Attached files
| file | filename |
|---|---|
| 8-K - 8-K - APOLLO EDUCATION GROUP INC | apolmay312014x8k.htm |
 | Exhibit 99.1 |
Apollo Education Group, Inc. | |
News Release | |
Apollo Education Group, Inc. Reports Third Quarter 2014 Results
Phoenix, June 25, 2014 - Apollo Education Group, Inc. (NASDAQ: APOL) today reported financial results for the three and nine months ended May 31, 2014, with third quarter revenue of $799.9 million and diluted earnings per share of $0.59, or $0.76 excluding special items.
“We have made meaningful progress on our strategy to differentiate University of Phoenix and all of our institutions, diversify Apollo Education Group, and build a more efficient organization focused on operational excellence,” said Greg Cappelli, Chief Executive Officer, Apollo Education Group. “During the third quarter, we continued our plan to realign the University of Phoenix by implementing our college-based strategy and also completed the roll-out of our new learning platform across the university. We further expanded our global network to South Africa and are now serving students on six continents through Apollo Global. Our teams are helping students ensure their education is linked to careers in growing areas and are working with employers to address their needs for access to high-quality talent with the most relevant job skills.”
“After a comprehensive national search, we are honored to have Tim Slottow in place as the new president of University of Phoenix, joining us from one of the world’s most respected higher education institutions,” Cappelli added. “Tim shares our commitment to the mission of University of Phoenix, and to delivering a quality education that helps students achieve academic and personal success to meet their individual and professional goals.”
Third Quarter 2014 Results of Operations
Apollo Education Group (“the Company”) reported net revenue for the third quarter 2014 of $799.9 million, compared to $946.8 million for the third quarter 2013. As University of Phoenix continued to realign its operations during the third quarter 2014, University of Phoenix New Degreed Enrollment decreased 12.9% to 33,900 and Degreed Enrollment decreased 15.9% to 241,900, compared to the same period a year ago. Operating income for the third quarter 2014 was $113.1 million, compared to $132.0 million from the prior year third quarter. Net income attributable to Apollo Education Group for the third quarter 2014 was $66.0 million, or $0.59 per share, compared to $80.0 million, or $0.71 per share, in the third quarter 2013.
Results for the third quarter 2014 included the following special items: $16.2 million of contingent consideration charges and acquisition costs, $14.9 million of restructuring and other charges, a $4.1 million charge associated with legal matters, and an $11.2 million gain related to foreign indirect taxes following resolution with a taxing authority, which is included in the Instructional and Student Advisory line item.
Excluding these special items, operating income was $137.1 million for the third quarter 2014, compared to $195.1 million in the third quarter 2013, and net income attributable to Apollo Education Group for the third quarter 2014 was $84.9 million, or $0.76 per share, compared to $119.1 million, or $1.05 per share, for the third quarter 2013. (See the reconciliation of GAAP financial information to non-GAAP financial information in the tables section of this press release for the third quarter 2014 and 2013 special items.)
First Nine Months of 2014 Results of Operations
Net revenue for the first nine months of fiscal year 2014 totaled $2.3 billion, compared to $2.8 billion in the first nine months of fiscal year 2013, representing a 17.7% decrease. In the first nine months of 2014, University of Phoenix Average Degreed Enrollment decreased 17.1% to 256,100 as compared to the same period a year ago. Operating income for the first nine months of 2014 was $290.0 million, compared to $392.7 million for same prior year period. The Company reported net income attributable to Apollo Education Group for the nine months ended May 31, 2014, of $179.5 million, or $1.59 per share, compared to $227.0 million, or $2.01 per share, for the nine months ended May 31, 2013.
Results for the first nine months of fiscal year 2014 included the following special items: $62.1 million of restructuring and other charges, $29.2 million of contingent consideration charges and acquisition costs, and a $13.1 million charge associated with legal matters, an $11.2 million gain related to foreign indirect taxes following resolution with a taxing authority, and a $10.2 million benefit from a tax settlement.
