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Bridgepoint Education Reports First Quarter 2016 Results

SAN DIEGO, May 3, 2016 /PRNewswire/ -- Bridgepoint Education (NYSE:BPI), a provider of postsecondary education services, today announced its results for the three months ended March 31, 2016.

Bridgepoint Education logo

Financial Results for the Three Months Ended March 31, 2016

Revenue for the first quarter of 2016 was $133.0 million, compared with revenue of $142.5 million for the first quarter of 2015.

Operating loss for the first quarter of 2016 was $16.3 million, compared with operating loss of $1.2 million for the first quarter of 2015.

Net loss for the first quarter of 2016 was $10.1 million, compared with net loss of $0.4 million for the first quarter of 2015.

Diluted loss per share for the first quarter of 2016 was $0.22, compared with diluted loss per share of $0.01 for the first quarter of 2015.

The Company recognized income tax benefit of $5.5 million for the first quarter of 2016, compared with income tax benefit of $0.1 million for the first quarter of 2015.

Non-GAAP Financial Results for the Three Months Ended March 31, 2016

Non-GAAP operating loss for the first quarter of 2016 was $1.7 million, compared with non-GAAP operating loss of $1.2 million for the first quarter of 2015. Non-GAAP operating loss for the first quarter of 2016 excludes a legal accrual of $13.9 million and restructuring and impairment charges of $0.7 million. The legal accrual represents the Company's current best estimate of the cost of a joint resolution of previously disclosed investigative subpoenas from the Attorney General of the State of California and civil investigative demands from the Consumer Financial Protection Bureau.

Non-GAAP net loss for the first quarter of 2016 was $0.9 million, compared with non-GAAP net loss of $0.4 million for the first quarter of 2015. Non-GAAP net loss for the first quarter of 2016 excludes the $13.9 million legal accrual referred to above, restructuring and impairment charges of $0.7 million and a tax benefit amount of $5.4 million.

Non-GAAP diluted loss per share for the first quarter of 2016 was $0.02, compared with non-GAAP diluted loss per share of $0.01 for the first quarter of 2015.

Balance Sheet and Cash Flow

As of March 31, 2016, the Company had cash, restricted cash, cash equivalents and marketable securities of $351.9 million, compared with cash, restricted cash, cash equivalents and marketable securities of $374.0 million as of December 31, 2015. 

The Company used $17.2 million of cash for operating activities during the three months ended March 31, 2016, compared with $7.4 million of cash provided by operating activities during the three months ended March 31, 2015.

Student Enrollment

Total student enrollment at the Company's academic institutions, Ashford University and University of the Rockies, was 50,814 students at March 31, 2016, compared with total student enrollment of 55,322 at March 31, 2015.

As of March 31, 2016, the 12-month retention for all Ashford students who were active on the last day of the first quarter of 2015 was 62.2%. As of March 31, 2015, the 12-month retention for all Ashford students who were active on the last day of the first quarter of 2014 was 64.2%.

About Non-GAAP Financial Measures

This press release contains non-GAAP financial measures for non-GAAP operating loss, non-GAAP net loss and non-GAAP diluted loss per share, each of which excludes our legal accrual, restructuring and impairment charges, and certain income tax adjustments. These non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles (GAAP) and are not based on a comprehensive set of accounting rules. Management believes non-GAAP financial measures are useful in providing investors with an understanding of how specific line items in the consolidated statements of income are affected by items that may not be indicative of the operating results of the Company's core business. To the extent that other companies use similar methods in calculating and reporting non-GAAP operating results, the Company believes provision of supplemental non-GAAP financial information allows for a meaningful comparison of the Company's performance against the performance of other companies. The Company further believes that these non-GAAP financial measures provide useful information regarding its ongoing operating activities and business trends related to its results of operations, as well as a meaningful comparison with historical financial results. The Company's management and board of directors utilize these non-GAAP financial measures, together with the Company's financial statements prepared in accordance with GAAP, in developing operating budgets and evaluating the Company's performance. These non-GAAP financial measures are intended to supplement GAAP financial information, and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. Refer to the accompanying tables for a detailed reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Earnings Conference Call and Webcast

