UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One) | |
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the quarterly period ended | |
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or | |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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For the transition period from _____ to _____ | |
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Commission File Number: |
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
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(Address of principal executive offices) | (Zip Code) |
(
(Registrant’s telephone number; including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
þ | Accelerated filer | ☐ | ||
Non-accelerated filer | ◻ | Smaller reporting company | ||
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| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of October 23, 2024, there were
Adtalem Global Education Inc.
Form 10-Q
Table of Contents
| Page | |
Item 1. | 1 | |
1 | ||
2 | ||
3 | ||
4 | ||
5 | ||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 27 |
Item 3. | 41 | |
Item 4. | 42 | |
Item 1. | 42 | |
Item 1A. | 42 | |
Item 2. | 42 | |
Item 5. | 43 | |
Item 6. | 43 | |
44 |
Part I. Financial Information
Item 1. Financial Statements
Adtalem Global Education Inc.
Consolidated Balance Sheets
(unaudited)
(in thousands, except par value)
September 30, | June 30, | |||||
2024 | 2024 | |||||
Assets: | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | | $ | | ||
Restricted cash |
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Accounts and financing receivables, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Noncurrent assets: |
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Property and equipment, net | | | ||||
Operating lease assets |
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Deferred income taxes |
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Intangible assets, net |
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Goodwill |
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Other assets, net |
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Assets held for sale | | | ||||
Total noncurrent assets |
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Total assets | $ | | $ | | ||
Liabilities and shareholders' equity: |
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Current liabilities: |
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Accounts payable | $ | | $ | | ||
Accrued payroll and benefits |
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Accrued liabilities |
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Deferred revenue |
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Current operating lease liabilities |
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Total current liabilities |
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Noncurrent liabilities: |
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Long-term debt |
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Long-term operating lease liabilities |
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Deferred income taxes |
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Other liabilities |
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Total noncurrent liabilities |
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Total liabilities |
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Commitments and contingencies |
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Shareholders' equity: |
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Common stock, $ |
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Additional paid-in capital |
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Retained earnings |
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Accumulated other comprehensive loss |
| ( |
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Treasury stock, at cost, |
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Total shareholders' equity |
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Total liabilities and shareholders' equity | $ | | $ | |
See accompanying Notes to Consolidated Financial Statements.
1
Adtalem Global Education Inc.
Consolidated Statements of Income
(unaudited)
(in thousands, except per share data)
Three Months Ended | ||||||
September 30, | ||||||
2024 | 2023 | |||||
Revenue | $ | | $ | | ||
Operating cost and expense: |
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Cost of educational services |
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Student services and administrative expense |
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Restructuring expense |
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Business integration expense |
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Total operating cost and expense |
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Operating income |
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Interest expense |
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Other income, net |
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Income from continuing operations before income taxes |
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Provision for income taxes |
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Income from continuing operations |
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Discontinued operations: |
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Loss from discontinued operations before income taxes |
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Benefit from income taxes |
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Loss from discontinued operations |
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Net income and comprehensive income | $ | | $ | | ||
Earnings (loss) per share: |
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Basic: |
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Continuing operations | $ | | $ | | ||
Discontinued operations | $ | ( | $ | ( | ||
Total basic earnings per share | $ | | $ | | ||
Diluted: |
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Continuing operations | $ | | $ | | ||
Discontinued operations | $ | ( | $ | ( | ||
Total diluted earnings per share | $ | | $ | | ||
Weighted-average shares outstanding: | ||||||
Basic shares | | | ||||
Diluted shares | | |
See accompanying Notes to Consolidated Financial Statements.
2
Adtalem Global Education Inc.
Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
Three Months Ended | ||||||
September 30, | ||||||
2024 | 2023 | |||||
Operating activities: | ||||||
Net income | $ | | $ | | ||
Loss from discontinued operations |
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Income from continuing operations | | | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
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Stock-based compensation |
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Amortization and impairments to operating lease assets | | | ||||
Depreciation |
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Amortization of acquired intangible assets |
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Amortization of debt discount and issuance costs | | | ||||
Provision for bad debts | | | ||||
Deferred income taxes |
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Loss on disposals of property and equipment |
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(Gain) loss on investments | ( | | ||||
Changes in assets and liabilities: |
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Accounts and financing receivables |
| ( |
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Prepaid expenses and other current assets |
| ( |
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Cloud computing implementation assets |
| ( |
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Accounts payable |
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Accrued payroll and benefits | ( | ( | ||||
Accrued liabilities |
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Deferred revenue |
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Operating lease liabilities | ( | ( | ||||
Other assets and liabilities |
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Net cash provided by operating activities-continuing operations |
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Net cash (used in) provided by operating activities-discontinued operations |
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Net cash provided by operating activities |
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Investing activities: |
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Capital expenditures |
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Proceeds from sales of marketable securities |
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Purchases of marketable securities |
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Net cash used in investing activities |
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Financing activities: |
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Proceeds from exercise of stock options |
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Employee taxes paid on withholding shares |
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Proceeds from stock issued under Colleague Stock Purchase Plan |
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Repurchases of common stock for treasury |
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Proceeds from issuance of long-term debt |
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Repayments of long-term debt |
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Net cash used in financing activities |
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Net increase (decrease) in cash, cash equivalents and restricted cash |
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Cash, cash equivalents and restricted cash at beginning of period |
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Cash, cash equivalents and restricted cash at end of period | $ | | $ | | ||
Non-cash investing and financing activities: | ||||||
Accrued capital expenditures | $ | | $ | | ||
Accrued liability for repurchases of common stock | $ | | $ | | ||
Accrued excise tax on share repurchases | $ | | $ | |
See accompanying Notes to Consolidated Financial Statements.
3
Adtalem Global Education Inc.
Consolidated Statements of Shareholders’ Equity
(unaudited)
(in thousands)
Accumulated | ||||||||||||||||||||||||
Additional | Other | |||||||||||||||||||||||
Common Stock | Paid-In | Retained | Comprehensive | Treasury Stock | ||||||||||||||||||||
Shares | Amount | Capital | Earnings | Loss | Shares | Amount | Total | |||||||||||||||||
June 30, 2023 | | $ | | $ | | $ | | $ | ( | | $ | ( | $ | | ||||||||||
Net income |
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Stock-based compensation |
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Net activity from stock-based compensation awards |
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Proceeds from stock issued under Colleague Stock Purchase Plan | ( | ( | ( | | | |||||||||||||||||||
Repurchases of common stock for treasury | | ( | ( | |||||||||||||||||||||
September 30, 2023 | | $ | | $ | | $ | | $ | ( | | $ | ( | $ | | ||||||||||
June 30, 2024 | | $ | | $ | | $ | | $ | ( | | $ | ( | $ | | ||||||||||
Net income |
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Stock-based compensation |
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Net activity from stock-based compensation awards |
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Proceeds from stock issued under Colleague Stock Purchase Plan |
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Repurchases of common stock for treasury | | ( | ( | |||||||||||||||||||||
September 30, 2024 | | $ | | $ | | $ | | $ | ( | | $ | ( | $ | |
See accompanying Notes to Consolidated Financial Statements.
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5
1. Nature of Operations
In this Quarterly Report on Form 10-Q, Adtalem Global Education Inc., together with its subsidiaries, is collectively referred to as “Adtalem,” “we,” “our,” “us,” or similar references. Adtalem reports on a fiscal year period ending on June 30. Therefore, this Quarterly Report for the quarterly period ended September 30, 2024 is for our first quarter of fiscal year 2025.
Adtalem is the leading healthcare educator in the U.S. Our schools consist of Chamberlain University (“Chamberlain”), Walden University (“Walden”), American University of the Caribbean School of Medicine (“AUC”), Ross University School of Medicine (“RUSM”), and Ross University School of Veterinary Medicine (“RUSVM”). AUC, RUSM, and RUSVM are collectively referred to as the “medical and veterinary schools.” “Home Office” includes activities not allocated to a reportable segment. See Note 18 “Segment Information” for information on our reportable segments.
2. Summary of Significant Accounting Policies
Basis of Presentation
Our significant accounting policies are described in Note 2 “Summary of Significant Accounting Policies” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024. We have prepared the accompanying unaudited consolidated financial statements in accordance with U.S generally accepted accounting principles (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (which are normal and recurring in nature) considered necessary for a fair presentation have been included. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. We use the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations. Unless indicated, or the context requires otherwise, references to years refer to Adtalem’s fiscal years. Certain items presented in tables may not sum due to rounding. Prior period amounts have been revised to conform with the current period presentation. These consolidated financial statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.
Business integration expense was $
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Recent Accounting Standards
In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07: “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” The guidance was issued to improve disclosures about reportable segments and addresses requests from investors for additional, more detailed information about a reportable segment’s expenses by requiring entities to provide disclosures of significant segment expenses and other segment items. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. The amendments should be applied retrospectively. Early adoption of the amendments is permitted, including adoption in an interim period. The amendments will impact our segment disclosures but will not otherwise impact Adtalem’s Consolidated Financial Statements.
