SANTA ANA, Calif., Apr 25, 2002 /PRNewswire-FirstCall via COMTEX/ -- Corinthian Colleges, Inc. (Nasdaq: COCO) today reported record results for its third fiscal quarter ended March 31, 2002, reflecting the company's continued strong growth in student enrollments and online course activity, coupled with added campuses and operating margin expansion.
For the quarter, revenues increased 35% to $88.3 million, up from $65.2 million for the third quarter of last year. For the nine months year- to-date, revenues increased 37% to $243.6 million, compared with $177.8 million for the same period last year.
Income from operations for the third quarter in fiscal 2002 climbed 58% to $18.3 million, compared with $11.6 million for the third quarter of last year. Operating margins for the third fiscal quarter increased 294 basis points over the prior year, to 20.7% of revenues. Income from operations for the nine months year-to-date gained 49.5% to $43.4 million, compared with $29.0 million for the first nine months of fiscal 2001. Operating margins for the nine months year-to-date rose to 17.8% of revenues, compared with 16.3% of revenues for the same period last year.
Net income for the third quarter of fiscal 2002 increased 55.0% to $11.1 million, compared with $7.2 million for the comparable period last year. Earnings per share increased 51.5% to $0.50 per diluted share, compared with $0.33 in the prior year. For the nine months year-to-date period in fiscal 2002, net income rose 48.2% to $26.9 million, or $1.21 per diluted share, compared with net income of $18.2 million, or $0.84 per diluted share, for the corresponding period last year.
At March 31, 2002, total student population grew 22.6% to 31,991, from 26,085 students at March 31, 2001. Student population in same schools as of March 31, 2002 increased 18.5% to 29,786. For the third quarter in fiscal 2002, starts (or new student enrollments) grew to 11,582, for an increase of 26.8%, and same school starts increased 18.7% to 10,469. For the nine months year-to-date in fiscal 2002, starts increased 30.4% to 32,122, and starts in same schools increased 15.7% to 27,618. During the third fiscal quarter, Corinthian opened its new Parks College campus in Arlington, Virginia, which was the third branch opening of Corinthian's 2002 fiscal year.
David G. Moore, Corinthian's chairman, president and chief executive officer, said, "We had an extraordinary third quarter as our operations effectively hit on all cylinders. The company's strong revenue growth during the third quarter and first nine months of fiscal 2002 reflects the implementation of new programs at numerous campuses to fuel same-school growth, the significant ramp up in performance from acquired campuses and new branch campuses, and the growing contribution from our online business. In addition to growing revenues, we improved our bottom line results by controlling expenses. We attribute these successful results to the quality of our curriculum and facilities, and the dedication of our instructors and staff to providing high quality education to our students."
Moore said, "During the third quarter, we organically grew our business and generated record starts and student population, reported record revenues and record earnings, and expanded our online learning to include associate and bachelor degree programs in business administration, accounting and criminal justice, and a master's degree in business. We expect our new online degree offerings to open up a new market for Corinthian and to attract students outside of the geographic areas served by our existing 'bricks and mortar' campuses."
Moore added: "Building upon the internal growth we achieved for the first nine months of this fiscal year, early in the fourth fiscal quarter, we expanded our enterprise with the purchase of National School of Technology, Inc. (NST) and its three campuses on April 1. On April 10, we announced the signing of a Stock Purchase Agreement for Wyo-Tech Acquisition Corp., the parent company of Wyoming Technical Institute (Wyo-Tech), and its two campuses. The Wyo-Tech transaction is expected to close on July 1, 2002. We believe this combination of organic and external growth strategies will provide the platform to support Corinthian's expansion well into the future.
"While we are focused on growing the business, we are also looking to improve our bottom line through expense control," Moore said. "As we have previously stated, we expected to report measurable improvements in bad debt expense in the second half of fiscal 2002. I am pleased to report that our bad debt expense for the quarter ended March 31, 2002, declined to 5.44% of revenues, marking the third consecutive quarter of improvement. Bad debt expense was 5.93% of revenues in the second quarter of fiscal 2002, 6.05% in the first quarter of fiscal 2002, and 6.25% for the fourth quarter of fiscal 2001. We were pleased with our improvements in this quarter, as we returned to our historical levels for bad debt expense. We expect to be able to further reduce our bad debt expense rate over the next several quarters."
The following statements are based on Corinthian Colleges' current expectations. These statements are forward looking and actual results may differ materially as a result of factors more specifically referenced below. The forward looking statements of expected results of operations include the expected operating results of NST, which was acquired on April 1, 2002, and include the anticipated results of previously announced new branch campuses that the company expects to open after the date of this news release. Statements of expectations exclude the expected results of operations of the recently announced but not yet completed acquisition of Wyo-Tech, which is expected to occur during Corinthian's next fiscal year that commences July 1, 2002. Except as otherwise specifically noted, these expectations are for the full fiscal 2002 year ending June 30, 2002.
