,198 $ 717,861 $ 660,268 Adjusted operating income: Chamberlain $ 33,229 $ 25,791 $ 60,231 $ 46,646 Walden 29,012 32,401 52,403 43,413 Medical and Veterinary 23,017 19,706 40,371 35,371 Home Office and Other (5,751) (7,664) (8,397) (18,759) Total consolidated adjusted operating income 79,507 70,234 144,608 106,671 Reconciliation to Consolidated Financial Statements: Deferred revenue adjustment — (2,354) — (8,561) CEO transition costs — — — (6,195) Restructuring expense (1,363) (3,387) (16,428) (6,481) Business acquisition and integration expense (15,941) (9,060) (24,356) (35,613) Intangible amortization expense (16,176) (30,699) (34,704) (47,150) Total consolidated operating income 46,027 24,734 69,120 2,671 Interest expense (15,589) (25,929) (33,349) (73,322) Other (expense) income, net (2,574) 861 (1,007) 1,739 Total consolidated income (loss) from continuing operations before income taxes $ 27,864 $ (334) $ 34,764 $ (68,912) Capital expenditures: Chamberlain $ 1,492 $ 2,969 $ 2,918 $ 6,614 Walden 268 2,748 1,093 2,932 Medical and Veterinary 342 504 915 1,759 Home Office and Other 2,094 1,860 4,821 3,467 Total consolidated capital expenditures $ 4,196 $ 8,081 $ 9,747 $ 14,772 Depreciation expense: Chamberlain $ 4,099 $ 4,726 $ 8,580 $ 9,310 Walden 2,269 2,516 4,864 4,228 Medical and Veterinary 3,031 3,645 6,136 7,100 Home Office and Other 1,257 744 1,881 1,492 Total consolidated depreciation expense $ 10,656 $ 11,631 $ 21,461 $ 22,130 Intangible asset amortization expense: Walden $ 16,176 $ 30,699 $ 34,704 $ 47,150 Total consolidated intangible asset amortization expense $ 16,176 $ 30,699 $ 34,704 $ 47,150 Adtalem conducts its educational operations in the U.S., Barbados, St. Kitts, and St. Maarten. Revenue and long-lived assets by geographic area are as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue from unaffiliated customers: Domestic operations $ 273,336 $ 279,748 $ 539,642 $ 484,004 Barbados, St. Kitts, and St. Maarten 89,966 91,450 178,219 176,264 Total consolidated revenue $ 363,302 $ 371,198 $ 717,861 $ 660,268 Long-lived assets: Domestic operations $ 287,811 $ 305,848 $ 287,811 $ 305,848 Barbados, St. Kitts, and St. Maarten 162,903 151,174 162,903 151,174 Total consolidated long-lived assets $ 450,714 $ 457,022 $ 450,714 $ 457,022 No one customer accounted for more than 10% of Adtalem’s consolidated revenue for all periods presented. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation A full listing of our significant accounting policies is described in Note 2 “Summary of Significant Accounting Policies” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022 (“2022 Form 10-K”). We have prepared the accompanying unaudited consolidated financial statements in accordance with GAAP for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (which are normal and recurring in nature) considered necessary for a fair presentation have been included. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. These consolidated financial statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto included in our 2022 Form 10-K. We use the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations. Certain prior period amounts have been reclassified for consistency with the current period presentation. Other (expense) income, net in the Consolidated Statements of Income (Loss) consists of interest income of $2.4 million and $4.0 million in the three and six months ended December 31, 2022, respectively, interest income of $0.9 million and $1.7 million in the three and six months ended December 31, 2021, respectively, and investment impairment of $5.0 million in the three and six months ended December 31, 2022. Business acquisition and integration expense was $15.9 million and $24.4 million in the three and six months ended December 31, 2022, respectively, and $9.1 million and $35.6 million in the three and six months ended December 31, 2021, respectively. These are transaction costs associated with acquiring Walden and costs associated with integrating Walden into Adtalem. In addition, during the first quarter of fiscal year 2023, we initiated transformation initiatives to accelerate growth and organizational agility. Certain costs relating to this transformation are included in business acquisition and integration costs in the Consolidated Statements of Income (Loss). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Although our current estimates contemplate current conditions, including, but not limited to, the impact of (i) the novel coronavirus (“COVID-19”) pandemic, (ii) rising interest rates, and (iii) labor and material cost increases and shortages, and how we anticipate them to change in the future, as appropriate, it is reasonably possible that actual conditions could differ from what was anticipated in those estimates, which could materially affect our results of operations and financial condition. On March 11, 2020, the COVID-19 outbreak was declared a pandemic by the World Health Organization, which recommended containment and mitigation measures worldwide. COVID-19 and the response of governmental and public health organizations in dealing with the pandemic included restricting general activity levels within communities, the economy, and operations of our customers. While we have experienced an impact to our business, operations, and financial results as a result of the COVID-19 pandemic, it may have even more far-reaching impacts on many aspects of our operations including the impact on customer behaviors, business operations, our employees, and the market in general. The extent to which the COVID-19 pandemic ultimately impacts our business, financial condition, results of operations, cash flows, and liquidity may differ from management’s current estimates due to inherent uncertainties regarding the duration and further spread of COVID-19, actions taken to contain the virus, the efficacy and distribution of the vaccines, as well as, how quickly and to what extent normal economic and operating conditions can resume. |
Recent Accounting Standards | Recent Accounting Standards Recently adopted accounting standards In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-08: “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” The amendments require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We adopted this guidance on July 1, 2022 and will apply the guidance to any future business combinations. Recently issued accounting standards not yet adopted In March 2022, the FASB issued ASU No. 2022-02: “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.” The guidance was issued as improvements to ASU No. 2016-13. The vintage disclosure changes are relevant to Adtalem and require an entity to disclose current-period gross write-offs by year of origination for financing receivables. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The amendments should be applied prospectively. Early adoption of the amendments is permitted, including adoption in an interim period. Management expects to implement this guidance effective July 1, 2023. The amendments will impact our disclosures but will not otherwise impact Adtalem’s Consolidated Financial Statements. We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our Consolidated Financial Statements. |
Acquisitions (Tables)
Acquisitions (Tables) - Walden University, LLC | 6 Months Ended |
Dec. 31, 2022 | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in thousands): August 12, 2021 Assets acquired: Cash and cash equivalents $ 65,010 Restricted cash 18,389 Accounts receivable 22,091 Prepaid expenses and other current assets 8,819 Property and equipment 25,882 Operating lease assets 6,096 Deferred income taxes 59 Intangible assets 833,351 Goodwill 651,052 Other assets, net 21,316 Total assets acquired 1,652,065 Liabilities assumed: Accounts payable 31,971 Accrued payroll and benefits 25,639 Accrued liabilities 1,620 Deferred revenue 10,958 Current operating lease liabilities 1,983 Long-term operating lease liabilities 4,343 Other liabilities 4,098 Total liabilities assumed 80,612 Net assets acquired $ 1,571,453 |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The values and estimated useful lives of other intangible assets acquired are as follows (in thousands): August 12, 2021 Value Estimated Assigned Useful Life Student relationships $ 161,900 3 years Curriculum $ 56,091 5 years |
Schedule of pro forma financial information | The following unaudited pro forma financial information summarizes our results of operations as though the acquisition occurred on July 1, 2020 (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2021 2021 Revenue $ 371,198 $ 729,507 Net income $ 29,535 $ 14,842 |
Discontinued Operations and A_2
Discontinued Operations and Assets Held for Sale (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Balance Sheet and Income Statement Information of Discontinued Operations | The following is a summary of balance sheet information of assets and liabilities reported as held for sale as of December 31, 2021, which includes ACAMS, Becker, OCL, and EduPristine (in thousands): December 31, 2021 Assets: Current assets: Cash and cash equivalents $ 48,450 Accounts receivable, net 21,960 Prepaid expenses and other current assets 3,987 Total current assets held for sale 74,397 Noncurrent assets: Property and equipment, net 14,065 Operating lease assets 1,172 Intangible assets, net 133,777 Goodwill 376,165 Other assets, net 4,149 Total noncurrent assets held for sale 529,328 Total assets held for sale $ 603,725 Liabilities: Current liabilities: Accounts payable $ 14,242 Accrued payroll and benefits 7,551 Accrued liabilities 3,752 Deferred revenue 31,017 Current operating lease liabilities 1,128 Total current liabilities held for sale 57,690 Noncurrent liabilities: Long-term operating lease liabilities 342 Deferred income taxes 30,827 Other liabilities 917 Total noncurrent liabilities held for sale 32,086 Total liabilities held for sale $ 89,776 The following is a summary of income statement information of operations reported as discontinued operations, which includes ACAMS, Becker, OCL, and EduPristine operations through the date of each respective sale, a gain (loss) from post-closing working capital adjustments, and activity related to the DeVry University divestiture, which includes litigation and settlement costs we continue to incur and the earn-outs we received (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue $ — $ 53,082 $ — $ 112,339 Operating cost and expense: Cost of educational services — 8,914 — 19,974 Student services and administrative expense (524) 39,060 2,914 93,307 Restructuring expense — 949 — 949 Total operating cost and expense (524) 48,923 2,914 114,230 Income (loss) from discontinued operations before income taxes 524 4,159 (2,914) (1,891) Gain (loss) on disposal of discontinued operations before income taxes 185 — (3,174) — (Provision for) benefit from income taxes (182) (25,340) 2,961 (112) Income (loss) from discontinued operations $ 527 $ (21,181) $ (3,127) $ (2,003) |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregate revenue | The following tables disaggregate revenue by source (in thousands): Three Months Ended December 31, 2022 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 141,396 $ 131,940 $ 87,197 $ 360,533 Other — — 2,769 2,769 Total $ 141,396 $ 131,940 $ 89,966 $ 363,302 Six Months Ended December 31, 2022 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 276,801 $ 262,841 $ 172,711 $ 712,353 Other — — 5,508 5,508 Total $ 276,801 $ 262,841 $ 178,219 $ 717,861 Three Months Ended December 31, 2021 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 139,121 $ 140,627 $ 88,500 $ 368,248 Other — — 2,950 2,950 Total $ 139,121 $ 140,627 $ 91,450 $ 371,198 Six Months Ended December 31, 2021 Chamberlain Walden Medical and Veterinary Consolidated Tuition and fees $ 274,760 $ 209,244 $ 170,975 $ 654,979 Other — — 5,289 5,289 Total $ 274,760 $ 209,244 $ 176,264 $ 660,268 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Pre-tax restructuring charges by segment were as follows (in thousands): Three Months Ended December 31, 2022 Six Months Ended December 31, 2022 Real Estate and Other Termination Benefits Total Real Estate and Other Termination Benefits Total Chamberlain $ — $ — $ — $ 818 $ — $ 818 Walden 41 — 41 3,067 54 3,121 Medical and Veterinary 87 — 87 6,913 — 6,913 Home Office and Other 557 678 1,235 4,626 950 5,576 Total $ 685 $ 678 $ 1,363 $ 15,424 $ 1,004 $ 16,428 Three Months Ended December 31, 2021 Six Months Ended December 31, 2021 Real Estate and Other Termination Benefits Total Real Estate and Other Termination Benefits Total Chamberlain $ 263 $ 72 $ 335 $ 263 $ 72 $ 335 Walden — 1,791 1,791 — 1,791 1,791 Medical and Veterinary 62 126 188 62 126 188 Home Office and Other 657 416 1,073 1,646 2,521 4,167 Total $ 982 $ 2,405 $ 3,387 $ 1,971 $ 4,510 $ 6,481 |
