American Public Education, Inc. APEI delivered fourth-quarter adjusted earnings of 42 cents per share which missed the Zacks Consensus Estimate of 44 cents by 4.5%. Adjusted earnings also declined 30% year over year due to declining revenues.
Revenues and Enrollment
Total revenue of $78.6 million missed the Zacks Consensus Estimate of $81 million by 2.9%. Revenues also decreased 8.5% year over year owing to declining revenues at both American Public University System (“APUS”) and Hondros College of Nursing.
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American Public University System: Revenues dropped 9.1% to $71.1 million from $78.1 million in the prior-year period due to a decrease in net course registrations.
Net course registrations at APUS fell 10% from the prior-year period. This was primarily due to a decrease in net course registrations by new students using Federal Student Aid (“FSA”) and military tuition assistance (“TA”).
Net course registrations by new students declined 29%, while net course registrations by returning students decreased 7%, both on a year-over-year basis.
Net course registrations of new students using FSA plunged 46%. The downside may be attributed to the company’s efforts to improve its quality mix of students, adjustments to its marketing efforts and increasing competition for online students.
Completion rates of undergraduate students using FSA at APUS increased approximately 19% year over year.
Net course registrations using TA was down 19%, largely due to changes in the TA program by the Department of Defense.
New enrollment of students using veteran benefits slipped 3%, while enrollment of students using cash and other sources declined 10%, both on a year-over-year basis.
Hondros College of Nursing: Revenues at fell 2.5% to $7.5 million from $7.7 million in the prior-year quarter. This was mainly due to lower enrollment trends.
Total enrollment at the Hondros College Nursing Programs declined approximately 13% year over year to 1,710 students, while new student enrollment increased approximately 1% year over year. This marks the first year-over-year enrollment increase.
Inside the Headline Numbers
Operating income plunged 28% to $11.3 million.
Costs and expenses decreased 4% year over year to $67.4 million in the quarter.
Selling and promotional or S&P as a percentage of revenues increased to 18.4%, from 17.7% in the prior-year period. This is due to S&P costs decreasing at a rate lower than the decline in revenues.
American Public Education, Inc. Price, Consensus and EPS Surprise
American Public Education, Inc. Price, Consensus and EPS Surprise | American Public Education, Inc. Quote