EX-99.1 2 a4704699ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 DeVry Inc. Reports Fiscal 2004 Fourth-Quarter, Year-End Results and Summer Term Enrollment OAKBROOK TERRACE, Ill.--(BUSINESS WIRE)--Aug. 18, 2004--DeVry Inc. (NYSE:DV), an international higher education company, today reported financial results for the fiscal 2004 fourth quarter and year-end, and student enrollment for the 2004 summer term. Financial and Operating Results Fiscal 2004 fourth quarter revenues were $200.0 million, an increase of 14.7 percent compared with $174.4 million for the same period one year ago. Net income for the fourth quarter was $15.7 million, or $0.22 per diluted share, up 29.2 percent compared with $12.1 million, or $0.17 per share for the same period last year, which included pretax charges of approximately $2.6 million related to workforce reductions in both eastern Canada and the United States. Revenues for the fiscal year ended June 30, 2004, were $784.9 million, an increase of 15.5 percent compared with $679.6 million in fiscal 2003. Net income for the year was $58.1 million or $0.82 per diluted share, a decline of 5.0 percent compared with $61.1 million or $0.87 per share in fiscal 2003, which included certain non-recurring income tax benefits totaling $8.1 million or approximately $0.12 per share. DeVry also said that as a result of a change in the CPA exam schedule, it has realigned Becker Professional Review's fiscal calendar to that of DeVry Inc. Although the company previously indicated that this change would be recorded in the fourth quarter of 2004, the appropriate accounting treatment is to recognize the change in the first quarter of fiscal year 2005. The realignment is expected to add $0.02 to earnings for the year. "The demand for entry-level accountants is reported to be the highest it has been in many years," said Ronald Taylor, chief executive officer of DeVry Inc. "We see current enrollment for Becker's CPA review courses recovering nicely and expect future Becker enrollment to reflect the increased demand for accountants." "As of July 1, we significantly strengthened our management team with the appointment of Daniel Hamburger as president and chief operating officer and John Skubiak as president of DeVry University, in addition to the previous hiring of Paul Eppen as chief marketing officer," commented Taylor. "These changes provide an immediate boost to our management team and give us the management resources necessary to achieve our strategic goals." In fiscal 2004, new DeVry University Centers (DVUCs) were opened in Indianapolis, Las Vegas, Philadelphia's Center City, Pittsburgh, Portland, Sacramento, Seven Hills (Cleveland), Ohio, and Gurnee, Ill. Also during the fourth quarter, construction of a new facility in northern Colorado Springs was announced, and a new Fort Worth, Texas location is scheduled to begin classes in September 2004. Most recently, the company announced its plans to open a new center in Broward County, Florida. DeVry currently operates 71 locations, comprising 23 DeVry University campuses and 48 DVUCs, and offers undergraduate and graduate degree programs online. During the fourth quarter, DeVry University announced two new online concentrations within its business administration bachelor degree program. Also during the quarter, Michigan State University and The Ohio State University became clinical training affiliates of Ross University School of Veterinary Medicine. Summer Enrollment DeVry University announced today that new undergraduate student enrollment for the 2004 summer term increased by 0.9 percent to 10,522, compared with 10,431 in the previous year. Total undergraduate student enrollment in the 2004 summer term was 38,036, a decline of 5.8 percent, compared to 40,398 for the 2003 summer term. These results exclude enrollments at DeVry's Toronto location, which last enrolled new students in July 2003. At DeVry University's Keller Graduate School of Management (KGSM), the number of coursetakers for the 2004 July term increased 8.4 percent to 10,276 compared with 9,483 in the July term last year. During fiscal 2004, KGSM aligned its academic calendar with that of DeVry University. The annual schedule for graduate coursework is now six eight-week terms as opposed to five 10-week terms in the prior KGSM calendar. The total number of online undergraduate and graduate coursetakers for the 2004 summer term increased 92.8 percent to 12,590 compared with 6,531 in the same term a year ago. The total number of students enrolled at Ross University for the 2004 May term was 3,310 compared to 2,852 in the same period last year, an increase of 16.1 percent. "There is strong interest in our business and healthcare programs, and significant growth at the graduate school, at the DVUCs, online and at Ross University; however, undergraduate technology enrollments continue to be weak," stated Taylor. "We are adopting a comprehensive program to aggressively address this issue and expect to see improvements in the area of recruiting. We are, of course, subject to ongoing general market conditions in the technology area." Daniel Hamburger, president and chief operating officer, commented, "Modifications have been implemented