Exhibit 99.1
DeVry Inc. Reports Fiscal 2005 Second Quarter Results
OAKBROOK TERRACE, Ill.--(BUSINESS WIRE)--Jan. 27, 2005--DeVry Inc. (NYSE:
DV), an international higher education company, today reported financial results
for the second quarter of fiscal year 2005 ended December 31, 2004.
Revenues for the second quarter were $194.5 million, compared with $198.8
million for the same quarter one year ago. Revenues for the six-month period
ended December 31, 2004, were $382.9 million compared to $388.0 million last
year.
Net income for the quarter totaled $5.9 million, or $0.08 per fully diluted
share, compared with $15.6 million, or $0.22 per fully diluted share, for the
same period last year. For the first six months of fiscal 2005, net income was
$10.2 million, or $0.14 per share, compared with $26.1 million, or $0.37 per
share for the first half of fiscal 2004.
"Earnings results in the second quarter reflect both reduced full-time
campus enrollments during the 2004 fall term and increasing levels of part-time
students at DeVry University Online and at DeVry University Centers," said
Ronald L. Taylor, chief executive officer of DeVry Inc. In December 2004, the
company reported that for the 2004 fall term, new undergraduate student
enrollment at DeVry University declined 5.8 percent and total undergraduate
student enrollment declined 8.3 percent from the previous year.
Second quarter results were also affected by a $2.2 million pre-tax accrual
for a work force reduction that included a voluntary separation plan offered to
employees with more than 20 years of service. As of the end of the second
quarter, 39 employees had accepted the separation plan and an additional 45
employees accepted the plan in January 2005. In addition, in January 2005, an
involuntary reduction in force was implemented which eliminated approximately 75
currently filled positions and 100 open positions. The costs associated with the
January 2005 acceptances of the voluntary separation plan and the involuntary
reduction in force will be recorded in the third quarter of fiscal 2005. The
company believes that at least $10.5 million in annual salary and benefit costs
will be eliminated by these actions. Because of the costs associated with
implementing these work force reductions, they are not expected to have a
positive financial impact in this fiscal year but will reduce the cost of
operations in fiscal 2006 and beyond.
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"As we continue to execute our plan to improve products and services and
address marketing and recruitment deficiencies, we have begun to see early
indications of favorable response to our efforts for the 2005 spring term," said
Daniel Hamburger, DeVry's president and chief operating officer. "Moreover, we
believe that these activities will positively influence undergraduate
enrollments in the 2006 fiscal year."
During the second quarter, DeVry announced the opening of a new DeVry
University Center in San Antonio, Texas, with plans to begin offering
undergraduate and graduate degree programs in July 2005. DeVry University
currently operates 72 locations in North America.
Also during the quarter, the company continued to enhance its management
team with the addition of Dr. Thomas Shepherd as Ross University president, and
Steve Riehs as vice president and general manager of online operations at DeVry
Inc. Jim Ritchey has been appointed interim chief information officer, replacing
Bruno LaCaria, who retired. Most recently, John Holbrook rejoined DeVry
University as vice president of new student recruitment.
DeVry Inc. will hold a conference call to discuss its fiscal 2005 second
quarter results on January 27, 2005 at 3:30 p.m. Central time (4:30 p.m. Eastern
time). The conference call will be led by Ronald Taylor, chief executive
officer, Daniel Hamburger, president and chief operating officer and Norman
Levine, senior vice president and chief financial officer.
For those wishing to participate by telephone, dial 800-218-8862 (domestic)
or 303-262-2190 (international). DeVry Inc. will also broadcast the conference
call live via the Internet. Interested parties may access the webcast through
the Investor Relations section of the company's web site at
http://www.devry.com/inc/index.html. Please access the web site at least 15
minutes prior to the start of the call to register, download and install any
necessary audio software.
The company will archive a telephone replay of the call until February 11,
2005. To access the replay, dial 800-405-2236 (domestic) or 303-590-3000
(international), passcode 11020825 or to access the webcast replay, visit
http://www.devry.com/inc/index.html.