Separation and Restructuring Plan Activity | The following table summarizes the separation and restructuring plan activity for fiscal years 2022 and 2023, for which cash payments are required (in thousands): Liability balance as of June 30, 2021 $ — Increase in liability (separation and other charges) 11,851 Reduction in liability (payments and adjustments) (11,038) Liability balance as of June 30, 2022 813 Increase in liability (separation and other charges) 1,004 Reduction in liability (payments and adjustments) (616) Liability balance as of December 31, 2022 $ 1,201 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Earnings per Share | |
Earnings per Share | The following table sets forth the computations of basic and diluted earnings per share and antidilutive shares (in thousands, except per share data): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Numerator: Net income (loss): Continuing operations $ 23,617 $ 39,034 $ 29,463 $ (38,148) Discontinued operations 527 (21,181) (3,127) (2,003) Net income (loss) $ 24,144 $ 17,853 $ 26,336 $ (40,151) Denominator: Weighted-average basic shares outstanding 45,425 49,776 45,350 49,719 Effect of dilutive stock awards 696 461 729 — Effect of ASR — — 153 — Weighted-average diluted shares outstanding 46,121 50,237 46,232 49,719 Earnings (loss) per share: Basic: Continuing operations $ 0.52 $ 0.78 $ 0.65 $ (0.77) Discontinued operations $ 0.01 $ (0.43) $ (0.07) $ (0.04) Total basic earnings (loss) per share $ 0.53 $ 0.36 $ 0.58 $ (0.81) Diluted: Continuing operations $ 0.51 $ 0.78 $ 0.64 $ (0.77) Discontinued operations $ 0.01 $ (0.42) $ (0.07) $ (0.04) Total diluted earnings (loss) per share $ 0.52 $ 0.36 $ 0.57 $ (0.81) Weighted-average antidilutive shares 365 1,336 421 1,254 |
Accounts Receivable and Credi_2
Accounts Receivable and Credit Losses (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Schedule of classification of our accounts receivable | The classification of our accounts receivable balances was as follows (in thousands): December 31, 2022 Gross Allowance Net Trade receivables, current $ 124,433 $ (27,516) $ 96,917 Financing receivables, current 6,060 (3,435) 2,625 Accounts receivable, current $ 130,493 $ (30,951) $ 99,542 Financing receivables, current $ 6,060 $ (3,435) $ 2,625 Financing receivables, noncurrent 39,043 (12,610) 26,433 Total financing receivables $ 45,103 $ (16,045) $ 29,058 June 30, 2022 Gross Allowance Net Trade receivables, current $ 109,882 $ (30,897) $ 78,985 Financing receivables, current 6,116 (3,466) 2,650 Accounts receivable, current $ 115,998 $ (34,363) $ 81,635 Financing receivables, current $ 6,116 $ (3,466) $ 2,650 Financing receivables, noncurrent 36,265 (11,425) 24,840 Total financing receivables $ 42,381 $ (14,891) $ 27,490 December 31, 2021 Gross Allowance Net Trade receivables, current $ 111,538 $ (21,335) $ 90,203 Financing receivables, current 7,252 (4,711) 2,541 Accounts receivable, current $ 118,790 $ (26,046) $ 92,744 Financing receivables, current $ 7,252 $ (4,711) $ 2,541 Financing receivables, noncurrent 39,534 (12,999) 26,535 Total financing receivables $ 46,786 $ (17,710) $ 29,076 |
Schedule of credit quality analysis of financing receivable | The credit quality analysis of financing receivables as of December 31, 2022 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2019 2020 2021 2022 2023 Total 1-30 days past due $ 362 $ 264 $ 141 $ 483 $ 1,183 $ 1,327 $ 3,760 31-60 days past due 78 64 — 385 316 493 1,336 61-90 days past due 144 49 37 25 756 40 1,051 91-120 days past due 58 — 37 448 207 — 750 121-150 days past due 38 122 45 301 80 — 586 Greater than 150 days past due 7,739 961 663 2,430 811 — 12,604 Total past due 8,419 1,460 923 4,072 3,353 1,860 20,087 Current 6,357 1,018 997 6,645 3,549 6,450 25,016 Financing receivables, gross $ 14,776 $ 2,478 $ 1,920 $ 10,717 $ 6,902 $ 8,310 $ 45,103 The credit quality analysis of financing receivables as of June 30, 2022 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2018 2019 2020 2021 2022 Total 1-30 days past due $ 104 $ 140 $ 114 $ 191 $ 699 $ 782 $ 2,030 31-60 days past due 278 38 214 145 691 332 1,698 61-90 days past due 58 29 217 8 668 273 1,253 91-120 days past due 97 139 113 45 670 14 1,078 121-150 days past due 17 30 20 41 206 81 395 Greater than 150 days past due 6,978 876 1,077 683 1,596 377 11,587 Total past due 7,532 1,252 1,755 1,113 4,530 1,859 18,041 Current 4,687 2,229 1,483 1,167 8,910 5,864 24,340 Financing receivables, gross $ 12,219 $ 3,481 $ 3,238 $ 2,280 $ 13,440 $ 7,723 $ 42,381 The credit quality analysis of financing receivables as of December 31, 2021 was as follows (in thousands): Amortized Cost Basis by Origination Year Prior 2018 2019 2020 2021 2022 Total 1-30 days past due $ 306 $ 118 $ 240 $ 30 $ 1,222 $ 370 $ 2,286 31-60 days past due 46 219 5 117 434 310 1,131 61-90 days past due 64 290 39 11 560 27 991 91-120 days past due — 28 18 152 372 — 570 121-150 days past due 587 13 155 — 328 102 1,185 Greater than 150 days past due 8,885 1,755 1,242 879 1,594 — 14,355 Total past due 9,888 2,423 1,699 1,189 4,510 809 20,518 Current 6,053 2,454 1,933 1,384 11,160 3,284 26,268 Financing receivables, gross $ 15,941 $ 4,877 $ 3,632 $ 2,573 $ 15,670 $ 4,093 $ 46,786 |
Rollforward of the allowance for credit losses | The following tables provide a rollforward of the allowance for credit losses (in thousands): Three Months Ended December 31, 2022 Six Months Ended December 31, 2022 Trade Financing Total Trade Financing Total Beginning balance $ 32,882 $ 15,624 $ 48,506 $ 30,897 $ 14,891 $ 45,788 Write-offs (14,712) (397) (15,109) (20,176) (616) (20,792) Recoveries 1,848 32 1,880 4,256 34 4,290 Provision for credit losses 7,498 786 8,284 12,539 1,736 14,275 Ending balance $ 27,516 $ 16,045 $ 43,561 $ 27,516 $ 16,045 $ 43,561 Three Months Ended December 31, 2021 Six Months Ended December 31, 2021 Trade Financing Total Trade Financing Total Beginning balance $ 16,497 $ 17,064 $ 33,561 $ 11,559 $ 16,832 $ 28,391 Write-offs (2,816) (209) (3,025) (4,548) (746) (5,294) Recoveries 2,104 17 2,121 3,354 17 3,371 Provision for credit losses 5,550 838 6,388 10,970 1,607 12,577 Ending balance $ 21,335 $ 17,710 $ 39,045 $ 21,335 $ 17,710 $ 39,045 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Property, Plant And Equipment [Abstract] | |
Schedule of Property and equipment, net | Property and equipment, net consisted of the following (in thousands): December 31, June 30, December 31, 2022 2022 2021 Land $ 44,476 $ 44,478 $ 44,478 Building 333,024 342,236 337,721 Equipment 232,114 268,352 268,783 Construction in progress 11,885 11,188 12,337 Property and equipment, gross 621,499 666,254 663,319 Accumulated depreciation (345,882) (376,328) (361,653) Property and equipment, net $ 275,617 $ 289,926 $ 301,666 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Lessee Disclosure [Abstract] | |
Summary of components of lease cost | The components of lease cost were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Operating lease cost $ 11,595 $ 14,362 $ 23,970 $ 28,587 Sublease income (3,516) (3,494) (7,086) (6,832) Total lease cost $ 8,079 $ 10,868 $ 16,884 $ 21,755 |
Summary of maturities of lease liabilities | Maturities of lease liabilities by fiscal year as of December 31, 2022 were as follows (in thousands): Operating Fiscal Year Leases 2023 (remaining) $ 30,312 2024 55,548 2025 45,078 2026 32,245 2027 29,769 Thereafter 63,355 Total lease payments 256,307 Less: imputed interest (41,366) Present value of lease liabilities $ 214,941 |
Summary of lease term and discount rate | Lease term and discount rate were as follows: December 31, 2022 Weighted-average remaining operating lease term (years) 5.7 Weighted-average operating lease discount rate 5.8% |
Summary of supplemental disclosures of cash flow information related to leases | Supplemental disclosures of cash flow information related to leases were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Cash paid for amounts in the measurement of operating lease liabilities (net of sublease receipts) $ 12,390 $ 13,525 $ 24,818 $ 26,728 Operating lease assets obtained in exchange for operating lease liabilities $ 13,038 $ 205 $ 13,038 $ 6,316 |
Schedule of Future minimum lease and sublease rental income | Future minimum lease and sublease rental income under these agreements as of December 31, 2022, were as follows (in thousands): Fiscal Year Amount 2023 (remaining) $ 7,920 2024 10,261 2025 5,121 2026 2,038 Total lease and sublease rental income $ 25,340 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill | The table below summarizes goodwill balances by reporting unit (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 4,716 $ 4,716 $ 4,716 Walden 651,052 651,052 649,848 AUC 68,321 68,321 68,321 RUSM and RUSVM 237,173 237,173 237,173 Total $ 961,262 $ 961,262 $ 960,058 The table below summarizes goodwill balances by reportable segment (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 4,716 $ 4,716 $ 4,716 Walden 651,052 651,052 649,848 Medical and Veterinary 305,494 305,494 305,494 Total $ 961,262 $ 961,262 $ 960,058 The table below summarizes the changes in goodwill balances by reportable segment (in thousands): Medical and Chamberlain Walden Veterinary Total June 30, 2021 $ 4,716 $ — $ 305,494 $ 310,210 Acquisition — 649,848 — 649,848 December 31, 2021 4,716 649,848 305,494 960,058 Purchase accounting adjustments — 1,204 — 1,204 June 30, 2022 4,716 651,052 305,494 961,262 December 31, 2022 $ 4,716 $ 651,052 $ 305,494 $ 961,262 |
Summary of Amortizable Intangible Assets | Amortizable intangible assets consisted of the following (in thousands): December 31, 2022 June 30, 2022 December 31, 2021 Gross Carrying Accumulated Gross Carrying Accumulated Gross Carrying Accumulated Weighted-Average Amount Amortization Amount Amortization Amount Amortization Amortization Period Student relationships $ 161,900 $ (116,551) $ 161,900 $ (87,457) $ 161,900 $ (42,943) 3 Years Curriculum 56,091 (15,427) 56,091 (9,817) 56,091 (4,207) 5 Years Total $ 217,991 $ (131,978) $ 217,991 $ (97,274) $ 217,991 $ (47,150) |
Summary of Indefinite-Lived Intangible Assets | Indefinite-lived intangible assets consisted of the following (in thousands): December 31, June 30, December 31, 2022 2022 2021 Walden trade name $ 119,560 $ 119,560 $ 119,560 AUC trade name 17,100 17,100 17,100 Ross trade name 5,100 5,100 5,100 Chamberlain Title IV eligibility and accreditations 1,200 1,200 1,200 Walden Title IV eligibility and accreditations 495,800 495,800 495,800 AUC Title IV eligibility and accreditations 100,000 100,000 100,000 Ross Title IV eligibility and accreditations 14,100 14,100 14,100 Total $ 752,860 $ 752,860 $ 752,860 The table below summarizes the indefinite-lived intangible asset balances by reportable segment (in thousands): December 31, June 30, December 31, 2022 2022 2021 Chamberlain $ 1,200 $ 1,200 $ 1,200 Walden 615,360 615,360 615,360 Medical and Veterinary 136,300 136,300 136,300 Total $ 752,860 $ 752,860 $ 752,860 |
