Bridgepoint Education Reports Fourth Quarter and Full Year 2018 Results

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March 12, 2019 4:05 PM EDT

SAN DIEGO, March 12, 2019 /PRNewswire/ -- Bridgepoint Education, Inc. (NYSE: BPI), a provider of postsecondary education services, today announced the results for its fourth quarter and full year ended December 31, 2018 (which reflect the amended and restated results for its third quarter of 2018 as filed with the SEC on March 12, 2019 in its amended Form 10-Q for such period).

Bridgepoint Education, Inc. logo (PRNewsFoto/Bridgepoint Education)

Financial Results for the Three Months Ended December 31, 2018

Revenue for the three months ended December 31, 2018 was $94.7 million, compared with revenue of $105.1 million for the three months ended December 31, 2017.

Operating loss for the three months ended December 31, 2018 was $13.6 million, compared with operating loss of $5.9 million for the three months ended December 31, 2017.

The Company recognized an income tax benefit of approximately $35,000 for the three months ended December 31, 2018, compared with income tax benefit of $0.5 million for the three months ended December 31, 2017.

Net loss for the three months ended December 31, 2018 was $13.4 million, compared with net loss of $5.1 million for the three months ended December 31, 2017.

Diluted loss per share for the three months ended December 31, 2018 was $0.49, compared with diluted loss per share of $0.18 for the three months ended December 31, 2017.

Non-GAAP Financial Results for the Three Months Ended December 31, 2018

Non-GAAP operating loss for the three months ended December 31, 2018 was $6.4 million, compared with non-GAAP operating loss of $4.2 million for the three months ended December 31, 2017. Non-GAAP operating loss for the three months ended December 31, 2018 excludes separation transaction costs of $3.2 million, and restructuring and impairment charges of $4.0 million. Non-GAAP operating loss for the three months ended December 31, 2017 excludes a legal settlement expense of $1.8 million and a reversal of restructuring and impairment charges of $0.1 million.

Non-GAAP net loss for the three months ended December 31, 2018 was $6.2 million, compared with non-GAAP net loss of $3.9 million for the three months ended December 31, 2017. Non-GAAP net loss for the three months ended December 31, 2018 excludes separation transaction costs of $3.2 million, and restructuring and impairment charges of $4.0 million, as well as the related tax effect. Non-GAAP net loss for the three months ended December 31, 2017 excludes a legal settlement expense of $1.8 million, a reversal of restructuring and impairment charges of $0.1 million, and the related tax effects.

Non-GAAP diluted loss per share for the three months ended December 31, 2018 was $0.23, compared with non-GAAP diluted loss per share of $0.14 for the three months ended December 31, 2017.

Financial Results for the Year Ended December 31, 2018

Revenue for the year ended December 31, 2018 was $443.4 million, compared with revenue of $475.1 million for the year ended December 31, 2017.

Operating loss for the year ended December 31, 2018 was $4.0 million, compared with operating income of $6.4 million for the year ended December 31, 2017.

The Company recognized an income tax benefit of $7.6 million for the year ended December 31, 2018, compared with income tax benefit of $1.2 million for the year ended December 31, 2017.

Net income for the year ended December 31, 2018 was $4.6 million, compared with net income of $9.1 million for the year ended December 31, 2017.

Diluted income per share for the year ended December 31, 2018 was $0.17, compared with diluted income per share of $0.28 for the year ended December 31, 2017.

Non-GAAP Financial Results for the Year Ended December 31, 2018

Non-GAAP operating income for the year ended December 31, 2018 was $12.0 million, compared with non-GAAP operating income of $16.2 million for the year ended December 31, 2017. Non-GAAP operating income for the year ended December 31, 2018 excludes a legal settlement expense of $0.1 million, separation transaction costs of $8.1 million and restructuring and impairment charges of $7.8 million. Non-GAAP operating income for the year ended December 31, 2017 excludes a legal settlement expense of $1.8 million and restructuring and impairment charges of $7.9 million.

Non-GAAP net income for the year ended December 31, 2018 was $13.0 million, compared with non-GAAP net income of $17.8 million for the year ended December 31, 2017. Non-GAAP net income for the year ended December 31, 2018 excludes a legal settlement expense of $0.1 million, separation transaction costs of $8.1 million, and restructuring and impairment charges of $7.8 million as well as the related tax effect. Non-GAAP net income for the year ended December 31, 2017 excludes a legal settlement expense of $1.8 million, restructuring and impairment charges of $7.9 million, and the related tax effects.

Non-GAAP diluted income per share for the year ended December 31, 2018 was $0.47, compared with non-GAAP diluted income per share of $0.55 for the year ended December 31, 2017.

Balance Sheet and Cash Flow

As of December 31, 2018, the Company had combined cash, cash equivalents, restricted cash (both current and long-term) and investments of $192.7 million, compared with cash, cash equivalents, restricted cash and investments of $207.6 million as of December 31, 2017.

