Press releases
View Concorde News Page

SCOTTSDALE, Ariz., July 26, 2013 /PRNewswire/ -- Universal Technical Institute, Inc. (NYSE: UTI), the leading provider of automotive technician training, today reported revenues for the third quarter ended June 30, 2013 of $91.0 million, an 8.7 percent decrease from $99.6 million for the third quarter of the prior year.  Net income for the third quarter ended June 30, 2013 was $0.3 million, or 1 cent per diluted share, compared to $1.0 million, or 4 cents per diluted share, for the third quarter ended June 30, 2012. 

Revenues for the nine months ended June 30, 2013 were $284.5 million, an 8.9 percent decrease from $312.3 million for the nine months ended June 30, 2012. Net income for the nine months ended June 30, 2013 was $2.9 million, or 12 cents per diluted share, compared to $7.4 million, or 30 cents per diluted share, for the nine months ended June 30, 2012.

Return on equity for the trailing four quarters ended June 30, 2013 was 3.2 percent compared to 6.2 percent for the trailing four quarters ended Sept. 30, 2012.

"The renewed health of the transportation industry has increased demand for our graduates and made the value of a UTI education clear to potential students and their families.  Our new partnership with GM and the recent expansion of our Mercedes-Benz and Porsche programs are strong indicators of rising demand, and our third-quarter increase in applications tells us students are taking note,"  said Kim McWaters, chief executive officer. "UTI continues to be the industry's choice for providing highly trained technicians, and our focus remains on efficiently and cost-effectively making a UTI education accessible and affordable for more students."

Third Quarter Operating Performance

For the third quarter of 2013, revenues were $91.0 million, an 8.7 percent decrease from $99.6 million for last year's third quarter.  The decrease in revenues primarily related to a decrease in average undergraduate full-time student enrollment of 9.8 percent.  The decrease was partially offset by an increase in revenue per student.  During the third quarter of 2013 and 2012, tuition excluded $4.4 million and $3.8 million, respectively, related to students participating in the Company's proprietary loan program which will be recognized as revenues when payments are received.

Operating income and margin for the third quarter of 2013 were $0.5 million and 0.5 percent, respectively, compared to operating income and margin of $1.5 million and 1.5 percent, respectively, in the same period last year.  The decreases were primarily attributable to the decrease in revenues and was partially offset by decreases in compensation and advertising expense.  

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the third quarter of 2013 was $6.4 million compared to $7.6 million in the same period last year.  See "Use of Non-GAAP Financial Information" below.

Nine Month Operating Performance

Revenues for the nine months ended June 30, 2013 were $284.5 million, an 8.9 percent decrease from $312.3 million for the nine months ended June 30, 2012.

Operating income and margin for the nine months ended June 30, 2013 were $4.5 million and 1.6 percent, respectively, compared to $11.9 million and 3.8 percent, respectively, for the nine months ended June 30, 2012. The decreases in operating income and margin were related to the decrease in revenues, partially offset by decreases in compensation and advertising expense.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the nine months ended June 30, 2013 was $22.7 million compared to $31.0 million for the nine months ended June 30, 2012. See "Use of Non-GAAP Financial Information" below.

Liquidity

Cash, cash equivalents and investments totaled $87.4 million at June 30, 2013, compared to $101.7 million at Sept. 30, 2012.  At June 30, 2013, shareholders' equity totaled $140.4 million as compared to $146.1 million at Sept. 30, 2012.  We paid cash dividends of $0.10 per common share in December 2012, March 2013 and June 2013.   The aggregate payment was approximately $7.4 million. 

Pursuant to the previously announced share repurchase plan, we purchased 556,900 shares of stock during the nine months ended June 30, 2013 at an average price of $9.61 for a total cost of approximately $5.4 million.  During the three months ended June 30, 2013, we purchased an immaterial number of shares.

Cash flow used in operating activities was $2.2 million for the three months ended June 30, 2013, compared  to $6.3 million for the three months ended June 30, 2012.  Cash provided by operating activities was $5.4 million for the nine months ended June 30, 2013 compared to $9.2 million for the nine months ended June 30, 2012.