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In December 2023, the FASB issued ASU No. 2023-09: “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The guidance was issued to enhance the transparency and decision usefulness of income tax disclosures by requiring entities to provide additional information in the rate reconciliation and additional disclosures about income taxes paid. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2024. The amendments should be applied prospectively, however retrospective application is permitted. Early adoption of the amendments is permitted. The amendments will impact our income tax disclosures but will not otherwise impact Adtalem’s Consolidated Financial Statements.
We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our Consolidated Financial Statements.
Revision to Previously Issued Financial Statements
During the fourth quarter of fiscal year 2024, Adtalem identified an error in the presentation of capitalized cloud computing implementation costs in its previously issued financial statements. In accordance with Accounting Standards Codification (“ASC”) 350-40 “Intangibles, Goodwill and Other, Internal-Use Software,” capitalized cloud computing implementation costs should be presented in the same line item on the Consolidated Balance Sheets as a prepayment of the fees for the associated hosting arrangement, and the cash flows from capitalized implementation costs should be presented in the same manner as cash flows for the fees associated with the hosting arrangement. Adtalem previously presented capitalized cloud implementation costs in property and equipment, net rather than as prepaid expenses and other current assets and other assets, net on the Consolidated Balance Sheets. Adtalem previously presented the cash flows from capitalized implementation costs as capital expenditures within investing activities rather than within cash flows from operating activities in the Consolidated Statements of Cash Flows. Adtalem assessed the materiality of this error individually and in the aggregate with other previously identified errors to prior periods’ Consolidated Financial Statements in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 99 “Materiality” and SAB 108 “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” codified in ASC 250 “Accounting Changes and Error Corrections.” Adtalem concluded that the error was not material to prior periods and therefore, amendments of previously filed reports are not required. However, Adtalem determined it was appropriate to revise its previously issued financial statements. In accordance with ASC 250, Adtalem corrected the prior period presented herein by revising the financial statement line item amounts previously disclosed in SEC filings in order to achieve comparability in the Consolidated Financial Statements. The impact of this revision on Adtalem’s previously reported Consolidated Financial Statements are detailed below. We have also revised impacted amounts within the accompanying Notes to Consolidated Financial Statements.
The following table summarizes the effect of the revisions on the affected line items within the Consolidated Statements of Cash Flows (in thousands):
Three Months Ended September 30, 2023 | |||||||||
As Reported | Adjustment | As Revised | |||||||
Operating activities: | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation | $ | | $ | ( | $ | | |||
Changes in assets and liabilities: | |||||||||
Cloud computing implementation assets | — | ( | ( | ||||||
Accounts payable | ( | | ( | ||||||
Net cash provided by operating activities-continuing operations | | ( | | ||||||
Net cash provided by operating activities | | ( | | ||||||
Investing activities: | |||||||||
Capital expenditures | ( | | ( | ||||||
Net cash used in investing activities-continuing operations | ( | | ( | ||||||
Net cash used in investing activities | ( | | ( | ||||||
Non-cash investing and financing activities: | |||||||||
Accrued capital expenditures | | ( | |
3. Discontinued Operations
On December 11, 2018, Adtalem completed the sale of DeVry University to Cogswell Education, LLC (“Cogswell”) for de minimis consideration. As the sale represented a strategic shift that had a major effect on Adtalem’s operations and
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financial results, DeVry University is presented in Adtalem’s Consolidated Financial Statements as a discontinued operation. The purchase agreement includes an earn-out entitling Adtalem to payments of up to $
The following is a summary of income statement information reported as discontinued operations, which includes expense from ongoing litigation costs and settlements related to the DeVry University and Carrington College divestitures (in thousands):
Three Months Ended | ||||||
September 30, | ||||||
2024 | 2023 | |||||
Revenue | $ | | $ | | ||
Operating cost and expense: |
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Student services and administrative expense |
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Total operating cost and expense |
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Loss from discontinued operations before income taxes | ( | ( | ||||
Benefit from income taxes |
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Loss from discontinued operations | $ | ( | $ | ( |
4. Revenue
Revenue is recognized when control of the promised goods or services is transferred to our customers (students), in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
The following tables disaggregate revenue by source (in thousands):
Three Months Ended September 30, 2024 | ||||||||||||
Chamberlain | Walden |
| Medical and | Consolidated | ||||||||
Tuition and fees |
| $ | |
| $ | |
| $ | |
| $ | |
Other | | | | | ||||||||
Total |
| $ | |
| $ | |
| $ | |
| $ | |
Three Months Ended September 30, 2023 | ||||||||||||
Chamberlain | Walden |
| Medical and | Consolidated | ||||||||
Tuition and fees | $ | |
| $ | |
| $ | |
| $ | | |
Other | | | | | ||||||||
Total |
| $ | |
| $ | |
| $ | |
| $ | |
In addition, see Note 18 “Segment Information” for a disaggregation of revenue by geographical region.
