ATGE - Earnings call transcript Q4 2024 | Adtalem Global Education Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Hello, and welcome to the Adtalem Global Education Inc. Fourth Quarter and Fiscal Year 2024 Earnings Conference Call and Webcast. [Operator Instructions] A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to turn the conference over to Jonathan Spitzer, Vice President, Investor Relations. Please go ahead, sir.

Jonathan Spitzer

to XXXX call results. welcome quarter the and year fiscal afternoon our for earnings fourth Good

Global Phelan, On Steve Chief Adtalem Beard, call President and the with and Executive me Officer Financial Officer. Chief today are Education; Bob of

and statements I'll see of as made for you legal, materials for directly you related new constitute in and the presentation, declarations. non-GAAP result this Steve, our latest Harbor Investor certain projections and factors changes appendix the risk forward-looking usual, Certain uncertainties information. information, use take of presentation Before website and XX-K, I to no are statements measures. to financial of in Form risks based any available will to are competitive relate that to measures this results of today's a presentation events, as and expectations hand cautionary over current on statements. In you through obligation XX-Q GAAP Safe after publicly future undertake could as to otherwise. results forward-looking financial refer on subject discussion that vary whether market reconciliations regulatory update future the Form forward-looking that We presentation Please actual assumptions statement cause to materially. We Relations comparable or most to

for on website After at You the will the find over a days. I presentation be link to on hand our this you call, investors.adtalem.com. archived webcast to Relations website will the Investor Steve. webcast and now will XX

Stephen Beard

Investor and achieved milestones year, accelerated everyone, Purpose our successful XXXX XXXX provider fiscal the post-secondary national the our we afternoon, talent Growth through targets We've with our of our making trajectory to our to and and U.S. reach results, strategic set execution education impact year our growth financial impact and XXXX Thanks, fourth call. and leading health Adtalem's operational substantial higher initiatives, welcome amplified against Jay. significant exceeded We're This a leader quarter and June strategy. in by we by care. Day. encouraged expanded earnings Good we're our during the as professional

fiscal efficient attractive note the integrated more with like As following operating durable we a our I'd specific and further model institutions, X real creating operating synergies, reflect on highlights. We profitability leverage. to XXXX,

marketing data-driven enhanced double-digit investments strategies growth scale to enterprise utilize adjusted producing of fiscal have for in year. Our the while awareness, brand attractive ending operating maintaining throughout economies student-facing EBITDA boost an returned inquiries to quarter XX% for year-over-year year, margin a the growth the year improved quarter. consistently fourth returning and enrollment profile. levels increase the pre-pandemic Total the first with and in to We

for adjusted Our EBITDA year-over-year. $X.XX earnings was approximately increase per XX%, share of X.X% in an XX% an billion, delivered year-over-year. revenue We resulting up adjusted $X.XX, of margin the of year

Bachelor at achieving and simulation environment, campus a $XXX accommodating an offerings nearly diverse generating continues $XXX expanding like turn Phoenix and capacity capital and July, features financial our strengthened increase opened learning we segments. Chamberlain range position, million in this learning physical cash including a school investments free In enhance we to relocated online actively expansive new proudly total modernized nursing quarter. of to our capable of strategic enhance campus, Nursing programs here, We're presence flow modalities, enrollment making This I'd while our national to X,XXX program in notable in option nursing locations. Finally, University, our returning to our in nation's Science its million leading students. the shareholders. through XX.X% of to lab. a our From

will represent our this plan Assistance our announce we're serve campus the with to location, City students. program second location approximately that In designed for also XXX our Kansas house enter which excited to market Physician addition, the field. Today, is in-demand would a XXth to Chamberlain

programs specialty marquee of caring Our Focused an combined program the of BSN as needs students aligns our Specialty clinical their students we've new flexible The our partnership tracks. critical and with provide leaders. Practice enrolled with XXXX, Since leader of partnership will by a completing in Specialty a over hybrid successfully education in-depth and further to individual than Care Ready. online Association to the AACN introduction workforce launch critically Practice for ill expanding with in Ready. way marks identified collaboration and patients Chamberlain acutely their through industry families. in extensive Critical Nurses. in American addressing campus Focused positions XXXX, January X,XXX footprint, more XXX a fifth of delivering Beginning this that learning with specialization, pathways, preferences. We're January