to refocus our marketing and sales efforts on specific audiences, which include recent high school graduates, adult learners, technology and business students and those interested in our online programs. These changes include a revamped high school outreach program and advertisements specifically oriented toward high school students." "Though weak technology enrollments will continue to affect performance in the near term, we are confident that with the plan we have in place, we will be successful in attracting an increasing number of full-time students looking for a high-quality education and an accelerated entry into a subsequent career," concluded Hamburger. DeVry Inc. will hold a conference call to discuss its fiscal 2004 fourth-quarter and year-end results on August 18, 2004 at 3:30 p.m. Central time (4:30 p.m. Eastern time). The conference call will be led by Ronald Taylor, chief executive officer, Daniel Hamburger, president and chief operating officer and Norman Levine, senior vice president and chief financial officer. For those wishing to participate by telephone, dial 800-218-0713 (domestic) or 303-262-2130 (international). DeVry Inc. will also broadcast the conference call live via the Internet. Interested parties may access the Webcast through the Investor Relations section of the company's Web site at www.investor.devry.com. Please access the Web site at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. The company will archive a telephone replay of the call until August 27, 2004. To access the replay, dial 800-405-2236 (domestic) or 303-590-3000 (international), passcode 11004930 or to access the Webcast replay, visit www.investor.devry.com. DeVry Inc. (NYSE:DV) is the holding company for DeVry University, Ross University and Becker Professional Review. DeVry University, which includes Keller Graduate School of Management, offers associate, bachelor's and master's degree programs in technology, business and management. Ross University, through its schools of Medicine and Veterinary Medicine, offers both doctor of medicine and doctor of veterinary medicine degrees. Becker Professional Review provides preparatory coursework for the certified public accountant, certified management accountant and chartered financial analyst exams. DeVry Inc. is based in Oakbrook Terrace, Ill. For more information about the company, visit http://www.devry.com. Summer 2004 Enrollment Results ------------------------------ DeVry University (excluding Toronto) Summer Summer Increase/ 2004 2003 (Decrease) New undergraduate students (onsite/online) 10,522 10,431 0.9% Total undergraduate students (onsite/online) 38,036 40,398 (5.8%) July July Increase/ 2004 2003 (Decrease) Graduate coursetakers (onsite/online) 10,276 9,483 8.4% Online coursetakers(1) 12,590 6,531 92.8% May May Increase/ 2004 2003 (Decrease) Ross University 3,310 2,852 16.1% (1)Online coursetakers are included in the total undergraduate and graduate enrollment number. DeVry Inc. For the Quarter Ended For the Fiscal Year Ended June 30, 2004 June 30, 2003 June 30, 2004 June 30, 2003 Revenues $200,043,000 $174,395,000 $784,885,000 $679,579,000 Net Income 15,696,000 12,149,000 58,061,000 61,148,000 Earnings Per Common Share Basic $0.22 $0.17 $0.83 $0.87 Diluted $0.22 $0.17 $0.82 $0.87 Number of Common Shares Basic 70,306,000 69,986,000 70,142,000 69,942,000 Diluted 70,926,000 70,548,000 70,757,000 70,336,000 Actual Shares Outstanding at June 30: 70,331,000 70,021,000 DEVRY INC. CONSOLIDATED STATEMENTS OF INCOME (Dollars in Thousands Except for Per Share Amounts) PRELIMINARY ----------- For The Three Months Ended June 30, ----------------------------- 2004 2003 2002 --------- --------- -------- REVENUES: Tuition $186,993 $162,846 $150,139 Other Educational 13,032 11,419 11,732 Interest 18 130 142 --------- --------- --------- Total Revenues 200,043 174,395 162,013 --------- --------- --------- COSTS AND EXPENSES: Cost of Educational Services 105,909 92,112 86,897 Student Services and Administrative Expense 70,437 61,325 48,206 Interest Expense 1,821 1,139 63 --------- --------- --------- Total Costs and Expenses 178,167 154,576 135,166 --------- --------- --------- Income Before Income Taxes 21,876 19,819 26,847 Income Tax Provision 6,180 7,670 10,656 --------- --------- --------- NET INCOME $ 15,696 $ 12,149 $ 16,191 ========= ========= ========= EARNINGS PER COMMON SHARE Basic $0.22 $0.17 $0.23 ======== ======== ========= Diluted $0.22 $0.17 $0.23 ======== ======== ========= DEVRY INC. CONSOLIDATED STATEMENTS OF INCOME (Dollars in Thousands Except for Per Share Amounts) PRELIMINARY ----------- For The Year Ended June 30, ---------------------------- 2004 2003 2002 --------- --------- -------- REVENUES: Tuition $737,546 $628,326 $600,400 Other Educational 47,173 50,810 47,181 Interest 166 443 553 --------- --------- --------- Total Revenues 784,885 679,579 648,134 --------- --------- --------- COSTS AND EXPENSES: Cost of Educational Services 420,108 366,075 347,986 Student Services and Administrative Expense 275,587 225,767 188,712 Interest Expense 7,834 1,280 807 --------- --------- -------- Total Costs and Expenses 703,529 593,122 537,505 --------- --------- -------- Income Before Income Taxes 81,356 