Bridgepoint Education Reports Full Year 2012 Results

SAN DIEGO, March 12, 2013 /PRNewswire/ -- Bridgepoint Education, Inc. (NYSE: BPI), a provider of postsecondary education services, announced the results for its fourth quarter and full year ended December 31, 2012.

Highlights for the fourth quarter ended December 31, 2012:

  • Revenue decreased to $209.4 million from $221.3 million for the same period in 2011.
  • Operating income decreased to $25.1 million from $35.3 million for the same period in 2011.
  • Net income decreased to $16.0 million from $22.9 million for the same period in 2011.
  • Fully diluted earnings per common share decreased to $0.29 from $0.41 for the same period in 2011.

Highlights for the full year ended December 31, 2012:

  • Total student enrollment decreased to 81,810 from 86,642 at December 31, 2011.
  • Revenue increased to $968.2 million from $933.3 million for 2011.
  • Operating income decreased to $202.7 million from $273.7 million for 2011.
  • Net income was $128.0 million compared with net income of $172.8 million for 2011.
  • Fully diluted earnings per common share was $2.29 compared with $3.02 for 2011.

Student Enrollment

Total student enrollment at the Company's academic institutions, Ashford University and University of the Rockies, was 81,810 at December 31, 2012, compared with 86,642 students at the end of the fourth quarter of 2011. Combined new student enrollments for the fourth quarter of 2012 at both of the Company's academic institutions were approximately 9,260, compared with combined new student enrollments of approximately 13,500 for the fourth quarter of 2011. 

Financial Results

Effective in the fourth quarter of 2012, the Company made changes in the presentation of its operating expenses. The Company determined that these changes would better reflect industry practice and would provide more meaningful information as well as increased transparency to its operations. The Company also believes that the reclassification better represents the operational changes and the business initiatives that have been implemented. The Company has reclassified prior periods to conform to the new presentation.

Revenue for the fourth quarter of 2012 was $209.4 million, compared with revenue of $221.3 million for the fourth quarter of 2011.  Revenue for the year ended December 31, 2012, was $968.2 million, compared with revenue of $933.3 million for the year ended December 31, 2011.

Operating income for the fourth quarter of 2012, was $25.1 million, compared with $35.3 million for the same period in 2011. Operating income for the year ended December 31, 2012, was $202.7 million, compared with $273.7 million for the year ended December 31, 2011.

Net income for the fourth quarter of 2012 was $16.0 million, compared with net income of $22.9 million for the fourth quarter of 2011.  Net income for the year ended December 31, 2012, was $128.0 million, compared with net income of $172.8 million for the year ended December 31, 2011.

Fully diluted earnings per common share for the fourth quarter of 2012 was $0.29 compared with fully diluted earnings per common share of $0.41 for the fourth quarter of 2011.  Fully diluted earnings per common share for the year ended December 31, 2012, was $2.29, compared with fully diluted earnings per common share of $3.02 for the year ended December 31, 2011.

The Company's effective tax rate for the year ended December 31, 2012, was 37.9%.

The Company anticipates a 2.75% tuition increase for online students at Ashford University for courses beginning on or after April 1, 2013.

Balance Sheet and Cash Flow           

As of December 31, 2012, the Company had cash, cash equivalents and investments of $514.7 million, compared with $407.2 million as of December 31, 2011.  The Company generated $143.2 million of cash from operating activities for the year ended December 31, 2012, compared with $220.8 million for the year ended December 31, 2011.

Earnings Conference Call and Webcast

The Company will host a conference call at 11:30 a.m. ET (8:30 a.m. PT) today to discuss its latest financial results and recent developments. The dial-in number for callers in the United States and Canada is (800) 347-6311 and for international callers is (719) 457-2086. The access code for all callers is 7577415. A live webcast will also be available on the Company's website at http://bridgepointeducation.com/investor_relations.htm

A replay of the call will be available via telephone through March 19, 2013. To access the replay, dial (888) 203-1112 in the United States or Canada and (719) 457-0820 for international callers; then enter the access code 7577415.

About Bridgepoint Education

Bridgepoint Education, Inc. (NYSE: BPI) improves the way individuals learn. By harnessing creativity, knowledge and proprietary technologies, such as Constellation, Thuze, and Waypoint Outcomes, Bridgepoint Education has re-engineered the modern student experience with innovative solutions that advance learning. Its academic institutions – Ashford University and University of the Rockies – embody the contemporary college experience. Ashford University offers associate's, bachelor's and master's degree programs while University of the Rockies offers master's and doctoral degree programs. Both provide progressive online platforms, as well as traditional campuses located in Clinton, Iowa (Ashford University), and Colorado Springs, Colorado (University of the Rockies).

For more information about Bridgepoint Education, call Paul Goodson, Associate Vice President of Investor Relations at (866) 475-0317 x2271.