Performance Obligations and Revenue Recognition
Tuition and fees: The majority of revenue is derived from tuition and fees, which is recognized on a straight-line basis over the academic term as instruction is delivered.
Other: Other revenue consists of housing and other miscellaneous services. Other revenue is recognized over the period in which the applicable performance obligation is satisfied.
Arrangements for payment are agreed to prior to registration of the student’s first academic term. The majority of U.S. students obtain Title IV or other financial aid resulting in institutions receiving a significant amount of the transaction price at the beginning of the academic term. Students not utilizing Title IV or other financial aid funding may pay after the academic term is complete.
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Transaction Price
Revenue, or transaction price, is measured as the amount of consideration expected to be received in exchange for transferring goods or services.
Students may receive scholarships, discounts, or refunds, which gives rise to variable consideration. The amounts of scholarships or discounts are generally applied to individual student accounts when such amounts are awarded. Therefore, the transaction price is immediately reduced directly by these scholarships or discounts from the amount of the standard tuition rate charged. Scholarships and discounts that are only applied to future tuition charged are considered a separate performance obligation if they represent a material right in accordance with ASC 606. In those instances, we defer the value of the related performance obligation associated with the future scholarship or discount based on estimates of future redemption based on our historical experience of student persistence toward completion of study. The contract liability associated with these material rights is presented as deferred revenue within current liabilities and other liabilities within noncurrent liabilities on the Consolidated Balance Sheets based on the amounts expected to be redeemed in the next 12 months. The contract liability amount associated with these material rights within current liabilities is $
Upon withdrawal, a student may be eligible to receive a refund, or partial refund, the amount of which is dependent on the timing of the withdrawal during the academic term. If a student withdraws prior to completing an academic term, federal and state regulations and accreditation criteria permit Adtalem to retain a set percentage of the total tuition received from such student, which varies with, but generally equals or exceeds, the percentage of the academic term completed by such student. Payment amounts received by Adtalem in excess of such set percentages of tuition are refunded to the student or the appropriate funding source. For contracts with similar characteristics and historical data on refunds, the expected value method is applied in determining the variable consideration related to refunds. Estimates of Adtalem’s expected refunds are determined at the outset of each academic term, based upon actual refunds in previous academic terms. Reserves related to refunds are presented as refund liabilities within accrued liabilities on the Consolidated Balance Sheets. All refunds are netted against revenue during the applicable academic term.
Management reassesses collectability on a student-by-student basis throughout the period revenue is recognized. This reassessment is based upon new information and changes in facts and circumstances relevant to a student’s ability to pay. Management also reassesses collectability when a student withdraws from the institution and has unpaid tuition charges. Such unpaid charges do not meet the threshold of reasonably collectible and are recognized as revenue on a cash basis.
Contract Balances
Students are billed at the beginning of each academic term and payment is due at that time. Adtalem’s performance obligation is to provide educational services in the form of instruction during the academic term and to provide for any scholarships or discounts that are deemed a material right under ASC 606. As instruction is provided or the deferred value of material rights are redeemed, deferred revenue is reduced. A significant portion of student payments are from Title IV financial aid and other programs and are generally received during the first month of the respective academic term. For students utilizing Adtalem’s credit extension programs (see Note 9 “Accounts and Financing Receivables”), payments are generally received after the academic term, and the corresponding performance obligation, is complete. When payments are received, accounts and financing receivables are reduced.
Deferred revenue within current liabilities is $
The difference between the opening and closing balances of deferred revenue includes decreases from revenue recognized during the period, increases from charges related to the start of academic terms beginning during the period,
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increases from payments received related to academic terms commencing after the end of the period, and increases from recognizing additional performance obligations for material rights during the period.
5. Restructuring Expense
During the three months ended September 30, 2024, Adtalem recorded restructuring expense primarily driven by workforce reductions, costs to exit certain course offerings, and prior real estate consolidations at Adtalem’s home office. We continue to incur restructuring charges or reversals related to exited leased space from previous restructuring actions. During the three months ended September 30, 2023, Adtalem recorded restructuring expense primarily driven by prior real estate consolidations at Adtalem’s home office. When estimating costs of exiting lease space, estimates are made which could differ materially from actual results and may result in additional restructuring charges or reversals in future periods. Termination benefit charges represent severance pay and benefits for employees impacted by workforce reductions.