The Company used $7.6 million of cash in operating activities during the year ended December 31, 2018, compared with $4.1 million of cash used in operating activities during the year ended December 31, 2017.

Student Enrollment

Total student enrollment at the Company's academic institutions was 38,153 at December 31, 2018, compared with total student enrollment of 40,730 at December 31, 2017.

About Non-GAAP Financial Measures

This press release contains non-GAAP financial measures for non-GAAP operating income, non-GAAP net income, non-GAAP diluted income per share, EBITDA and adjusted EBITDA, which exclude a legal settlement expense, restructuring and impairment charges, separation transaction costs, as well as certain income tax adjustments, as applicable. These non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles (GAAP) and are not based on a comprehensive set of accounting rules. Management believes non-GAAP financial measures are useful in providing investors with an understanding of how specific line items in the consolidated statements of income are affected by items that may not be indicative of the operating results of the Company's core business. To the extent that other companies use similar methods in calculating and reporting non-GAAP operating results, the Company believes provision of supplemental non-GAAP financial information allows for a meaningful comparison of the Company's performance against the performance of other companies. The Company further believes that these non-GAAP financial measures provide useful information regarding its ongoing operating activities and business trends related to its results of operations, as well as a meaningful comparison with historical financial results. The Company's management and board of directors utilize these non-GAAP financial measures, together with the Company's financial statements prepared in accordance with GAAP, in developing operating budgets and evaluating the Company's performance. These non-GAAP financial measures are intended to supplement GAAP financial information, and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. Refer to the accompanying tables for a detailed reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Earnings Conference Call and Webcast

Bridgepoint Education will host a conference call and webcast at 5:00 p.m. ET (2:00 p.m. PT) today to discuss its latest financial results and recent highlights.

Participants can attend a live broadcast of the call at http://ir.bridgepointeducation.com. Call participants can also dial (877) 395-6119, or (647) 689-5537 internationally, and provide the conference ID 2798689. The broadcast of the call will be archived and available for one year.

About Bridgepoint Education

Bridgepoint Education, Inc. (NYSE: BPI) harnesses the latest technology to reimagine the modern student experience through programs, technologies, and resources representing a unique model for advancing education in the 21st century. Bridgepoint stands for greater access, social learning, and exposure to leading minds. For more information, visit www.bridgepointeducation.com or www.facebook.com/BridgepointEducation.

Contact: Dori Abel, Investor Relations866.475.0317 x11611[email protected]

BRIDGEPOINT EDUCATION, INC.

Consolidated Statements of Income (Loss)

(In thousands, except per share amounts)

Three Months EndedDecember 31,

Year EndedDecember 31,

2018

2017

2018

2017

Revenue

$

94,713

$

105,052

$

443,373

$

475,113

Costs and expenses:

Instructional costs and services

51,580

54,858

217,700

235,390

Admissions advisory and marketing

38,780

43,256

168,751

175,389

General and administrative

13,952

10,362

52,980

47,381

Legal settlement expense

—

1,845

141

1,845

Restructuring and impairment charges

3,999

678

7,794

8,682

Total costs and expenses

108,311

110,999

447,366

468,687

Operating income (loss)

(13,598)

(5,947)

(3,993)

6,426

Other income, net

148

346

1,047

1,511

Income (loss) before income taxes

(13,450)

(5,601)

(2,946)

7,937

Income tax benefit

(35)

(456)

(7,582)

(1,174)

Net income (loss)

$

(13,415)

$

(5,145)

$

4,636

$

9,111

Income (loss) per share:

Basic

$

(0.49)

$

(0.18)

$

0.17

$

0.28

Diluted

$

(0.49)

$

(0.18)

$

0.17

$

0.28

Weighted average number of common shares outstanding used in computing income (loss) per share:

Basic

27,144

28,275

27,135

32,058

Diluted

27,144

28,275

27,563

32,794

BRIDGEPOINT EDUCATION, INC.

Consolidated Balance Sheets

(In thousands)

As of December 31,

2018

2017

ASSETS

Current assets:

Cash and cash equivalents

$

166,307

$

185,098

Restricted cash

18,619

20,428

Investments

2,068

2,065

Accounts receivable, net

27,015

24,174

Prepaid expenses and other current assets

18,255

22,388

Total current assets

232,264

254,153

Property and equipment, net

16,860

10,434

Goodwill and intangibles, net

12,441

14,593

Other long-term assets

7,927

5,456

Total assets

$

269,492

$

284,636

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities

$

62,792

$

71,165

Deferred revenue and student deposits

63,834

70,766

Total current liabilities

126,626

141,931

Rent liability

3,183

7,001

Lease financing obligation

8,634

—

Other long-term liabilities

3,435

12,708

Total liabilities

141,878

161,640

Total stockholders' equity

127,614

122,996

Total liabilities and stockholders' equity

$

269,492

$

284,636

BRIDGEPOINT EDUCATION, INC.