Bridgepoint Education will host a conference call at 5:00 p.m. ET (2:00 p.m. PT) today to discuss its latest financial results and recent highlights. The dial-in number for callers in the United States / Canada is 866-859-7412, and the dial-in number for other callers is 832-900-4623. The access code for all callers is 97526740. A live broadcast of the call will also be available on the Company's website at http://ir.bridgepointeducation.com.

A replay of the call will be available via telephone through June 2, 2016. To access the replay, callers in the United States / Canada should dial 855-859-2056 and other callers should dial 404-537-3406, and enter the access code 97526740.

About Bridgepoint Education

Bridgepoint Education, Inc. (NYSE:BPI) harnesses the latest technology to reimagine the modern student experience. Bridgepoint owns two academic institutions - Ashford University and University of the Rockies. Together, these programs, technologies, and resources represent a unique model for advancing education in the 21st century. Bridgepoint stands for greater access, social learning, and exposure to leading minds. For more information, visit www.bridgepointeducation.com or www.facebook.com/BridgepointEducation.

Forward-Looking Statements

This news release may contain forward-looking statements, including, without limitation, statements regarding management's intentions, hopes, beliefs or expectations, and statements regarding the Company's outlook for 2016 and beyond. These forward-looking statements are subject to risks and uncertainties that could cause the Company's actual performance or results to differ materially from those expressed in or suggested by such statements. Such risks and uncertainties include, without limitation, the failure to comply with the extensive regulatory framework applicable to the Company and its institutions, adverse administrative, economic, legislative or regulatory changes affecting the Company and its 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, recruiting costs and tuition rates, reputational and other risks related to potential compliance audits, regulatory or legal actions, negative publicity or service disruptions, and the inability to recruit and retain students or develop new or expanded programs in a timely and cost-effective manner.

Additional information on factors that could affect the Company's performance or results is included from time to time in the Company's filings with the Securities and Exchange Commission (SEC), including, but not limited to, the Company's Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC, and the Company's quarterly reports on Form 10-Q and current reports on Form 8-K. You should not place undue reliance on any forward-looking statements.  Forward-looking statements are made on the basis of management's good faith beliefs, expectations and assumptions regarding future events based on information available at the time such statements are made.  Forward-looking statements speak only as of the date they are made. The Company assumes no obligation to update or revise any forward-looking statements to reflect actual results or any changes in assumptions, expectations or other factors affecting such forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable securities laws.

 


BRIDGEPOINT EDUCATION, INC.

Condensed Consolidated Statements of Income

(In thousands, except per share amounts)

(Unaudited)



Three Months Ended March 31,


2016


2015

Revenue

$

133,002



$

142,518


Costs and expenses:




Instructional costs and services

69,586



75,049


Admissions advisory and marketing

51,677



52,347


General and administrative

13,455



16,322


Legal accrual

13,874




Restructuring and impairment charges

709




Total costs and expenses

149,301



143,718


Operating loss

(16,299)



(1,200)


Other income, net

683



689


Loss before income taxes

(15,616)



(511)


Income tax benefit

(5,504)



(140)


Net loss

$

(10,112)



$

(371)


Loss per share:




Basic

$

(0.22)



$

(0.01)


Diluted

(0.22)



(0.01)


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




Basic

45,933



45,428


Diluted

45,933



45,428



BRIDGEPOINT EDUCATION, INC.

