Apollo Group, Inc. Reports Fiscal 2003 Fourth Quarter and Year End Results.Business Editors PHOENIX--(BUSINESS WIRE)--Oct. 7, 2003 Apollo Group Apollo Group, Inc. NASDAQ: APOL is an S&P 500 corporation based in Phoenix, Arizona. Apollo Group, Inc., through its subsidiaries, provides higher education to working adults. , Inc. today reported fiscal 2003 financial results for Apollo Apollo (əpŏl`ō), in Greek religion and mythology, one of the most important Olympian gods, concerned especially with prophecy, medicine, music and poetry, archery, and various bucolic arts, particularly the care of flocks and herds. Education Group (Nasdaq:APOL APOL Asia Pacific Online APOL Alternate Person on Line ) and University of Phoenix Online (Nasdaq:UOPX UOPX University of Phoenix ) for the fourth quarter and year ended August 31, 2003. Net income attributed to Apollo Education Group for the year ended August 31, 2003 was $231.7 million, or $1.30 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to $153.2 million, or $.87 per diluted share, reported for the same period last year. Net income attributed to University of Phoenix Online for the year ended August 31, 2003, was $15.3 million, or $.93 per diluted share, compared to $8.0 million or $.53 per diluted share, reported for the same period last year. Net income attributed to Apollo Education Group for the three months ended August 31, 2003 was $65.5 million, or $.37 per diluted share, compared to $46.6 million, or $.26 per diluted share, reported for the same period last year. Net income attributed to University of Phoenix Online for the three months ended August 31, 2003, was $4.9 million, or $.29 per diluted share, compared to $2.7 million or $.18 per diluted share, reported for the same period last year. Todd S Todd , Sir Alexander Robertus 1907-1997. British chemist. He won a 1957 Nobel Prize for his study of nucleic acids and nucleotide structures. . Nelson, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "We are pleased to report that we have reached a milestone “Milemarker” redirects here. For the American indie rock band, see Milemarker (band). A milestone or kilometre sign is one of a series of numbered markers placed along a road at regular intervals, typically at the side of the road or in a median. in enrollment by breaking the 200,000 mark. During the fourth quarter, we opened four campuses located in Westborough Westborough, town (1990 pop. 14,133), Worcester co., E central Mass., on the Assabet River; inc. 1717. The town, which is largely residential, produces electronic components, tools, dyes, and other products. , MA; Charlotte, NC; Columbus Columbus. 1 City (1990 pop. 178,681), seat of Muscogee co., W Ga., at the head of navigation on the Chattahoochee River; settled and inc. 1828 on the site of a Creek village. , GA; and Indianapolis Indianapolis (ĭn'dēənă`pəlĭs), city (1990 pop. 731,327), state capital and seat of Marion co., central Ind., on the White River; selected 1820 as the site of the state capital (which was moved there in 1825), inc. 1847. , IN. We also opened 3 new learning centers during the last quarter; two for the University of Phoenix in Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. and Houston Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; , TX and one for the Institute for Professional Development in Costa Mesa Costa Mesa (kŏs`tə mā`sə), city (1990 pop. 96,357), Orange co., S Calif., on the Pacific south of Santa Ana; inc. 1953. It is a transportation, residential, and light industrial center. , CA." Total consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: revenues for Apollo Group, Inc. for the year ended August 31, 2003 rose 32.7% to $1.340 billion, compared with $1.009 billion for the same period last year. The University of Phoenix accounted for 94.6% of the $1.261 billion in net tuition For tuition fees in the United Kingdom, see . Tuition means instruction, teaching or a fee charged for educational instruction especially at a formal institution of learning or by a private tutor usually in the form of one-to-one tuition. revenues from students enrolled in degree programs for the year ended August 31, 2003. Total revenues for University of Phoenix Online for the year ended August 31, 2003 rose 61.7% to $529.6 million, compared with $327.5 million for the same period last year. Total consolidated revenues for Apollo Group, Inc. for the three months ended August 31, 2003 rose 31.5% to $371.3 million, compared with $282.3 million in the fourth quarter of fiscal 2002. The University of Phoenix accounted for 95.1% of the $349.8 million in net tuition revenues from students enrolled in degree programs for the three months ended August 31, 2003. Total revenues for University of Phoenix Online for the three months ended August 31, 2003 rose 56.7 % to $156.6 million, compared with $99.9 million in the fourth quarter of fiscal 2002. Consolidated net income for Apollo Group, Inc. for the year ended August 31, 2003 increased 53.3% to $247.0 million, compared to $161.2 million for the same period last year. Net income for University of Phoenix