Consolidated Statements of Cash Flows

(In thousands)

Year Ended December 31,

2018

2017

Cash flows from operating activities

Net income

$

4,636

$

9,111

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Provision for bad debts

22,834

30,294

Depreciation and amortization

6,786

8,863

Amortization of premium/discount

—

20

Deferred income taxes

(19)

(600)

Stock-based compensation

4,787

3,632

Net loss (gain) on marketable securities

89

(274)

Loss on termination of leased space

2,943

5,829

Loss on disposal or impairment of fixed assets

1,406

864

Loss on impairment of goodwill and intangibles

495

—

Changes in operating assets and liabilities:

  Accounts receivable

(27,007)

(30,343)

  Prepaid expenses and other current assets

4,133

280

  Other long-term assets

2,843

(3,066)

  Accounts payable and accrued liabilities

(12,190)

(12,908)

  Deferred revenue and student deposits

(6,598)

(5,605)

  Other liabilities

(12,729)

(10,172)

Net cash used in operating activities

(7,591)

(4,075)

Cash flows from investing activities

Capital expenditures

(2,581)

(3,387)

Purchases of investments

(1,067)

(315)

Capitalized costs for intangible assets

(873)

(553)

Sales of investments

975

214

Maturities of investments

—

47,725

Net cash (used in) provided by investing activities

(3,546)

43,684

Cash flows from financing activities

Proceeds from exercise of stock options

455

3,848

Tax withholdings related to net exercise of stock options

(1,097)

—

Proceeds from the issuance of stock under employee stock purchase plan

210

289

Tax withholding on issuance of stock awards

(949)

(1,860)

Repurchase of common stock

(2,424)

(168,695)

Net cash used in financing activities

(3,805)

(166,418)

Net (decrease) increase in cash, cash equivalents and restricted cash

(14,942)

(126,809)

Cash, cash equivalents and restricted cash at beginning of period

205,526

332,335

Cash, cash equivalents and restricted cash at end of period

$

190,584

$

205,526

BRIDGEPOINT EDUCATION, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share amounts)

(Unaudited)

Three Months EndedDecember 31,

Year EndedDecember 31,

2018

2017

2018

2017

Operating Income (Loss) Reconciliation:

GAAP operating income (loss)

$

(13,598)

$

(5,947)

$

(3,993)

$

6,426

Legal settlement expense

—

1,845

141

1,845

Separation transaction costs

3,247

—

8,081

—

Restructuring and impairment charges

3,999

(120)

7,795

7,884

Non-GAAP operating income (loss)

$

(6,352)

$

(4,222)

$

12,024

$

16,155

Net Income (Loss) Reconciliation:

GAAP net income (loss)

$

(13,415)

$

(5,145)

$

4,636

$

9,111

Legal settlement expense

—

1,845

141

1,845

Restructuring and impairment charges

3,999

(120)

7,795

7,884

Separation transaction costs

3,247

—

8,081

—

Income tax impact, non-GAAP

(38)

(444)

(7,685)

(1,034)

Non-GAAP net income (loss)

$

(6,207)

$

(3,864)

$

12,968

$

17,806

Diluted Income (Loss) Per Share Reconciliation:

GAAP diluted income (loss) per share

$

(0.49)

$

(0.18)

$

0.17

$

0.28

Legal settlement expense

—

0.07

0.01

0.06

Restructuring and impairment charges

0.15

(0.01)

0.28

0.24

Separation transaction costs

0.12

—

0.29

—

Income tax impact, non-GAAP

(0.01)

(0.02)

(0.28)

(0.03)

Non-GAAP diluted income (loss) per share

$

(0.23)

$

(0.14)

$

0.47

$

0.55

EBITDA and Adjusted EBITDA Reconciliation:

GAAP net income (loss)

$

(13,415)

$

(5,145)

$

4,636

$

9,111

Income tax benefit

(35)

(456)

(7,582)

(1,174)

Other income (expense)

(310)

(94)

(229)

(301)

Depreciation and amortization

1,586

2,043

6,786

8,863

EBITDA

(12,174)

(3,652)

3,611

16,499

Legal settlement expense

—

1,845

141

1,845

Restructuring and impairment charges

3,999

(120)

7,795

7,884

Separation transaction costs

3,247

—

8,081

—

Income tax impact, non-GAAP

(38)

(444)

(7,685)

(1,034)

Adjusted EBITDA

$

(4,966)

$

(2,371)

$

11,943

$

25,194

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/bridgepoint-education-reports-fourth-quarter-and-full-year-2018-results-300811140.html

SOURCE Bridgepoint Education


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