Perdoceo Education Corporation Reports Fourth Quarter and Full Year 2024 Results

Perdoceo Education Corporation (NASDAQ: PRDO) today reported operating and financial results for the quarter and year ended December 31, 2024.

Full Year 2024 Results as Compared to Prior Year

• Total student enrollments increased by 8.1% at CTU and 11.8% at AIUS.
• Operating income increased 15.8% to $174.3 million, while adjusted operating income increased 9.9% to $192.2 million.*
• As expected, revenue for the full year was lower by 4.0% due to the lag impact from the 2023 operational changes at AIUS and simplification of our professional development offerings at CTU. Excluding the latter, CTU’s revenue increased as compared to the prior year.
• Earnings per diluted share were $2.19 as compared to $2.18, while adjusted earnings per diluted share were $2.29 as compared to $2.10.*
• Completed the previously announced acquisition of the University of St. Augustine for Health Sciences “USAHS” in December.
• Ended the quarter with $591.5 million in cash, cash equivalents, restricted cash and available-for-sale-short-term investments, after making all payments associated with the USAHS acquisition.

Fourth Quarter 2024 Results as Compared to Prior Year Quarter

• Operating income increased 133.2% to $37.2 million, while adjusted operating income increased 122.9% to $43.2 million.*
• Revenue increased 19.3% to $176.4 million, supported by organic growth at CTU and AIUS, as well as the USAHS acquisition that was completed in December 2024.
• Earnings per diluted share were $0.47 as compared to $0.26, while adjusted earnings per diluted share were $0.50 as compared to $0.27.*

"Quarterly operating performance at CTU and AIUS was ahead of our expectations, and we ended the year on a strong note as it relates to prospective student interest, student retention and student engagement. This broad momentum sets us up well for 2025 while our faculty and student support teams continue to prioritize enhancing student experiences, retention and academic outcomes for current and prospective learners,” said Todd Nelson, President and Chief Executive Officer.

“During the quarter, we also closed the acquisition of the University of St. Augustine for Health Sciences, which has meaningfully expanded our academic offerings in the graduate health sciences field and the number of students we serve and educate. Our balance sheet is strong, and we remain committed to making investments in student technology and student support processes, while maintaining strong liquidity.”

REVENUE

• For the quarter ended December 31, 2024, revenue of $176.4 million increased 19.3% compared to revenue of $147.9 million for the prior year quarter.
• For the year ended December 31, 2024, revenue of $681.3 million decreased 4.0% compared to revenue of $710.0 million for the prior year.

TOTAL STUDENT ENROLLMENTS

• As of December 31, 2024, total student enrollments increased 20.0% compared to December 31, 2023.

OPERATING INCOME

• For the quarter ended December 31, 2024, operating income increased by 133.2% to $37.2 million as compared to the prior year quarter.
• For the year ended December 31, 2024, operating income increased by 15.8% to $174.3 million as compared to the prior year.

ADJUSTED OPERATING INCOME

The Company believes it is useful to present non-GAAP financial measures, which exclude certain significant and non-cash items, as a means to understand the performance of its operations. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.)

• For the quarter ended December 31, 2024, adjusted operating income of $43.2 million increased 122.9% compared to adjusted operating income of $19.4 million for the prior year quarter.
• For the year ended December 31, 2024, adjusted operating income of $192.2 million increased 9.9% compared to adjusted operating income of $174.9 million for the prior year.

NET INCOME AND EARNINGS PER DILUTED SHARE

For the quarter ended December 31, 2024, the Company recorded:

• Net income of $31.5 million compared to $17.2 million for the prior year quarter.
• Earnings per diluted share of $0.47 compared to $0.26 for the prior year quarter.
• Adjusted earnings per diluted share of $0.50 compared to $0.27 for the prior year quarter. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.)

For the year ended December 31, 2024, the Company recorded:

• Net income of $147.6 million compared to $147.7 million for the prior year.
• Earnings per diluted share of $2.19 compared to $2.18 for the prior year.
• Adjusted earnings per diluted share of $2.29 compared to $2.10 for the prior year. (See table below and the GAAP to non-GAAP reconciliation attached to this press release for further details.)

QUARTERLY DIVIDEND PAYMENT

The board of directors declared a quarterly dividend of $0.13 per share, which will be paid on March 13, 2025 for holders of record of common stock as of March 1, 2025. Any decision to pay future cash dividends, however, will be made by the board of directors and depend on the Company’s available retained earnings, financial condition and other relevant factors. The Company expects quarterly dividend payments to be an integral and growing part of its balanced capital allocation strategy that also prioritizes investments in student support and technology projects, while also evaluating acquisitions and share repurchases.

BALANCE SHEET AND CASH FLOW

• For the quarter ended December 31, 2024 net cash provided by operating activities was $17.6 million, compared to net cash provided by operating activities of $13.2 million for the prior year quarter.
• For the year ended December 31, 2024, net cash provided by operating activities was $161.6 million, compared to net cash provided by operating activities of $112.0 million in the prior year.
• As of December 31, 2024 and December 31, 2023, cash, cash equivalents, restricted cash and available-for-sale short-term investments totaled $591.5 million and $604.2 million, respectively. The decrease is driven by the cash paid of $137.8 million in December 2024 for the acquisition of USAHS, which was mostly offset with cash generated by operating activities.

