Exhibit 99.1
Career Education Corporation Reports
Results for First Quarter 2006; Substantial Cash Flow Generation;
Approximately $490 Million Cash and Investments on Hand
HOFFMAN ESTATES, Ill.--(BUSINESS WIRE)--May 3, 2006--Career
Education Corporation (NASDAQ:CECO) today reported revenue of $528.6
million and net income of $52.7 million for the first quarter ended
March 31, 2006, as well as substantial cash flow generation concluding
the quarter with approximately $490 million cash and investments on
hand.
"Our focus on quality growth, return on investment, and value for
our students and our stockholders continues to drive our business
forward," said John Larson, Chairman, President and Chief Executive
Officer of Career Education Corporation. "In spite of outside
pressures during the quarter, our business remains strong, and our
momentum, substantial. We also made significant progress in addressing
outstanding compliance, legal and governance issues. We are confident
that we are positioning the company to capitalize on attractive growth
opportunities, to the benefit of our students and, in turn, our
stockholders over the long term."
RESULTS OF OPERATIONS
Three Months Ended March 31, 2006
-- Consolidated revenue increased 4.0 percent to $528.6 million
during the first quarter of 2006. During the first quarter of
2005, consolidated revenues were $510.4 million. The increase
is primarily attributable to an approximate 3.0 percent
increase in student population from January 31, 2005, to
January 31, 2006. Revenue for our universities' online
campuses was $193.0 million during the first quarter of 2006,
an increase of 22.7 percent from $157.3 million during the
first quarter of 2005.
-- On January 1, 2006, CEC adopted Statement of Financial
Accounting Standards (SFAS) No. 123R "Share-Based Payment,"
which requires the costs relating to share-based payment
transactions with employees be recognized as expense in the
financial statements and measured based on the estimated fair
value of the equity instrument issued. First quarter 2006
operating results include a non-cash share-based compensation
expense of $4.0 million. Share-based compensation expense
recognition was not required during the first quarter of 2005.
-- In connection with reporting its results for the first quarter
of 2006, the company tested the goodwill balance for its Gibbs
division for impairment in accordance with SFAS 142 "Goodwill
and Other Intangible Assets." The review involved the
application of a fair-value-based test. Due to continued weak
operating results and cash flows in our Gibbs division, the
test indicated that the value of goodwill attributable to the
Gibbs division had been impaired as the estimate of the
division's fair value was less than the division's carrying
value as of the time of the test. As a result, the entire
goodwill balance related to the Gibbs division of $10.4
million was written off effective March 31, 2006.
-- Operating profit margin percentage was 15.0 percent during the
first quarter of 2006, a decrease of 4.4 percentage points
from 19.4 percent during the first quarter of 2005. Of the
total decrease, approximately 2.0 percentage points were due
to the Gibbs goodwill impairment charge, approximately 0.8
percentage points were due to non-cash share-based
compensation expense, and approximately 3.3 percentage points
were due to an increase in advertising and admission expenses.
These decreases were offset, in part, by a 0.7 percentage
point reduction in bad debt expense during the quarter and a
1.6 percentage point reduction in administrative expense.
-- Consolidated net income was $52.7 million, or $0.53 per
diluted share, during the first quarter of 2006, a decrease of
5.7 percent from $55.9 million, or $0.53 per diluted share,
during the first quarter of 2005. As discussed above, first
quarter 2006 net income includes the following non-cash
charges (in millions, except per share data):
Impact on
Earnings
Per
Pretax Tax Diluted
Loss Benefit Net Loss Share
- ----------------------------------------------------------------------
Goodwill Impairment
Charge - Gibbs Division ($10.4) $3.9 ($6.5) ($0.065)
- ----------------------------------------------------------------------
Share-based Compensation
Expense ($4.0) $1.5 ($2.5) ($0.025)
- ----------------------------------------------------------------------
Total ($14.4) $5.4 ($9.0) ($0.090)
- ----------------------------------------------------------------------
-- First quarter 2005 net income included a loss from
discontinued operations of $5.7 million, or $0.054 per diluted
share, primarily attributable to the sale of our International
Academy of Design and Technology (IADT) campus in Montreal,
Canada.
