Perdoceo Education Corp (PRDO) Reports Mixed 2023 Financial Results
Annual Revenue: Increased by 2.1% to $710.0 million, with CTU segment up by 11.8%.
Operating Income: Grew 16.1% to $150.4 million for the full year; Q4 operating income fell by 29.7%.
Earnings Per Share: Full year EPS rose to $2.18 from $1.39; Q4 EPS increased to $0.26 from $0.23.
Student Enrollments: CTU enrollments up by 3.2%, while AIUS saw a 39.3% decrease.
Dividend: Board declared a Q4 dividend of $0.11 per share, payable on March 15, 2024.
Stock Repurchase: New program authorizes up to $50.0 million in stock repurchases, starting March 1, 2024.
Cash Position: Ended the year with $604.2 million in cash and investments, an increase from $518.2 million.
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On February 21, 2024, Perdoceo Education Corp (NASDAQ:PRDO) released its 8-K filing, detailing its financial performance for the fourth quarter and full fiscal year of 2023. The company, known for its online educational institutions, including the American InterContinental University and Colorado Technical University, reported a mixed set of results with annual revenue growth offset by a decline in the fourth quarter.
Annual and Quarterly Performance
For the full year, PRDO saw a revenue increase to $710.0 million, a 2.1% rise, bolstered by an 11.8% increase in revenue from the Colorado Technical University (CTU) segment. Operating income for the year improved significantly by 16.1% to $150.4 million, and earnings per diluted share jumped to $2.18 from $1.39 in the previous year. Adjusted operating income and adjusted earnings per diluted share also saw increases of 6.7% and 28.8%, respectively.
However, the fourth quarter painted a different picture, with revenue declining by 16.0% to $147.9 million, primarily due to enrollment reductions at the American InterContinental University System (AIUS). Operating income for the quarter also decreased by 29.7% to $15.9 million, and adjusted operating income fell by 40.2% to $19.4 million. Despite these declines, earnings per diluted share for the quarter increased to $0.26 from $0.23 in the prior year's quarter.
Enrollment Dynamics
Enrollment trends showed a divergent pattern, with CTU's total student enrollments increasing by 3.2%, while AIUS experienced a significant decrease of 39.3%. The company attributed the decline at AIUS to short-term operational changes that impacted year-end total student enrollments.
Capital Allocation and Cash Flow
PRDO's board of directors declared a quarterly dividend of $0.11 per share, underscoring the company's commitment to returning value to shareholders. Additionally, a new stock repurchase program was approved, authorizing the company to buy back up to $50.0 million of its common stock through September 30, 2025.
Net cash provided by operating activities for the quarter was $13.2 million, a decrease from the prior year's quarter, and capital expenditures were down by 54.2%. The company ended the year with a strong cash position, with $604.2 million in cash, cash equivalents, restricted cash, and short-term investments, an increase from the previous year's total of $518.2 million.
Looking Ahead
Perdoceo Education Corp's management expressed confidence in their strategic investments in student support and technology, which are expected to enhance student retention and academic outcomes. The company's financial outlook for 2024 includes assumptions of consistent student interest and retention trends, no significant regulatory impacts, and an effective income tax rate of approximately 25.5% for the first quarter and 26% for the full year.
Investors and analysts are encouraged to review the full 8-K filing for a detailed understanding of PRDO's financial performance and future prospects. The company will also be hosting a conference call to discuss these results and provide further insights into its 2024 outlook.
For more detailed information and analysis on Perdoceo Education Corp's performance and future outlook, value investors and interested parties are invited to visit GuruFocus.com.
Explore the complete 8-K earnings release (here) from Perdoceo Education Corp for further details.
This article first appeared on GuruFocus.