Forward-Looking Statements

This news release may contain forward-looking statements including, without limitation, statements regarding the Company's 2013 outlook and related commentary. These statements involve risks and uncertainties, and the Company's actual performance may differ materially from those expressed in or suggested by such statements. Risks and uncertainties include, without limitation:

  • failure to comply with the extensive regulatory framework applicable to the Company and its institutions, including Title IV of the Higher Education Act and its regulations, state laws and regulatory requirements, and accrediting agency requirements;
  • adverse administrative, regulatory or legislative changes affecting the Company's institutions;
  • the imposition of fines or other corrective measures against the Company's institutions;
  • competition in the postsecondary education market and its potential impact on the Company's market share and recruiting costs; and
  • reputational and other risks related to potential compliance audits, regulatory actions, negative publicity or service disruptions.

More information on potential factors that could affect the Company's performance is included from time to time in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's periodic reports filed with the SEC, including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012, to be filed with the SEC. Forward-looking statements are made on the basis of management's views and assumptions regarding future events and business performance as of the time the statements are made, and the Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates, except as required by law.

Contact: Paul Goodson, Associate Vice President, Investor Relations
(866) 475-0317 x2271
investorrelations@bridgepointeducation.com

 

 

BRIDGEPOINT EDUCATION, INC.

Consolidated Statements of Income

(In thousands, except per share amounts)

 




Year Ended December 31,



2012


2011

Revenue


$

968,171



$

933,349


Costs and expenses:





Instructional costs and services


355,273



303,860


Admissions advisory and marketing


339,209



297,619


General and administrative


70,975



58,123


Total costs and expenses


765,457



659,602


Operating income


202,714



273,747


Other income, net


3,370



2,768


Income before income taxes


206,084



276,515


Income tax expense


78,121



103,751


Net income


$

127,963



$

172,764


Earnings per common share:





Basic


$

2.42



$

3.30


Diluted


2.29



3.02


Weighted average number of common shares outstanding used in computing earnings per common share:





Basic


52,947



52,291


Diluted


55,946



57,133


 

 

BRIDGEPOINT EDUCATION, INC.

Consolidated Balance Sheets

(In thousands, except par value)

 



As of December 31,


2012


2011

ASSETS




Current assets:




Cash and cash equivalents

$

255,965



$

133,921


Restricted cash



25


Investments

136,967



153,779


Accounts receivable, net

75,177



62,156


Deferred income taxes

8,228



5,429


Prepaid expenses and other current assets

19,810



17,199


Total current assets

496,147



372,509


Property and equipment, net

95,966



89,667


Investments

121,738



119,507


Student loans receivable, net

15,143



9,255


Goodwill and intangibles, net

10,739



7,037


Deferred income taxes

13,266



11,200


Other long-term assets

2,330



4,461


Total assets

$

755,329



$

613,636


LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Accounts payable

$

4,588



$

8,961


Accrued liabilities

44,640



40,205


Deferred revenue and student deposits

175,057



185,446


Total current liabilities

224,285



234,612


Rent liability

25,173



16,595


Other long-term liabilities

9,759



8,781


Total liabilities

259,217



259,988


Total stockholders' equity

496,112



353,648


Total liabilities and stockholders' equity

$

755,329



$

613,636


 


 

BRIDGEPOINT EDUCATION, INC.

Consolidated Statements of Cash Flows

(In thousands)

 



Year Ended December 31,


2012


2011

Cash flows from operating activities




Net income

$

127,963



$

172,764


Adjustments to reconcile net income to net cash provided by operating activities:




Provision for bad debts

66,446



58,511


Depreciation and amortization

17,424



12,743


Amortization of premium/discount

6,805



3,969


Deferred income taxes

(7,264)



6,606


Stock-based compensation

13,729



10,595


Excess tax benefit of option exercises

(10,058)



(19,096)


Loss on disposal of fixed assets

1,153



13


Changes in operating assets and liabilities:




Accounts receivable

(81,577)



(60,817)


Prepaid expenses and other current assets

(1,056)



(2,104)


Student loans receivable

(3,778)



(7,947)


Other long-term assets

2,131



253


Accounts payable and accrued liabilities

12,100



27,509


Deferred revenue and student deposits

(10,389)



11,870


Other liabilities

8,772



5,882


Uncertain tax position

784



57


Net cash provided by operating activities

143,185



220,808


Cash flows from investing activities




Capital expenditures

(25,296)



(34,492)


Purchases of investments

(179,387)



(337,084)


Restricted cash

25




Capitalized curriculum development costs

(5,262)



(3,521)


Sales and maturities of investments

186,911



167,049


Net cash used in investing activities

(23,009)



(208,048)


Cash flows from financing activities




Proceeds from exercise of stock options

2,257



4,889


Tax withholdings related to net issuance of stock options

(10,418)




Excess tax benefit of option exercises

10,058



19,096


Proceeds from the issuance of stock under employee stock purchase plan

1,340



1,330


Proceeds from the exercise of warrants

490



106


Tax withholdings related to net issuance of warrants

(944)




Issuance of restricted stock

(313)




Repurchase of common stock

(602)



(92,778)


Net cash provided by (used in) financing activities

1,868



(67,357)


Net increase (decrease) in cash and cash equivalents

122,044



(54,597)


Cash and cash equivalents at beginning of period

133,921



188,518


Cash and cash equivalents at end of period

$

255,965



$

133,921


 

SOURCE Bridgepoint Education, Inc.



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