CASH FLOWS AND FINANCIAL POSITION
Cash Flows
-- Net cash provided by operating activities was $122.6 million
during the first quarter of 2006, compared to net cash
provided by operating activities of $111.2 million during the
first quarter of 2005.
-- Capital expenditures decreased to $17.5 million during the
first quarter of 2006, from $25.5 million during the first
quarter of 2005. Capital expenditures represented
approximately 3.3 percent of consolidated revenue during the
first quarter of 2006 and 5.0 percent of consolidated revenue
during the first quarter of 2005.
Financial Position
-- As of March 31, 2006, and December 31, 2005, cash and cash
equivalents and investments totaled $489.0 million and $404.4
million, respectively.
-- Net student receivables as of March 31, 2006, were $61.8
million, a 19.1 percent decrease from net student receivables
of $76.4 million as of December 31, 2005. Allowance for
doubtful accounts as a percentage of gross student receivables
increased to 39.8 percent as of March 31, 2006, as compared to
37.0 percent as of December 31, 2005.
-- Quarterly days sales outstanding (DSO) were 12 days as of
March 31, 2006, a two-day decrease from DSO as of December 31,
2005, of 14 days, and a one-day decrease from DSO as of March
31, 2005, of 13 days. DSO is calculated by dividing the sum of
net student receivables and net other receivables by average
daily revenue for the quarter. Average daily revenue for the
quarter is computed by dividing total revenue by the total
number of days in the quarter.
-- During the three months ended March 31, 2006, we repurchased
approximately 0.7 million shares of our common stock for
approximately $24.9 million at an average price of
approximately $36.16 per share. The repurchase did not have a
significant impact on diluted weighted average shares
outstanding.
CORPORATE GOVERNANCE
The company has adopted or proposed the following corporate
governance enhancements:
2006 Actions:
-- Proposal to the stockholders for a phased-in declassification
of the board of directors to be voted on at the company's
annual meeting on May 18, 2006
-- Proposal to enable stockholders to call a special meeting with
a two-thirds affirmative vote to be voted on at the company's
annual meeting on May 18, 2006
-- Adoption of a majority voting bylaw provision governing
election of directors
-- Appointment of Steven H. Lesnik to the board of directors,
filling the seat vacated by the retirement of Wallace O. Laub
2005 Actions:
-- Termination of the Shareholder Rights Plan
-- Appointment of two new independent directors to the board of
directors, Leslie T. Thornton and Patrick W. Gross
-- Minimum stock ownership guidelines for senior management and
the board of directors
-- Policy requiring approval for board members to serve on other
outside boards
-- Mandatory continuing education for all board members
Stock Repurchase Program
Since July 2005, CEC's board of directors has authorized the use
of approximately $500 million in the aggregate for the repurchase of
shares of our outstanding common stock. Stock repurchases under this
program may be made on the open market or in privately negotiated
transactions from time to time, depending on factors including market
conditions and corporate and regulatory requirements. The stock
repurchase program does not have an expiration date and may be
suspended or discontinued at any time.
Since inception of the program, the company has repurchased
approximately 6.0 million shares of its common stock for approximately
$225.1 million at an average price of approximately $37.76 per share.
SEGMENT REPORTING
Previously, the company reported operating results in two
reportable segments: Colleges, Schools, and Universities (CSU), which
represented an aggregation of our schools on-ground campuses, and the
Online Education Group (OEG), which represented an aggregation of our
online campuses of American InterContinental University (AIU) and
Colorado Technical University (CTU). During the fourth quarter of
2005, we reorganized our management structure with respect to the
management of the University division schools, AIU and CTU, and those
schools' online campuses. Upon completion of the reorganization in the
first quarter of 2006, the company also evaluated its other reporting
segments in accordance with the provisions SFAS 131 "Disclosures about
Segments of an Enterprise and Related Information."
