On Monday, Apollo Education Group, the parent company of the University of Phoenix, reported an 18 percent decline in revenue and a sharp drop in enrollment.
The Phoenix-based company reported financial results for the three months ended November 30, 2015, with first quarter revenue of $586.0 million and a $0.53 diluted loss per share from continuing operations, or $0.29 earnings per share excluding special items.
“Apollo is taking the necessary steps to enhance long-term shareholder value through a series of strategic actions which include transforming University of Phoenix into a higher retaining, more trusted provider of career relevant higher education, continued expansion of our international network, and a commitment to efficiency,” said Greg Cappelli, Chief Executive Officer, Apollo Education Group. “The University of Phoenix team is implementing major components of its transformational plan as quickly as possible, and although this is having a near-term negative impact on revenue, we believe speed of execution will help the University return to stability more quickly. Apollo Global continues to expand and grow its network through a combination of high quality acquisitions and organic growth and is on-target for a record year. Finally, we have committed to incremental cost reductions in order to preserve our operating margin during this transformational period,” according to a statment issued by Apollo.
Apollo Education Group reported net revenue for the first quarter 2016 of $586.0 million, compared to $714.5 million for the first quarter 2015. First quarter 2016 University of Phoenix New Degreed Enrollment was 24,500 and Degreed Enrollment was 176,900, compared to New Degreed Enrollment of 39,600 and Degreed Enrollment of 227,400 for the prior year first quarter. Operating loss for the first quarter 2016 was $45.2 million, compared to operating income of $64.2 million for the first quarter 2015. The operating results for the first quarter 2016 were significantly impacted by $73.4 million of goodwill impairment charges. Loss from continuing operations attributable to Apollo Education Group for the first quarter 2016 was $57.5 million, or $0.53 per share, compared to income of $36.1 million, or $0.33 per share, for the prior year first quarter.
Excluding special items, income from continuing operations attributable to Apollo Education Group for the first quarter 2016 was $31.3 million, or $0.29 per share, compared to $49.9 million, or $0.46 per share, for the first quarter 2015. Adjusted EBITDA was $80.2 million for the first quarter 2016 compared to $118.5 million for the first quarter 2015.
As of November 30, 2015, the Company’s unrestricted cash and cash equivalents and marketable securities (including current and noncurrent) totaled $755.7 million, compared to $794.2 million as of August 31, 2015. The decrease was primarily attributable to cash used in operating activities and capital expenditures during the first quarter 2016.
Total debt outstanding (including short-term borrowings and the current portion of long-term debt) was $43.3 million as of November 30, 2015.