Capella Education Co. (NASDAQ:CPLA) Q4 2015 Earnings Conference Call - Final Transcript

Feb 11, 2016 • 09:00 am ET


Capella Education Co. (NASDAQ:CPLA) Q4 2015 Earnings Conference Call - Final Transcript


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Good morning. My name is Destiny, and I will be your conference operator today. At this time, I would like to welcome everyone to the Capella Education Company Fourth Quarter 2015 Earnings Call. All this time, all participants are in a listen-only mode. Please note, this call may be recorded. Thank you.

Heide Erickson, Director of Investor Relations, you may begin your conference.

Heide Erickson

Thank you, Destiny. And again, good morning, everyone. Welcome to our fourth quarter and year end conference call. Kevin Gilligan, Capella's Chairman and Chief Executive Officer; and Steve Polacek, Senior Vice President and Chief Financial Officer are here with us to discuss the fourth quarter and year end results.

Please note that this call may include forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risks and uncertainties. Although the company believes that the expectations reflected in such statements are based upon reasonable assumptions. The company's actual results could differ materially from those described in the forward-looking statements and are subject to uncertainties and risks, including those identified in the company's fourth quarter news release. These and other risk factors are discussed in the company's most recent 10-K and 10-Qs filed with the Securities and Exchange Commission. Other risks may be discussed in future 10-K and 10-Q filings. All filings and reconciliations of non-GAAP financial information presented in this call are available for viewing on our website at Following our prepared remarks, we'll take questions.

With that, I'd like to turn the call over to Kevin Gilligan. Kevin?

Kevin Gilligan

Thank you, Heide, and good morning, everyone. Thanks for joining us today. We have three key points we want to make today; first, 2015 was a solid year for Capella; second, our goal for 2016 is to deliver another year of new and total enrollment growth; and finally, we are positioning Capella for accelerated growth in 2017 and beyond by investing in FlexPath and by extending our unique competency-based learning and assessment capabilities into the non-degree space.

I'll start with a brief overview of our performance last year, discuss our expectations for 2016, and then focus the majority of my comments on the steps we are taking to position Capella for long-term, sustainable growth. 2015 was a solid year for Capella. We delivered positive new and total enrollment growth, and positive revenue growth in a tough market. 2015 was our fourth consecutive year of annual new enrollment growth, fourth consecutive year of early cohort persistence improvement and second consecutive year of total enrollment and revenue growth. While we didn't accomplish everything we set out to do last year, delivering consistent, positive growth on an annual basis in this environment demonstrates the strength of our differentiation and our ability to execute. This gives us confidence that the strategies we began implementing a few years ago are working.

Now, turning to this year, we have two major objectives. First, we want to maintain positive, new and