Press releases
View Concorde News Page

PHOENIX, Aug. 3, 2022 /PRNewswire/ -- Universal Technical Institute, Inc. (NYSE: UTI), a leading provider of transportation and technical training programs, reported financial results for the fiscal 2022 third quarter ended June 30, 2022.

• New student starts increased 25.0% from the prior year quarter and average undergraduate full-time active students increased 11.4%.
• Revenue increased 20.5% to $101.0 million versus the prior year quarter.
• Net income of $0.8 million, adjusted net income* of $5.7 million, and adjusted EBITDA* of $11.0 million, with the latter two increasing 71% and 53% versus the prior year quarter, respectively.

"We delivered another strong quarter with revenue and adjusted EBITDA exceeding our expectations," said Jerome Grant, UTI's Chief Executive Officer. "Several elements of our growth and diversification strategy, which is still in its early stages of deployment, contributed positively to our performance in the quarter, including the MIAT College of Technology acquisition and the opening of our new campus in Austin, TX."

Grant continued, "As always, our focus on delivering strong student and employment outcomes is central to everything we do at UTI. The need for our services across a broad array of in-demand fields in the transportation and skilled trades arenas supports our strategy of expanding our offerings into areas where the skills gap remains substantial. Our recent announcement to acquire Concorde Career Colleges, which will broaden our family of education brands into sizeable and growing healthcare fields like dental and other allied health professions, as well as patient care and nursing, fits perfectly with this strategy. In addition, we are opening our new campus in Miramar, FL this month and are executing on our plan for MIAT program expansions across the UTI campuses over the next two years. We remain focused and excited for the opportunities ahead of us and delivering on our longer-term strategic roadmap that we believe will result in revenue in excess of $700 million and adjusted EBITDA margin of approximately 20% by fiscal 2025. With our flexible and adaptable business model, we are prepared to navigate any nearer term challenges affecting the broader economic environment."

Financial Results for the Three-Month Period Ended June 30, 2022 Compared to 2021

• Revenues increased 20.5% to $101.0 million compared to $83.8 million primarily due to an increase in average undergraduate full-time active students and higher revenue earned per student, as well as the addition of MIAT.
• Operating expenses rose by 22.7% to $99.0 million, compared to $80.7 million. The increase was primarily due to the incremental cost of delivery associated with growth in the average student population, the inclusion of MIAT and ongoing one-time investments in support of our growth and diversification strategy.
• Operating income was $2.0 million compared to $3.1 million.
• Net income was $0.8 million compared to $3.0 million. Adjusted net income* was $5.7 million compared to $3.3 million.
• Basic and diluted (loss) income per share (EPS) were $(0.01) compared to $0.03.
• Adjusted EBITDA* was $11.0 million compared to $7.2 million.
• Average undergraduate full-time active students increased 11.4% driven by strong new student start growth in the quarter and the addition of MIAT.
• New student starts increased 25.0% in the period.

*See "Use of Non-GAAP Financial Information" below.

"We delivered 25% new student start growth in the quarter, which was in line with our expectations, as we benefited from multiple factors including increased MIAT starts, the first cohorts of students at our new Austin, TX campus, as well as benefits from start optimization efforts in our important high school channel," said UTI Chief Financial Officer, Troy Anderson. "Our strong financial results so far this year give us further confidence in meeting the growth we projected at the beginning of the fiscal year. We expect to come in towards the higher end of the guidance range for our key financial metrics, including revenue and adjusted EBITDA. Regarding new student start growth this year, we now expect full-year growth of low to mid-single digits, as our efforts to optimize high school starts will not offset pressure from macroeconomic factors we are seeing in our adult channel. That said, we are still seeing strong inquiry volumes and expect accelerated new student start growth in fiscal 2023 and beyond as we yield the benefits of our growth and diversification strategy."

Balance Sheet and Liquidity

At June 30, 2022, UTI's total available liquidity was $70.7 million. In April 2022, the Company completed the financing of the Lisle campus purchase via a new term loan of $38 million, with net proceeds of approximately $20 million after certain fees and the retirement of the existing debt that transferred with the acquired entity. Additionally, consistent with UTI's growth and diversification strategy, year-to-date capital expenditures, excluding the Lisle campus purchase, were $41.1 million driven primarily by the Austin, TX and Miramar, FL new campus build-outs, new welding programs, and the campus optimization initiatives, all of which will be mostly completed during fiscal 2022.  