Online for the year ended August 31, 2003 increased 71.6% to $110.5 million, compared to $64.4 million for the same period last year. Consolidated net income for Apollo Group, Inc. for the three months ended August 31, 2003 increased 42.8% to $70.4 million, compared to $49.3 million for the same period last year. Net income for University of Phoenix Online for the three months ended August 31, 2003 increased 63.6% to $34.5 million, compared to $21.1 million for the same period last year. Net cash provided by operating activities for Apollo Group, Inc. for the year ended August 31, 2003 was $343.0 million, compared to $260.5 million for the year ended August 31, 2002. Net additions to property and equipment for Apollo Group, Inc. for the year ended August 31, 2003 were $55.8 million, compared to $36.7 million for the year ended August 31, 2002. Net cash provided by operating activities for Apollo Group, Inc. for the three months ended August 31, 2003 was $94.4 million, compared to $79.2 million for the three months ended August 31, 2002. Net additions to property and equipment for Apollo Group, Inc. for the three months ended August 31, 2003 were $14.7 million, compared to $9.0 million for the three months ended August 31, 2002. Consolidated degree enrollments for all of the Apollo Group, Inc. institutions at August 31, 2003 increased by 26.8% to 200,100 students compared to 157,800 students at August 31, 2002. Degree enrollments at The University of Phoenix (excluding University of Phoenix Online) were 95,600 students at August 31, 2003 compared to 84,300 students at August 31, 2002 representing a 13.4% increase. Degree enrollments for University of Phoenix Online at August 31, 2003 increased by 60.8% to 79,400 students compared to 49,400 students at August 31, 2002. Business Outlook Apollo Group, Inc. -- We expect revenue for the quarter ending November November: see month. 30, 2003 to be between $392 million and $395 million and to be between $1.731 billion and $1.734 billion for fiscal 2004. -- Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: is expected to be between 30.0% and 30.5% for the quarter ending November 30, 2003 and to be between 29.5% and 30.0% for fiscal 2004. University of Phoenix Online -- We expect revenue for the quarter ending November 30, 2003 to be between $165 million and $166 million and to be between $793 million and $794 million for fiscal 2004. -- Operating margin is expected to be between 32.5 % and 33.0% for the quarter ending November 30, 2003 and to be between 34.0% and 34.5% for fiscal 2004. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of attributed to Apollo Education Group are expected to be $.39 for the quarter ending November 30, 2003 and to be $1.64 for fiscal 2004. Diluted earnings per share attributed to University of Phoenix Online are expected to be $.27 for the quarter ending November 30, 2003 and to be $1.30 for fiscal 2004. Based on lead flow, we expect degree enrollments at The University of Phoenix (excluding University of Phoenix Online) to continue to grow between 12% and 14% over the prior year at the end of the first quarter of fiscal 2004. We expect University of Phoenix Online degree enrollments to continue to grow 50% over the prior year at the end of the first quarter of fiscal 2004. The company will hold a conference call to discuss these earnings results at 11:00 AM Eastern time, 8:00 AM Phoenix time, on Tuesday Tuesday: see week. , October October: see month. 7, 2003. The call may be accessed by dialing (877) 292-6888 (domestic) or (706) 634-1393 (internationally). The conference ID number is 2798396. A live webcast of this event may be accessed by visiting the company web site at: http://www.apollogrp.edu/Company_News. A replay of the call will be available on our website or at (706) 645-9291 (conf. ID #2798396) until October 31, 2003. Apollo Group, Inc. has been providing higher education higher education Study beyond the level of secondary education. Institutions of higher education include not only colleges and universities but also professional schools in such fields as law, theology, medicine, business, music, and art. programs to working adults for over 25 years. Apollo Group, Inc., operates through its subsidiaries The University of Phoenix, Inc., Institute for Professional Development, The College for Financial Planning Financial planning Evaluating the investing and financing options available to a firm. Planning includes attempting to make optimal decisions, projecting the consequences of these decisions for the firm in the form of a financial plan, and then comparing future performance against Institutes Corporation, and Western International University, Inc. The consolidated enrollment in its educational programs makes it the largest private institution of higher education in the United States Higher education in the United States refers to colleges and universities within the United States. Overview The American university system, like the American educational system in general, is highly decentralized because the U.S. . It offers educational programs