Three Months Ended September 30, 2024 | |||||||||
Real Estate | Termination | Total | |||||||
Chamberlain | $ | |
| $ | |
| $ | | |
Medical and Veterinary | |
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Home Office | |
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Total | $ | | $ | | $ | |
Three Months Ended September 30, 2023 | |||||||||
Real Estate | Termination | Total | |||||||
Medical and Veterinary | $ | |
| $ | |
| $ | | |
Home Office | |
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Total | $ | | $ | | $ | |
The following table summarizes the separation and restructuring plan activity for fiscal years 2024 and 2025, for which cash payments are required (in thousands):
Liability balance as of June 30, 2023 | $ | | |
Increase in liability (separation and other charges) |
| | |
Reduction in liability (payments and adjustments) |
| ( | |
Liability balance as of June 30, 2024 |
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Increase in liability (separation and other charges) |
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Reduction in liability (payments and adjustments) |
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Liability balance as of September 30, 2024 | $ | |
These liability balances are recorded as accrued liabilities on the Consolidated Balance Sheets.
6. Other Income, Net
Other income, net consisted of the following (in thousands):
Three Months Ended | ||||||
September 30, | ||||||
2024 | 2023 | |||||
Interest and dividend income | $ | | $ | | ||
Investment gain (loss) | | ( | ||||
Other income, net | $ | | $ | |
Investment gain (loss) includes trading gains and losses related to the rabbi trust used to fund nonqualified deferred compensation plan obligations.
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7. Income Taxes
Our effective tax rates from continuing operations were
RUSM and RUSVM each have agreements with their respective domestic governments that exempt them from local income taxation. RUSM has an exemption in Barbados until 2039 and RUSVM has an exemption in St. Kitts until 2038.
8. Earnings per Share
The following table sets forth the computations of basic and diluted earnings per share and antidilutive shares (in thousands, except per share data):
Three Months Ended | ||||||
September 30, | ||||||
2024 | 2023 | |||||
Numerator: | ||||||
Net income (loss): |
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Continuing operations | $ | | $ | | ||
Discontinued operations | ( | ( | ||||
Net income | $ | | $ | | ||
Denominator: | ||||||
Weighted-average basic shares outstanding |
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Effect of dilutive stock awards |
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Weighted-average diluted shares outstanding |
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Earnings (loss) per share: | ||||||
Basic: | ||||||
Continuing operations | $ | | $ | | ||
Discontinued operations | $ | ( | $ | ( | ||
Total basic earnings per share | $ | | $ | | ||
Diluted: | ||||||
Continuing operations | $ | | $ | | ||
Discontinued operations | $ | ( | $ | ( | ||
Total diluted earnings per share | $ | | $ | | ||
Weighted-average antidilutive shares | — | |
9. Accounts and Financing Receivables
Our accounts receivables relate to student balances occurring in the normal course of business. Accounts receivables have a term of less than one year and are included in accounts and financing receivables, net on our Consolidated Balance Sheets. Our financing receivables relate to credit extension programs where the student is provided payment terms in excess of one year with their respective school and are included in accounts and financing receivables, net and other assets, net on our Consolidated Balance Sheets.
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The classification of our accounts and financing receivable balances was as follows (in thousands):
September 30, 2024 | |||||||||
Gross | Allowance | Net | |||||||
Accounts receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, current | | ( | | ||||||
Accounts and financing receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, noncurrent | | ( | | ||||||
Total financing receivables | $ | | $ | ( | $ | |
June 30, 2024 | |||||||||
Gross | Allowance | Net | |||||||
Accounts receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, current | | ( | | ||||||
Accounts and financing receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, current | $ | | $ | ( | $ | | |||
Financing receivables, noncurrent | | ( | | ||||||
Total financing receivables | $ | | $ | ( | $ | |
Our financing receivables relate to credit extension programs available to students at Chamberlain, AUC, RUSM, and RUSVM. These credit extension programs are designed to assist students who are unable to completely cover educational costs consisting of tuition, fees, and books, and are available only after all other student financial assistance has been applied toward those purposes. In addition, AUC, RUSM, and RUSVM allow students to finance their living expenses. Repayment plans for financing agreements are developed to address the financial circumstances of the particular student. Interest charges at rates from
Credit Quality
The primary credit quality indicator for our financing receivables is delinquency. Balances are considered delinquent when contractual payments on the loan become past due. We write-off financing receivable balances when they are at least 181 days past due. Payments are applied first to outstanding interest and then to the unpaid principal balance.
The credit quality analysis of financing receivables as of September 30, 2024 was as follow