Estimated Amortization Expense for Amortized Intangible Assets | Future intangible asset amortization expense, by reporting unit, is expected to be as follows (in thousands): Fiscal Year Walden 2023 (remaining) $ 26,535 2024 35,644 2025 11,220 2026 11,220 2027 1,394 Total $ 86,013 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Debt Instruments [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following senior secured credit facilities (in thousands): December 31, June 30, December 31, 2022 2022 2021 Total debt: Senior Secured Notes due 2028 $ 404,950 $ 405,882 $ 800,000 Term Loan B 303,333 453,333 850,000 Total principal payments due 708,283 859,215 1,650,000 Unamortized debt discount and issuance costs (14,502) (20,307) (41,962) Total amount outstanding 693,781 838,908 1,608,038 Less current portion: Term Loan B — — (8,500) Noncurrent portion $ 693,781 $ 838,908 $ 1,599,538 |
Schedule of Maturities of Long-term Debt | Scheduled future maturities of long-term debt were as follows (in thousands): Maturity Fiscal Year Payments 2023 (remaining) $ — 2024 — 2025 — 2026 — 2027 — Thereafter 708,283 Total $ 708,283 |
Schedule Of Debt Issuance Costs | The following table summarizes the unamortized debt discount and issuance costs activity for the six months ended December 31, 2022 (in thousands): Notes Term Loan B Revolver Total Unamortized debt discount and issuance costs as of June 30, 2022 $ 6,725 $ 13,582 $ 8,383 $ 28,690 Amortization of debt discount and issuance costs (560) (948) (1,014) (2,522) Debt discount and issuance costs write-off (15) (4,282) — (4,297) Unamortized debt discount and issuance costs as of December 31, 2022 $ 6,150 $ 8,352 $ 7,369 $ 21,871 |
Schedule of components of interest expense | The components of interest expense were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Notes interest expense $ 5,568 $ 11,000 $ 11,165 $ 22,000 Term Loan B interest expense 6,450 11,405 13,451 17,603 Term Loan B ticking fees — — — 5,330 Prior Term Loan B interest expense — — — 1,272 Term Loan B debt discount and issuance costs write-off 1,402 — 4,282 — Notes issuance costs write-off — — 15 — Gain on extinguishment of debt — — (71) — Unused bridge fee — — — 10,329 Prior Credit Facility issuance costs write-off — — — 6,000 Swap settlement — — — 4,525 Amortization of debt discount and issuance costs 1,190 2,127 2,522 3,656 Other 979 1,397 1,985 2,607 Total interest expense $ 15,589 $ 25,929 $ 33,349 $ 73,322 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Comprehensive Income, Net Of Tax [Abstract] | |
Schedule of accumulated other comprehensive income loss | The following table shows the changes in accumulated other comprehensive loss by component (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Foreign currency translation adjustments Beginning balance $ (2,227) $ (740) $ (960) $ (670) Gain (loss) on foreign currency translation — 106 (1,267) 36 Ending balance $ (2,227) $ (634) $ (2,227) $ (634) Interest rate swap Beginning balance, gross $ — $ — $ — $ (8,926) Beginning balance, tax effect — — — 2,231 Beginning balance, net of tax — — — (6,695) Reclassification from other comprehensive income — — — 6,695 Ending balance $ — $ — $ — $ — Total ending balance $ (2,227) $ (634) $ (2,227) $ (634) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of options Activity | The following is a summary of options activity for the six months ended December 31, 2022: Weighted-Average Remaining Aggregate Number of Weighted-Average Contractual Life Intrinsic Value Options Exercise Price (in years) (in thousands) Outstanding as of July 1, 2022 1,144,372 $ 35.36 Exercised (54,514) 26.08 Expired (1,575) 18.60 Outstanding as of December 31, 2022 1,088,283 35.85 5.9 $ 2,103 Exercisable as of December 31, 2022 813,502 $ 35.81 5.2 $ 1,746 |
Fair Values of Stock Option Awards Estimated Weighted Average Assumptions | No stock options were granted during the first six months of fiscal year 2023. The fair value of Adtalem’s option grants was estimated assuming the following weighted-average assumptions: Fiscal Year 2022 Expected life (in years) 6.56 Expected volatility 39.99 % Risk-free interest rate 0.94 % Dividend yield 0.00 % |
Summary of Restricted Stock Units Activity | The following is a summary of RSU activity for the six months ended December 31, 2022: Weighted-Average Number of Grant Date RSUs Fair Value Unvested as of July 1, 2022 1,171,692 $ 35.05 Granted 320,970 39.87 Vested (305,449) 37.58 Forfeited (70,778) 37.90 Unvested as of December 31, 2022 1,116,435 $ 35.56 |
Total Stock-Based Compensation Expense Included in Consolidated Statement of Earnings | Stock-based compensation expense, which is included in student services and administrative expense, and the related income tax benefit were as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Stock-based compensation $ 1,968 $ 4,220 $ 8,113 $ 13,931 Income tax benefit (622) (1,074) (2,303) (2,493) Stock-based compensation, net of tax $ 1,346 $ 3,146 $ 5,810 $ 11,438 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Tabulation of Business Segment Information Based on Current Segmentation | Summary financial information by reportable segment is as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue: Chamberlain $ 141,396 $ 139,121 $ 276,801 $ 274,760 Walden 131,940 140,627 262,841 209,244 Medical and Veterinary 89,966 91,450 178,219 176,264 Total consolidated revenue $ 363,302 $ 371,198 $ 717,861 $ 660,268 Adjusted operating income: Chamberlain $ 33,229 $ 25,791 $ 60,231 $ 46,646 Walden 29,012 32,401 52,403 43,413 Medical and Veterinary 23,017 19,706 40,371 35,371 Home Office and Other (5,751) (7,664) (8,397) (18,759) Total consolidated adjusted operating income 79,507 70,234 144,608 106,671 Reconciliation to Consolidated Financial Statements: Deferred revenue adjustment — (2,354) — (8,561) CEO transition costs — — — (6,195) Restructuring expense (1,363) (3,387) (16,428) (6,481) Business acquisition and integration expense (15,941) (9,060) (24,356) (35,613) Intangible amortization expense (16,176) (30,699) (34,704) (47,150) Total consolidated operating income 46,027 24,734 69,120 2,671 Interest expense (15,589) (25,929) (33,349) (73,322) Other (expense) income, net (2,574) 861 (1,007) 1,739 Total consolidated income (loss) from continuing operations before income taxes $ 27,864 $ (334) $ 34,764 $ (68,912) Capital expenditures: Chamberlain $ 1,492 $ 2,969 $ 2,918 $ 6,614 Walden 268 2,748 1,093 2,932 Medical and Veterinary 342 504 915 1,759 Home Office and Other 2,094 1,860 4,821 3,467 Total consolidated capital expenditures $ 4,196 $ 8,081 $ 9,747 $ 14,772 Depreciation expense: Chamberlain $ 4,099 $ 4,726 $ 8,580 $ 9,310 Walden 2,269 2,516 4,864 4,228 Medical and Veterinary 3,031 3,645 6,136 7,100 Home Office and Other 1,257 744 1,881 1,492 Total consolidated depreciation expense $ 10,656 $ 11,631 $ 21,461 $ 22,130 Intangible asset amortization expense: Walden $ 16,176 $ 30,699 $ 34,704 $ 47,150 Total consolidated intangible asset amortization expense $ 16,176 $ 30,699 $ 34,704 $ 47,150 |
Revenues and Long-Lived Assets by Geographic Area | Revenue and long-lived assets by geographic area are as follows (in thousands): Three Months Ended Six Months Ended December 31, December 31, 2022 2021 2022 2021 Revenue from unaffiliated customers: Domestic operations $ 273,336 $ 279,748 $ 539,642 $ 484,004 Barbados, St. Kitts, and St. Maarten 89,966 91,450 178,219 176,264 Total consolidated revenue $ 363,302 $ 371,198 $ 717,861 $ 660,268 Long-lived assets: Domestic operations $ 287,811 $ 305,848 $ 287,811 $ 305,848 Barbados, St. Kitts, and St. Maarten 162,903 151,174 162,903 151,174 Total consolidated long-lived assets $ 450,714 $ 457,022 $ 450,714 $ 457,022 |
Nature of Operations (Details)
Nature of Operations (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) item segment | Dec. 31, 2021 USD ($) | |
Number of reportable segments | segment | 3 | |||
Business acquisition and integration expense | $ 15,941 | $ 9,060 | $ 24,356 | $ 35,613 |
Walden University | ||||
Minimum number of courses offered | item | 100 | |||
Walden University, LLC | ||||
Business acquisition and integration expense | $ 15,900 | $ 9,100 | $ 24,400 | $ 35,600 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Interest income | $ 2,400 | $ 900 | $ 4,000 | $ 1,700 |
Investment impairment | 5,000 | 5,000 | ||
Business acquisition and integration expense | 15,941 | 9,060 | 24,356 | 35,613 |
Walden University, LLC | ||||
Business acquisition and integration expense | $ 15,900 | $ 9,100 | $ 24,400 | $ 35,600 |
Acquisitions (Estimated Fair Va
Acquisitions (Estimated Fair Values of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Aug. 12, 2021 |
Assets acquired: | ||||
Goodwill | $ 961,262 | $ 961,262 | $ 960,058 | |
Walden University, LLC | ||||
Assets acquired: | ||||
Cash and cash equivalents | $ 65,010 | |||
Restricted cash | 18,389 | |||
Accounts receivable | 22,091 | |||
Prepaid expenses and other current assets | 8,819 | |||
Property and equipment | 25,882 | |||
Operating lease assets | 6,096 | |||
Deferred income taxes | 59 | |||
Intangible assets | 833,351 | |||
Goodwill | 651,052 | |||
Other assets, net | 21,316 | |||
Total assets acquired | 1,652,065 | |||
Liabilities assumed: | ||||
Accounts payable | 31,971 | |||
Accrued payroll and benefits | 25,639 | |||
Accrued liabilities | 1,620 | |||
Deferred revenue | 10,958 | |||
Current operating lease liabilities | 1,983 | |||
Long-term operating lease liabilities | 4,343 | |||
Other liabilities | 4,098 | |||
Total liabilities assumed | 80,612 | |||
Net assets acquired | $ 1,571,453 |
Acquisitions (Acquired Intangib
Acquisitions (Acquired Intangible Assets Subject to Amortization and Values and Estimated Useful Lives) (Details) - Walden University, LLC $ in Thousands | Aug. 12, 2021 USD ($) |
Student Relationships | |
Business Acquisition [Line Items] | |
Intangible assets, finite lived | $ 161,900 |
Amortizable intangible assets, estimated useful lives | 3 years |
Curriculum | |
Business Acquisition [Line Items] | |
Intangible assets, finite lived | $ 56,091 |
Amortizable intangible assets, estimated useful lives | 5 years |
Acquisitions (Unaudited Proform
Acquisitions (Unaudited Proforma Financial Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Dec. 31, 2022 | Dec. 31, 2021 | |
Unaudited pro forma financial information | ||
Revenue | $ 371,198 | $ 729,507 |
Net income | $ 29,535 | $ 14,842 |
Acquisitions (Additional Inform
Acquisitions (Additional Information) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 12, 2021 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |||||
Payments to acquire business | $ 0 | $ 1,488,054 | |||
Long-term debt, gross | $ 1,650,000 | 708,283 | 1,650,000 | $ 859,215 | |
Senior Secured Notes Due 2028 | |||||
Business Acquisition [Line Items] | |||||
Long-term debt, gross | 800,000 | 404,950 | 800,000 | 405,882 | |
Term B Loan | |||||
Business Acquisition [Line Items] | |||||
Long-term debt, gross | 850,000 | $ 303,333 | 850,000 | $ 453,333 | |
Walden University, LLC | |||||
Business Acquisition [Line Items] | |||||
Percentage of voting interests acquired | 100% | ||||
Payments to acquire business | $ 1,488,100 | ||||
Cash acquired from acquisition | $ 83,400 | ||||
Minimum number of courses offered | item | 100 | ||||
Revenue | 140,600 | 209,200 | |||
Net loss | $ 1,800 | 10,500 | |||
Acquisition costs | $ 22,300 | ||||
Fair value of acquired accounts receivable | $ 22,100 | ||||
Gross amount due under contracts | 37,900 | ||||
