Strategic Education, Inc. Reports First Quarter 2024 Results
HERNDON, Va. , April 25 /Businesswire/ - Strategic Education, Inc. (Strategic Education) (NASDAQ: STRA) today announced financial results for the period ended March 31, 2024.
“As we begin a new year, we are pleased with strength across our business and proud of the organization’s ongoing commitment to the success of our students,” said Karl McDonnell, Chief Executive Officer of Strategic Education. “The U.S. Higher Education segment delivered another quarter of strong growth driven by employer affiliated enrollment; the Education Technology Services segment continued to see strength, including from Sophia subscriptions; and the Australia/New Zealand segment returned to total enrollment growth.”
STRATEGIC EDUCATION CONSOLIDATED RESULTS
Three Months Ended March 31
U.S. Higher Education Segment Highlights
Education Technology Services Segment Highlights
Australia/New Zealand Segment Highlights
Balance Sheet and Cash Flow
At March 31, 2024, Strategic Education had cash, cash equivalents, and marketable securities of $253.6 million, and $61.3 million outstanding under its revolving credit facility. For the first three months of 2024, cash provided by operations was $77.6 million compared to $35.2 million for the same period in 2023. Capital expenditures for the first three months of 2024 were $9.2 million compared to $8.3 million for the same period in 2023.
For the first quarter of 2024, consolidated bad debt expense as a percentage of revenue was 4.2%, compared to 3.8% of revenue for the same period in 2023.
COMMON STOCK CASH DIVIDEND
Strategic Education announced today that it declared a regular, quarterly cash dividend of $0.60 per share of common stock. This dividend will be paid on June 3, 2024 to shareholders of record as of May 24, 2024.
CONFERENCE CALL WITH MANAGEMENT
Strategic Education will host a conference call to discuss its first quarter 2024 results at 10:00 a.m. (ET) today. This call will be available via webcast. To access the live webcast of the conference call, please go to www.strategiceducation.com in the Investor Relations section 15 minutes prior to the start time of the call to register. An earnings release presentation will also be posted to www.strategiceducation.com in the Investor Relations section. Following the call, the webcast will be archived and available at www.strategiceducation.com in the Investor Relations section. To participate in the live call, investors should register here prior to the call to receive dial-in information and a PIN.
About Strategic Education, Inc.
Strategic Education, Inc. (NASDAQ: STRA) (www.strategiceducation.com) is dedicated to helping advance economic mobility through higher education. We primarily serve working adult students globally through our core focus areas: 1) U.S. Higher Education, including Capella University and Strayer University, each institutionally accredited, and collectively offer flexible and affordable associate, bachelor’s, master’s, and doctoral programs including the Jack Welch Management Institute at Strayer University, and non-degree web and mobile application development courses through Strayer University’s Hackbright Academy and Devmountain; 2) Education Technology Services, developing and maintaining relationships with employers to build education benefits programs providing employees access to affordable and industry-relevant training, certificate, and degree programs, including through Workforce Edge, a full-service education benefits administration solution for employers, and Sophia Learning, enabling education benefits programs through low-cost online general education-level courses that are ACE-recommended for college credit; and 3) Australia/New Zealand, comprised of Torrens University, Think Education, and Media Design School that collectively offer certificate and degree programs in Australia and New Zealand. This portfolio of high quality, innovative, relevant, and affordable programs and institutions helps our students prepare for success in today’s workforce and find a path to bettering their lives.
Forward-Looking Statements
This communication contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as “expect,” “estimate,” “assume,” “believe,” “anticipate,” “may,” “will,” “forecast,” “outlook,” “plan,” “project,” “potential” and other similar words, and include all statements that are not historical facts, including with respect to, among other things, the future financial performance and growth opportunities of Strategic Education; Strategic Education’s plans, strategies and prospects; and future events and expectations. The statements are based on Strategic Education’s current expectations and are subject to a number of assumptions, uncertainties and risks, including but not limited to:
Many of these risks, uncertainties and assumptions are beyond Strategic Education’s ability to control or predict. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, these forward-looking statements speak only as of the information currently available to Strategic Education on the date they are made, and Strategic Education undertakes no obligation to update or revise forward-looking statements, except as required by law. Actual results may differ materially from those projected in the forward-looking statements.
STRATEGIC EDUCATION, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (in thousands, except per share data) |
|||||||
|
For the three months ended March 31, |
||||||
|
|
2023 |
|
|
|
2024 |
|
Revenues |
$ |
256,606 |
|
|
$ |
290,250 |
|
Costs and expenses: |
|
|
|
||||
Instructional and support costs |
|
152,938 |
|
|
|
157,709 |
|
General and administration |
|
95,465 |
|
|
|
96,695 |
|
Amortization of intangible assets |
|
3,532 |
|
|
|
— |
|
Merger and integration costs |
|
425 |
|
|
|
— |
|
Restructuring costs |
|
5,595 |
|
|
|
(5,510 |
) |
Total costs and expenses |
|
257,955 |
|
|
|
248,894 |
|
Income (loss) from operations |
|
(1,349 |
) |
|
|
41,356 |
|
Other income |
|
398 |
|
|
|
1,794 |
|
Income (loss) before income taxes |
|
(951 |
) |
|
|
43,150 |
|
Provision for income taxes |
|
1,077 |
|
|
|
13,448 |
|
Net income (loss) |
$ |
(2,028 |
) |
|
$ |
29,702 |
|
Earnings (loss) per share: |
|
|
|
||||
Basic |
$ |
(0.09 |
) |
|
$ |
1.27 |
|
Diluted |
$ |
(0.09 |
) |
|
$ |
1.23 |
|
Weighted average shares outstanding: |
|
|
|
||||
Basic |
|
23,430 |
|
|
|
23,391 |
|
Diluted |
|
23,430 |
|
|
|
24,060 |
|
STRATEGIC EDUCATION, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) |
|||||||
|
December 31,
|
|
March 31,
|
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
168,481 |
|
|
$ |
222,116 |
|
Marketable securities |
|
39,728 |
|
|
|
31,448 |
|
Tuition receivable, net |
|
76,102 |
|
|
|
83,082 |
|
Other current assets |
|
44,758 |
|
|
|
53,801 |
|
Total current assets |
|
329,069 |
|
|
|
390,447 |
|
Property and equipment, net |
|
118,529 |
|
|
|
116,419 |
|
Right-of-use lease assets |
|
119,202 |
|
|
|
114,653 |
|
Marketable securities, non-current |
|
483 |
|
|
|
— |
|
Intangible assets, net |
|
251,623 |
|
|
|
248,855 |
|
Goodwill |
|
1,251,888 |
|
|
|
1,229,882 |
|
Other assets |
|
54,419 |
|
|
|
54,980 |
|
Total assets |
$ |
2,125,213 |
|
|
$ |
2,155,236 |
|
|
|
|
|
||||
LIABILITIES & STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable and accrued expenses |
$ |
90,888 |
|
|
$ |
99,245 |
|
Income taxes payable |
|
2,200 |
|
|
|
10,659 |
|
Contract liabilities |
|
92,341 |
|
|
|
128,503 |
|
Lease liabilities |
|
24,190 |
|
|
|
23,316 |
|
Total current liabilities |
|
209,619 |
|
|
|
261,723 |
|
Long-term debt |
|
61,400 |
|
|
|
61,256 |
|
Deferred income tax liabilities |
|
28,338 |
|
|
|
30,439 |
|
Lease liabilities, non-current |
|
127,735 |
|
|
|
116,350 |
|
Other long-term liabilities |
|
45,603 |
|
|
|
42,885 |
|
Total liabilities |
|
472,695 |
|
|
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