OUTLOOK

The Company is providing its first quarter and full year 2025 outlook, subject to the key assumptions identified below. Please see the GAAP to non-GAAP reconciliation for adjusted operating income and adjusted earnings per diluted share attached to this press release for further details.

Operating income, which is the most directly comparable GAAP measure to adjusted operating income, and earnings per diluted share, which is the most directly comparable GAAP measure to adjusted earnings per diluted share, may not follow the same trends stated in the outlook above because of adjustments made for certain significant and non-cash items. The operating income, adjusted operating income, earnings per share and adjusted earnings per share outlook provided above for 2025 are based on the following key assumptions and factors, among others: (i) prospective student interest in the Company’s programs and trends in student retention and engagement remain consistent with management’s recent experiences and future expectations, (ii) no significant impact from new or proposed regulations, or from updated interpretations of current regulation, or other adverse changes in the legal or regulatory environment, which may require operational changes in the way the Company’s academic institutions attract, connect with, enroll, support and educate current and prospective students, among other impacts, (iii) no significant operating impacts from the settlement with the U.S. Federal Trade Commission or other legal or regulatory matters, (iv) the positive impact on total enrollments from various student loan initiatives implemented by the prior administration remains consistent with management's estimates, (v) earnings per diluted share outlook assumes an effective income tax rate of approximately 25.5% for the first quarter and approximately 26.0% for the full year, and (vi) excludes any future impact from the Company’s stock repurchase program. Although these estimates and assumptions are based upon management’s good faith beliefs regarding current and future circumstances and actions that may be undertaken, actual results could differ materially from these estimates. In addition, decisions the Company makes in the future as it continues to evaluate diverse strategies to enhance stockholder value may impact the outlook provided above.

CONFERENCE CALL INFORMATION

Perdoceo Education Corporation will host a conference call on Tuesday, February 18, 2025 at 5:00 p.m. Eastern time to discuss fourth quarter and full year 2024 results and 2025 outlook. Interested parties can access the live webcast of the conference call at www.perdoceoed.com in the Investor Relations section of the website. Participants can also listen to the conference call by dialing 1-800-715-9871 (domestic) or 1-646-307-1963 (international). Both dial-in numbers will use the access code 4671240. Viewers can also access the conference call by following this link https://events.q4inc.com/attendee/748718635. Please log-in or dial-in at least 10 minutes prior to the start time to ensure a connection. An archived version of the webcast will be accessible for 90 days at www.perdoceoed.com in the Investor Relations section of the website.

ABOUT PERDOCEO EDUCATION CORPORATION

Perdoceo’s accredited academic institutions offer a quality postsecondary education to a diverse student population, with fully online, campus-based and hybrid learning programs. The Company’s academic institutions – Colorado Technical University (“CTU”), the American InterContinental University System (“AIUS” or “AIU System”) and University of St. Augustine for Health Sciences ("USAHS") – provide degree programs from the associate through doctoral level as well as non-degree seeking and professional development programs. Our academic institutions offer students industry-relevant and career-focused academic programs that are designed to meet the educational needs of today’s busy adults. CTU and AIUS continue to show innovation in higher education, advancing personalized learning technologies like their intellipath® learning platform and using data analytics and technology to serve and educate students while enhancing overall learning and academic experiences. USAHS is among the nation's reputable universities offering graduate health sciences degrees, primarily in physical therapy, occupational therapy, speech language therapy and nursing, as well as continuing education programs. Perdoceo's academic institutions are committed to providing quality education that closes the gap between learners who seek to advance their careers and employers needing a qualified workforce. For more information, please visit www.perdoceoed.com.

Except for the historical and present factual information contained herein, the matters set forth in this release, including statements identified by words such as “believe,” “will,” “expect,” “continue,” “outlook,” “remain,” “focused on,” “should” and similar expressions, are forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on information currently available to us and are subject to various assumptions, risks, uncertainties and other factors that could cause our results of operations, financial condition, cash flows, performance, business prospects and opportunities to differ materially from those expressed in, or implied by, these statements. Except as expressly required by the federal securities laws, we undertake no obligation to update or revise such factors or any of the forward-looking statements contained herein to reflect future events, developments or changed circumstances, or for any other reason. These risks and uncertainties, the outcomes of which could materially and adversely affect our financial condition and operations, include, but are not limited to, the following: declines in enrollment or interest in our programs or our ability to attract and connect with prospective students; our continued compliance with and eligibility to participate in Title IV Programs under the Higher Education Act of 1965, as amended, and the regulations thereunder (including the new 90-10, gainful employment, financial responsibility and administrative capability standards prescribed by the U.S. Department of Education), as well as applicable accreditation standards and state regulatory requirements; the impact of various versions of “borrower defense to repayment” regulations; the final outcome of various legal challenges to the Department's loan discharge and forgiveness efforts; rulemaking or changing interpretations of existing regulations, guidance or historical practices by the U.S. Department of Education or any state or accreditor and increased focus by Congress and governmental agencies on, or increased negative publicity about, for-profit education institutions; the success of our initiatives to improve student experiences, retention and academic outcomes; our continued ability to participate in educational assistance programs for key employers, veterans or other military personnel; our ability to pay dividends on our common stock and execute our stock repurchase program; increased competition; the impact of management changes; and changes in the overall U.S. economy. Further information about these and other relevant risks and uncertainties may be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and its subsequent filings with the Securities and Exchange Commission.