Excluding these special items noted above, operating income was $383.2 million for the nine months ended May 31, 2014, compared to $500.8 million for the nine months ended May 31, 2013, and net income attributable to Apollo Education Group for the nine months ended May 31, 2014, was $235.7 million, or $2.08 per share, compared to $295.0 million, or $2.61 per share, for the nine months ended May 31, 2013. (See the reconciliation of GAAP financial information to non-GAAP financial information in the tables section of this press release for the first nine months of 2014 and 2013 special items.)
Balance Sheet and Cash Flow
As of May 31, 2014, the Company’s unrestricted cash and cash equivalents and short-term marketable securities were $800 million, compared to $1.5 billion at August 31, 2013. The decrease was primarily due to $623.3 million used for payments on borrowings, $119.5 million for acquisitions, $118.5 million for share repurchases (which includes $3.8 million of repurchases related to tax withholding requirements on restricted stock units), $80.6 million for capital expenditures, and a net investment of $61.7 million in long-term marketable securities. These items were partially offset by $289.0 million of cash provided by operations.
Accounts receivable were $201.7 million as of May 31, 2014, compared to $215.4 million at August 31, 2013. As of May 31, 2014, excluding accounts receivable and the related net revenue for Apollo Global, the Company’s days sales outstanding was 18 days as compared to 20 days as of May 31, 2013.
Share Repurchases
Under its share repurchase program, the Company repurchased approximately 1.5 million shares of its common stock at a weighted average purchase price of $29.85 per share for a total cost of $45.0 million during the three months ended May 31, 2014. For the nine months ended May 31, 2014, the Company repurchased 3.8 million shares of its common stock at a weighted average price of $30.21 for a total cost of $114.7 million. The Company currently has approximately $135.3 million available on its share repurchase authorization. There is no expiration date on the repurchase authorizations and repurchases occur at management’s discretion.
Business Outlook
The Company offers the following outlook for fiscal year 2014 based on the business trends observed during the third quarter 2014, as well as management’s current expectations of future trends.
• | Net revenue of $3.04 to $3.06 billion; and |
• | Operating income of $420 to $435 million, excluding the impact of special items. |
Conference Call Information
The Company will hold a conference call to discuss these earnings results at 8:30 a.m. ET, 5:30 a.m. PT, today, Wednesday, June 25, 2014.
Dial-In Numbers:
877-292-6888 (Domestic)
973-200-3381 (International)
Conference ID: 35042411
Webcast and Replay:
A live webcast of this event will be available on the Apollo Education Group website at www.apollo.edu, with a webcast replay available approximately one hour following the conclusion of the call at the same link.
A telephone replay will be available approximately two hours following the conclusion of the call until July 2, 2014.
855-859-2056 (Domestic)
404-537-3406 (International)
Conference ID: 35042411
About Apollo Education Group, Inc.
Apollo Education Group, Inc. is one of the world’s largest private education providers and has been in the education business since 1973. Through its subsidiaries: Apollo Global, College for Financial Planning, Institute for Professional Development, University of Phoenix, and Western International University, Apollo Education Group offers innovative and distinctive educational programs and services, online and on-campus, at the undergraduate, masters and doctoral levels. Its educational programs and services are offered throughout the United States and in Europe, Australia, Latin America, Africa and Asia, as well as online throughout the world. For more information about Apollo Education Group, Inc. and its subsidiaries, call (800) 990-APOL or visit www.apollo.edu.