University. Walden to turning Now,

Our go-to-market distance XX.X% for and of focus commitment another impressive resulted working an learning on have adults strategy, operational reflecting excellence increase to in quarter flexible year-over-year. enrollment,

By of Chamberlain. confident the streamlined of addition just as Walden improvements behind enhancement new high Our a leader nursing of in in professionals. The rates. navigation addressing newly and only industry-leading labor technology students as enhancements experience. virtual remain the latest prioritizing our our to in is and in student Nursing implementation tech-enabled learning ranking tech-enabled the through student producer redesigned seamless website, methods, areas university, largest for Science which support Walden's a working ongoing the position a students as digital driving Master advising operational a experience in in graduates Walden persistence are classrooms, but also such we second enrollment, its sister not attracting platforms offers of launch shortages, more remains country, leader

experienced this Tempo middle the is significant and our has competency-based, year. growth enrollment psychology, services each work our strides making comprehensive double-digit program, Additionally, through we're quarter programs. human tackling which counseling, social Furthermore, health crisis in

and progress and medical Medical Veterinary its work the over launch. promising to as making our to Our respect Walden's Believe designed advancements, and return Achieve continued provide technological we're since schools had we to has with segment, contribute significant our financial initiatives, confidence clarity trajectory. With year-over-year Scholarship to XX,XXX participants These growth. along reward our growth in to persistence at

student Our remediation intake. as are to evidenced positive the plans improved for results starting the May enrollment by yield trends

implementing leadership enrollment established initiatives remains to for to institutions opportunities enhance our dedicated newly improve identifying journey team Our prospective the students. and and

see We continue Med's Return Home interest in strong program. Ross clinical to

Veterinary celebrated commencement, in States. DVM Medicine. Vet the our students nearly Additionally, Doctors accounted achieved Ross In capacity. curriculum. Ross graduates Med the elective, reported a first on sciences annual the Capstone, of of near academic enrolled for to May, Step insights its year have cohort operating us incorporate In outcomes promising XXX XXXX, all we our in prompting basic USMLE Vet academic X% United new is recently most approximately of graduating Ross X, into

we will that Medical continue Looking anticipate improve and year in enrollment in ahead, our trends total Veterinary XXXX. to segment fiscal

with strategy expect on top to will our and its We focus Growth drive that bottom line results. continue with operational excellence Purpose

revenue We with to and to of expect fiscal another per $X.X $X.XX $X.XX. $X.XX earnings record adjusted year projected billion of XXXX billion year to be share

with students, making dedication by a to overview, to XX,XXX to a of the who I our positive Before on call work colleagues come that, the good. Bob. society. And and I'll hand our to serving for day awestruck nearly commitment detailed be over every remarkable and turn with to over I'd call driving to unwavering Adtalem your making a outcomes I like goal for force thank impact continue financial Bob the

Robert Phelan

and Thank everyone. hello, you, Steve,

ahead sustainable strategic as our Growth yielded of year as expectations fourth momentum and Our well growth our growth Later quarter full bottom I'll my for performance our and and results Purpose enrollment drivers set quarter a range. quarter and recent review year. and the year, with $XXX.X against disciplined growth are financial and robust by of most we expectations financial begin the assumptions our total XX.X% Chamberlain enhanced remarks, amplifying all will line year exceeded growth We in year our generation. with and the trajectory. driven for through top updated Revenue highlight enrollment accelerated heading the in and top full strong operational in achieved our the million, and not at but the turn, our guidance fiscal key results into fourth increased only for Returns segments, and I with cash the leverage our also operational Walden. initial achieved performance. initiatives delivering In through quarter our to X by in particular, discuss results in XXXX. Starting we fourth line.

For $X.XX X.X%. billion, the full up revenue year, was

improved sequentially trend and our growth year across segments as their quarter enrollment throughout X all Purpose with every generated intended returns. Our the marketing initiatives Growth investments

compared led by growth million, to the and $XX.X operating up up a to Chamberlain the XXX basis point the EBITDA growth This came in During year from resulted generated as prior revenue margin was in XX.X%, million, leverage. X adjusted was income and in from operational XX.X% last compared segments. XX.X% Walden prior year $XX.X an of all efficiencies and growth adjusted consolidated quarter, year. Adjusted EBITDA increase at

adjusted of million, with the EBITDA $XXX.X prior Looking an at was the full increase X.X% year, year. compared