and services at 71 campuses and 121 learning centers in 37 states, Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. and Vancouver Vancouver, city, Canada Vancouver, city (1991 pop. 471,844), SW British Columbia, Canada, on Burrard Inlet of the Strait of Georgia, opposite Vancouver Island and just N of the Wash. border. , British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography . Combined degree enrollment was 200,052 students as of August 31, 2003. For more information about Apollo Group, Inc. and its subsidiaries, call (800) 990-APOL or visit Apollo on the World Wide Web at http://www.apollogrp.edu See .edu. (networking) edu - ("education") The top-level domain for educational establishments in the USA (and some other countries). E.g. "mit.edu". The UK equivalent is "ac.uk". . This press release includes statements that constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 (the "Reform Act"). Apollo Group, Inc. claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act. These forward-looking statements are often characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by the terms "may," "believes," "projects," "expects," or "anticipates," and do not reflect historical facts. Specific forward-looking statements contained in this press release relate, among other matters, to the business outlook of Apollo Group, Inc. and University of Phoenix Online. Forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of Apollo Group, Inc. and University of Phoenix Online to be materially different from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. Factors that could affect Apollo Group, Inc.'s or University of Phoenix Online's results and cause them to materially differ from those contained in the forward-looking statements include: -- the failure to maintain or renew required regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approvals, accreditation accreditation, n a process of formal recognition of a school or institution attesting to the required ability and performance in an area of education, training, or practice. or state authorizations; -- the failure to obtain authorizations from states in which University of Phoenix does not currently provide degree programs; -- the failure to obtain the Higher Learning higher learning n. Education or academic accomplishment at the college or university level. Commission's approval for University of Phoenix to operate in new states; -- any adverse changes in student enrollment; -- risk factors and cautionary statements made in Apollo Group, Inc.'s Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the period ended August 31, 2002; and -- other factors that Apollo Group is currently unable to identify or quantify Quantify - A performance analysis tool from Pure Software. , but may arise or become known in the future. These forward-looking statements are based on estimates, projections, beliefs, and assumptions of Apollo Group, Inc. and its management and speak only as of the date made and are not guarantees of future performance. Apollo Group, Inc. undertakes no obligation to publicly update or revise any forward-looking statements, or any facts, events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" that may bear upon forward-looking statements. You are advised, however, to consult any further disclosures Apollo Group, Inc. makes in its reports filed with the Securities and Exchange Commission.
APOLLO GROUP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL AND OPERATING DATA
(Dollars in thousands, except per share amounts)
For the Three Months For the Year Ended
Ended
August 31, August 31,
2003 2002 2003 2002
------------------------ --------------------------
Revenues:
Tuition and
other, net $371,273 $282,309 $1,339,517 $1,009,455
------------ ----------- ------------- ------------
Costs and expenses:
Instructional
costs and
services 168,243 133,152 612,940 498,454
Selling and
promotional 76,547 56,038 272,348 198,889
General and
administrative 17,106 15,013 66,970 58,260
------------ ----------- ------------- ------------
261,896 204,203 952,258 755,603
------------ ----------- ------------- ------------
Income from
operations 109,377 78,106 387,259 253,852
Interest income,
net 3,649 3,225 14,545 12,072
------------ ----------- ------------- ------------
Income before
income taxes 113,026 81,331 401,804 265,924
Provision for
income taxes 42,648 32,032 154,794 104,774
------------ ----------- ------------- ------------
Net income $70,378 $49,299 $247,010 $161,150
============ =========== ============= ============
Net income
attributed to:
Apollo Education
Group common stock $65,509 $46,562 $231,702 $153,161
============ =========== ============= ============
University of
Phoenix Online
common stock $4,869 $2,737 $15,308 $7,989
============ =========== ============= ============
Earnings per share
attributed to:
Apollo Education Group Common
Stock:
Diluted net income
per share $0.37 $0.26 $1.30 $0.87
============ =========== ============= ============
Diluted weighted
average shares
outstanding 178,426 176,401 177,637 175,697
============ =========== ============= ============