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Second Quarter Ended December 31:
Fiscal Year Fiscal Year
2005 2004
Revenues $194,522,000 $198,806,000
Net Income 5,856,000 15,578,000
Earnings Per Common Share
Basic: $0.08 $0.22
Diluted: $0.08 $0.22
Number of Common Shares
Basic 70,368,000 70,047,000
Diluted 70,506,000 70,626,000
Six Months Ended December 31:
Fiscal Year Fiscal Year
2005 2004
Revenues $382,918,000 $388,042,000
Net Income $10,156,000 26,070,000
Earnings Per Common Share
Basic: $0.14 $0.37
Diluted: $0.14 $0.37
Number of Common Shares
Basic 70,359,000 70,038,000
Diluted 70,582,000 70,625,000
December 31:
Actual Shares Outstanding 70,368,000 70,058,000
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DeVry Inc. (NYSE: DV) is the holding company for DeVry University, Ross
University and Becker Professional Review. DeVry University, which includes
Keller Graduate School of Management, offers associate, bachelor's and master's
degree programs in technology, business and management. Ross University, through
its schools of Medicine and Veterinary Medicine, offers both doctor of medicine
and doctor of veterinary medicine degrees. Becker Professional Review, which
includes Stalla CFA Review, provides preparatory coursework for the certified
public accountant, certified management accountant and chartered financial
analyst exams. DeVry Inc. is based in Oakbrook Terrace, Ill. For more
information about the company, visit http://www.devry.com.
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DEVRY INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
Dec. 31, June 30, Dec. 31,
2004 2004 2003
------------ ----------- ------------
(Unaudited) (Unaudited)
ASSETS
- ------
Current Assets
--------------
Cash and Cash Equivalents $132,445 $146,227 $106,126
Restricted Cash 36,224 13,457 21,476
Accounts Receivable, Net 75,323 28,150 75,705
Inventories 1,047 3,281 2,241
Deferred Income Taxes 6,889 7,619 9,944
Prepaid Expenses and Other 11,714 10,141 7,963
--------- --------- ---------
Total Current Assets 263,642 208,875 223,455
--------- --------- ---------
Land, Buildings and
Equipment, net
--------------
Land 65,071 64,256 60,300
Buildings 205,520 203,651 198,428
Equipment 231,387 222,898 216,753
Construction In Progress 17,404 6,214 3,198
--------- --------- ---------
519,382 497,019 478,679
Accumulated Depreciation (230,915) (210,132) (197,046)
--------- --------- ---------
Land, Buildings and
Equipment, Net 288,467 286,887 281,633
--------- --------- ---------
Other Assets
------------
Intangible Assets, Net 79,072 86,346 93,091
Goodwill 284,397 284,397 285,670
Perkins Program Fund, Net 12,697 12,247 11,861
Other Assets 5,165 5,380 5,264
--------- --------- ---------
Total Other Assets 381,331 388,370 395,886
--------- --------- ---------
TOTAL ASSETS $933,440 $884,132 $900,974
========= ========= =========
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DEVRY INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
Dec. 31, June 30, Dec. 31,
2004 2004 2003
------------ ----------- ------------
(Unaudited) (Unaudited)
LIABILITIES
- -----------
Current Liabilities
-------------------
Current Maturities of
Revolving Loan $ - $35,000 $ -
Accounts Payable 19,527 27,349 15,423
Accrued Salaries, Wages
& Benefits 37,725 31,041 31,759
Accrued Expenses 36,184 24,610 20,310
Advance Tuition Payments 32,185 16,819 6,546
Deferred Tuition Revenue 100,013 21,830 116,021
--------- --------- ---------
Total Current Liabilities 225,634 156,649 190,059
--------- --------- ---------
Non-Current Liabilities
-----------------------
Revolving Loan 65,000 90,000 115,000
Senior Debt 125,000 125,000 125,000
Deferred Income Taxes 12,060 17,660 13,432
Deferred Rent and Other 17,659 16,566 15,196
--------- --------- ---------
Total Non-Current
Liabilities 219,719 249,226 268,628
--------- --------- ---------
TOTAL LIABILITIES 445,353 405,875 458,687
--------- --------- ---------
SHAREHOLDERS' EQUITY
- --------------------
Common Stock, $0.01 par value,
200,000,000 Shares Authorized,
70,368,359, 70,331,323 and
70,058,125, Shares Issued and
Outstanding at December 31, 2004,
June 30, 2004 and December 31,
2003, Respectively. 705 704 701
Additional Paid-in Capital 71,943 71,797 67,906
Retained Earnings 415,192 405,036 373,045
Accumulated Other
Comprehensive Income 247 720 635
--------- --------- ---------
TOTAL SHAREHOLDERS' EQUITY 488,087 478,257 442,287
--------- --------- ---------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $933,440 $884,132 $900,974
========= ========= =========
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DEVRY INC.