Forward-Looking Statements Safe Harbor
Statements about Apollo Education Group and its business in this release which are not statements of historical fact, including statements regarding Apollo Education Group’s future strategy and plans and commentary regarding future results of operations and prospects, are forward-looking statements and are subject to the Safe Harbor provisions created by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current information and expectations and involve a number of risks and uncertainties. Actual plans implemented and actual results achieved may differ materially from those set forth in or implied by such statements due to various factors, including without limitation: (i) the impact of increased competition from traditional public universities and proprietary educational institutions; (ii) the costs and effectiveness of University of Phoenix initiatives to improve student retention, improve student outcomes and demonstrate a compelling and cost effective relationship between a student’s education and career; (iii) changes in law or regulation affecting the University of Phoenix’s eligibility to participate in or the manner in which it participates in U.S. federal and state student financial aid programs, including changes that may be included in the reauthorization of the federal Higher Education Act and the proposed Department of Education regulations relating to gainful employment and state authorization; (iv) any adverse impact on University of Phoenix’s business arising from the Notice sanction imposed by the University’s principal accreditor, and any associated impact on the University’s pending recertification by the U.S. Department of Education for participation in Title IV student financial aid programs; (v) the impact of the Company’s recent campus closures and other restructuring initiatives; (vi) the impact of the operational and governance changes made to increase
University of Phoenix autonomy in response to governance concerns expressed by its principal accreditor; (vii) the impact of any reduction in financial aid available to students, including active and retired military personnel, due to the U.S. government deficit reduction proposals, debt ceiling limitations, budget sequestration or otherwise; (viii) the impact of changes in marketing channels and other recruiting practices; (ix) changes in University of Phoenix’s business necessary to remain in compliance with U.S. federal student financial aid program regulations, including the so-called 90/10 Rule and the limitations on student loan cohort default rates, and to remain in compliance with the accrediting criteria of the relevant accrediting bodies; (x) changes in University of Phoenix enrollment or student mix; (xi) unexpected expenses or other challenges in integrating acquired businesses, consumer or regulatory impact arising from consummation of the acquired businesses, and unexpected changes or developments in the acquired businesses, and (xii) unexpected changes in the U.S. or global economy. For a discussion of the various factors that may cause actual plans implemented and actual results achieved to differ materially from those set forth in the forward-looking statements, please refer to the risk factors and other disclosures contained in Apollo Education Group’s quarterly reports and Form 10-K for fiscal year 2013, and other filings with the Securities and Exchange Commission which are available at www.apollo.edu.
Use of Non-GAAP Financial Information
This press release and the related conference call contain non-GAAP financial measures, which are intended to supplement, but not substitute for, the most directly comparable GAAP measures. Management uses, and chooses to disclose to investors, these non-GAAP financial measures because: (i) such measures provide an additional analytical tool to clarify the Company’s results from operations and help to identify underlying trends in its results of operations; (ii) as to the non-GAAP earnings measures, such measures help compare the Company’s performance on a consistent basis across time periods; and (iii) these non-GAAP measures are employed by the Company’s management in its own evaluation of performance and are utilized in financial and operational decision-making processes, such as budgeting and forecasting. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may calculate non-GAAP financial measures differently, limiting their usefulness as a comparative measure across companies.
