PITTSBURGH, July 31, 2001 (PRIMEZONE) -- Education Management Corporation (Nasdaq:EDMC) today reported its financial results for the fourth quarter and year ended June 30, 2001.
Net revenues for the fourth quarter of fiscal 2001 increased by 24.2% to $94.6 million, compared with $76.2 million in the fourth quarter of fiscal 2000. Net income for the quarter grew 27.8% to $3.8 million, or $.12 per diluted share, as compared to $3.0 million, or $.10 per diluted share, in the fourth quarter last year.
For the twelve months ended June 30, 2001, net revenues rose 20.6% to $370.7 million, compared with $307.2 million, in the prior year. Net income for fiscal 2001 increased 28.6% to $29.0 million, or $.93 per diluted share, as compared to $22.5 million, or $.75 per diluted share, last year.
Revenue growth in the fourth quarter resulted from a 15.9% increase in student enrollment and an increase in average tuition rates of approximately 7% over last year. Total student enrollment at the Company's schools in the fourth quarter of fiscal 2001 was 25,945 compared to 22,390 last year.
At the start of the current summer quarter (first quarter of fiscal 2002), total enrollment at EDMC's schools increased 17.8% to 24,735, up from 20,991 as of the comparable point last year. At the 17 schools operated by EDMC for two or more years, enrollment grew 10.3% in the quarter to 22,522 students, as compared to 20,424 students at the start of the same period last year. Total enrollment in bachelor's degree programs was 8,640, a 65.0% increase from start of the first quarter last year.
The Company's quarterly revenues and income fluctuate with student enrollment patterns. Student enrollment typically increases in the fall (fiscal year second quarter), when the largest number of new high school graduates traditionally begin post-secondary education. The Company's quarterly costs and expenses, however, do not fluctuate as significantly as revenues.
Earlier this month, EDMC announced the signing of agreements to acquire Argosy Education Group, headquartered in Chicago, and International Fine Arts College, Miami, Florida. When the transactions are approved by regulatory authorities, education programs in psychology, education, law, business and various art and design fields will be added to the EDMC system, at the undergraduate, graduate and postgraduate levels, serving more than 7,000 students at a number of campus locations.
Robert Knutson, EDMC's Chairman and Chief Executive Officer, commented, "We're pleased to report another quarter and fiscal year of improved operating results. The recently announced agreement to acquire Argosy Education Group, when closed later this calendar year, will provide a platform for EDMC to participate more broadly in the growing higher education market."
Mr. Knutson added, "The Art Institutes, our core business, has consistently demonstrated that a focus on student outcomes serves all our constituencies well. The announced acquisition of International Fine Arts College represents an extension of our strategy to enter attractive new geographic markets and add promising new education programs. We believe we will have sufficient revenue growth and margin expansion to deliver better than 20% earnings per share growth in our current fiscal year."
EDMC is among the largest providers of proprietary post-secondary education in the United States, based on student enrollment and revenue. EDMC's 24 current education institutions offer bachelor's and associate's degree programs and non-degree programs in the areas of design, media arts, culinary arts and fashion. The Company has provided career-oriented education programs for over 35 years, and its Art Institutes have more than 125,000 graduates. For more information about The Art Institutes and The Art Institute Online, visit their Web sites at www.artinstitutes.edu and www.aionline.edu.
This press release may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Securities and Exchange Commission filings. Past results of EDMC are not necessarily indicative of its future results. EDMC does not undertake any obligation to update any forward-looking statements.
Education Management Corporation
Summary Consolidated Statements of Income
(In thousands, except earnings per share)
Three Months Twelve Months
ended June 30, ended June 30,
(unaudited)
2001 2000 2001 2000
-------- -------- -------- --------
Net revenues $ 94,642 $ 76,181 $370,681 $307,249
Costs and expenses:
Educational services 67,115 53,418 242,313 201,187
General and
administrative 20,417 17,252 76,716 66,209
Amortization of
intangibles 594 396 1,977 1,511
-------- -------- -------- --------
88,126 71,066 321,006 268,907
-------- -------- -------- --------
Income before interest
and taxes (EBIT) 6,516 5,115 49,675 38,342
Interest expense, net 398 197 2,275
-------- -------- -------- --------
726
Income before income taxes 6,118 4,918 47,400 37,616
Provision for income taxes 2,325 1,951 18,422 15,086
-------- -------- -------- --------
Net income $ 3,793 $ 2,967 $ 28,978 $ 22,530
======== ======== ======== ========
Diluted earnings per share $ .12 $ .10 $ .93 $ .75
======== ======== ======== ========
Weighted average number of
diluted shares
outstanding (000's): 31,659 30,186 31,016 29,921
Selected Balance Sheet Data:
As of June 30,
2001 2000
---- ----
Cash and cash equivalents $ 47,290 $ 39,538
Receivables, net 18,945 14,931
Current assets 84,434 66,713
Total assets 286,280 240,675
Current liabilities 70,150 62,891
Long-term debt
(including current portion) 53,660 64,283
Shareholders' investment 159,949 112,950