86,457 110,629 Income Tax Provision 23,295 33,459 43,574 Non-recurring Tax Benefit - (8,150) - --------- --------- --------- NET INCOME $ 58,061 $ 61,148 $ 67,055 ========= ========= ========= EARNINGS PER COMMON SHARE Basic $0.83 $0.87 $0.96 ======== ======== ======== Diluted $0.82 $0.87 $0.95 ======== ======== ======== DEVRY INC. CONSOLIDATED BALANCE SHEETS (Dollars in Thousands) PRELIMINARY ----------- June 30, -------------------- 2004 2003 --------- --------- ASSETS: Current Assets: --------------- Cash and Cash Equivalents $146,227 $93,471 Restricted Cash 13,457 14,052 Accounts Receivable, Net 28,150 24,275 Inventories 3,281 4,315 Deferred Income Taxes 7,619 11,358 Prepaid Expenses and Other 9,356 6,988 --------- --------- Total Current Assets 208,090 154,459 --------- --------- Land, Buildings and Equipment: ------------------------------ Land 64,256 59,888 Buildings 203,651 188,320 Equipment 222,898 207,405 Construction In Progress 6,214 12,662 --------- --------- 497,019 468,275 Accumulated Depreciation (210,132) (182,921) --------- --------- Land, Buildings and Equipment, Net 286,887 285,354 --------- --------- Other Assets: ------------- Intangible Assets, Net 86,345 103,330 Goodwill 283,750 280,979 Perkins Program Fund, Net 12,247 11,291 Other Assets 4,232 6,003 --------- --------- Total Other Assets 386,574 401,603 --------- --------- TOTAL ASSETS $881,551 $841,416 ========= ========= DEVRY INC. CONSOLIDATED BALANCE SHEETS (Dollars in Thousands) PRELIMINARY ----------- June 30, -------------------- 2004 2003 --------- --------- LIABILITIES: Current Liabilities: -------------------- Current Maturities of Revolving Loan $35,000 $15,000 Accounts Payable 27,349 18,866 Accrued Salaries, Wages and Benefits 31,041 30,791 Accrued Expenses 18,476 31,767 Advance Tuition Payments 16,819 10,568 Deferred Tuition Revenue 21,830 16,291 --------- --------- Total Current Liabilities 150,515 123,283 --------- --------- Other Liabilities ----------------- Revolving Loan 90,000 150,000 Senior Debt 125,000 125,000 Deferred Income Taxes 20,379 13,049 Deferred Rent and Other 17,400 14,417 --------- --------- Total Other Liabilities 252,779 302,466 --------- --------- TOTAL LIABILITIES 403,294 425,749 --------- --------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Common Stock, $0.01 Par Value, 200,000,000 Shares Authorized; 70,331,323 and 70,021,513 Shares Outstanding at June 30, 2004 and 2003, Respectively 704 701 Additional Paid-in Capital 71,797 67,288 Retained Earnings 405,036 346,975 Accumulated Other Comprehensive Income 720 703 --------- --------- TOTAL SHAREHOLDERS' EQUITY 478,257 415,667 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $881,551 $841,416 ========= ========= DEVRY INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands) PRELIMINARY ----------- For The Year Ended June 30, ---------------------------- 2004 2003 2002 --------- --------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $58,061 $61,148 $67,055 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation 40,836 37,758 32,725 Amortization 14,748 2,574 811 Provision for Refunds and Uncollectible Accounts 35,495 34,501 34,249 Deferred Income Taxes 5,472 8,940 2,630 Loss on Disposals and Adjustments to Land, Buildings and Equipment 439 263 188 Changes in Assets and Liabilities, Net of Effects from Acquisitions of Businesses: Restricted Cash 595 6,206 1,220 Accounts Receivable (39,340) (23,633) (34,525) Inventories 1,034 592 (8) Prepaid Expenses And Other (2,368) (3,070) 677 Perkins Program Fund Contribution and Other 2,636 (1,114) 193 Accounts Payable 8,483 (2,132) (105) Accrued Salaries, Wages, Expenses and Benefits (3,472) 2,061 5,363 Advance Tuition Payments 6,251 (6,997) 1,704 Deferred Tuition Revenue 5,539 (16,904) 1,330 --------- --------- -------- NET CASH PROVIDED BY OPERATING ACTIVITIES 134,409 100,193 113,507 --------- --------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Capital Expenditures (42,808) (43,762) (85,873) Payments for Purchases of Businesses, Net of Cash Acquired (1,493) (295,908) - --------- --------- -------- NET CASH USED IN INVESTING ACTIVITIES (44,301) (339,670) (85,873) --------- --------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from Exercise of Stock Options 2,631 404 1,068 Comprehensive Income from Interest Rate Hedge 18 - - Proceeds from Revolving Credit Facility 25,000 165,000 55,000 Repayments Under Revolving Credit Facility (65,000) - (55,000) Proceeds from Senior Note Issuance 0 125,000 - --------- --------- -------- NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (37,351) 290,404 1,068 --------- --------- -------- Effects of Exchange Rate Differences (1) 29 (46) --------- --------- -------- NET INCREASE IN CASH AND CASH EQUIVALENTS 52,756 50,956 28,656 Cash and Cash Equivalents at Beginning of Year 93,471 42,515 13,859 --------- --------- -------- Cash and Cash Equivalents at End of Year $146,227 $93,471 $42,515 ========= ========= ======== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Interest Paid During the Year $7,091 $662 $807 Income Taxes Paid During the Year, Net 22,471 17,373 42,486 CONTACT: DeVry Inc. Investor Relations Joan Bates, 630-574-1949 or Linden Alschuler & Kaplan Hannah Arnold, 212-575-4545