Apollo Education Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(Unaudited)
Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||
2014 | 2013 | % of Net Revenue | 2014 | 2013 | % of Net Revenue | ||||||||||||||||||||||
(In thousands, except per share data) | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
Net revenue | $ | 799,919 | $ | 946,774 | 100.0 | % | 100.0 | % | $ | 2,335,312 | $ | 2,836,329 | 100.0 | % | 100.0 | % | |||||||||||
Costs and expenses: | |||||||||||||||||||||||||||
Instructional and student advisory | 327,764 | 393,387 | 41.0 | % | 41.5 | % | 987,018 | 1,209,239 | 42.3 | % | 42.6 | % | |||||||||||||||
Marketing | 139,868 | 156,918 | 17.5 | % | 16.6 | % | 421,104 | 493,104 | 18.0 | % | 17.4 | % | |||||||||||||||
Admissions advisory | 58,202 | 65,078 | 7.3 | % | 6.9 | % | 164,783 | 204,618 | 7.0 | % | 7.2 | % | |||||||||||||||
General and administrative | 75,618 | 82,717 | 9.4 | % | 8.7 | % | 218,524 | 237,474 | 9.4 | % | 8.4 | % | |||||||||||||||
Depreciation and amortization | 37,721 | 38,360 | 4.7 | % | 4.1 | % | 111,524 | 123,554 | 4.8 | % | 4.4 | % | |||||||||||||||
Provision for uncollectible accounts receivable | 12,485 | 15,258 | 1.6 | % | 1.6 | % | 37,997 | 67,566 | 1.6 | % | 2.4 | % | |||||||||||||||
Contingent consideration charges and acquisition costs | 16,168 | — | 2.0 | % | — | % | 29,173 | — | 1.2 | % | — | % | |||||||||||||||
Restructuring and other charges | 14,904 | 63,103 | 1.9 | % | 6.7 | % | 62,076 | 131,295 | 2.7 | % | 4.6 | % | |||||||||||||||
Litigation charge (credit) | 4,125 | — | 0.5 | % | — | % | 13,125 | (23,200 | ) | 0.6 | % | (0.8 | )% | ||||||||||||||
Total costs and expenses | 686,855 | 814,821 | 85.9 | % | 86.1 | % | 2,045,324 | 2,443,650 | 87.6 | % | 86.2 | % | |||||||||||||||
Operating income | 113,064 | 131,953 | 14.1 | % | 13.9 | % | 289,988 | 392,679 | 12.4 | % | 13.8 | % | |||||||||||||||
Interest income | 453 | 506 | — | % | 0.1 | % | 1,620 | 1,443 | 0.1 | % | 0.1 | % | |||||||||||||||
Interest expense | (1,915 | ) | (1,940 | ) | (0.2 | )% | (0.2 | )% | (5,984 | ) | (6,074 | ) | (0.2 | )% | (0.2 | )% | |||||||||||
Other (expense) income, net | (284 | ) | (862 | ) | — | % | (0.1 | )% | 630 | 811 | — | % | — | % | |||||||||||||
Income before income taxes | 111,318 | 129,657 | 13.9 | % | 13.7 | % | 286,254 | 388,859 | 12.3 | % | 13.7 | % | |||||||||||||||
Provision for income taxes | (46,308 | ) | (49,487 | ) | (5.8 | )% | (5.2 | )% | (110,026 | ) | (161,290 | ) | (4.8 | )% | (5.7 | )% | |||||||||||
Net income | 65,010 | 80,170 | 8.1 | % | 8.5 | % | 176,228 | 227,569 | 7.5 | % | 8.0 | % | |||||||||||||||
Net loss (income) attributable to noncontrolling interests | 1,015 | (217 | ) | 0.2 | % | (0.1 | )% | 3,293 | (594 | ) | 0.2 | % | — | % | |||||||||||||
Net income attributable to Apollo | $ | 66,025 | $ | 79,953 | 8.3 | % | 8.4 | % | $ | 179,521 | $ | 226,975 | 7.7 | % | 8.0 | % | |||||||||||
Basic income per share attributable to Apollo | $ | 0.60 | $ | 0.71 | $ | 1.60 | $ | 2.02 | |||||||||||||||||||
Diluted income per share attributable to Apollo | $ | 0.59 | $ | 0.71 | $ | 1.59 | $ | 2.01 | |||||||||||||||||||
Basic weighted average shares outstanding | 110,613 | 112,742 | 112,024 | 112,579 | |||||||||||||||||||||||
Diluted weighted average shares outstanding | 112,082 | 113,372 | 113,129 | 113,121 | |||||||||||||||||||||||
Apollo Education Group, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited)
As of | |||||||
($ in thousands) | May 31, 2014 | August 31, 2013 | |||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 638,796 | $ | 1,414,485 | |||