Expected uncollectible | 15,800 | ||||
Intangible assets | 833,351 | ||||
Walden University, LLC | Senior Secured Notes Due 2028 | |||||
Business Acquisition [Line Items] | |||||
Long-term debt, gross | 800,000 | ||||
Walden University, LLC | Term B Loan | |||||
Business Acquisition [Line Items] | |||||
Long-term debt, gross | 850,000 | ||||
Walden University, LLC | Walden Title IV eligibility and accreditations | |||||
Business Acquisition [Line Items] | |||||
Intangible assets, indefinite lived | 495,800 | ||||
Walden University, LLC | Trade Name | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | $ 119,600 |
Discontinued Operations and A_3
Discontinued Operations and Assets Held for Sale (Summary of Balance Sheet Information of Assets and Liabilities) (Detail) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | |||
Cash and cash equivalents | $ 48,450 | ||
Accounts receivable, net | 21,960 | ||
Prepaid expenses and other current assets | 3,987 | ||
Total current assets held for sale | $ 0 | $ 0 | 74,397 |
Noncurrent assets: | |||
Property and equipment, net | 14,065 | ||
Operating lease assets | 1,172 | ||
Intangible assets, net | 133,777 | ||
Goodwill | 376,165 | ||
Other assets, net | 4,149 | ||
Total noncurrent assets held for sale | 0 | 0 | 529,328 |
Total assets held for sale | 603,725 | ||
Current Liabilities: | |||
Accounts payable | 14,242 | ||
Accrued payroll and benefits | 7,551 | ||
Accrued liabilities | 3,752 | ||
Deferred revenue | 31,017 | ||
Current operating lease liabilities | 1,128 | ||
Total current liabilities held for sale | 0 | 0 | 57,690 |
Noncurrent liabilities: | |||
Long-term operating lease liabilities | 342 | ||
Deferred income taxes | 30,827 | ||
Other liabilities | 917 | ||
Total noncurrent liabilities held for sale | $ 0 | $ 0 | 32,086 |
Total liabilities held for sale | $ 89,776 |
Discontinued Operations and A_4
Discontinued Operations and Assets Held for Sale (Summary of Income Statement Information of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Discontinued Operations And Disposal Groups [Abstract] | ||||
Revenue | $ 0 | $ 53,082 | $ 0 | $ 112,339 |
Operating cost and expense: | ||||
Cost of educational services | 0 | 8,914 | 0 | 19,974 |
Student services and administrative expense | (524) | 39,060 | 2,914 | 93,307 |
Restructuring expense | 0 | 949 | 0 | 949 |
Total operating cost and expense | (524) | 48,923 | 2,914 | 114,230 |
Income (loss) from discontinued operations before income taxes | 524 | 4,159 | (2,914) | (1,891) |
Gain (loss) on disposal of discontinued operations before income taxes | 185 | 0 | (3,174) | 0 |
(Provision for) benefit from income taxes | (182) | (25,340) | 2,961 | (112) |
Income (loss) from discontinued operations | $ 527 | $ (21,181) | $ (3,127) | $ (2,003) |
Discontinued Operations and A_5
Discontinued Operations and Assets Held for Sale (Additional Information) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 15 Months Ended | |||||
Mar. 10, 2022 USD ($) | Dec. 11, 2018 USD ($) | Dec. 11, 2018 USD ($) | Dec. 31, 2022 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) lease | Dec. 31, 2022 USD ($) | |
Earn Out Received | $ 4,100 | $ 2,900 | $ 7,000 | |||||
Cash balance | $ 48,450 | |||||||
Wendel Group and Colibri Group | Equity Purchase Agreement | ||||||||
Cash balance | $ 21,500 | |||||||
Sale of stock | $ 962,700 | |||||||
DeVry University | ||||||||
Earn Out Term | 10 years | |||||||
Earn Out Maximum | $ 20,000 | |||||||
Receivable with Imputed Interest, Face Amount | $ 10,000 | $ 10,000 | ||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | 4% | ||||||
Receivable with Imputed Interest, Due Date | Jan. 01, 2022 | Jan. 01, 2022 | ||||||
Operating lease, option to extend | true | |||||||
Lessor, Operating Lease, Number Of Contracts Without Option To Extend | lease | 1 | |||||||
Lessee, Operating Lease, Term of Contract | 1 year | 1 year | 1 year | |||||
Loan payment received | $ 10,000 | |||||||
EduPristine | Wendel Group and Colibri Group | Equity Purchase Agreement | ||||||||
Cash Transferred Out From Divestitures Of Discontinued Operation | $ 1,900 | $ 1,900 | $ 1,900 | |||||
Association of Certified Anti-Money Laundering Specialists | Wendel Group and Colibri Group | Equity Purchase Agreement | ||||||||
Loss on sale of assets | $ 200 | $ (3,200) |
Revenue (Disaggregate revenue)
Revenue (Disaggregate revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 363,302 | $ 371,198 | $ 717,861 | $ 660,268 |
Tuition and fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 360,533 | 368,248 | 712,353 | 654,979 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 2,769 | 2,950 | 5,508 | 5,289 |
Chamberlain | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 141,396 | 139,121 | 276,801 | 274,760 |
Chamberlain | Tuition and fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 141,396 | 139,121 | 276,801 | 274,760 |
Chamberlain | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Walden University | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 131,940 | 140,627 | 262,841 | 209,244 |
Walden University | Tuition and fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 131,940 | 140,627 | 262,841 | 209,244 |
Walden University | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Medical and Veterinary | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 89,966 | 91,450 | 178,219 | 176,264 |
Medical and Veterinary | Tuition and fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 87,197 | 88,500 | 172,711 | 170,975 |
Medical and Veterinary | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 2,769 | $ 2,950 | $ 5,508 | $ 5,289 |
Revenue (Additional Information
Revenue (Additional Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue recognized included in the deferred revenue | $ 0.7 | $ 0 | $ 141.4 | $ 68.8 |
Revenue practical expedient remaining performance obligation applied | true | |||
Maximum | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue practical expedient remaining performance obligation | 1 year | 1 year |
Restructuring Charges (Restruct
Restructuring Charges (Restructuring and Related Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | $ 1,363 | $ 3,387 | $ 16,428 | $ 6,481 |
Chamberlain. | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 335 | 818 | 335 | |
Walden | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 41 | 1,791 | 3,121 | 1,791 |
Medical and Veterinary | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 87 | 188 | 6,913 | 188 |
Home Office and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 1,235 | 1,073 | 5,576 | 4,167 |
Real Estate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 685 | 982 | 15,424 | 1,971 |
Real Estate and Other | Chamberlain. | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 263 | 818 | 263 | |
Real Estate and Other | Walden | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 41 | 3,067 | ||
Real Estate and Other | Medical and Veterinary | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 87 | 62 | 6,913 | 62 |
Real Estate and Other | Home Office and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 557 | 657 | 4,626 | 1,646 |
Termination Benefits | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 678 | 2,405 | 1,004 | 4,510 |
Termination Benefits | Chamberlain. | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 72 | 72 | ||
Termination Benefits | Walden | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 1,791 | 54 | 1,791 | |
Termination Benefits | Medical and Veterinary | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 126 | 126 | ||
Termination Benefits | Home Office and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | $ 678 | $ 416 | $ 950 | $ 2,521 |
Restructuring Charges (Separati
Restructuring Charges (Separation and Restructuring Plan Activity) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Jun. 30, 2022 | |
Restructuring and Related Activities [Abstract] | ||
Liability beginning balance | $ 813 | $ 0 |
Increase in liability (separation and other charges) | 1,004 | 11,851 |
Reduction in liability (payments and adjustments) | (616) | (11,038) |
Liability ending balance | $ 1,201 | $ 813 |
Restructuring Charges (Addition
Restructuring Charges (Additional Information) (Detail) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Jun. 30, 2021 |
Restructuring Cost and Reserve [Line Items] | |||
Liability balance | $ 1,201 | $ 813 | $ 0 |
Accrued Liabilities | |||
Restructuring Cost and Reserve [Line Items] | |||
Liability balance | $ 1,200 |
Income Taxes (Details)
Income Taxes (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | |
Income Tax Disclosure [Abstract] | ||||
Income Tax Expense (Benefit) | $ | $ 4,247 | $ (39,368) | $ 5,301 | $ (30,764) |
Number of operating units benefit from local tax incentives | item | 3 | |||
U.S. federal corporate tax rate | 21% | 21% | 21% | 21% |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 14, 2022 | |
Numerator: | |||||
Continuing operations | $ 23,617 | $ 39,034 | $ 29,463 | $ (38,148) | |
Discontinued operations | 527 | (21,181) | (3,127) | (2,003) | |
Net income (loss) | $ 24,144 | $ 17,853 | $ 26,336 | $ (40,151) | |
Denominator: | |||||
Weighted-average basic shares outstanding | 45,425 | 49,776 | 45,350 | 49,719 | |
Effect of dilutive stock awards | 696 | 461 | 729 | 0 | |
Effect of ASR | 153 | ||||
Weighted-average diluted shares outstanding | 46,121 | 50,237 | 46,232 | 49,719 | |
Basic: | |||||
Continuing operations | $ 0.52 | $ 0.78 | $ 0.65 | $ (0.77) | |
Discontinued operations | 0.01 | (0.43) | (0.07) | (0.04) | |
Total basic earnings (loss) per share | 0.53 | 0.36 | 0.58 | (0.81) | |
Diluted: | |||||
Continuing operations | 0.51 | 0.78 | 0.64 | (0.77) | |
Discontinued operations | 0.01 | (0.42) | (0.07) | (0.04) | |
Total diluted earnings (loss) per share | $ 0.52 | $ 0.36 | $ 0.57 | $ (0.81) | |
Weighted-average anti-dilutive shares | 447 | ||||
Authorized amount for repurchase | $ 150,000 | ||||
Contingently issuable shares under the ASR agreement | 0 | 0 | |||
Weighted Average | |||||
Diluted: | |||||
Weighted-average anti-dilutive shares | 365 | 1,336 | 421 | 1,254 |
Accounts Receivable and Credi_3
Accounts Receivable and Credit Losses (Classification of Accounts Receivable) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||||||
Trade receivables, current - Gross | $ 124,433 | $ 109,882 | $ 111,538 | |||
Trade receivables, current - Allowance | (27,516) | (30,897) | (21,335) | |||
Trade receivables, current - Net | 96,917 | 78,985 | 90,203 | |||
Financing Receivable, after Allowance for Credit Loss, Current [Abstract] | ||||||
Financing receivables, current - Gross | 6,060 | 6,116 | 7,252 | |||
Financing receivables, current - Allowance | (3,435) | (3,466) | (4,711) | |||
Financing receivables, current - Net | 2,625 | 2,650 | 2,541 | |||
Accounts Receivable, after Allowance for Credit Loss [Abstract] | ||||||
Accounts receivable, current - Gross | 130,493 | 115,998 | 118,790 | |||
Accounts receivable, current - Allowance | (30,951) | (34,363) | (26,046) | |||
Accounts receivable, current - Net | 99,542 | 81,635 | 92,744 | |||
Financing Receivable, after Allowance for Credit Loss, Noncurrent [Abstract] | ||||||
Financing receivables, noncurrent - Gross | 39,043 | 36,265 | 39,534 | |||
Financing receivables, noncurrent - Allowance | (12,610) | (11,425) | (12,999) | |||
Financing receivables, noncurrent - Net | 26,433 | 24,840 | 26,535 | |||
Financing Receivable, after Allowance for Credit Loss [Abstract] | ||||||
Total | 45,103 | 42,381 | 46,786 | |||
Total Financing receivables - Allowance | (16,045) | $ (15,624) | (14,891) | (17,710) | $ (17,064) | $ (16,832) |
Total Financing receivables - Net | $ 29,058 | $ 27,490 | $ 29,076 |
Accounts Receivable and Credi_4