Pursuant to SFAS 131, as of January 1, 2006, the company has
identified five reportable segments: the University segment, the
Culinary Arts segment, the Health Education segment, the Gibbs
segment, and the Other Schools segment. The University segment
includes AIU and CTU, including both universities' on-ground and
online campuses. The Culinary Arts segment includes its Le Cordon Bleu
Schools of North America and the Kitchen Academy schools. The Health
Education segment primarily includes our Sanford-Brown Colleges and
Institutes. The Gibbs segment includes our Katherine Gibbs School and
Gibbs Colleges schools. The Other Schools segment includes the
Academy, College East, College West, and INSEEC division schools.
POPULATION AND NEW STUDENT START DATA
Student Population
CEC total student population as of April 30, 2006 and 2005, was as
follows:
- ----------------------------------------------------------------------
Population Population
April 30, April 30, Percentage
2006 2005 Difference
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
University segment (1) 44,000 39,400 12%
- ----------------------------------------------------------------------
Culinary Arts segment 10,600 11,600 (9%)
- ----------------------------------------------------------------------
Health Education segment 11,100 10,700 4%
- ----------------------------------------------------------------------
Gibbs segment 6,500 8,100 (20%)
- ----------------------------------------------------------------------
Other Schools segment 24,900 26,900 (7%)
- ----------------------------------------------------------------------
CEC Consolidated 97,100 96,700 -%
- ----------------------------------------------------------------------
(1) University segment population includes approximately 31,500 and
25,500 students as of April 30, 2006 and 2005, respectively, that
are enrolled in fully online academic programs offered by
University segment schools, and is presented as supplemental data.
New Student Starts
Total CEC new student starts during the first quarter of 2006 were
approximately 28,300, compared to new student starts of approximately
32,500 during the first quarter of 2005.
GROWTH INITIATIVES
During the first quarter of 2006, CTU introduced Stonecliffe
College Online, an academic division of CTU. Stonecliffe College
Online is the company's first fully online academic program offering
that is marketed specifically to students who prefer a slower pace to
their online education. Presently, Stonecliffe College Online offers
associate degree programs in business and criminal justice, although
the introduction of additional program and degree offerings are
planned.
Also in the first quarter of 2006, the company's JDV Online
division launched Blish.com, a new fully-digital marketplace aimed at
bringing together buyers and sellers of digital content. Blish.com,
which attracts millions of potential customers to its site each month,
aims to establish itself as the primary source for consumers seeking
to purchase digital content.
"We continue to listen to the marketplace and respond with
innovations that are student-centered and consumer-oriented," said
Larson. "Targeted innovations and flexible academic program offerings
will continue to be key to our future, along with intelligent,
strategic acquisitions and long-term, sustainable organic growth."
CONFERENCE CALL INFORMATION
Career Education Corporation will host a conference call today,
May 3, 2006 at 5:00 PM (Eastern Time). Interested parties can access
the live webcast of the conference call at www.careered.com.
Participants can also listen to the conference call by dialing
617-213-8060 (international) or (866) 825-1709 (domestic) and citing
code 80094258. Please log-in or dial-in at least 10 minutes prior to
the start time to ensure a connection. An archived version of the
webcast will be accessible for 90 days at www.careered.com. A replay
of the call will also be available for seven days by calling (617)
801-6888 (international) or (888) 286-8010 and citing code 93539037.
About Career Education Corporation
The educational institutions that are part of the Career Education
Corporation (CEC) family offer high quality education to more than
97,000 students across the world in a variety of career-oriented
disciplines. The 86 campuses, including the online campuses of
American InterContinental University and Colorado Technical
University, that serve these students are located throughout the
United States and in France, Canada, and the United Kingdom, and offer
doctoral, master's, bachelor's, and associate degrees and diploma and
certificate programs.
Career Education is an industry leader whose gold-standard brands
are recognized globally. Those brands include, among others, the Le
Cordon Bleu schools of North America; the Harrington School of Design;
the Brooks Institute of Photography; American Intercontinental
University; Colorado Technical Institute; and Sanford-Brown. The
mission of CEC, through its schools, its educators, and its employees
is education--their primary goal, to enable students to graduate
successfully and pursue rewarding careers.
For more information see www.careered.com. The company's website
also has a detailed listing of individual campus locations and web
links for each of its educational institutions.