segments continue more across our and X EBITDA year goal efficient, We operational of integrated achieve investments as with meeting XX.X%, our our a balance high income $XX.X fiscal margin we adjusted operating long-term quarter to our in X.X% home year. Adjusted optimally growth scaled foundation adjusted was for $X.XX. income compared office. Fiscal the share year of $XXX.X XXXX million the per adjusted was net earnings with prior to million, up

as of returned by higher the cost XX% net rate. of earnings market that the income our $XXX with at long-term million lower value increase an $XXX.X offset for partially intrinsic for shares we capital repurchases outstanding a X% and year, million, of believe the effective prior year, expense tax higher per of to approximately interest $XX.XX benefit Diluted basis through year $X.X growth year was in shareholders. compared adjusted were total shareholders at million diluted adjusted average lower million actions a net share operating increased share and we income $XX.X as shares of an this increased adjusted the For open by full have share to resulting per $X.XX, outstanding a

increase discuss will XX.X% driven fourth both enrollment when fourth million, enrollment. quarter and the program quarter consecutive student with growth. growth quarter nursing a during Next, XX.X% year, Chamberlain quarter highlights $XXX post-licensure of reported prior year, by of to sixth increased compared in pre-licensure Total by the compared the an of I financial revenue prior primarily segment.

marketing, our lower bad tied margin debt. performance our for employee support or rapidly students option, $XX.X education year-over-year, We EBITDA available. Adjusted in online to states, XX.X% options BSN pre-licensure quarter. increased nursing and XX.X% costs benefit points access expand in academic basis local the Adjusted our was had as year of leverage offered the investments growing by for was triple over prior higher no services who million student for continue outcomes, to provision EBITDA operational XX digits limited fourth XX by offset than traditional previously enhance expanding higher to now to to underlying

investments student-facing creating market-leading Our student position. differentiation and enhancing seamless more our are a experience,

with are our that position. investments, nursing education believe top marketing together Taken we we expanding our

commensurate programs year and being with the Walden. quarter, prior and new across to up the our robust with to increased points million, of the Fourth XX.X% expanded of to accelerated which growth versus leverage, high driven nursing in transformation quarter growth by by Turning in growth prior increase support programs EBITDA social strong levels EBITDA in continued $XXX.X in an revenue and enrollment prior by by balanced rates. non-health new was care increased Adjusted strong investments year generate The enrollments. million. year an as persistence was XX student led the the level to Total is quarter. of compared also and strong student basis enrollments. margin and operational enrollment health XX.X% from degree with XX.X% up the XX.X% $XX.X efficiencies enrollment Adjusted behavioral versus

the continues to future us operational to ability invest growth Walden. focus Our at afford for

Veterinary and to XX% the remain the near $XX.X plans to For as medical the balance to X.X% compared the from our on at EBITDA by Ross Adjusted year sheet. growth by cash Medical XXX with to prior versus X.X% increased operate operational student revenue points focus. Shifting and increased segment, the fourth million. Adjusted enrollment expanded XX.X% the track quarter $XX.X million. Total capacity. schools in and flow prior revenue decreased to continues and year basis Vet EBITDA margin our

increase investments. cash to performance increase we drove flow continue investments free our in the year-over-year increases million, XXXX in strength $XXX to through increase working million enhance financial robust in inclusive improvements a free $XX of cash expansion. generation. capital planned We our and cash technologies last flow, was year, versus Strong student-facing in continue while physical Fiscal year our

X.Xx. ending leverage Our of $XXX sheet year million balance low EBITDA net and adjusted healthy, remains in the with cash a

to generate aim balanced We thoughtfully We'll Growth optimal positive allocation. strong remains top as institutions our achieve a balance our while initiatives outcomes. year Purpose Our also XXXX reinvest returns. exited priority continue sheet tangible approach to to fiscal student we we capacity into our capital and deliver with as strengthen

a XXXX. are fiscal higher base We into year creating sustainable momentum enrollment off total heading

basis Included approximately $X.XX, current reach growth XXXX into generation. half continue quarter. we performance, though into in through leverage. year the growing fiscal education X.X% June share year-over-year from to we expand total from our revenue to growth To Revenue plan As exceeds XX% of continued which growth level with more well revenue the capital margin to marketing first higher the during level billion XX% be capture student-facing continue XXX XXXX. accelerating to compared and investments, compared growth operational year access, adjusted of second more as year balanced our within with initiating marketing in are to slightly incremental primarily half, adjusted earnings of fiscal expect a XXXX Day points actions allocation opportunities growth accelerate the billion, throughout year investing during growth are make approximate enhanced fiscal fiscal we of technology had we year-over-year. We growth to We our the the and the faster range anticipate targets. flow to external to guidance, EBITDA guidance to expansion seen the per of first our 'XX we $X.X as investments an strong total in the inclusive than resulting to revenue execute and $X.XX are cash year-over-year fiscal range in X% XXXX XXXX year $X.XX approximately revenue the year Investor market to

health approximately are to anticipate we normalized continue Finally, conclusion, well we positioned outsized tax positive rate U.S. to impact a a care. adjusted XX%. In effective make of on