Accounts Receivable and Credit Losses (Credit Quality Analysis of Financing Receivable) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | $ 14,776 | $ 12,219 | $ 15,941 |
Four Years Before | 2,478 | 3,481 | 4,877 |
Three Years Before | 1,920 | 3,238 | 3,632 |
Two Years Before | 10,717 | 2,280 | 2,573 |
Year Before | 6,902 | 13,440 | 15,670 |
Origination Year | 8,310 | 7,723 | 4,093 |
Total | 45,103 | 42,381 | 46,786 |
Total Institutional Loans | 45,103 | 42,381 | 46,786 |
Financing Receivables 1 To 30 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 362 | 104 | 306 |
Four Years Before | 264 | 140 | 118 |
Three Years Before | 141 | 114 | 240 |
Two Years Before | 483 | 191 | 30 |
Year Before | 1,183 | 699 | 1,222 |
Origination Year | 1,327 | 782 | 370 |
Total | 3,760 | 2,030 | 2,286 |
Total Institutional Loans | 3,760 | 2,030 | 2,286 |
Financing Receivables 31 To 60 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 78 | 278 | 46 |
Four Years Before | 64 | 38 | 219 |
Three Years Before | 0 | 214 | 5 |
Two Years Before | 385 | 145 | 117 |
Year Before | 316 | 691 | 434 |
Origination Year | 493 | 332 | 310 |
Total | 1,336 | 1,698 | 1,131 |
Total Institutional Loans | 1,336 | 1,698 | 1,131 |
Financing Receivables 61 To 90 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 144 | 58 | 64 |
Four Years Before | 49 | 29 | 290 |
Three Years Before | 37 | 217 | 39 |
Two Years Before | 25 | 8 | 11 |
Year Before | 756 | 668 | 560 |
Origination Year | 40 | 273 | 27 |
Total | 1,051 | 1,253 | 991 |
Total Institutional Loans | 1,051 | 1,253 | 991 |
Financing Receivables 91 To 120 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 58 | 97 | 0 |
Four Years Before | 0 | 139 | 28 |
Three Years Before | 37 | 113 | 18 |
Two Years Before | 448 | 45 | 152 |
Year Before | 207 | 670 | 372 |
Origination Year | 0 | 14 | 0 |
Total | 750 | 1,078 | 570 |
Total Institutional Loans | 750 | 1,078 | 570 |
Financing Receivables 121 To 150 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 38 | 17 | 587 |
Four Years Before | 122 | 30 | 13 |
Three Years Before | 45 | 20 | 155 |
Two Years Before | 301 | 41 | 0 |
Year Before | 80 | 206 | 328 |
Origination Year | 0 | 81 | 102 |
Total | 586 | 395 | 1,185 |
Total Institutional Loans | 586 | 395 | 1,185 |
Financing Receivables Greater Than 150 Days Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 7,739 | 6,978 | 8,885 |
Four Years Before | 961 | 876 | 1,755 |
Three Years Before | 663 | 1,077 | 1,242 |
Two Years Before | 2,430 | 683 | 879 |
Year Before | 811 | 1,596 | 1,594 |
Origination Year | 0 | 377 | 0 |
Total | 12,604 | 11,587 | 14,355 |
Total Institutional Loans | 12,604 | 11,587 | 14,355 |
Financial Asset, Past Due | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 8,419 | 7,532 | 9,888 |
Four Years Before | 1,460 | 1,252 | 2,423 |
Three Years Before | 923 | 1,755 | 1,699 |
Two Years Before | 4,072 | 1,113 | 1,189 |
Year Before | 3,353 | 4,530 | 4,510 |
Origination Year | 1,860 | 1,859 | 809 |
Total | 20,087 | 18,041 | 20,518 |
Total Institutional Loans | 20,087 | 18,041 | 20,518 |
Financing Receivable Current | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Prior | 6,357 | 4,687 | 6,053 |
Four Years Before | 1,018 | 2,229 | 2,454 |
Three Years Before | 997 | 1,483 | 1,933 |
Two Years Before | 6,645 | 1,167 | 1,384 |
Year Before | 3,549 | 8,910 | 11,160 |
Origination Year | 6,450 | 5,864 | 3,284 |
Total | 25,016 | 24,340 | 26,268 |
Total Institutional Loans | $ 25,016 | $ 24,340 | $ 26,268 |
Accounts Receivable and Credi_5
Accounts Receivable and Credit Losses (Rollforward of Allowances for Credit Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Trade | ||||
Beginning balance | $ 32,882 | $ 16,497 | $ 30,897 | $ 11,559 |
Write-offs | (14,712) | (2,816) | (20,176) | (4,548) |
Recoveries | 1,848 | 2,104 | 4,256 | 3,354 |
Provision for credit losses | 7,498 | 5,550 | 12,539 | 10,970 |
Ending balance | 27,516 | 21,335 | 27,516 | 21,335 |
Financing | ||||
Beginning balance | 15,624 | 17,064 | 14,891 | 16,832 |
Write-offs | (397) | (209) | (616) | (746) |
Recoveries | 32 | 17 | 34 | 17 |
Provision for credit losses | 786 | 838 | 1,736 | 1,607 |
Ending balance | 16,045 | 17,710 | 16,045 | 17,710 |
Allowance for credit losses | ||||
Beginning balance | 48,506 | 33,561 | 45,788 | 28,391 |
Write-offs | (15,109) | (3,025) | (20,792) | (5,294) |
Recoveries | 1,880 | 2,121 | 4,290 | 3,371 |
Provision for credit losses | 8,284 | 6,388 | 14,275 | 12,577 |
Ending balance | $ 43,561 | $ 39,045 | $ 43,561 | $ 39,045 |
Accounts Receivable and Credi_6
Accounts Receivable and Credit Losses (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Jul. 31, 2019 | Dec. 11, 2018 | Dec. 11, 2018 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | |
Financing Receivables [Line Items] | ||||||||||
Financing Receivable Allowance For Credit Losses | $ 16,045 | $ 17,710 | $ 14,891 | $ 15,624 | $ 17,064 | $ 16,832 | ||||
Minimum | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 3% | |||||||||
Maximum | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 12% | |||||||||
DeVry University | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Receivable with Imputed Interest, Face Amount | $ 10,000 | $ 10,000 | ||||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | 4% | ||||||||
Receivable with Imputed Interest, Due Date | Jan. 01, 2022 | Jan. 01, 2022 | ||||||||
Loan payment received | $ 10,000 | |||||||||
Chicago, Illinois Campus | Other Noncurrent Assets | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Loan Receivable | $ 44,600 | $ 43,300 | $ 44,000 | |||||||
Chicago, Illinois Campus | Discontinued Operations, Disposed of by Sale | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Financing Receivable Allowance For Credit Losses | $ 0 | |||||||||
Receivable with Imputed Interest, Face Amount | $ 46,800 | |||||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | |||||||||
Receivable with Imputed Interest, Due Date | Jul. 31, 2024 | |||||||||
Future Cash Flows Discounting Rate | 7% | 7% | 7% | |||||||
Chicago, Illinois Campus | Discontinued Operations, Disposed of by Sale | Other Noncurrent Assets | ||||||||||
Financing Receivables [Line Items] | ||||||||||
Loan Receivable | $ 44,600 | $ 43,300 | $ 44,000 |
Property and Equipment, Net (Sc
Property and Equipment, Net (Schedule of Property and equipment, net) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Property and Equipment, Net | |||
Property and equipment, gross | $ 621,499 | $ 666,254 | $ 663,319 |
Accumulated depreciation | (345,882) | (376,328) | (361,653) |
Property and equipment, net | 275,617 | 289,926 | 301,666 |
Land | |||
Property and Equipment, Net | |||
Property and equipment, gross | 44,476 | 44,478 | 44,478 |
Building | |||
Property and Equipment, Net | |||
Property and equipment, gross | 333,024 | 342,236 | 337,721 |
Equipment | |||
Property and Equipment, Net | |||
Property and equipment, gross | 232,114 | 268,352 | 268,783 |
Construction in progress | |||
Property and Equipment, Net | |||
Property and equipment, gross | $ 11,885 | $ 11,188 | $ 12,337 |
Property and Equipment, Net (Ad
Property and Equipment, Net (Additional Information) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Dec. 31, 2021 |
Real Estate [Line Items] | ||
Notes receivable | $ 21,960 | |
Financing payables | $ 917 | |
Discontinued Operations, Disposed of by Sale | Chicago, Illinois Campus | ||
Real Estate [Line Items] | ||
Proceeds from disposal | $ 52,000 | |
Proceeds From Down Payment on Seller Loan | 5,200 | |
Receivable with Imputed Interest, Face Amount | $ 46,800 | |
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | |
Discontinued Operations, Disposed of by Sale | Chicago, Illinois Campus | Other Noncurrent Assets | ||
Real Estate [Line Items] | ||
Notes receivable | $ 40,300 | |
Discontinued Operations, Disposed of by Sale | Chicago, Illinois Campus | Other Liabilities | ||
Real Estate [Line Items] | ||
Financing payables | $ 45,500 |
Leases (Components of Lease Cos
Leases (Components of Lease Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Lease, Cost [Abstract] | ||||
Operating lease cost | $ 11,595 | $ 14,362 | $ 23,970 | $ 28,587 |
Sublease income | (3,516) | (3,494) | (7,086) | (6,832) |
Total lease cost | $ 8,079 | $ 10,868 | $ 16,884 | $ 21,755 |
Leases (Maturities of Lease Lia
Leases (Maturities of Lease Liabilities) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Maturities of lease liabilities | |
2023 (remaining) | $ 30,312 |
2024 | 55,548 |
2025 | 45,078 |
2026 | 32,245 |
2027 | 29,769 |
Thereafter | 63,355 |
Total lease payments | 256,307 |
Less: imputed interest | (41,366) |
Present value of lease liabilities | $ 214,941 |
Leases (Lease Term, Discount Ra
Leases (Lease Term, Discount Rate and Cash Flow Information ) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Lessee Disclosure [Abstract] | ||||
Weighted-average remaining operating lease term (years) | 5 years 8 months 12 days | 5 years 8 months 12 days | ||
Weighted-average operating lease discount rate | 5.80% | 5.80% | ||
Cash paid for amounts in the measurement of operating lease liabilities (net of sublease receipts) | $ 12,390 | $ 13,525 | $ 24,818 | $ 26,728 |
Operating lease assets obtained in exchange for operating lease liabilities | $ 13,038 | $ 205 | $ 13,038 | $ 6,316 |
Leases (Future Minimum Rental C
Leases (Future Minimum Rental Commitments for Noncancelable Operating Leases ) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract] | |
2023 (remaining) | $ 7,920 |
2024 | 10,261 |
2025 | 5,121 |
2026 | 2,038 |
Total lease and sublease rental income | $ 25,340 |
Leases (Additional Information)
Leases (Additional Information) (Details) $ in Thousands | 6 Months Ended | ||||
Dec. 31, 2022 USD ($) facility location lease | Dec. 31, 2023 USD ($) | Mar. 31, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Lessee, Lease, Description [Line Items] | |||||
Option to terminate lease | true | ||||
Option to extend lease | true | ||||
Extension term | 5 years | ||||
Number of facilities owned by lessor | facility | 2 | ||||
Number of operating lease locations the entity has agreements to sublease either a portion or the full leased space | location | 10 | ||||
Number of leases yet to commence | lease | 2 | ||||
Operating Lease, Right-of-Use Asset | $ 175,097 | $ 177,995 | $ 155,356 | ||
Operating Lease, Liability | $ 214,941 | ||||
Operating Lease, Lease Not yet Commenced, Contract One | Forecast | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease term on property lease that has not yet commenced | 10 years | ||||
Operating Lease, Right-of-Use Asset | $ 5,300 | ||||
Operating Lease, Liability | $ 5,300 | ||||
Operating Lease, Lease Not yet Commenced, Contract Two | Forecast | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease term on property lease that has not yet commenced | 12 years | ||||
Operating Lease, Right-of-Use Asset | $ 16,600 | ||||
Operating Lease, Liability | $ 16,600 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Summary of Goodwill Balances by Reporting Unit) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Goodwill [Line Items] | |||
Goodwill | $ 961,262 | $ 961,262 | $ 960,058 |
Chamberlain | |||
Goodwill [Line Items] | |||
Goodwill | 4,716 | 4,716 | 4,716 |
Walden University | |||
Goodwill [Line Items] | |||
Goodwill | 651,052 | 651,052 | 649,848 |
AUC | |||
Goodwill [Line Items] | |||
Goodwill | 68,321 | 68,321 | 68,321 |
RUSM and RUSVM | |||
Goodwill [Line Items] | |||
Goodwill | $ 237,173 | $ 237,173 | $ 237,173 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Summary of Goodwill Balances by Reporting Segment) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Goodwill [Line Items] | |||
Goodwill | $ 961,262 | $ 961,262 | $ 960,058 |
Chamberlain | |||
Goodwill [Line Items] | |||
Goodwill | 4,716 | 4,716 | 4,716 |
Walden University | |||