Financial Results for the Nine-Month Period Ended June 30, 2022 Compared to 2021

• Revenues increased 29.7% to $308.1 million compared to $237.6 million. Similar to the three months ended, the increase is primarily due to higher average undergraduate full-time active students and higher revenue earned per student, as well as the addition of MIAT. Revenue per student in the prior year period was negatively impacted by the pace in which students were progressing through their programs due to the continuing effects of the pandemic.
• Operating expenses increased by 22.8% to $289.2 million, compared to $235.4 million. Similar to the three months ended, the increase was primarily due to the incremental cost of delivery associated with growth in the average student population, the inclusion of MIAT and ongoing investments in support of our growth and diversification strategy.
• Operating income was $18.9 million compared to $2.2 million.
• Net income was $23.0 million and includes an income tax benefit from the reversal of a majority of our valuation allowance during the current year, compared to a net income of $2.5 million. Adjusted net income* was $27.3 million compared to $3.6 million.
• Basic and diluted EPS were $0.36 and $0.35, respectively, compared to $(0.04).
• Adjusted EBITDA* was $41.8 million compared to $14.3 million.
• Operating cash flow provided $7.9 million compared to $14.8 million.
• Adjusted free cash flow* used cash of $3.0 million compared to providing cash of $5.0 million.
• Average undergraduate full-time active students increased 14.2% driven by strong new student starts throughout fiscal 2021 and the addition of MIAT.
• New student starts increased 7.9% in the period.

*See "Use of Non-GAAP Financial Information" below.

Student Metrics

For UTI's most recent investor presentation and quarterly financial supplement, please see its investor relations website at https://investor.uti.edu.

Updated Fiscal 2022 Financial Outlook

Conference Call

Management will hold a conference call to discuss the financial results for the fiscal 2022 third quarter ended June 30, 2022, on Wednesday, August 3, 2022, at 4:30 p.m. ET.

To participate in the live call, investors are invited to dial (844) 881-0138 (domestic) or (412) 317-6790 (international).  A live webcast of the call will be available via the Universal Technical Institute investor relations website at https://investor.uti.edu. Please go to the website at least 10 minutes early to register, download and install any necessary audio software. The conference call webcast will be archived for fourteen days at https://investor.uti.edu or the telephone replay can be accessed August 17, 2022, by dialing (877) 344-7529 (domestic) or (412) 317-0088 (international) and entering passcode 8868532.

Use of Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles ("GAAP"), UTI also discloses certain non-GAAP financial information in this press release and may similarly disclose non-GAAP financial information on the related conference call. These financial measures are not recognized measures under GAAP and are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.  UTI discloses these non-GAAP financial measures because it believes that they provide investors an additional analytical tool to clarify its results of operations and identify underlying trends. Additionally, UTI believes that these measures may also help investors compare its performance on a consistent basis across time periods. Additional details on our non-GAAP measures and the tables reconciling these measures to the most directly comparable GAAP measure are provided below.

Adjusted EBITDA

UTI defines adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation, amortization and adjusted for items not considered as part of the company's normal recurring operations.

Adjusted Free Cash Flow

UTI defines adjusted free cash flow as net cash provided by (used in) operating activities less capital expenditures, adjusted for items not considered as part of the company's normal recurring operations.

Adjusted Net Income (Loss)

UTI defines adjusted net income (loss) as net income (loss), adjusted for items that affect trends in underlying performance from year to year and are not considered normal recurring operations, including the income tax effect on the adjustments utilizing the effective tax rate.     

