EX-99.01 2 a4934061ex99_01.txt EXHIBIT 99.01 - PRESS RELEASE Exhibit 99.01 Laureate Education, Inc. Reports Strong Second Quarter 2005 Results; Company Announces 32% Increase in Total Student Enrollment BALTIMORE--(BUSINESS WIRE)--July 21, 2005--Laureate Education, Inc. (NASDAQ: LAUR), the world's leading international provider of higher education, announced strong financial results for the quarter ended June 30, 2005. -- Second quarter 2005 revenues increased 38% to $217.8 million, compared to $158.3 million in the second quarter of 2004. -- Total operating income for the second quarter 2005 increased 52% to $33.6 million compared to $22.2 million in the second quarter of 2004. -- The Company reported earnings from continuing operations of $0.43 per diluted share for the quarter ending June 30, 2005. -- Laureate Education reiterates its 2005 Earnings Outlook of $1.62 to $1.67 per diluted share. -- The Company currently believes that it will achieve earnings of $0.21 to $0.23 per diluted share for the quarter ending September 30, 2005. -- The Company's campus-based institutions reported second quarter total student enrollment increased 33% to 149,212 students. -- Laureate Online Education reported a 34% increase in new student enrollment, driving a 29% increase in total student enrollment. -- Laureate launched its first U.S. dual-degree program at its campus-based university in Mexico, Universidad del Valle de Mexico (UVM), in partnership with its online university, Walden University. This program offers UVM students the opportunity to receive a dual UVM/Walden degree that is recognized by both the United States and Mexican authorities. Douglas Becker, Chairman and Chief Executive Officer of Laureate Education stated, "We are very pleased with the performance of the Company this quarter. Our enrollment growth and operating income performance in the quarter position us to deliver the substantial growth indicated by our annual guidance, especially in the fourth quarter, our most important earnings period. We also continue to make important investments that should position the company well for 2006 and beyond." "Now we are very focused on delivering substantial growth in enrollment in our third quarter, in which our largest intake of new students takes place," added Mr. Becker. Financial Results Total revenues for the second quarter of 2005 were $217.8 million, an increase of 38% compared to total revenues of $158.3 million in the second quarter of 2004. Total operating income for the second quarter increased to $33.6 million, versus operating income of $22.2 million in the second quarter of 2004. After-tax income from continuing operations for the second quarter of 2005 was $22.2 million or $0.43 per share on diluted shares outstanding of 52 million. For the six-month period ended June 30, 2005, total revenues were $401.9 million, an increase of 38% compared to total revenues of $290.4 million in the same period of 2004. Total operating income for the six-month period increased to $38.9 million, versus operating income of $25.8 million in the same period of 2004. After-tax income from continuing operations for the six-month period ended June 30, 2005 was $26.0 million or $0.50 per share on diluted shares outstanding of 51.9 million. Total cash and marketable securities at June 30, 2005 were approximately $104 million, while total corporate debt was approximately $105 million. Laureate Education now operates institutions of higher education in 12 countries, offering programs through 44 campus locations and online to 172,116 students in over 80 countries. Revenue Growth - Organic and Acquisition Three months ended June 30, 2005 % Growth Revenue Amount Constant (In Thousands) 2005 2004 in USD Currency Mexico Region(1) $ 44,305 $37,167 19% 16% Andean Region(2) 57,688 45,974 25% 16% Europe Region 42,136 40,475 4% 0% Online 45,578 34,635 32% 31% Subtotal 189,707 158,251 20% Acquisitions 28,082 NA Total $ 217,789 $ 158,251 38% Student Enrollment For the period ended June 30, 2005 New Student Enrollment 2005 2004 % Change Online 5,186 3,865 34% Total Student Enrollment 2005 2004 Mexico Region(1) 58,792 48,591 21% Andean Region(2) 59,369 51,911 14% Europe Region 12,010 11,907 1% Online 22,904 17,788 29% Subtotal: 153,075 130,197 18% Total Student Enrollment at Acquired Schools(3): 19,041 NA NA Total Student Enrollment with Acquisitions: 172,116 130,197 32% (1) Mexico Region includes campus-based universities located in Mexico, Panama and Costa Rica. (2) Andean Region includes campus-based universities located in Chile and Ecuador. (3) Acquired schools include acquisitions not owned during the full periods presented, including Peru. Note: Laureate Education reports second and fourth quarter enrollment as of the last day of the respective fiscal quarters. Due to ongoing enrollment activity following the end of the first quarter and third quarter, the company reports enrollment for these periods as of the earnings report date. Financial Outlook The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially. -- Laureate Education anticipates total revenue of $185 to $200 million for the third quarter 2005. -- The Company anticipates Campus-Based revenue of $145 to $155 million for the third quarter 2005, with operating margins