Goodwill [Line Items] | |||
Goodwill | 651,052 | 651,052 | 649,848 |
Medical and Veterinary | |||
Goodwill [Line Items] | |||
Goodwill | $ 305,494 | $ 305,494 | $ 305,494 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Changes in Carrying Amount of Goodwill, by Segment) (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | |
Goodwill [Line Items] | |||
Goodwill beginning balance | $ 960,058 | $ 310,210 | |
Purchase Accounting Adjustments | 1,204 | ||
Acquisitions | 649,848 | ||
Goodwill ending balance | 961,262 | 960,058 | |
Goodwill balance | 961,262 | 960,058 | $ 961,262 |
Chamberlain | |||
Goodwill [Line Items] | |||
Goodwill beginning balance | 4,716 | 4,716 | |
Purchase Accounting Adjustments | 0 | ||
Acquisitions | 0 | ||
Goodwill ending balance | 4,716 | 4,716 | |
Goodwill balance | 4,716 | 4,716 | 4,716 |
Walden University | |||
Goodwill [Line Items] | |||
Goodwill beginning balance | 649,848 | 0 | |
Purchase Accounting Adjustments | 1,204 | ||
Acquisitions | 649,848 | ||
Goodwill ending balance | 651,052 | 649,848 | |
Goodwill balance | 651,052 | 649,848 | 651,052 |
Medical and Veterinary | |||
Goodwill [Line Items] | |||
Goodwill beginning balance | 305,494 | 305,494 | |
Purchase Accounting Adjustments | 0 | ||
Acquisitions | 0 | ||
Goodwill ending balance | 305,494 | 305,494 | |
Goodwill balance | $ 305,494 | $ 305,494 | $ 305,494 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Intangible Assets [Line Items] | |||
Amortizable Intangible Assets, Gross Carrying Amount | $ 217,991 | $ 217,991 | $ 217,991 |
Amortizable Intangible Assets, Accumulated Amortization | (131,978) | (97,274) | (47,150) |
Indefinite-lived Intangible Assets, Gross Carrying Amount | 752,860 | 752,860 | 752,860 |
Student Relationships | |||
Intangible Assets [Line Items] | |||
Amortizable Intangible Assets, Gross Carrying Amount | 161,900 | 161,900 | 161,900 |
Amortizable Intangible Assets, Accumulated Amortization | $ (116,551) | (87,457) | (42,943) |
Amortizable Intangible Assets, Weighted Average Amortization Period | 3 years | ||
Curriculum | |||
Intangible Assets [Line Items] | |||
Amortizable Intangible Assets, Gross Carrying Amount | $ 56,091 | 56,091 | 56,091 |
Amortizable Intangible Assets, Accumulated Amortization | $ (15,427) | (9,817) | (4,207) |
Amortizable Intangible Assets, Weighted Average Amortization Period | 5 years | ||
Walden trade name | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | $ 119,560 | 119,560 | 119,560 |
AUC trade name | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | 17,100 | 17,100 | 17,100 |
Ross trade name | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | 5,100 | 5,100 | 5,100 |
Chamberlain Title IV eligibility and accreditations | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | 1,200 | 1,200 | 1,200 |
Walden Title IV eligibility and accreditations | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | 495,800 | 495,800 | 495,800 |
AUC Title IV eligibility and accreditations | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | 100,000 | 100,000 | 100,000 |
Ross Title IV eligibility and accreditations | |||
Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets, Gross Carrying Amount | $ 14,100 | $ 14,100 | $ 14,100 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets (Summary of Indefinite-Lived Intangible Assets Balances by Reporting Segment) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets balances | $ 752,860 | $ 752,860 | $ 752,860 |
Chamberlain | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets balances | 1,200 | 1,200 | 1,200 |
Walden University | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets balances | 615,360 | 615,360 | 615,360 |
Medical and Veterinary | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets balances | $ 136,300 | $ 136,300 | $ 136,300 |
Goodwill and Intangible Asset_7
Goodwill and Intangible Assets (Estimated Amortization Expense for Amortized Intangible Assets) (Details) - Walden University $ in Thousands | Dec. 31, 2022 USD ($) |
Intangible Assets [Line Items] | |
2023 (remaining) | $ 26,535 |
2024 | 35,644 |
2025 | 11,220 |
2026 | 11,220 |
2027 | 1,394 |
Total | $ 86,013 |
Goodwill and Intangible Asset_8
Goodwill and Intangible Assets (Additional Information) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Jun. 30, 2022 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Number of reporting units | segment | 4 | ||||
Amortization of Intangible Assets | $ 16,176 | $ 30,699 | $ 34,704 | $ 47,150 | |
Goodwill write-off | $ 0 |
Debt (Long-term debt) (Details)
Debt (Long-term debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Total debt: | |||
Long-term Debt, Gross | $ 708,283 | $ 859,215 | $ 1,650,000 |
Unamortized debt discount and issuance costs | (14,502) | (20,307) | (41,962) |
Total Amount Outstanding | 693,781 | 838,908 | 1,608,038 |
Less current portion: | |||
Current portion | 0 | 0 | (8,500) |
Noncurrent portion | 693,781 | 838,908 | 1,599,538 |
Senior Secured Notes Due 2028 | |||
Total debt: | |||
Long-term Debt, Gross | 404,950 | 405,882 | 800,000 |
Term B Loan | |||
Total debt: | |||
Long-term Debt, Gross | 303,333 | 453,333 | 850,000 |
Prior Term Loan B | |||
Less current portion: | |||
Current portion | $ 0 | $ 0 | $ (8,500) |
Debt (Scheduled maturities of l
Debt (Scheduled maturities of long-term debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | |||
2023 (remaining) | $ 0 | ||
2024 | 0 | ||
2025 | 0 | ||
2026 | 0 | ||
2027 | 0 | ||
Thereafter | 708,283 | ||
Long-term Debt | $ 708,283 | $ 859,215 | $ 1,650,000 |
Debt (Debt Issuance Costs) (Det
Debt (Debt Issuance Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Unamortized debt discount and issuance costs, beginning | $ 28,690 | |||
Amortization of debt discount and issuance costs | $ (1,190) | $ (2,127) | (2,522) | $ (3,656) |
Debt discount and issuance costs write-off | (4,297) | |||
Unamortized debt discount and issuance costs, ending | 21,871 | 21,871 | ||
Revolver | ||||
Unamortized debt discount and issuance costs, beginning | 8,383 | |||
Amortization of debt discount and issuance costs | (1,014) | |||
Debt discount and issuance costs write-off | 0 | |||
Unamortized debt discount and issuance costs, ending | 7,369 | 7,369 | ||
Senior Secured Notes Due 2028 | ||||
Unamortized debt discount and issuance costs, beginning | 6,725 | |||
Amortization of debt discount and issuance costs | (560) | |||
Debt discount and issuance costs write-off | 0 | 0 | (15) | 0 |
Unamortized debt discount and issuance costs, ending | 6,150 | 6,150 | ||
Term B Loan | ||||
Unamortized debt discount and issuance costs, beginning | 13,582 | |||
Amortization of debt discount and issuance costs | (948) | |||
Debt discount and issuance costs write-off | (1,402) | $ 0 | (4,282) | $ 0 |
Unamortized debt discount and issuance costs, ending | $ 8,352 | $ 8,352 |
Debt (Interest Expense) (Detail
Debt (Interest Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Interest Expense, Debt [Abstract] | ||||
Debt discount and issuance costs write-off | $ 4,297 | |||
Gain on extinguishment of debt | $ 0 | $ 0 | (71) | $ 0 |
Amortization of debt discount and issuance costs | 1,190 | 2,127 | 2,522 | 3,656 |
Other | 979 | 1,397 | 1,985 | 2,607 |
Total interest expense | 15,589 | 25,929 | 33,349 | 73,322 |
Senior Secured Notes Due 2028 | ||||
Interest Expense, Debt [Abstract] | ||||
Interest expense | 5,568 | 11,000 | 11,165 | 22,000 |
Debt discount and issuance costs write-off | 0 | 0 | 15 | 0 |
Gain on extinguishment of debt | (100) | |||
Amortization of debt discount and issuance costs | 560 | |||
Term B Loan | ||||
Interest Expense, Debt [Abstract] | ||||
Interest expense | 6,450 | 11,405 | 13,451 | 17,603 |
Ticking fees | 0 | 0 | 0 | 5,330 |
Debt discount and issuance costs write-off | 1,402 | 0 | 4,282 | 0 |
Amortization of debt discount and issuance costs | 948 | |||
Prior Term Loan B | ||||
Interest Expense, Debt [Abstract] | ||||
Interest expense | 0 | 0 | 0 | 1,272 |
Interest Rate Swap | ||||
Interest Expense, Debt [Abstract] | ||||
Loss on derivative | 0 | 0 | 0 | (4,525) |
Bridge | ||||
Interest Expense, Debt [Abstract] | ||||
Debt discount and issuance costs write-off | 0 | 0 | 0 | 10,329 |
Prior Revolving Credit Facility | ||||
Interest Expense, Debt [Abstract] | ||||
Debt discount and issuance costs write-off | $ 0 | $ 0 | $ 0 | $ 6,000 |
Debt (Additional Information) (
Debt (Additional Information) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||||||||||||
Nov. 22, 2022 | Sep. 22, 2022 | Apr. 11, 2022 | Mar. 11, 2022 | Aug. 12, 2021 | Jul. 29, 2021 | Mar. 01, 2021 | Feb. 12, 2021 | Mar. 24, 2020 | Apr. 13, 2018 | Jun. 30, 2022 | Mar. 31, 2024 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2016 | Dec. 31, 2022 | Dec. 31, 2021 | Jan. 18, 2023 | Sep. 30, 2021 | |
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Repayment of long-term debt | $ 150,861,000 | $ 291,000,000 | |||||||||||||||||||||
Gain on extinguishment of debt | $ 0 | $ 0 | 71,000 | 0 | |||||||||||||||||||
Line of Credit facility, initiation date | Apr. 13, 2018 | ||||||||||||||||||||||
Debt Issuance Costs Write-off | 4,297,000 | ||||||||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Letters of credit outstanding | $ 76,100,000 | ||||||||||||||||||||||
Interest Rate Swap | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | 0 | $ 0 | $ 0 | (4,525,000) | |||||||||||||||||||
Interest Rate Swap | Interest Expense. | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | $ (4,500,000) | ||||||||||||||||||||||
Revolver | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Maximum borrowing capacity | $ 400,000,000 | ||||||||||||||||||||||
Commitment fee percentage | 0.25% | ||||||||||||||||||||||
Undrawn amount on letters of credit | 400,000,000 | $ 400,000,000 | |||||||||||||||||||||
Term | 5 years | ||||||||||||||||||||||
Debt Issuance Costs Write-off | $ 0 | ||||||||||||||||||||||
Revolver | LIBOR Floor | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 0.75% | ||||||||||||||||||||||
Revolver | LIBOR Floor | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 3.75% | ||||||||||||||||||||||
Revolver | LIBOR Floor | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 4.25% | ||||||||||||||||||||||
Revolver | Alternate Base Rate | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 2.75% | ||||||||||||||||||||||
Revolver | Alternate Base Rate | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 3.25% | ||||||||||||||||||||||
De Vry University Title IV Letter Of Credit | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Letters of credit outstanding | $ 68,400,000 | $ 68,400,000 | |||||||||||||||||||||
Letter Of Credit Title Iv Disbursement Percentage | 10% | ||||||||||||||||||||||
Letter of credit, repayment period | 5 years | ||||||||||||||||||||||
Credit annual fee percentage reimbursement | 2% | ||||||||||||||||||||||
Walden Title IV Letter Of Credit | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Letters of credit outstanding | 84,000,000 | $ 84,000,000 | |||||||||||||||||||||
Prior Revolving Credit Facility | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Maximum borrowing capacity | $ 300,000,000 | ||||||||||||||||||||||
Line of credit facility, expiration date | Apr. 13, 2023 | ||||||||||||||||||||||
Debt Issuance Costs Write-off | 0 | $ 0 | $ 0 | 6,000,000 | |||||||||||||||||||
Prior Revolving Credit Facility | Interest Expense. | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt Issuance Costs Write-off | 6,000,000 | ||||||||||||||||||||||
Prior Revolving Credit Facility | Base Rate | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Application rate, percentage | 0.75% | ||||||||||||||||||||||
Prior Revolving Credit Facility | Base Rate | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Application rate, percentage | 1.75% | ||||||||||||||||||||||