UTI discloses any campus adjustments as direct costs (net of any corporate allocations). Management utilizes adjusted figures as performance measures internally for operating decisions, strategic planning, annual budgeting and forecasting.  For the periods presented, this includes acquisition-related costs for both announced and potential acquisitions, integration costs for completed acquisitions, costs related to the purchase of our Lisle, Illinois and Avondale, Arizona campuses, start-up costs associated with the Austin, TX and Miramar, FL campus openings, lease accounting adjustments resulting from the purchase of our Lisle, Illinois campus and our campus consolidation efforts, the income tax benefit recorded as a result of the CARES Act, and severance expenses due to the CEO transition. To obtain a complete understanding of UTI's performance, these measures should be examined in connection with net income (loss) and net cash provided by (used in) operating activities, 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 ("SEC").  Because the items excluded from these non-GAAP measures are significant components in understanding and assessing UTI's financial performance under GAAP, these measures should not be considered to be an alternative to net income (loss) or net cash provided by (used in) operating activities as a measure of UTI's operating performance or liquidity.  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 define and calculate non-GAAP financial measures differently than UTI does, limiting their usefulness as a comparative measure across similarly titled performance measures presented by other companies. A reconciliation of the historical non-GAAP financial measures to the most directly comparable GAAP measures is provided below and investors are encouraged to review the reconciliations.

Forward Looking Statements

All statements contained in this press release and the related conference call, other than statements of historical fact, are "forward-looking" statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). These forward-looking statements which address UTI's expected future business and financial performance, may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will," the negative form of these expressions or similar expressions. Examples of forward-looking statements include, among others, statements regarding (1) UTI's expectation that it will meet its fiscal year 2022 guidance for new student start growth (decline), revenue growth, net income, adjusted net income, adjusted EBITDA, and adjusted free cash flow; (2) expectation that it will continue to expand its value proposition and build a business that can grow in low-to-mid single digits with potential upside, regardless of the economic environment; (3) UTI's expectation that it will succeed in new campus launches next year; and (4) UTI's expectation of the successful integration of the MIAT acquisition. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on UTI's current beliefs, expectations and assumptions regarding the future of its business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of UTI's control. UTI's actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could affect UTI's actual results include, among other things, impacts related to the COVID-19 pandemic, 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 modified campuses or instruction, potential increased competition, changes in demand for the programs UTI offers, increased investment in management and capital resources, failure to comply with the restrictive covenants and UTI's ability to pay the amounts when due under the Credit Agreement with Fifth Third Bank, the Credit Agreement with Valley National Bancorp, National Association, the effectiveness of UTI student recruiting, advertising and promotional efforts, changes to interest rates and unemployment, general economic and political conditions, the adoption of new accounting standards, and other risks that are described from time to time in UTI'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 SEC.  Any forward-looking statements made by UTI in this press release and the related conference call are based only on information currently available to UTI and speak only as of the date on which it is made.  UTI expressly disclaims any obligation to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, changes in expectations, any changes in events, conditions or circumstances, or otherwise.

Social Media Disclosure

Universal Technical Institute (UTI) uses its websites (https://www.uti.edu/ and https://investor.uti.edu/) and LinkedIn page (https://www.linkedin.com/school/universal-technical-institute/) as channels of distribution of information about its programs, its planned financial and other announcements, its attendance at upcoming investor and industry conferences, and other matters. Such information may be deemed material information, and UTI may use these channels to comply with its disclosure obligations under Regulation FD. Therefore, investors should monitor the company's website and its social media accounts in addition to following the company's press releases, SEC filings, public conference calls, and webcasts.

About Universal Technical Institute, Inc.

Founded in 1965 and headquartered in Phoenix, Universal Technical Institute's (NYSE: UTI) mission is to serve our students, partners, and communities by providing quality education and support services for in-demand careers. Approximately 250,000 students have graduated from one of UTI's 15 campuses located across Arizona, California, Florida, Illinois, Michigan, North Carolina, Pennsylvania, New Jersey, and Texas. UTI's campuses are accredited by the Accrediting Commission of Career Schools and Colleges (ACCSC), while its employer-aligned technical training programs are offered under four brands: Universal Technical Institute, Motorcycle Mechanics Institute / Marine Mechanics Institute, NASCAR Technical Institute, and MIAT College of Technology. For more information and a complete list of all programs offered, please visit www.uti.edu or follow on LinkedIn @UniversalTechnicalInstitute.

Company Contact:
Troy R. Anderson
Chief Financial Officer
Universal Technical Institute, Inc.
(623) 445-9365

Media Contact:
Mark Brenner
Vice President, Corporate Affairs & Communications
Universal Technical Institute, Inc.
(623) 445-0872

Investor Relations Contact:
Robert Winters
Alpha IR Group
(312) 445-2870
UTI@alpha-ir.com

SOURCE Universal Technical Institute, Inc.