Growth our strategy growing Purpose with amplifying Our is enrollments through trajectory, expanding access.

student care-focused decades from to to for deliver we the to continue outstanding now outcomes, that, a institution health for an As number positive have of the over will to impacts poised to continue Adtalem operator graduates come. With turn coming grow, Q&A. will I call societal

Operator

question now first you. from Markets. today Thank begin Capital session. Instructions] question-and-answer Silber coming our [Operator BMO We'll Our is Jeff from

Ryan Griffin

This on is Ryan Jeff. for

leverage still down that achieve Just how to will was marketing 'XX able to much in you driven admissions FY expansion? curious the then be growth if to you margin by spend? slow get And spend

Stephen Beard

the persistent gains I by driven impacted were a enrollment be the of by got real the year think to marketing without And of that as Well, of think ordinary total new that last heels enrollment in material momentum marketing. persistence. combination overall we've and investments portion our enrollment did a on campaigns. kind result, We beyond wouldn't of growth refreshing sustain the the we of brand campaigns course

Ryan Griffin

just for in And I think environment you've about was how the XXXX. comments curious looks pricing that just you and the can tuition any like should then and rates my It environment? competitive give been follow-up, in on up bringing successful there, the we

Stephen Beard

is that we've to the as strategy. have part Growth Yes. to disciplines begun mean of competitively. we we we're taking Price And Purpose priced one can price also by means not taking with It pricing core our power. potentially think adhere where down of price optimization, where optimization

basis and in segments our than teams the contain in make from regular that a pool aspiring to we're on ensure so with the our accordingly our we, each of for X and of competitive review And large fair that the along programs. students share more adjustments marketplace

Ryan Griffin

we confirm, XXX margin this points to expansion basis still be EBITDA using year? just should adjusted And of

Stephen Beard

correct. That's

Operator

from Pawlak Steven question is from next coming Baird. Our

Steven Pawlak

I and some view? I was asking normalized capacities characterize you the COVID. to is, post normalized guess relative there hospitals would think environment as And demand current still I'm catch-up the reason a How more are clinical

to just a how you normal would So, characterize relative environment the environment? more

Stephen Beard

to want sure... just I make

Steven Pawlak

On the demand side.

Stephen Beard

question, you're for or environment the talking these students about for demand programs? in Your environment clinicians demand

Steven Pawlak

students. For

Stephen Beard

students operating impact I for But been of ed. one-time was demand of in real I that the all across wake take 'XX. we've normalized that been something enrollments is is our normalized on share had, our what for think least we in demand year. by continue a view undergraduate in the do to expect think, environment. demand to the COVID, last environment really to into that's which last gratified And higher So, year. we've at There environment reset normalized And a ability a fiscal

Steven Pawlak

the puts And then or you of would sort within what at color provide put range? and on you the on guidance range, end any lower of that can higher takes

Robert Phelan

closely Sure. enrollments tell the in we'll right into on up at the for looking like. year that see is things really to the our in this guidance be Obviously, be what look in rest the the our would the would yourself important that will is on terms visibility for in September, basing I extent first enrollments of of the What rest of what one now, stronger period that future the we're setting for particular, in we you come year. of get that you September

Operator

Thank you.

end We back turn to or like our the have of over floor question-and-answer comments. management for closing to any I'd session. reached further

Stephen Beard

in all joining next Thank I call. on to thank 'XX record-setting for everyone fiscal want us you your you look to and talk 'XX. forward we'll to for a fiscal quarter. of support Thank We you. the

Operator

teleconference today's and conclude does That you. Thank webcast.

for wonderful disconnect may today. You time this and participation day. lines We at your have you thank your a

Adtalem Global Education (ATGE) 6 Aug 242024 Q4 Earnings call transcript