Except for the historical and present factual information
contained herein, the matters set forth in this release, including
statements under "Business Outlook" and "Innovations," statements
identified by words such as "anticipate," "believe," "plan," "expect,"
"intend," "project," "will," and similar expressions, are
forward-looking statements as defined in Section 21E of the Securities
Exchange Act of 1934, as amended. These statements are based on
information currently available to us and are subject to various
risks, uncertainties, and other factors, that could cause our actual
growth, results of operations, performance and business prospects, and
opportunities to differ materially from those expressed in, or implied
by, these statements. Except as expressly required by federal
securities laws, we undertake no obligation to update such factors or
to publicly announce the results of any of the forward-looking
statements contained herein to reflect future events, developments, or
changed circumstances, or for any other reason. These risks and
uncertainties, the outcome of which could materially and adversely
affect our financial condition and operations, include, but are not
limited to, the following: risks related to our ability to comply
with, and the impact of changes in, legislation and regulations that
affect our ability to participate in student financial aid programs;
costs, risks and effects of legal and administrative proceedings and
investigations and governmental regulations, including the pending
Securities and Exchange Commission and Justice Department
investigations and, class action, derivative, and other lawsuits;
risks related to our ability to comply with accrediting agency
requirements or obtain accrediting agency approvals; costs and
difficulties related to the integration of acquired businesses; risks
related to our ability to manage and continue growth; future financial
and operational results, including the impact of possible impairment
of goodwill and other intangible assets; risks related to competition,
general economic conditions, and other risk factors relating to our
industry and business, and the factors discussed in our Annual Report
on Form 10-K for the year ended December 31, 2005, and from time to
time in our other reports filed with the Securities and Exchange
Commission.
CAREER EDUCATION CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
For the Three Months Ended March 31, 2006 and 2005
(In thousands, except per share amounts and percentages)
% of % of
2006 Revenue 2005 Revenue
--------- --------- --------- ---------
REVENUE:
Tuition and registration
fees $506,677 95.8% $484,881 95.0%
Other 21,953 4.2% 25,555 5.0%
--------- ---------
Total revenue 528,630 100.0% 510,436 100.0%
--------- ---------
OPERATING EXPENSES:
Educational services and
facilities 161,959 30.6% 156,348 30.6%
General and administrative 256,058 48.4% 237,990 46.6%
Depreciation and
amortization 21,009 4.0% 17,201 3.4%
Goodwill impairment charge 10,389 2.0% - - %
--------- ---------
Total operating expenses 449,415 85.0% 411,539 80.6%
--------- ---------
Income from operations 79,215 15.0% 98,897 19.4%
--------- ---------
OTHER INCOME (EXPENSE):
Interest income 4,297 0.8% 1,707 0.3%
Interest expense (351) -0.1% (436) -0.1%
Share of affiliate earnings 903 0.2% 1,826 0.4%
Miscellaneous income
(expense) 121 - % (558) -0.1%
--------- ---------
Total other income 4,970 0.9% 2,539 0.5%
--------- ---------
Income before provision for
income taxes 84,185 15.9% 101,436 19.9%
PROVISION FOR INCOME TAXES 31,486 5.9% 39,814 7.8%
--------- ---------
Income from continuing
operations 52,699 10.0% 61,622 12.1%
DISCONTINUED OPERATIONS:
Loss from discontinued
operations - - % (5,700) -1.1%
--------- ---------
NET INCOME $52,699 10.0% $55,922 11.0%
========= =========
NET INCOME PER SHARE -
DILUTED:
Income from continuing
operations $0.526 $0.586
Loss from discontinued
operations - (0.054)
--------- ---------
Net income $0.526 $0.532
========= =========
Diluted weighted average
shares outstanding 100,220 105,195
========= =========
CAREER EDUCATION CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
2006 2005
------------- -------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $99,022 $132,308
Investments 389,991 272,093
------------- -------------
Total cash and cash equivalents and
investments 489,013 404,401
Receivables:
Students, net of allowance for
doubtful accounts of $40,869 and
$44,839 as of March 31, 2006,
