Franklin Covey (NYSE: FC) reported Q4 EPS of $0.07, $0.23 better than the analyst estimate of ($0.16). Revenue for the quarter came in at $48.99 million versus the consensus estimate of $47.92 million.

Bob Whitman, Chairman and Chief Executive Officer, commented, “We have been very encouraged by the strength and resilience of our subscription business and by the strength of demand for our live-online and other digital delivery modalities. During the pandemic, All Access Pass sales have increased on all fronts, including: sales to new organizations; sales of multi-year All Access Passes; and a revenue retention rate that exceeded 90% during fiscal 2020. Our clients have pivoted to scheduling training and coaching engagements through our digital ‘live-online’ modality and our booking pace has improved significantly during the fourth quarter compared with earlier in the pandemic, and has now returned to pre-pandemic levels. Previous investments in our delivery capabilities have been key in allowing us to provide high-quality content, training, and coaching through digital modalities. Sales in our foreign offices and among our international licensees also strengthened and improved compared with the third quarter. These foreign operations, which will ultimately sell primarily All Access Pass did not have a significant base of subscription revenues entering this period to add strength and durability to their operations. As a result, these operations accounted for a significantly disproportionate share of the decline in our sales over the third and fourth quarters of fiscal 2020. We expect these foreign operations to continue to strengthen in fiscal 2021 as they make the transition to selling the All Access Pass and related services. Additionally, despite the fierce headwinds faced by educational institutions in our third and fourth quarters as schools closed, teaching moved live-online, the need for school-provided meals continued, and budgets were constrained, nearly 2,200 existing Leader in Me schools renewed their Leader in Me subscriptions (a number higher than in fiscal 2019) and 320 new schools became Leader in Me schools. We believe this was a remarkable achievement in the current economic environment.”

Whitman continued, “Organizations of all kinds face what can seem like intractable challenges relating to getting the most from their people and organizations, executing with excellence, etc., and the current environment only adds to the difficulty of successfully addressing these challenges. However, these are exactly the challenges which Franklin Covey’s ongoing significant investments in best-in-class content and solutions are focused on addressing. Further, our ongoing investments in technology have provided customers with the ability to access the full collection of our solutions, through almost any modality, in any segment of time, on nearly any device, and in more than 20 languages worldwide through our All Access Pass and Leader in Me subscription offerings. Customers have found this value proposition to be very compelling both before and during these unusual times. We are confident that, driven by its All Access Pass and Leader in Me subscription businesses, Franklin Covey will be able to accelerate its growth in revenue, Adjusted EBITDA, and cash flow in fiscal 2021 and beyond.”

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