2013 Outlook

While we expect new student starts to be up in the fourth quarter of 2013, we anticipate full year new student starts for 2013 to be down by mid single digits compared to the prior year, resulting in a lower average student population for the year. These lower levels of enrollment will most likely result in a high single digit decline in revenue in 2013. While we expect significantly lower expenses in 2013, we still believe we will record an overall decline in operating margin and net income compared to 2012.  Due to the timing and number of student start dates in each of the next two quarters, we expect meaningful new student start growth during the fourth quarter and relatively flat year over year start growth in the first quarter of fiscal 2014 leading to positive start growth over the next six months.

Conference Call

Management will hold a conference call to discuss the 2013 third quarter results today at 8:00 a.m. PDT (11 a.m. EDT). This call can be accessed by dialing 412-858-4600 or 800-860-2442.  Investors are invited to listen to the call live at http://uti.investorroom.com/ .  Please access the website at least 15 minutes early to register, download and install any necessary audio software.  A replay of the call will be available on the Investor Relations section of UTI's website for 60 days or the replay can be accessed through August 5th, 2013 by dialing 412-317-0088 or 877-344-7529 and entering pass code 10031199.

Safe Harbor Statement

All statements contained herein, other than statements of historical fact, are "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933, as amended.  Such statements are based upon management's current expectations and are subject to a number of uncertainties that could cause actual performance and results to differ materially from the results discussed in the forward-looking statements.  Factors that could affect the Company's actual results include, among other things, changes to federal and state educational funding, changes to regulations or agency interpretation of such regulations affecting the for-profit education industry, possible failure or inability to obtain regulatory consents and certifications for new or expanding campuses, potential increased competition, changes in demand for the programs offered by UTI, increased investment in management and capital resources, the effectiveness of the recruiting, advertising and promotional efforts, changes to interest rates and unemployment, general economic conditions of the Company and other risks that are described from time to time in the Company's public filings.  Further information on these and other potential factors that could affect the financial results or condition may be found in the Company's filings with the Securities and Exchange Commission.  The forward-looking statements speak only as of the date of this press release.  Except as required by law, the Company expressly disclaims any obligation to publicly update any forward-looking statements whether as a result of new information, future events, changes in expectations, any changes in events, conditions or circumstances, or otherwise.

Use of Non-GAAP Financial Information

This press release and the related conference call contains non-GAAP (Generally Accepted Accounting Principles) financial measures, which are intended to supplement, but not substitute for, the most directly comparable GAAP measures. Management chooses to disclose to investors, these non-GAAP financial measures because they provide an additional analytical tool to clarify the results from operations and helps to identify underlying trends.  Additionally, such measures help compare the Company's performance on a consistent basis across time periods. To obtain a complete understanding of the Company's performance these measures should be examined in connection with net income, determined in accordance with GAAP, as presented in the financial statements and notes thereto included in the annual and quarterly filings with the Securities and Exchange Commission.  Since the items excluded from these measures are significant components in understanding and assessing financial performance under GAAP, these measures should not be considered to be an alternative to net income as a measure of the Company's operating performance or profitability.  Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may calculate non-GAAP financial measures differently than UTI does, limiting their usefulness as a comparative measure across companies.  A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures are included below. 

About Universal Technical Institute, Inc.

Headquartered in Scottsdale, Arizona, Universal Technical Institute, Inc. (NYSE: UTI) is the leading provider of post-secondary education for students seeking careers as professional automotive, diesel, collision repair, motorcycle and marine technicians.  With more than 170,000 graduates in its 48-year history, UTI offers undergraduate degree, diploma and certificate programs at 11 campuses across the United States, as well as manufacturer-specific training programs at dedicated training centers.  Through its campus-based school system, UTI provides specialized post-secondary education programs under the banner of several well-known brands, including Universal Technical Institute (UTI), Motorcycle Mechanics Institute and Marine Mechanics Institute (MMI) and NASCAR Technical Institute (NASCAR Tech).  For more information visit www.uti.edu .

(Tables Follow)

SOURCE Universal Technical Institute, Inc.