-- While Corinthian expects to sustain revenue growth over the next several years in the 20% to 25% range, the company believes revenues for both the fourth fiscal quarter and the full fiscal year 2002 will grow between 35% and 37% over the same periods of the prior year; -- Growth in quarterly revenues for fiscal 2002 and fiscal 2003, as compared with previous years, will be influenced by the timing of new branch campus openings and acquisitions completed during those years; -- Corinthian expects annual operating profits, as a percent of revenue, to be between 17.5% and 18.0%; -- The company believes its annual effective tax rate will range between 40% and 40.5% of pre-tax income; -- Based on current trends, Corinthian expects earnings per diluted common share for the fourth quarter of fiscal 2002 to be between $0.46 and $0.47. For fiscal 2002, Corinthian expects earnings per diluted share to be between $1.67 and $1.68, including $0.02 per share reported in the second quarter from a non-recurring gain; -- For the fiscal year ended June 30, 2003, the company currently expects revenues to increase between 22% and 26% over fiscal 2002 (excluding the expected impact of Wyo-Tech); -- For fiscal 2003, Corinthian expects operating margins to be between 17.7% and 18.2% of revenues (excluding the expected impact of Wyo-Tech); and -- For fiscal 2003, the company expects its effective income tax rate to be between 40.0% and 40.5%.About Corinthian Colleges, Inc.
Corinthian Colleges, Inc. is one of the largest for-profit post-secondary education companies in the United States. As of April 1, 2002, the company operated 61 colleges in 20 states including 17 in California and 12 in Florida. With the expected openings of the Lynnwood, Washington and Burr Ridge, Illinois branch campuses and the completion of the Wyo-Tech acquisition, Corinthian will operate 65 campuses in 21 states. Corinthian serves the large and growing segment of the population seeking to acquire career-oriented education to become more qualified and marketable in today's increasingly demanding workplace environment.
Certain statements in this press release may be deemed to be forward- looking statements under the Private Securities Litigation Reform Act of 1995. The company intends that all such statements be subject to the "safe-harbor" provisions of that Act. Such statements include, but are not limited to, the company's discussion of (i) its expectations regarding the attractiveness of its online degree programs, (ii) its belief that the combination of internal and external growth platforms will continue to support Corinthian's business model, (iii) its expectations regarding the completion of the Wyo-Tech acquisition, (iv) its expectations regarding improvements in bad debt expense, (v) its growth strategy and the expected results of such strategy, (vi) the expected introduction of new programs, (vii) the planned opening of new branch campuses, (viii) the possibility of future acquisitions, and (ix) the statements under the heading "Business Outlook". Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including changes in student perception, the demand for curricula offered by the company, potential higher average costs to offer new curricula, increased competition, the company's effectiveness in reducing expenses as a percentage of revenues, the effectiveness of the company's advertising and promotional efforts, branching regulations, the failure to occur of any of the conditions to closing of the Wyo-Tech transaction, integration risks associated with acquisitions and opening branch campuses and the other risks and uncertainties described in the company's filings with the Securities and Exchange Commission. The historical results achieved by the company are not necessarily indicative of its future prospects. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Corinthian Colleges, Inc. (In thousands, except per share data) Consolidated Statements of Income (Unaudited): For the three months For the nine months ended March 31, ended March 31, 2002 2001 2002 2001 Net revenues $88,334 $65,197 $243,595 $177,758 Operating expenses Educational services 43,942 34,903 127,091 94,268 General and administration 7,988 5,257 20,968 15,326 Marketing and advertising 18,141 13,479 52,150 39,139 Total operating expenses 70,071 53,639 200,209 148,733 Income from operations 18,263 11,558 43,386 29,025 Interest expense (income), net (338) (481) (1,114) (1,644) Other (income) expense -- -- (612) -- Income before provision for income taxes 18,601 12,039 45,112 30,669 Provision for income taxes 7,496 4,875 18,203 12,515 Net income $11,105 $7,164 $26,909 $18,154 Income per common share: Basic $0.52 $0.34 $1.26 $0.86 Diluted $0.50 $0.33 $1.21 $0.84 Weighted average number of common shares outstanding: Basic 21,385 21,182 21,298 20,999 Diluted 22,414 21,964 22,206 21,647 Selected Balance Sheet Data March 31, June 30, 2002 2001 (Unaudited) Cash, restricted cash, and marketable securities $71,372 $29,447 Receivables, net (including long term notes receivable) 24,329 26,675 Current assets 108,379 68,156 Total assets 187,696 138,636 Current liabilities 45,069 28,434 Long-term debt (including current portion) 1,686 3,184 Total liabilities 50,031 33,073 Total stockholders' equity 137,665 105,563 MAKE YOUR OPINION COUNT - Click Here http://tbutton.prnewswire.com/prn/11690X43604155SOURCE Corinthian Colleges, Inc.
CONTACT: Dennis Beal, Chief Financial Officer of Corinthian Colleges, Inc., +1-714-427-3000; or Investor Relations, Cecilia Wilkinson or Julie MacMedan of PondelWilkinson MS&L, +1-310-207-9300, for Corinthian Colleges, Inc. (COCO)