CONSOLIDATED STATEMENTS OF INCOME
------------------------------------
(Dollars in Thousands Except for Per Share Amounts)
(Unaudited)
For The Quarter For The Six Months
Ended December 31, Ended December 31,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
REVENUES:
Tuition $184,127 $187,286 $362,111 $364,880
Other Educational 10,311 11,479 20,663 23,064
Interest 84 41 144 98
--------- --------- --------- ---------
Total Revenues 194,522 198,806 382,918 388,042
--------- --------- --------- ---------
COSTS AND EXPENSES:
Cost of Educational
Services 108,236 104,635 217,721 209,085
Student Services and
Administrative Expense 76,663 70,156 150,271 138,105
Interest Expense 2,091 1,972 4,082 4,128
--------- --------- --------- ---------
Total Costs and
Expenses 186,990 176,763 372,074 351,318
--------- --------- --------- ---------
Income Before Income Taxes
and Cumulative Effect of
Change in Accounting 7,532 22,043 10,844 36,724
Income Tax Provision 1,676 6,465 2,498 10,654
--------- --------- --------- ---------
Income Before Cumulative
Effect of Change
in Accounting 5,856 15,578 8,346 26,070
Cumulative Effect of Change
in Accounting, Net of Tax - - 1,810 -
--------- --------- --------- ---------
NET INCOME $5,856 $15,578 $10,156 $26,070
========= ========= ========= =========
EARNINGS PER COMMON SHARE
Basic
Income Before Cumulative
Effect of Change in
Accounting $0.08 $0.22 $0.12 $0.37
Cumulative Effect of
Change in Accounting - - 0.02 -
--------- --------- --------- ---------
Net Income $0.08 $0.22 $0.14 $0.37
========= ========= ========= =========
Diluted
Income Before Cumulative
Effect of Change in
Accounting $0.08 $0.22 $0.12 $0.37
Cumulative Effect of
Change in Accounting - - 0.02 -
--------- --------- --------- ---------
Net Income $0.08 $0.22 $0.14 $0.37
========= ========= ========= =========
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DEVRY INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
For The Six Months
Ended December 31,
-------------------
2004 2003
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $10,156 $26,070
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Depreciation 19,937 19,667
Amortization 7,816 7,296
Provision for Refunds and Uncollectible
Accounts 19,768 17,461
Deferred Income Taxes (4,870) 1,797
(Gain) Loss on Disposals of Land, Buildings
and Equipment (91) 147
Changes in Assets and Liabilities, Net of
Effects from Acquisition of Business:
Restricted Cash (22,767) (7,424)
Accounts Receivable (66,841) (68,891)
Inventories 2,234 2,074
Prepaid Expenses And Other (797) (44)
Perkins Program Fund Contributions
and Other (550) (570)
Accounts Payable (7,822) (3,443)
Accrued Salaries, Wages, Expenses
and Benefits 18,258 (10,489)
Advance Tuition Payments 15,366 (4,022)
Deferred Tuition Revenue 78,183 99,730
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 67,980 79,359
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures (21,426) (16,093)
Payments for Purchases of Businesses,
net of Cash Acquired - (1,143)
--------- ---------
NET CASH USED IN INVESTING ACTIVITIES (21,426) (17,236)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds From Exercise of Stock Options 147 618
Repayments Under Revolving Credit Facility (60,000) (50,000)
--------- ---------
NET CASH USED IN FINANCING ACTIVITIES (59,853) (49,382)
--------- ---------
Effects of Exchange Rate Differences (483) (86)
--------- ---------
NET (DECREASE) INCREASE IN CASH
AND CASH EQUIVALENTS (13,782) 12,655
Cash and Cash Equivalents at
Beginning of Period 146,227 93,471
--------- ---------
Cash and Cash Equivalents at
End of Period $132,445 $106,126
========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest Paid During the Period $3,152 $3,923
Income Tax Payments During the Period, Net 409 21,729
CONTACT: Investor Contact:
DeVry Inc.
Joan Bates, 630-574-1949
or
Media Contact:
Dresner Corporate Services
Kyra Kyles, 312-780-7208
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