Perdoceo Education (PRDO) Tops Q1 EPS by 4c, Revenues Beat; Offers 2Q & FY20 EPS Guidance

Perdoceo Education (NASDAQ: PRDO) reported Q1 EPS of $0.42, $0.04 better than the analyst estimate of $0.38. Revenue for the quarter came in at $171 million versus the consensus estimate of $161.63 million.

First Quarter 2020 Results as Compared to Prior Year Quarter

Financial Results

• Revenue increased by 8.3 percent to $171.0 million with both universities contributing to this growth
• Operating income increased 24.5 percent to $37.3 million
• Adjusted operating income increased 23.7 percent to $40.8 million*
• Earnings per diluted share of $0.41 as compared to earnings per diluted share of $0.35
• Adjusted earnings per diluted share of $0.42 as compared to $0.36*
• Ended the quarter with $285.6 million in cash, cash equivalents, restricted cash and available-for-sale short-term investments

“The COVID-19 pandemic is posing unique challenges to our society, and our highest priority is the well-being of our students, employees and communities. We have leveraged our technology and processes to move our students and employees to a remote environment, while delivering on our commitments and responsibilities to serve our students,” said Todd Nelson, President and Chief Executive Officer. “Although the pandemic has not had a material impact on our operating results to date, we are closely monitoring the situation and remain focused on executing against our strategy of sustainable and responsible growth.”

Nelson further added, “We entered 2020 with positive momentum and experienced student enrollment growth at both universities, which resulted in first quarter results coming in ahead of our expectations. Our balance sheet continues to strengthen, and we are strategically investing in initiatives that further enhance our student’s experiences, retention and academic outcomes.”

GUIDANCE:

Perdoceo Education sees Q2 2020 EPS of $0.36-$0.38, versus the consensus of $0.38.

Perdoceo Education sees FY2020 EPS of $1.49-$1.53, versus the consensus of $1.50.

The Company is providing the following 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.

The outlook now incorporates the Trident acquisition, including known acquisition and restructuring costs, as well as known costs associated with COVID-19, such as transitioning our students and employees to a remote environment. The outlook continues to reflect the Company’s expectation of growth in new and total student enrollments at both universities for the full year of 2020.

Further, for the second quarter of 2020, the Company expects growth in CTU’s new student enrollments as compared to the prior year quarter. AIU’s second quarter new student enrollments are expected to show significant growth due to 50 percent more enrollment days in the second quarter of 2020 as compared to the prior year quarter, as well as the Trident acquisition. This increase is expected to more than offset the decline in new student enrollments from the first quarter of 2020 such that on a combined basis AIU is expected to show growth for the first half of 2020, even after excluding the positive impact from the Trident acquisition. The Company expects AIU’s enrollment days for the third and fourth quarters of 2020 to be relatively comparable to the respective prior year periods.

For earnings history and earnings-related data on Perdoceo Education (PRDO) click here.

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