DeVry Inc. Reports Fiscal 2007 Third-Quarter Results, Enrollment at DeVry University, Ross University.
OAKBROOK TERRACE, Ill. -- DeVry Inc. (NYSE: DV), an international higher education company, reported today its financial results for the fiscal 2007 third quarter and the nine-month period ended March 31, 2007, and spring enrollment at DeVry University and Ross University.
Revenues for the third quarter of fiscal 2007 increased 12.5 percent to $247.8 million, compared to $220.2 million for the same quarter one year ago. For the nine-month period of fiscal 2007, revenues were up 12.6 percent to $706.0 million compared to $626.9 million last year.
Net income increased 46.2 percent for the quarter to $22.9 million, or $0.32 per fully diluted share, compared to $15.7 million, or $0.22 per fully diluted share, for the same period last year. For the first nine months of fiscal 2007, net income increased 92.8 percent to $60.2 million, or $0.85 per fully diluted share, compared to $31.2 million, or $0.44 per fully diluted share, for the first nine months of fiscal 2006. Net income in the first nine months of fiscal 2007 includes a gain on the sale of a DeVry University facility located in West Hills, Calif., of $11.8 million, net of tax, or $0.16 per share.
Third-quarter and nine-month results include a pre-tax gain of approximately $1.0 million for the sale of excess land in Tinley Park, Ill. The pre-tax gain was offset by a severance charge of $1.1 million pre-tax for the previously announced Voluntary Separation Plan for eligible DeVry University campus-based employees. The company expects charges related to this program in the fourth quarter of $2.6 million pre-tax.
Based on the results of the voluntary separation plan, today the company announced an involuntary workforce reduction that will affect approximately 145 employees at DeVry University campuses. The company expects to incur a charge of approximately $2.6 million related to severance charges from this involuntary reduction in the fourth quarter. Annual savings are expected to be approximately $10 million per year as a result of these voluntary and involuntary plans.
"We take these difficult decisions seriously and have endeavored to conduct these plans with respect for the individual," said Daniel Hamburger, president and chief executive officer. " In line with our strategic plan, we are focused on realigning our cost structure with our revenue streams and making investments to support high growth areas such as DeVry University Centers, online education, Ross University and Chamberlain College of Nursing."
At DeVry University, new undergraduate student enrollment in spring 2007 increased 6.9 percent to 11,075 students, compared to 10,359, in spring 2006. Total undergraduate student enrollment in spring 2007 increased 5.5 percent to 40,637 students, compared to 38,523 students in the previous year.
For the January 2007 session, the number of graduate coursetakers at Keller Graduate School of Management increased 10.9 percent to 15,278, compared to 13,776 coursetakers in January 2006. In the March 2007 session, graduate coursetakers increased 5.2 percent to 14,756 from 14,029 in the prior year.
The total number of online undergraduate and graduate coursetakers in spring 2007 increased 22.5 percent to 35,417, compared to 28,912 last year.
DeVry University opened a new location in San Jose, Calif., in March, and in April announced a new Master of Science in Educational Technology program, marking the first master's degree program that will be offered solely under the DeVry University brand.
At Ross University, new students increased 28.2 percent to 496 in the January 2007 term, compared to 387 in the same term last year. Total students increased 14.8 percent to 3,747, compared to 3,264 last year.
As a result of continued demand for accounting and finance professionals, DeVry's professional and training segment once again experienced strong results in the third quarter, with revenue increasing almost 17 percent over last year.
Mr. Hamburger added, "As a result of our efforts to optimize our core business, we continued to show year-over-year improvement in spring enrollment results. We are pleased with these overall results and will continue to implement our multi-year plan to improve enrollment at our campuses."
In November 2006, the company adopted a stock repurchase program which allows for the repurchase of up to $35 million of its common stock within the next two years. During the quarter, the company purchased approximately 194,000 shares of DeVry common stock for approximately $5.3 million.
DeVry further reduced its outstanding debt during the quarter, ending the fiscal 2007 third quarter with no debt and cash of $135.8 million, as illustrated in the accompanying Chart 1.
DeVry Inc. will hold a conference call to discuss its fiscal 2007 third-quarter and spring enrollment results on April 26, 2007, at 3:30 p.m. Central Time (4:30 p.m. Eastern Time). The conference call will be led by Daniel Hamburger, president and chief executive officer, and Rick Gunst, chief financial officer.
For those wishing to participate by telephone, dial 866-203-3436 (domestic) or 617-213-8849 (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, or http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=93880& eventID=1425756. (Due to the length of this URL, it may be necessary to copy and paste this hyperlink into your Internet browser's URL address field. You may also need to remove an extra space in the URL if one exists.) 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 May 10, 2007. To access the replay, dial 888-286-8010 (domestic) or 617-801-6888 (international), passcode 72244859. To access the Webcast replay, please visit the company's Web site, or http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c= 93880&eventID=1425756. (Due to the length of this URL, it may be necessary to copy and paste this hyperlink into your Internet browser's URL address field. You may also need to remove an extra space in the URL if one exists.)
About DeVry Inc.
DeVry Inc. (NYSE: DV) is the holding company for DeVry University, Ross University, Chamberlain College of Nursing and Becker Professional Review. DeVry University, which includes Keller Graduate School of Management, offers associate, bachelor's and master's degree programs in technology, healthcare technology, business and management. Ross University offers doctoral degree programs through its schools of Medicine and Veterinary Medicine. Chamberlain College of Nursing offers associate and bachelor's degree programs in nursing. Becker Professional Review, which includes Stalla CFA Review, provides preparatory coursework for the certified public accountant and chartered financial analyst exams, and continuing professional education. DeVry Inc. is based in Oakbrook Terrace, Ill. For more information about the company, visit http://www.devryinc.com.
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1The term "coursetaker" refers to the number of courses taken by a student. Thus one student taking two courses is counted as two coursetakers.
2 Graduates who actively pursued employment or who were already employed when they graduated and held positions in their chosen fields within six months of graduation.
The following table illustrates the effects of the gain on the sales of the West Hills facility and excess Tinley Park land and the separation plan severance on the company's earnings. The non-GAAP disclosure of earnings is not preferable to GAAP net income but is shown as a supplement to such disclosure for comparability to the year-ago three- and nine-month periods ended March 31 (in thousands, except per share data):
Certain statements contained in this release concerning DeVry's future performance, including those statements concerning DeVry's expectations or plans, may constitute forward-looking statements subject to the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as DeVry Inc. or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Actual results may differ materially from those projected or implied by these forward-looking statements. Potential risks, uncertainties and other factors that could cause results to differ are described more fully in Item 1A, "Risk Factors," in the Company's most recent Annual Report on Form 10-K for the year ending June 30, 2006 and filed with the Securities and Exchange Commission on September 13, 2006.
[Financial Statements to follow]
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