and December 31, 2005, respectively 61,836 76,447
Other, net 7,042 5,015
Prepaid expenses 37,908 37,412
Inventories 15,408 14,090
Deferred income tax assets 10,122 10,122
Other current assets 29,082 31,067
------------- -------------
Total current assets 650,411 578,554
------------- -------------
PROPERTY AND EQUIPMENT, net 405,272 411,144
GOODWILL 433,475 443,584
INTANGIBLE ASSETS, net 35,434 35,286
OTHER ASSETS 37,945 37,537
------------- -------------
TOTAL ASSETS $1,562,537 $1,506,105
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt $590 $627
Accounts payable 24,108 28,627
Accrued expenses:
Payroll and related benefits 27,740 39,471
Income taxes 39,566 23,509
Other 82,643 82,513
Deferred tuition revenue 166,286 152,007
------------- -------------
Total current liabilities 340,933 326,754
------------- -------------
LONG-TERM LIABILITIES:
Long-term debt, net of current
maturities 16,673 16,358
Deferred rent obligations 95,756 89,680
Deferred income tax liabilities 31,212 31,212
Other 5,862 5,854
------------- -------------
Total long-term liabilities 149,503 143,104
------------- -------------
STOCKHOLDERS' EQUITY:
Common stock 1,035 1,033
Additional paid-in capital 598,952 591,287
Accumulated other comprehensive income 2,402 1,989
Retained earnings 694,795 642,096
Cost of shares in treasury (225,083) (200,158)
------------- -------------
Total stockholders' equity 1,072,101 1,036,247
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,562,537 $1,506,105
============= =============
CAREER EDUCATION CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2006 and 2005
(In thousands)
For the Three Months
ended March 31,
----------------------
2006 2005
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $52,699 $55,922
Adjustments to reconcile net income to net
cash provided by operating activities:
Goodwill impairment charge 10,389 -
Loss from discontinued operations - 5,700
Depreciation and amortization 21,009 17,201
Compensation expense related to share-
based awards 4,015 -
Loss on disposition of property and
equipment 23 430
Share of affiliate earnings, net of
dividends received (903) (612)
Tax benefit associated with stock option
exercises - 626
Other 204 191
Changes in operating assets and
liabilities 35,201 31,725
---------- ----------
Net cash provided by operating
activities 122,637 111,183
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Business dispositions/acquisitions, net of
cash - (908)
Purchases of property and equipment (17,543) (25,539)
Purchases of available-for-sale investments (361,619) -
Sales of available-for-sale for sale
investments 243,772 -
Other (5) 2
---------- ----------
Net cash used in investing
activities (135,395) (26,445)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchases of treasury stock (24,925) -
Issuance of common stock 2,932 2,314
Tax benefit associated with stock option
exercises 720 -
Payments of revolving loans - (1,630)
Payments of capital lease obligations and
other long-term debt (89) (708)
---------- ----------
Net cash used in financing
activities (21,362) (24)
---------- ----------
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE
CHANGES ON CASH AND CASH EQUIVALENTS 834 (1,904)
---------- ----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (33,286) 82,810
CASH AND CASH EQUIVALENTS, beginning of period 132,308 349,458
---------- ----------
CASH AND CASH EQUIVALENTS, end of period $99,022 $432,268
========== ==========
CAREER EDUCATION CORPORATION
SELECTED SEGMENT INFORMATION
(Dollars in thousands)
For the Three Months
Ended March 31,
----------------------
2006 2005
---------- ----------
REVENUE:
University segment (1) $243,582 $211,719
Culinary Arts segment (2) 90,628 92,556
Health Education segment (3) 40,578 37,921
Gibbs segment (4) 29,505 38,272
Other Schools segment (5) 124,230 129,968
Corporate and other (6) 107 -
---------- ----------
$528,630 $510,436
========== ==========
SEGMENT PROFIT (7):
University segment $82,390 $78,743
Culinary Arts segment 14,009 18,639
Health Education segment 1,213 (254)
Gibbs segment (8) (17,553) (278)
Other Schools segment 15,772 18,271
Corporate and other (15,713) (14,398)
--------------------
$80,118 $100,723
========== ==========
SEGMENT PROFIT PERCENTAGE:
University segment 33.8% 37.2%
Culinary Arts segment 15.5% 20.1%
Health Education segment 3.0% -0.7%
Gibbs segment -59.5% -0.7%
Other Schools segment 12.7% 14.1%
- ----------------------------------------------------------
(1) University segment includes AIU and CTU branded schools.