Prior Revolving Credit Facility | Eurocurrency Rate | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Application rate, percentage | 1.75% | ||||||||||||||||||||||
Prior Revolving Credit Facility | Eurocurrency Rate | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Application rate, percentage | 2.75% | ||||||||||||||||||||||
Bridge | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt Issuance Costs Write-off | 0 | $ 0 | $ 0 | 10,329,000 | |||||||||||||||||||
Bridge | Interest Expense. | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt Issuance Costs Write-off | 10,300,000 | ||||||||||||||||||||||
Senior Secured Notes Due 2028 And Term B Loan | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Term | 7 years | ||||||||||||||||||||||
Cap percentage | 20% | ||||||||||||||||||||||
Senior Secured Notes Due 2028 And Term B Loan | Scenario, Plan | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Total net leverage ratio | 3.25% | 4% | |||||||||||||||||||||
Senior Secured Notes Due 2028 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt instrument, face amount | $ 800,000,000 | ||||||||||||||||||||||
Fixed interest rate | 5.50% | ||||||||||||||||||||||
Repayment of long-term debt | $ 373,300,000 | $ 20,800,000 | $ 900,000 | $ 394,100,000 | |||||||||||||||||||
Gain on extinguishment of debt | $ 100,000 | ||||||||||||||||||||||
Percentage of notes issued on par value | 100% | ||||||||||||||||||||||
Redemption price, percentage of principal amount redeemed | 100% | 100% | 90% | 92% | |||||||||||||||||||
Debt covenant, percentage of principal amount of notes outstanding | 25% | ||||||||||||||||||||||
Debt Issuance Costs Write-off | 0 | $ 0 | 15,000 | 0 | |||||||||||||||||||
Senior Secured Notes Due 2028 | Accrued Liabilities | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt Instrument, Accrued Interest | $ 7,400,000 | $ 7,400,000 | $ 7,400,000 | 14,700,000 | $ 7,400,000 | 14,700,000 | |||||||||||||||||
Senior Secured Notes Due 2028 | 2024 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Redemption price, percentage of principal amount redeemed | 102.75% | ||||||||||||||||||||||
Senior Secured Notes Due 2028 | 2025 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Redemption price, percentage of principal amount redeemed | 101.375% | ||||||||||||||||||||||
Senior Secured Notes Due 2028 | 2026 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Redemption price, percentage of principal amount redeemed | 100% | ||||||||||||||||||||||
Senior Secured Notes Due 2028 | Prior to March 1,2024 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Redemption price percentage | 105.50% | ||||||||||||||||||||||
Senior Secured Notes Due 2028 | Maximum | Prior to March 1,2024 | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Redemption price, percentage of principal amount redeemed | 40% | ||||||||||||||||||||||
Term B Loan | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt instrument, face amount | 850,000,000 | $ 850,000,000 | |||||||||||||||||||||
Fixed interest rate | 8.39% | 8.39% | |||||||||||||||||||||
Repayment of long-term debt | $ 50,000,000 | $ 100,000,000 | $ 396,700,000 | $ 396,700,000 | |||||||||||||||||||
Debt Instrument, Ticking Fee, Term | 30 days | ||||||||||||||||||||||
Debt Instrument, Ticking Fee, Percent | 50% | ||||||||||||||||||||||
Basic spread rate | 4.50% | ||||||||||||||||||||||
Principal payment | $ 2,125,000 | ||||||||||||||||||||||
Debt Instrument, Issuance Price, Percent Of Principal Amount | 99% | ||||||||||||||||||||||
Debt Instrument, Issuance Discount, Percent | 1% | ||||||||||||||||||||||
Debt Issuance Costs Write-off | $ 1,402,000 | $ 0 | $ 4,282,000 | $ 0 | |||||||||||||||||||
Asset sale or disposition period | 1 year | ||||||||||||||||||||||
Asset sale or disposition investments | $ 20,000,000 | ||||||||||||||||||||||
Mandatory prepayment terms | $ 0 | ||||||||||||||||||||||
Term B Loan | LIBOR Floor | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 0.75% | 0.75% | |||||||||||||||||||||
Term B Loan | Alternate Base Rate | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 3% | ||||||||||||||||||||||
Term B Loan | Alternate Base Rate | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 3.50% | ||||||||||||||||||||||
Term B Loan | LIBOR | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 4.50% | ||||||||||||||||||||||
Term B Loan | Eurocurrency Rate | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 4% | ||||||||||||||||||||||
Term B Loan | Eurocurrency Rate | Maximum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 4.50% | ||||||||||||||||||||||
Prior Term Loan B | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt instrument, face amount | $ 300,000,000 | ||||||||||||||||||||||
Repayment of long-term debt | $ 291,000,000 | ||||||||||||||||||||||
Principal payment | $ 750,000 | ||||||||||||||||||||||
Debt instrument, maturity date | Apr. 13, 2025 | ||||||||||||||||||||||
Prior Term Loan B | Base Rate | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 2% | ||||||||||||||||||||||
Debt instrument, description of variable rate basis | base rate plus 2% | ||||||||||||||||||||||
Prior Term Loan B | Eurocurrency Rate | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Basic spread rate | 3% | 3% | |||||||||||||||||||||
Debt instrument, description of variable rate basis | LIBOR-equivalent rate plus 3% | ||||||||||||||||||||||
Prior Term Loan B | Interest Rate Swap | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Derivative, Fixed Interest Rate | 0.946% | ||||||||||||||||||||||
Derivative, Swaption Interest Rate | 3.946% | 3.946% | |||||||||||||||||||||
Prior Term Loan B | Interest Rate Swap | LIBOR | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Debt instrument, description of variable rate basis | one-month LIBOR | ||||||||||||||||||||||
Prior Term Loan B | Interest Rate Swap | LIBOR | Minimum | |||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||
Derivative, Floor Interest Rate | 0% |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interest (Additional Information) (Details) - EduPristine - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2021 | Mar. 26, 2020 | |
Noncontrolling Interest [Line Items] | |||
Ownership interest of parent in subsidiary | 100% | 69% | |
Kaizen | |||
Noncontrolling Interest [Line Items] | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 31% | ||
Ownership percentage held by minority available for purchase | 33% | ||
Decrease in noncontrolling interest | $ 1.8 |
Share Repurchases (Open Market
Share Repurchases (Open Market Share Repurchase Programs) (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Mar. 14, 2022 | Mar. 01, 2022 | Feb. 04, 2020 |
Equity, Class of Treasury Stock [Line Items] | ||||
Authorized amount for repurchase | $ 150 | |||
Maximum | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Remaining authorized amount for repurchase | $ 300 | |||
Maximum | Authorized On February Fourth Two-Thousand Twenty | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Authorized amount for repurchase | $ 300 | |||
Maximum | Authorized On March One, Two-Thousand Twenty Two | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Authorized amount for repurchase | $ 300 |
Share Repurchases (ASR Agreemen
Share Repurchases (ASR Agreement) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Nov. 02, 2022 | Mar. 14, 2022 | Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 14, 2022 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Authorized amount for repurchase | $ 150,000 | |||||
Payment on equity forward contract | $ 13,162 | $ 0 | ||||
Asr Agreement | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Authorized amount for repurchase | $ 150,000 | |||||
Number of shares for common stock | 4,709,576 | |||||
Accelerated Share Repurchase Program, Percent Delivery | 80% | |||||
Shares owed to counterparty | 332,212 | |||||
Payment on equity forward contract | $ 13,200 | |||||
Asr Agreement | Treasury Stock, Common | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Authorized amount for repurchase | $ 120,000 | |||||
Payment on equity forward contract | $ 13,200 | |||||
Asr Agreement | Additional Paid-In Capital | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Authorized amount for repurchase | $ 30,000 | |||||
Additional paid in capital reclassified into treasury stock | $ 30,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance at the beginning of period | $ 1,510,039 | $ 1,265,181 | $ 1,505,067 | $ 1,301,070 |
Reclassification from other comprehensive income | 0 | 0 | 0 | 6,695 |
Balance at the end of period | 1,522,722 | 1,287,890 | 1,522,722 | 1,287,890 |
Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance at the beginning of period | (2,227) | (740) | (960) | (7,365) |
Reclassification from other comprehensive income | 6,695 | |||
Balance at the end of period | (2,227) | (634) | (2,227) | (634) |
Foreign currency translation adjustments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance at the beginning of period | (2,227) | (740) | (960) | (670) |
Loss on foreign currency translation | 0 | 106 | (1,267) | 36 |
Balance at the end of period | (2,227) | (634) | (2,227) | (634) |
Interest Rate Swap. | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance at the beginning of period - Gross | 0 | 0 | 0 | (8,926) |
Balance at the beginning of period - Tax | 0 | 0 | 0 | (2,231) |
Balance at the beginning of period | 0 | 0 | 0 | (6,695) |
Reclassification from other comprehensive income | 0 | 0 | 0 | 6,695 |
Balance at the end of period | $ 0 | $ 0 | $ 0 | $ 0 |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Options Activity) (Details) - Stock Option $ / shares in Units, $ in Thousands | 6 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |
Number of Options, Outstanding at beginning of period | shares | 1,144,372 |
Number of Options, Exercised | shares | (54,514) |
Number of Options Expired | shares | (1,575) |
Number of Options, Outstanding at end of period | shares | 1,088,283 |
Number of Options, Exercisable at end of period | shares | 813,502 |
Weighted Average Exercise Price at beginning of period | $ / shares | $ 35.36 |
Weighted Average Exercise Price, Options Exercised | $ / shares | 26.08 |
Weighted Average Exercise Price, Options Expired | $ / shares | 18.60 |
Weighted Average Exercise Price, Outstanding at end of period | $ / shares | 35.85 |
Weighted Average Exercise Price, Exercisable at end of period | $ / shares | $ 35.81 |
Weighted Average Remaining Contractual Life, Outstanding at end of period | 5 years 10 months 24 days |
Weighted Average Remaining Contractual Life, Exercisable at end of period | 5 years 2 months 12 days |
Aggregate Intrinsic Value, Outstanding at End of period | $ | $ 2,103 |
Aggregate Intrinsic Value, Exercisable at end of period | $ | $ 1,746 |
Stock-Based Compensation (Fair
Stock-Based Compensation (Fair Values of Stock Option Awards Weighted Average Assumptions) (Details) | 6 Months Ended |
Dec. 31, 2022 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Expected life (in years) | 6 years 6 months 21 days |
Expected volatility | 39.99% |
Risk-free interest rate | 0.94% |
Dividend yield | 0% |
Stock-Based Compensation (Sum_2
Stock-Based Compensation (Summary of Restricted Stock Units Activity) (Details) - Restricted Stock Units - $ / shares | 6 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted Stock Units Unvested at beginning of period | 1,171,692 | |
Restricted Stock Units Unvested, Shares Granted | 320,970 | |
Restricted Stock Units, Shares Vested | (305,449) | |
Restricted Stock Units, Shares Forfeited | (70,778) | |
Restricted Stock Units Unvested at end of period | 1,116,435 | |
Weighted Average Grant Date Fair Value, Nonvested beginning balance | $ 35.05 | |