between 12% and 13%. Latin America expects revenue of $120 to $129 million with margins of 24% to 25%. Europe expects revenue of $25 to $26 million with margins of (25%). Campus-based general and administrative expenses are expected to be approximately $4.5 million. -- The Company anticipates Online revenue of $40 to $45 million for the third quarter 2005, with operating margins between 15% and 16%. -- General and administrative expenses are expected to be approximately $5.5 million in the third quarter 2005. -- Non-cash stock compensation expense is expected to be approximately $1 million in the third quarter 2005. -- The Company currently believes that it will achieve earnings of $0.21 to $0.23 per diluted share for the quarter ending September 30, 2005. Fully diluted shares outstanding for the third quarter 2005 are projected to be approximately 52.3 million. -- Laureate Education reiterates its 2005 Earnings Outlook of $1.62 to $1.67 per diluted share. About Laureate Education, Inc. Laureate Education Inc. (NASDAQ: LAUR) is focused exclusively on providing a superior university experience to over 170,000 students through the leading global network of accredited campus-based and online universities. Addressing the rapidly growing global demand for higher education, Laureate offers a broad range of career-oriented undergraduate and graduate programs through campus-based universities located in Latin America, Europe, and Asia. Through online universities, Laureate offers the growing population of non-traditional, working-adult students the convenience and flexibility of distance learning to pursue undergraduate, master's and doctorate degree programs in major career fields including engineering, education, business, and healthcare. For more information, please visit our website, www.laureate-inc.com. Forward Looking Statements This release includes information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company's actual results could differ materially from those described in the forward-looking statements. The following factors might cause such a difference: -- The Company's operations can be materially affected by competition in its target markets and by overall market conditions, among other factors. -- The Company's foreign operations, in particular, are subject to political, economic, legal, regulatory and currency-related risks. Additional information regarding these risk factors and uncertainties is detailed from time to time in the Company's filings with the Securities and Exchange Commission, including but not limited to our most recent Forms 10-K and 10-Q, available for viewing on our website. (To access this information on our website, www.laureate-inc.com, please click on "Investor Relations", "SEC Filings"). Laureate Education, Inc. & Subsidiaries Consolidated Statements of Operations (Amounts in thousands, except per share data) Three Months Ended June 30, ------------------------------------- $ % 2005 2004 Variance Variance ------------------------------------- Revenues Mexico region (a) $50,365 $37,167 $13,198 36% Andean region (b) 68,858 45,974 22,884 50% --------- -------- -------- -------- Campus Based - Latin America 119,223 83,141 36,082 43% Spain 27,731 25,764 1,967 8% Hospitality/Switzerland (c) 11,560 12,169 (609) -5% France 13,697 2,542 11,155 GT200% --------- -------- -------- -------- Campus Based - Europe 52,988 40,475 12,513 31% --------- -------- -------- -------- Campus Based Total 172,211 123,616 48,595 39% --------- -------- -------- -------- Laureate Online Education 45,578 34,635 10,943 32% --------- -------- -------- -------- Total revenues 217,789 158,251 59,538 38% --------- -------- -------- -------- Core operating expenses 178,072 128,376 49,696 39% Non-cash stock compensation expense 414 2,283 (1,869) -82% General and administrative expenses 5,687 5,431 256 5% --------- -------- -------- -------- Total operating expenses 184,173 136,090 48,083 35% --------- -------- -------- -------- Operating income 33,616 22,161 11,455 52% Non-operating items Interest and other income (e) 3,273 16,043 (12,770) -80% Interest expense (2,704) (1,595) (1,109) -70% Foreign exchange (loss) gain (936) (297) (639) LT-200% --------- -------- -------- -------- Total non-operating items (367) 14,151 (14,518) N/A --------- -------- -------- -------- Income from continuing operations before minority interest, equity in net income (loss) of affiliates, and income taxes 33,249 36,312 (3,063) -8% Minority interest in income of consolidated subsidiaries, net of income tax (6,240) (6,066) (174) -3% Equity in net loss of affiliates, net of income tax (114) - (114) N/A Income tax expense (4,738) (6,409) 1,671 26% --------- -------- -------- -------- Income from continuing operations 22,157 23,837 (1,680) -7% (Loss) income from discontinued operations, net of income tax(d) - (3,027) 3,027 N/A Loss on disposal of discontinued operations, net of income tax (2,351) - (2,351) N/A --------- -------- -------- -------- Net income $19,806 $20,810 $(1,004) -5% ========= ======== ======== ======== Weighted average shares (basic) 49,566 45,344 Weighted average shares (diluted)51,950 48,131 EPS-Net income (basic) $0.40 $0.46 EPS-Net Income (diluted) $0.38 $0.43 EPS-Income from continuing operations (basic) $0.45 $0.53 EPS-Income from continuing operations (diluted) $0.43 $0.50 Reconciliation - Pro Forma Income from Continuing Operations ---------------------------------- Income from continuing operations before income taxes $30,246 Impact from early repayment of Educate Inc. note receivable (10,380) -------- Subtotal $19,866 Pro Forma Tax (2,257) -------- Pro Forma income from continuing operations $17,609 -------- Pro Forma weighted average shares (diluted) 48,131 EPS - Pro Forma income from continuing operations (diluted) $0.37 Segment operating profit (loss): Campus Based - Latin America $29,645 $20,796 $8,849 43% Campus Based - Europe 7,584 6,426 1,158 18% Campus Based - Overhead (2,898) (2,391) (507) -21% --------- -------- -------- -------- Campus Based - Total $34,331 $24,831 $9,500 38% --------- -------- -------- -------- Laureate Online $5,386 $5,044 $342 7% --------- -------- -------- -------- a) The Mexico region includes Mexico, Costa Rica and Panama. b) The Andean region includes Chile, Ecuador and Peru. Hospitality includes the operating results of Les Roches, c) Marbella and Glion. d) The 2005 and 2004 operating results present the K-12 (including UK/France), WSI and India business units as discontinued operations. e) For 2004, includes acceleration of original issue discount triggered by the early repayment of the K-12 seller note. GT = Greater Than, LT = Less Than Six Months Ended June 30, ------------------------------------- $ % 2005 2004 Variance Variance ------------------------------------- Revenues Mexico region (a) $114,090 $85,105 $28,985 34% Andean region (b) 93,148 64,309 28,839 45% --------- -------- -------- -------- Campus Based - Latin America 207,238 149,414 57,824 39% Spain 56,846 51,675 5,171 10% Hospitality/Switzerland (c) 25,355 24,822 533 2% France 27,423 5,177 22,246 GT200% --------- -------- -------- -------- Campus Based - Europe 109,624 81,674 27,950 34% --------- -------- -------- -------- Campus Based Total 316,862 231,088 85,774 37% --------- -------- -------- -------- Laureate Online Education 85,041 59,319 25,722 43% --------- -------- -------- -------- Total revenues 401,903 290,407 111,496 38% --------- -------- -------- -------- Core operating expenses 349,956 250,939 99,017 39% Non-cash stock compensation expense 1,194 2,995 (1,801) -60% General and administrative expenses 11,901 10,720 1,181 11% --------- -------- -------- -------- Total operating expenses 363,051 264,654 98,397 37% --------- -------- -------- -------- Operating income 38,852 25,753 13,099 51% Non-operating items Interest and other income (e) 5,689 19,345 (13,656) -71% Interest expense (5,078) (3,153) (1,925) -61% Foreign exchange (loss) gain (687) 63 (750) N/A --------- -------- -------- -------- Total non-operating items (76) 16,255 (16,331) N/A --------- -------- -------- -------- Income from continuing operations before minority interest, equity in net income (loss) of affiliates, and income taxes 38,776 42,008 (3,232) -8% Minority interest in income of consolidated subsidiaries, net of income tax (7,132) (8,540) 1,408 16% Equity in net loss of affiliates, net of income tax (204) (8) (196) LT-200% Income tax expense (5,429) (7,116) 1,687 24% --------- -------- -------- -------- Income from continuing operations 26,011 26,344 (333) -1% (Loss) income from discontinued operations, net of income tax(d) 742 (5,918) 6,660 N/A Loss on disposal of discontinued operations, net of income tax (2,351) - (2,351) N/A --------- -------- -------- -------- Net income $24,402 $20,426 $3,976 19% ========= ======== ======== ======== Weighted average shares (basic) 49,402 45,134 Weighted average shares (diluted)51,882 47,807 EPS-Net income (basic) $0.49 $0.45 EPS-Net Income (diluted) $0.47 $0.43 EPS-Income from continuing operations (basic) $0.53 $0.58 EPS-Income from continuing operations (diluted) $0.50 $0.55 Reconciliation - Pro Forma Income from Continuing Operations ---------------------------------- Income from continuing operations before income taxes $33,460 Impact from early repayment of Educate Inc. note receivable (10,380) -------- Subtotal $23,080 Pro Forma Tax (2,964) -------- Pro Forma income from continuing operations $20,116 -------- Pro Forma weighted average shares (diluted) 47,807 EPS - Pro Forma income from continuing operations (diluted) $0.42 Segment operating profit (loss): Campus Based - Latin America $34,389 $24,359 $10,030 41% Campus Based - Europe 16,447 15,201 1,246 8% Campus Based - Overhead (5,488) (5,300) (188) -4% --------- -------- -------- -------- Campus Based - Total $45,348 $34,260 $11,088 32% --------- -------- -------- -------- Laureate Online $6,599 $5,208 $1,391 27% --------- -------- -------- -------- a) The Mexico region includes Mexico, Costa Rica and Panama. b) The Andean region includes Chile, Ecuador and Peru. Hospitality includes the operating results of Les Roches, c) Marbella and Glion. d) The 2005 and 2004 operating results present the K-12 (including UK/France), WSI and India business units as discontinued operations. e) For 2004, includes acceleration of original issue discount triggered by the early repayment of the K-12 seller note. GT = Greater Than, LT = Less Than CONTACT: Laureate Education Sean Creamer, 410-843-8991 or Chris Symanoskie, 410-843-6394