(2) Culinary Arts segment includes Le Cordon Bleu and Kitchen Academy
branded schools.
(3) Health Education segment primarily includes Sanford-Brown branded
schools.
(4) Gibbs segment includes Gibbs College and Katharine Gibbs Schools
branded schools.
(5) Other Schools segment represents an aggregation of the Academy,
College East, College West, and INSEEC school operating divisions.
(6) Corporate and other revenue represents advertising revenue
realized by our JDV Online operating division.
(7) Segment profit equals the sum of income from operations and share
of affiliate earnings.
(8) Gibbs segment profit for the three months ended March 31, 2006,
includes a goodwill impairment charge of $10,389.
CAREER EDUCATION CORPORATION
SELECTED ACCOUNTS RECEIVABLE AND ALLOWANCE INFORMATION
(Dollars in thousands)
DAYS SALES OUTSTANDING
March 31,
-------------------
2006 2005
--------- ---------
Total revenue during the
quarter ended $528,630 $510,436
Number of days in the
quarter ended 90 90
Total revenue per day $5,874 $5,672
Receivables, net $68,878 $74,775
Days sales outstanding 12 13
ALLOWANCE AS A PERCENTAGE OF STUDENT RECEIVABLES
March 31,
-------------------
2006 2005
--------- ---------
Allowance for doubtful accounts $40,869 $50,880
Gross student receivables $102,705 $120,103
Allowance as a percentage of
student receivables 39.8% 42.4%
STUDENT RECEIVABLES VALUATION ALLOWANCE
Balance,
Beginning Charges Amounts Balance,
of to Written- End of
Period Expense Off Period
--------- --------- --------- --------
For the three months ended
March 31, 2006 $44,839 $14,476 $(18,446) 40,869
For the three months ended
March 31, 2005 61,136 17,496 (27,752) 50,880
CAREER EDUCATION CORPORATION
HISTORICAL SEGMENT INFORMATION (a)
(Dollars in thousands)
2005:
- ----- For the
For the Three Months Ended, Year
--------------------------------------- Ended
September December December
March 31, June 30, 30, 31, 31,
--------- --------- --------- --------- -----------
REVENUE:
University
segment $211,719 $221,030 $215,281 $222,095 $870,125
Culinary Arts
segment 92,556 90,907 100,406 99,461 383,330
Health Education
segment 37,921 37,508 38,309 40,135 153,873
Gibbs segment 38,272 33,116 30,756 31,728 133,872
Other Schools
segment 129,968 114,902 112,730 135,741 493,341
Corporate and
other - - - 14 14
--------- --------- --------- --------- -----------
$510,436 $497,463 $497,482 $529,174 $2,034,555
========= ========= ========= ========= ===========
SEGMENT PROFIT:
University
segment $78,743 $75,469 $63,926 $69,887 $288,025
Culinary Arts
segment 18,639 14,749 25,439 23,847 82,674
Health Education
segment (254) (1,141) 683 1,797 1,085
Gibbs segment (278) (5,690) (5,501) (3,920) (15,389)
Other Schools
segment 18,271 13,637 11,875 23,255 67,038
Corporate and
other (14,398) (13,832) (12,283) (8,781) (49,294)
--------- --------- --------- --------- -----------
$100,723 $83,192 $84,139 $106,085 $374,139
========= ========= ========= ========= ===========
SEGMENT PROFIT
PERCENTAGE:
University
segment 37.2% 34.1% 29.7% 31.5% 33.1%
Culinary Arts
segment 20.1% 16.2% 25.3% 24.0% 21.6%
Health Education
segment -0.7% -3.0% 1.8% 4.5% 0.7%
Gibbs segment -0.7% -17.2% -17.9% -12.4% -11.5%
Other Schools
segment 14.1% 11.9% 10.5% 17.1% 13.6%