Restricted cash and cash equivalents | 256,137 | 259,174 | |||||
Marketable securities | 168,959 | 105,809 | |||||
Accounts receivable, net | 201,660 | 215,401 | |||||
Prepaid taxes | 1,701 | 30,359 | |||||
Deferred tax assets | 76,343 | 60,294 | |||||
Other current assets | 62,813 | 64,134 | |||||
Total current assets | 1,406,409 | 2,149,656 | |||||
Marketable securities | 105,681 | 43,941 | |||||
Property and equipment, net | 447,968 | 472,614 | |||||
Goodwill | 259,672 | 103,620 | |||||
Intangible assets, net | 197,443 | 132,192 | |||||
Deferred tax assets | 68,409 | 63,894 | |||||
Other assets | 45,276 | 32,030 | |||||
Total assets | $ | 2,530,858 | $ | 2,997,947 | |||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND SHAREHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Short-term borrowings and current portion of long-term debt | $ | 31,093 | $ | 628,050 | |||
Accounts payable | 65,162 | 73,123 | |||||
Income taxes payable | 10,319 | — | |||||
Student deposits | 296,625 | 309,176 | |||||
Deferred revenue | 218,246 | 213,260 | |||||
Accrued and other current liabilities | 326,642 | 346,706 | |||||
Total current liabilities | 948,087 | 1,570,315 | |||||
Long-term debt | 39,756 | 64,004 | |||||
Deferred tax liabilities | 32,219 | 12,177 | |||||
Other long-term liabilities | 241,662 | 233,442 | |||||
Total liabilities | 1,261,724 | 1,879,938 | |||||
Commitments and contingencies | |||||||
Redeemable noncontrolling interests | 58,744 | — | |||||
Shareholders’ equity: | |||||||
Preferred stock, no par value | — | — | |||||
Apollo Education Group Class A nonvoting common stock, no par value | 103 | 103 | |||||
Apollo Education Group Class B voting common stock, no par value | 1 | 1 | |||||
Additional paid-in capital | — | — | |||||
Apollo Education Group Class A treasury stock, at cost | (3,922,049 | ) | (3,824,758 | ) | |||
Retained earnings | 5,157,935 | 4,978,815 | |||||
Accumulated other comprehensive loss | (26,543 | ) | (36,563 | ) | |||
Total Apollo shareholders’ equity | 1,209,447 | 1,117,598 | |||||
Noncontrolling interests | 943 | 411 | |||||
Total equity | 1,210,390 | 1,118,009 | |||||
Total liabilities, redeemable noncontrolling interests and shareholders’ equity | $ | 2,530,858 | $ | 2,997,947 | |||
Apollo Education Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended May 31, | |||||||
($ in thousands) | 2014 | 2013 | |||||
Operating activities: | |||||||
Net income | $ | 176,228 | $ | 227,569 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Share-based compensation | 33,694 | 39,888 | |||||
Excess tax benefits from share-based compensation | (49 | ) | (14 | ) | |||
Depreciation and amortization | 111,524 | 123,554 | |||||
Accelerated depreciation included in restructuring | 6,159 | 41,581 | |||||
(Gain) loss on asset dispositions and write-offs, net | (862 | ) | 3,976 | ||||
Non-cash foreign currency loss, net | 642 | 810 | |||||
Provision for uncollectible accounts receivable | 37,997 | 67,566 | |||||
Deferred income taxes | (22,067 | ) | (21,243 | ) | |||
Changes in assets and liabilities, excluding the impact of acquisitions: | |||||||
Restricted cash and cash equivalents | 3,659 | (747 | ) | ||||
Accounts receivable | (20,472 | ) | (70,761 | ) | |||
Other assets | (9,436 | ) | (13,842 | ) | |||
Accounts payable | (10,789 | ) | 2,239 | ||||
Income taxes | 39,724 | 41,205 | |||||
Student deposits | (15,436 | ) | (10,430 | ) | |||
Deferred revenue | (7,768 | ) | (28,672 | ) | |||