University of Phoenix Online
Common Stock:
Diluted net income
per share $0.29 $0.18 $0.93 $0.53
============ =========== ============= ============
Diluted weighted
average shares
outstanding 16,949 15,608 16,518 15,098
============ =========== ============= ============
At August 31,
2003 2002
------------------------
OPERATING DATA
Students enrolled
in degree programs 200,052 157,762
Number of
locations:
Campuses 71 65
Learning Centers 121 111
------------ -----------
192 176
APOLLO GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
August 31, August 31,
2003 2002
----------- -----------
Assets:
Current assets
Cash and cash equivalents $416,452 $295,237
Restricted cash 147,616 100,252
Marketable securities 235,962 214,547
Receivables, net 123,728 99,282
Deferred tax assets, net 9,098 7,415
Income taxes receivable 842
Other current assets 16,545 13,714
----------- -----------
Total current assets 950,243 730,447
Property and equipment, net 119,057 104,292
Marketable securities 245,772 78,619
Cost in excess of fair value of assets
purchased, net 37,096 37,096
Deferred tax assets, net 1,155 5,062
Other assets 24,881 24,126
----------- -----------
Total assets $1,378,204 $979,642
=========== ===========
Liabilities and Shareholders' Equity:
Current liabilities
Current portion of long-term liabilities $3,231 $7,510
Accounts payable 29,314 22,478
Accrued liabilities 49,525 39,855
Income taxes payable 7,974
Student deposits and current portion of
deferred tuition revenue 253,153 186,497
----------- -----------
Total current liabilities 335,223 264,314
Deferred tuition revenue, less current portion 942 827
Long-term liabilities, less current portion 15,114 15,508
----------- -----------
Total liabilities 351,279 280,649
----------- -----------
Commitments and contingencies
Shareholders' equity
Preferred stock, no par value, 1,000,000 shares
authorized; none issued
Apollo Education Group Class A nonvoting common
stock, no par value, 400,000,000 shares
authorized; 175,286,000 and 173,221,000
issued and outstanding at August 31, 2003
and August 31, 2002, respectively 103 103
Apollo Education Group Class B voting common
stock, no par value, 3,000,000 shares
authorized; 477,000 and 484,000 issued and
outstanding at August 31, 2003 and August
31, 2002, respectively 1 1
University of Phoenix Online nonvoting common
stock, no par value, 400,000,000 shares
authorized; 15,659,000 and 14,256,000 issued
and outstanding at August 31, 2003 and
August 31, 2002, respectively
Additional paid-in capital 293,650 227,155
Apollo Education Group Class A treasury stock,
at cost, 2,103,000 and 4,162,000 shares at
August 31, 2003 and August 31, 2002,
respectively (27,100) (46,029)
University of Phoenix Online treasury stock, at
cost, 86,000 and 24,000 shares at
August 31, 2003 and August 31, 2002,
respectively (4,601) (526)
Retained earnings 765,196 518,186
Accumulated other comprehensive income (loss) (324) 103
----------- -----------
Total shareholders' equity 1,026,925 698,993
----------- -----------
Total liabilities and shareholders' equity $1,378,204 $979,642
=========== ===========
APOLLO GROUP, INC. AND SUBSIDIARIES
DEGREE ENROLLMENTS
August 31,
2003 2002
------------------------
University of Phoenix:
Campuses established prior to August 1998 153,366 119,582
Campuses established after August 1998 21,573 14,078
------------- ----------
Total University of Phoenix 174,939 133,660
------------- ----------
Institute for Professional Development 22,348 21,724
Western International University 2,035 1,822
College for Financial Planning 730 556
------------- ----------
Total Degree Enrollment 200,052 157,762
============= ==========
UNIVERSITY OF PHOENIX ONLINE
SELECTED FINANCIAL DATA
(in thousands)
For the Three Months For the Year Ended
Ended
August 31, August 31,
2003 2002 2003 2002
-------------------------- -------------------
Revenues:
Tuition and other, net $156,594 $99,938 $529,580 $327,483
--------------- ---------- --------- ---------
Costs and expenses:
Instructional costs
and services 60,335 38,578 206,452 132,044
Selling and
promotional 34,005 21,991 119,857 73,755
General and
administrative 6,825 5,220 24,815 17,932
--------------- ---------- --------- ---------
101,165 65,789 351,124 223,731
--------------- ---------- --------- ---------
Income from operations 55,429 34,149 178,456 103,752
Interest income, net 1,168 813 4,430 3,126
--------------- ---------- --------- ---------
Income before income
taxes 56,597 34,962 182,886 106,878
Provision for income
taxes 22,145 13,897 72,408 42,484
--------------- ---------- --------- ---------
Net income $34,452 $21,065 $110,478 $64,394
=============== ========== ========= =========
This press release includes statements which may constitute forward-looking statements made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provision of the Private Securities Litigation Reform Act of 1995. This information may involve risk and uncertainties that could cause actual results to differ materially from the forward-looking statements. |
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