Condensed Consolidated Balance Sheets

(In thousands)

(Unaudited)



March 31,
 2016


December 31,
 2015

ASSETS




Current assets:




Cash and cash equivalents

$

243,120



$

282,145


Restricted cash

21,439



24,685


Investments

37,243



19,387


Accounts receivable, net

34,179



24,091


Student loans receivable, net

726



775


Prepaid expenses and other current assets

42,027



52,192


Total current assets

378,734



403,275


Property and equipment, net

19,568



21,742


Investments

50,056



47,770


Student loans receivable, net

7,147



7,394


Goodwill and intangibles, net

20,210



21,265


Other long-term assets

5,162



5,320


Total assets

$

480,877



$

506,766


LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Accounts payable and accrued liabilities

$

70,810



$

79,196


Deferred revenue and student deposits

82,379



88,756


Total current liabilities

153,189



167,952


Rent liability

17,842



20,118


Other long-term liabilities

14,974



15,046


Total liabilities

186,005



203,116


Total stockholders' equity

294,872



303,650


Total liabilities and stockholders' equity

$

480,877



$

506,766


 

BRIDGEPOINT EDUCATION, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)



Three Months Ended March 31,


2016


2015

Cash flows from operating activities:




Net loss

$

(10,112)



$

(371)


Adjustments to reconcile net loss to net cash (used in) provided by operating activities:




    Provision for bad debts

9,619



8,396


    Depreciation and amortization

3,729



5,345


    Amortization of premium/discount

(51)



19


    Stock-based compensation

2,298



2,245


    Excess tax benefit of option exercises

(336)



(231)


    Loss on impairment of student loans receivable

141



359


    Net (gain) loss on marketable securities

(19)



34


    Loss on impairment of fixed assets



163


Changes in operating assets and liabilities:




    Restricted cash

3,298



5,716


    Accounts receivable

(19,633)



(17,931)


    Prepaid expenses and other current assets

(5,336)



360


    Student loans receivable

320



260


    Other long-term assets

157



(185)


    Accounts payable and accrued liabilities

7,470



10,270


    Deferred revenue and student deposits

(6,367)



(5,313)


    Other liabilities

(2,348)



(1,748)


   Net cash (used in) provided by operating activities

(17,170)



7,388


Cash flows from investing activities:




Capital expenditures

(291)



(1,626)


Purchases of investments

(20,156)



(142)


Non-operating restricted cash

(52)



12


Capitalized costs for intangible assets

(227)



(592)


Sales of investments



10,101


Maturities of investments



20,000


   Net cash (used in) provided by investing activities

(20,726)



27,753


Cash flows from financing activities:




Proceeds from exercise of stock options

138



127


Excess tax benefit of option exercises

336



231


Tax withholdings on issuance of stock awards

(1,603)



(1,225)


   Net cash used in financing activities

(1,129)



(867)


Net (decrease) increase in cash and cash equivalents

(39,025)



34,274


Cash and cash equivalents at beginning of period

282,145



207,003


Cash and cash equivalents at end of period

$

243,120



$

241,277


 

BRIDGEPOINT EDUCATION, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share amounts)

(Unaudited)



Three Months Ended March 31,


2016


2015

Operating Loss Reconciliation:




GAAP operating loss

$

(16,299)



$

(1,200)


Legal accrual

13,874




Restructuring and impairment charges

709




Non-GAAP operating loss

$

(1,716)



$

(1,200)










Net Loss Reconciliation:




GAAP net loss

$

(10,112)



$

(371)


Legal accrual

13,874




Restructuring and impairment charges

709




Income tax expense impact

(5,406)




Non-GAAP net loss

$

(935)



$

(371)










Diluted Loss Per Share Reconciliation:




GAAP diluted loss per share

$

(0.22)



$

(0.01)


Legal accrual

0.30




Restructuring and impairment charges

0.02




Income tax expense impact

(0.12)




Non-GAAP diluted loss per share

$

(0.02)



$

(0.01)


 

Contact: Kevin Royal, Chief Financial Officer
866.475.0317 x11120
investorrelations@bridgepointeducation.com

Logo - http://photos.prnewswire.com/prnh/20140912/145861

 

SOURCE Bridgepoint Education

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