Accrued and other liabilities | (33,742 | ) | (12,326 | ) | |||
Net cash provided by operating activities | 289,006 | 390,353 | |||||
Investing activities: | |||||||
Purchases of property and equipment | (80,642 | ) | (96,735 | ) | |||
Purchases of marketable securities | (265,083 | ) | (130,207 | ) | |||
Maturities of marketable securities | 136,157 | 15,890 | |||||
Acquisitions, net of cash acquired | (119,454 | ) | — | ||||
Other investing activities | 3,446 | (1,500 | ) | ||||
Net cash used in investing activities | (325,576 | ) | (212,552 | ) | |||
Financing activities: | |||||||
Payments on borrowings | (624,393 | ) | (633,450 | ) | |||
Proceeds from borrowings | 1,081 | 2,176 | |||||
Purchase of noncontrolling interest | — | (42,500 | ) | ||||
Share repurchases | (118,478 | ) | (5,696 | ) | |||
Share reissuances | 1,793 | 2,993 | |||||
Excess tax benefits from share-based compensation | 49 | 14 | |||||
Net cash used in financing activities | (739,948 | ) | (676,463 | ) | |||
Exchange rate effect on cash and cash equivalents | 829 | (974 | ) | ||||
Net decrease in cash and cash equivalents | (775,689 | ) | (499,636 | ) | |||
Cash and cash equivalents, beginning of period | 1,414,485 | 1,276,375 | |||||
Cash and cash equivalents, end of period | $ | 638,796 | $ | 776,739 | |||
Supplemental disclosure of cash flow and non-cash information: | |||||||
Cash paid for income taxes, net of refunds | $ | 113,753 | $ | 134,201 | |||
Cash paid for interest | 5,859 | 5,903 | |||||
Restricted stock units vested and released | 10,195 | 15,617 | |||||
Capital lease additions | — | 3,500 | |||||
Credits received for tenant improvements | — | 1,540 | |||||
Apollo Education Group, Inc. and Subsidiaries
Segment Data and University of Phoenix Operating Metrics
(Unaudited)
Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||
(in thousands, except enrollment data) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Net revenue: | |||||||||||||||
University of Phoenix | |||||||||||||||
Degree seeking gross revenues(1) | $ | 739,183 | $ | 907,766 | $ | 2,179,917 | $ | 2,700,903 | |||||||
Less: Discounts and other | (69,055 | ) | (76,862 | ) | (189,752 | ) | (200,837 | ) | |||||||
Degree seeking net revenues(1) | 670,128 | 830,904 | 1,990,165 | 2,500,066 | |||||||||||
Other revenues | 11,579 | 12,536 | 30,486 | 32,724 | |||||||||||
Total University of Phoenix | 681,707 | 843,440 | 2,020,651 | 2,532,790 | |||||||||||
Apollo Global | 100,459 | 82,125 | 260,252 | 229,604 | |||||||||||
Other | 17,753 | 21,209 | 54,409 | 73,935 | |||||||||||
Net revenue | $ | 799,919 | $ | 946,774 | $ | 2,335,312 | $ | 2,836,329 | |||||||
Operating income (loss): | |||||||||||||||
University of Phoenix | $ | 135,153 | $ | 147,380 | $ | 405,308 | $ | 465,997 | |||||||
Apollo Global | (13,845 | ) | 7,636 | (51,632 | ) | (27,651 | ) | ||||||||
Other | (8,244 | ) | (23,063 | ) | (63,688 | ) | (45,667 | ) | |||||||
Operating income | $ | 113,064 | $ | 131,953 | $ | 289,988 | $ | 392,679 | |||||||
University of Phoenix Enrollment Data: | |||||||||||||||
Degreed Enrollment(2) | 241,900 | 287,500 | |||||||||||||
New Degreed Enrollment(3) | 33,900 | 38,900 | |||||||||||||
Degree seeking net revenues per degreed enrollment | $ | 2,770 | $ | 2,890 | |||||||||||
(1) Represents revenue from tuition and other fees for students enrolled in University of Phoenix degree programs or certificate programs of at least 18 credits in length with some course applicability into a related degree program. | |||||||||||||||