2004:
- ----- For the
For the Three Months Ended, Year
--------------------------------------- Ended
September December December
March 31, June 30, 30, 31, 31,
--------- --------- --------- --------- -----------
REVENUE:
University
segment $123,049 $145,556 $155,840 $173,103 $597,548
Culinary Arts
segment 78,861 79,433 92,749 98,558 349,601
Health Education
segment 33,771 34,855 37,732 38,637 144,995
Gibbs segment 46,781 41,650 41,289 42,049 171,769
Other Schools
segment 114,903 102,568 108,424 138,724 464,619
--------- --------- --------- --------- -----------
$397,365 $404,062 $436,034 $491,071 $1,728,532
========= ========= ========= ========= ===========
SEGMENT PROFIT:
University
segment $41,302 $48,452 $44,737 $48,517 $183,008
Culinary Arts
segment 15,033 14,328 23,322 26,821 79,504
Health Education
segment (552) (634) 1,344 2,819 2,977
Gibbs segment 877 (3,133) (4,755) (5,191) (12,202)
Other Schools
segment 17,116 9,959 10,881 29,314 67,270
Corporate and
other (8,700) (7,494) (5,948) (2,606) (24,748)
--------- --------- --------- --------- -----------
$65,076 $61,478 $69,581 $99,674 $295,809
========= ========= ========= ========= ===========
SEGMENT PROFIT
PERCENTAGE:
University
segment 33.6% 33.3% 28.7% 28.0% 30.6%
Culinary Arts
segment 19.1% 18.0% 25.1% 27.2% 22.7%
Health Education
segment -1.6% -1.8% 3.6% 7.3% 2.1%
Gibbs segment 1.9% -7.5% -11.5% -12.3% -7.1%
Other Schools
segment 14.9% 9.7% 10.0% 21.1% 14.5%
(a) Effective January 1, 2006, we changed the composition of our
reportable segments. The historical segment information reflected
in this table is categorized in accordance with our new segment
structure.
CAREER EDUCATION CORPORATION AND SUBSIDIARIES
SELECTED QUARTERLY DATA FOR UNIVERSITY SEGMENT
2006 2005
--------------------------- ---------------------------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
------ ------ ------ ------ ------ ------ ------ ------
Revenue
earning days
AIU Online 83 84 78 70 82 84 79 70
CTU Online 77 77 77 77 77 77 77 77
------ ------ ------ ------ ------ ------ ------ ------
Total 160 161 155 147 159 161 156 147
====== ====== ====== ====== ====== ====== ====== ======
AIU Online CTU Online
--------------------------- ---------------------------
2006 2005 2006 2005
------------- ------------- ------------- -------------
Start Grad Start Grad Start Grad Start Grad
------ ------ ------ ------ ------ ------ ------ ------
January 1/1 none 1/2 none 1/1 none 1/2 none
February 2/5 2/4 2/13 2/5 2/8 2/7 2/9 2/8
March 3/19 3/11 3/20 3/19 none 3/18 none 3/19
Total 1Q
dates 3 2 3 2 2 2 2 2
April 4/23 4/22 none 4/23 4/2 none 4/3 none
May none 5/27 5/1 none 5/10 5/9 5/11 5/10
June 6/4 none 6/5 6/4 none 6/17 none 6/18
Total 2Q
dates 2 2 2 2 2 2 2 2
July 7/9 7/8 7/17 7/9 7/2 none 7/3 none
August 8/27 8/12 8/21 8/20 8/9 8/8 8/10 8/9
September none 9/30 none 9/24 none 9/16 none 2/17
Total 3Q
dates 2 3 2 3 2 2 2 2
October 10/1 none 10/9 none 10/1 none 10/2 none
November 11/12 11/4 11/13 11/12 11/8 11/7 11/9 11/8
December none 12/16 none 12/17 none 12/16 none 12/17
Total 4Q
dates 2 2 2 2 2 2 2 2
CONTACT: Career Education Corporation
Karen M. King (Investors), 847-585-3899
www.careered.com
or
Pattie Overstreet-Miller (Media), 847-851-7351