Universal Technical (UTI) Tops Q1 Earnings Estimates, View Up
Universal Technical Institute, Inc. UTI reported impressive first-quarter fiscal 2024 results. Quarterly earnings and revenues surpassed the Zacks Consensus Estimate. On a year-over-year basis, the top and the bottom line increased impressively.
The company outperformed its financial expectations in the first quarter, advancing its growth, diversification and optimization strategy. It reported strong year-over-year new student start growth in UTI and Concorde segments. The firm made progress with launching and ramping up new programs. The company is optimistic about its fiscal 2024 performance with a solid multi-divisional foundation and ability to deliver on expectations.
UTI shares jumped 3.74% in the after-hours trading session on Feb 7, following its earnings release. The company also raised its fiscal 2024 guidance. This might have boosted Investors’ sentiments.
Inside the Numbers
Adjusted earnings of 17 cents per share topped the consensus mark of 6 cents by 183.3% and rose significantly from the year-ago quarter’s level of 2 cents.
Quarterly revenues of $174.7 million topped the consensus mark of $168.2 million by 3.9% and increased 45.6% from the prior-year quarter’s figure. The upside was mainly attributable to the growth in UTI new student starts and the inclusion of Concorde for a full quarter.
Universal Technical Institute Inc Price, Consensus and EPS Surprise
Universal Technical Institute Inc price-consensus-eps-surprise-chart | Universal Technical Institute Inc Quote
Total new student starts totaled 4,346, up 89.4% from 2,295 students reported a year ago.
Adjusted EBITDA was $24.5 million, up from $14.4 million reported a year ago.
Segment Highlights
UTI: Revenues from the segment rose 9.3% to $115.4 million year over year. New student starts totaled 2,314, up 17.2% from a year ago. Adjusted EBITDA was $21.6 million, up from $20.2 million reported a year ago.
Concorde: Revenues from the segment were $59.3 million during the reported period compared with $14.4 million a year ago. New student starts came in at 2,032. Adjusted EBITDA in the segment totaled $8.8 million.
Financial Details
At the end of first-quarter fiscal 2024, the company had cash and cash equivalents of $143.6 million compared with $151.5 million at fiscal 2023-end.
Long-term debt is now $159 million, slightly down from $159.6 million at the end of the fiscal 2023.
For the first three months of fiscal 2024, cash provided by operating activities totaled $10.8 million compared with $2.8 million in the year-ago period.
Adjusted free cash flow in the quarter was $10.2 million compared with $2.6 million a year ago.
Fiscal 2024 Guidance Raised
Universal Technical expects new student starts in the 24,500-25,500 range, suggesting an increase of 11% from fiscal 2023 levels, considering the mid-point.
Fiscal 2024 revenues are projected in the range of $710-$720 million, up from the prior estimate of $705-$715 million. The expected figure indicates an increase of 17.7% from the previous year’s levels.
Net income is projected in the range of $36-$40 million, up from the prior estimate of $34-$38 million. The company reported net income of 12.3 million in the previous year.
It expects adjusted EBITDA in the range of $100-$103 million, up from the prior estimate of $98-$102 million. The projected figure indicated a rise of 58.1% year over year. Adjusted free cash flow is expected between $62 million and $66 million (up 30%).
Adjusted earnings in the range of 67-72 cents per share, up from the prior estimate of 53-58 cents per share. The company reported an adjusted earnings per share of 13 cents in the prior year.
Zacks Rank
Universal Technical currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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