(2) Represents students enrolled in a University of Phoenix degree program who attended a credit bearing course during the quarter and had not graduated as of the end of the quarter; students who previously graduated from one degree program and started a new degree program in the quarter (e.g., a graduate of the associate’s degree program returns for a bachelor’s degree); and students participating in certain certificate programs of at least 18 credits with some course applicability into a related degree program. | |||||||||||||||
(3) Represents new students and students who have been out of attendance for more than 12 months who enroll in a University of Phoenix degree program and start a credit bearing course in the quarter; students who have previously graduated from a degree program and start a new degree program in the quarter; and students who commence participation in certain certificate programs of at least 18 credits with some course applicability into a related degree program. | |||||||||||||||
Apollo Education Group, Inc. and Subsidiaries
Reconciliation of GAAP Financial Information to Non-GAAP Financial Information
(Unaudited)
Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||
(In thousands, except per share data) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Operating income | $ | 113,064 | $ | 131,953 | $ | 289,988 | $ | 392,679 | |||||||
Income before income taxes | $ | 111,318 | $ | 129,657 | $ | 286,254 | $ | 388,859 | |||||||
Provision for income taxes | $ | 46,308 | $ | 49,487 | $ | 110,026 | $ | 161,290 | |||||||
Effective income tax rate | 41.6 | % | 38.2 | % | 38.4 | % | 41.5 | % | |||||||
Net income attributable to Apollo | $ | 66,025 | $ | 79,953 | $ | 179,521 | $ | 226,975 | |||||||
Diluted income per share attributable to Apollo | $ | 0.59 | $ | 0.71 | $ | 1.59 | $ | 2.01 | |||||||
Special items: | |||||||||||||||
Restructuring and other charges | $ | 14,904 | $ | 63,103 | $ | 62,076 | $ | 131,295 | |||||||
Contingent consideration charges and acquisition costs | 16,168 | — | 29,173 | — | |||||||||||
Litigation charge (credit) | 4,125 | — | 13,125 | (23,200 | ) | ||||||||||
Gain related to foreign indirect taxes following resolution with tax authority(1) | (11,173 | ) | — | (11,173 | ) | — | |||||||||
Special items before income taxes | 24,024 | 63,103 | 93,201 | 108,095 | |||||||||||
Less: income tax effects of special items | (5,171 | ) | (23,941 | ) | (26,819 | ) | (40,110 | ) | |||||||
Tax benefit from Internal Revenue Service settlement | — | — | (10,176 | ) | — | ||||||||||
Special items, net of income tax | $ | 18,853 | $ | 39,162 | $ | 56,206 | $ | 67,985 | |||||||
Excluding special items: | |||||||||||||||
Operating income | $ | 137,088 | $ | 195,056 | $ | 383,189 | $ | 500,774 | |||||||
Income before income taxes | $ | 135,342 | $ | 192,760 | $ | 379,455 | $ | 496,954 | |||||||
Provision for income taxes | $ | 51,479 | $ | 73,428 | $ | 147,021 | $ | 201,400 | |||||||
Effective income tax rate | 38.0 | % | 38.1 | % | 38.7 | % | 40.5 | % | |||||||
Net income attributable to Apollo | $ | 84,878 | $ | 119,115 | $ | 235,727 | $ | 294,960 | |||||||
Diluted income per share attributable to Apollo | $ | 0.76 | $ | 1.05 | $ | 2.08 | $ | 2.61 | |||||||
(1) This gain is included in instructional and student advisory on our Condensed Consolidated Statements of Income.
Investor Relations Contacts:
Beth Coronelli, (312) 660-2059
beth.coronelli@apollo.edu
Erin Kelly, (602) 557-3830
erin.kelly@apollo.edu
Media Contact:
Media Relations Hotline, (602) 254-0086
media@apollo.edu