Weighted Average Grant Date Fair Value, Shares Granted | 39.87 | $ 35.46 |
Weighted Average Grant Date Fair Value, Shares Vested | 37.58 | |
Weighted Average Grant Date Fair Value, Shares Forfeited | 37.90 | |
Weighted Average Grant Date Fair Value, Nonvested ending balance | $ 35.56 |
Stock-Based Compensation (Total
Stock-Based Compensation (Total Stock-Based Compensation Expense Included in Consolidated Statement of Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Stock-based compensation | $ 1,968 | $ 4,220 | $ 8,113 | $ 13,931 |
Income tax benefit | (622) | (1,074) | (2,303) | (2,493) |
Stock-based compensation, net of tax | $ 1,346 | $ 3,146 | $ 5,810 | $ 11,438 |
Stock-Based Compensation (Addit
Stock-Based Compensation (Additional Information) (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2022 USD ($) item $ / shares shares | Dec. 31, 2021 USD ($) $ / shares | Jun. 30, 2022 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total intrinsic value of options exercised | $ 700 | $ 6,700 | |
Total pre-tax unrecognized compensation costs related to non-vested awards | $ 20,700 | ||
Total pre-tax unrecognized compensation costs related to non-vested awards expected to be recognized, years | 2 years 3 months 18 days | ||
Total fair value of options and Restricted Stock Units vested | $ 13,700 | 13,000 | |
Share-based Payment Arrangement, Amount Capitalized | $ 0 | $ 0 | $ 0 |
Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of options granted | shares | 0 | ||
Stock Incentive Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation arrangements plans | item | 2 | ||
Term of options (in years) | 10 years | ||
Vesting Period (in years) | 4 years | ||
Weighted average estimated grant date fair values, for options granted at market price, per share | $ / shares | $ 14.72 | ||
Common Stock, Capital Shares Reserved for Future Issuance | shares | 2,871,830 | ||
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted Average Grant Date Fair Value, Shares Granted | $ / shares | $ 39.87 | $ 35.46 | |
Restricted Stock Units Outstanding, Shares Granted | shares | 320,970 | ||
Performance Based Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Term of options (in years) | 3 years | ||
Non-Performance Based Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting Period (in years) | 3 years | 4 years |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||||
Jul. 31, 2019 | Dec. 11, 2018 | Dec. 11, 2018 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Mar. 01, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Long-term debt, gross | $ 708,283 | $ 708,283 | $ 859,215 | $ 1,650,000 | |||||
Investment impairment | 5,000 | 5,000 | |||||||
Equity Securities without Readily Determinable Fair Value, Amount | 0 | 0 | 5,000 | ||||||
Senior Secured Notes Due 2028 | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Interest Rate | 5.50% | ||||||||
Long-term debt, gross | 404,950 | 404,950 | 405,882 | 800,000 | |||||
Senior Secured Notes Due 2028 | Level 1 | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Long-term debt, fair value | $ 371,500 | $ 371,500 | |||||||
Term B Loan | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Interest Rate | 8.39% | 8.39% | |||||||
Long-term debt, gross | $ 303,333 | $ 303,333 | 453,333 | 850,000 | |||||
Term B Loan | Level 2 | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Long-term debt, fair value | 301,600 | 301,600 | |||||||
Other income (expense), net | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Investment impairment | 5,000 | ||||||||
Accounts Receivable | Credit extension program | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Loans Receivable, Fair Value Disclosure | 29,100 | 29,100 | 27,500 | 29,100 | |||||
Nonqualified Deferred Compensation Plan | Accrued Liabilities | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Deferred Compensation Liability, Current, Fair Value Disclosure | 14,600 | 14,600 | 16,300 | 21,400 | |||||
Nonqualified Deferred Compensation Plan | Prepaid Expenses and Other Current Assets | Investment in Rabbi Trust | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Deferred Compensation Plan Assets, Fair Value Disclosure | $ 18,100 | $ 18,100 | 17,800 | 21,600 | |||||
DeVry University | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Loan payment received | $ 10,000 | ||||||||
Receivable with Imputed Interest, Face Amount | $ 10,000 | $ 10,000 | |||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | 4% | |||||||
Receivable with Imputed Interest, Due Date | Jan. 01, 2022 | Jan. 01, 2022 | |||||||
DeVry University | Prepaid Expenses and Other Current Assets | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Loans Receivable, Fair Value Disclosure | 10,000 | ||||||||
Chicago, Illinois Campus | Discontinued Operations, Disposed of by Sale | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Receivable with Imputed Interest, Face Amount | $ 46,800 | ||||||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 4% | ||||||||
Receivable with Imputed Interest, Due Date | Jul. 31, 2024 | ||||||||
Chicago, Illinois Campus | Discount rate | Level 2 | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Debt Instrument, Measurement Input | 0.07 | 0.07 | |||||||
Chicago, Illinois Campus | Other Noncurrent Assets | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Loans Receivable, Fair Value Disclosure | $ 44,600 | $ 44,600 | 44,000 | 43,300 | |||||
Chicago, Illinois Campus | Other Noncurrent Assets | Discontinued Operations, Disposed of by Sale | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Loans Receivable, Fair Value Disclosure | $ 44,600 | $ 44,600 | $ 44,000 | $ 43,300 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Feb. 28, 2022 USD ($) claim | Nov. 02, 2021 USD ($) claim | Mar. 12, 2021 USD ($) | Apr. 13, 2018 class | Dec. 31, 2022 USD ($) | Jun. 30, 2022 USD ($) | May 04, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2020 USD ($) | Dec. 04, 2017 USD ($) |
Maximum | DeVry University | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Indemnification | $ 340,000,000 | |||||||||
Nicole Versetto | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of other individuals filed lawsuit | class | 3 | |||||||||
Loss contingency accrual | $ 44,950,000 | |||||||||
Nicole Versetto | Prepaid Expenses and Other Current Assets | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement fund | $ 44,950,000 | $ 44,950,000 | $ 44,950,000 | |||||||
McCormick | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement fund | $ 44,950,000 | |||||||||
Stoltmann Case | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 20,375,000 | |||||||||
Settlement reduced | $ 75,000 | |||||||||
Number of claimants | claim | 552 | |||||||||
Number of plaintiff declined to participate | claim | 6 | 6 | ||||||||
Reducing settlement amount | $ 450,000 | |||||||||
Remitted | $ 19,925,000 | |||||||||
Number of claimants declined to participate | claim | 546 | |||||||||
Number of plaintiff declined to participate due to voluntary dismiss of arbitration | claim | 2 | |||||||||
Number of plaintiff declined to participate due to arbitration in progress | claim | 1 | |||||||||
Number of plaintiff declined to participate due to arbitration not recommenced | claim | 3 | |||||||||
John Doe Plaintiff Case | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Loss contingency sought value | $ 50,000 |
Segment Information (Tabulation
Segment Information (Tabulation of Business Segment Information Based on Current Segmentation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | |
Segment Reporting Information [Line Items] | |||||
Total Consolidated Revenue | $ 363,302 | $ 371,198 | $ 717,861 | $ 660,268 | |
Total consolidated adjusted operating income | 79,507 | 70,234 | 144,608 | 106,671 | |
Restructuring expense | (1,363) | (3,387) | (16,428) | (6,481) | |
Business acquisition and integration expense | (15,941) | (9,060) | (24,356) | (35,613) | |
Total consolidated operating income (loss) | 46,027 | 24,734 | 69,120 | 2,671 | |
Interest Expense | 15,589 | 25,929 | 33,349 | 73,322 | |
Other (expense) income, net | (2,574) | 861 | (1,007) | 1,739 | |
Total consolidated income (loss) from continuing operations before income taxes | 27,864 | (334) | 34,764 | (68,912) | |
Total Consolidated Assets | 2,843,038 | 3,659,773 | 2,843,038 | 3,659,773 | $ 3,029,175 |
Total Consolidated capital expenditures | 4,196 | 8,081 | 9,747 | 14,772 | |
Total consolidated depreciation expense | 10,656 | 11,631 | 21,461 | 22,130 | |
Total consolidated intangible asset amortization expense | 16,176 | 30,699 | 34,704 | 47,150 | |
Chamberlain | |||||
Segment Reporting Information [Line Items] | |||||
Total Consolidated Revenue | 141,396 | 139,121 | 276,801 | 274,760 | |
Total consolidated adjusted operating income | 33,229 | 25,791 | 60,231 | 46,646 | |
Total Consolidated capital expenditures | 1,492 | 2,969 | 2,918 | 6,614 | |
Total consolidated depreciation expense | 4,099 | 4,726 | 8,580 | 9,310 | |
Walden University | |||||
Segment Reporting Information [Line Items] | |||||
Total Consolidated Revenue | 131,940 | 140,627 | 262,841 | 209,244 | |
Total consolidated adjusted operating income | 29,012 | 32,401 | 52,403 | 43,413 | |
Total Consolidated capital expenditures | 268 | 2,748 | 1,093 | 2,932 | |
Total consolidated depreciation expense | 2,269 | 2,516 | 4,864 | 4,228 | |
Total consolidated intangible asset amortization expense | 16,176 | 30,699 | 34,704 | 47,150 | |
Medical and Veterinary | |||||
Segment Reporting Information [Line Items] | |||||
Total Consolidated Revenue | 89,966 | 91,450 | 178,219 | 176,264 | |
Total consolidated adjusted operating income | 23,017 | 19,706 | 40,371 | 35,371 | |
Restructuring expense | (87) | (188) | (6,913) | (188) | |
Total Consolidated capital expenditures | 342 | 504 | 915 | 1,759 | |
Total consolidated depreciation expense | 3,031 | 3,645 | 6,136 | 7,100 | |
Home Office and Other | |||||
Segment Reporting Information [Line Items] | |||||
Total consolidated adjusted operating income | (5,751) | (7,664) | (8,397) | (18,759) | |
Restructuring expense | (1,235) | (1,073) | (5,576) | (4,167) | |
Total Consolidated capital expenditures | 2,094 | 1,860 | 4,821 | 3,467 | |
Total consolidated depreciation expense | 1,257 | 744 | 1,881 | 1,492 | |
Segment Reconciling Items | |||||
Segment Reporting Information [Line Items] | |||||
Deferred revenue adjustment | 0 | (2,354) | 0 | (8,561) | |
CEO transition costs | 0 | 0 | 0 | (6,195) | |
Restructuring expense | (1,363) | (3,387) | (16,428) | (6,481) | |
Business acquisition and integration expense | (15,941) | (9,060) | (24,356) | (35,613) | |
Total consolidated intangible asset amortization expense | $ 16,176 | $ 30,699 | $ 34,704 | $ 47,150 |
Segment Information (Revenues a
Segment Information (Revenues and Long-Lived Assets by Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Total Consolidated Revenue | $ 363,302 | $ 371,198 | $ 717,861 | $ 660,268 |
Total Consolidated Long-lived Assets | 450,714 | 457,022 | 450,714 | 457,022 |
Domestic Operations | ||||
Segment Reporting Information [Line Items] | ||||
Total Consolidated Revenue | 273,336 | 279,748 | 539,642 | 484,004 |
Total Consolidated Long-lived Assets | 287,811 | 305,848 | 287,811 | 305,848 |
Barbados, Dominica, St. Kitts and St. Maarten | ||||
Segment Reporting Information [Line Items] | ||||
Total Consolidated Revenue | 89,966 | 91,450 | 178,219 | 176,264 |
Total Consolidated Long-lived Assets | $ 162,903 | $ 151,174 | $ 162,903 | $ 151,174 |
Segment Information (Additional
Segment Information (Additional Information) (Details) | 6 Months Ended |
Dec. 31, 2022 item segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | segment | 3 |
Walden University | |
Segment Reporting Information [Line Items] | |
Minimum number of courses offered | item | 100 |