Adtalem Global Education Inc. (NYSE:ATGE) Q2 2019 Earnings Conference Call Transcript

Feb 07, 2019 • 05:00 pm ET


Adtalem Global Education Inc. (NYSE:ATGE) Q2 2019 Earnings Conference Call Transcript


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Greetings, and welcome to the Adtalem Second Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation.

(Operator Instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Mr. Chaka Patterson, Vice President and Deputy General Counsel. Thank you. Please begin.

Chaka Patterson

Thank you and good afternoon. With me today from Adtalem's leadership team are Lisa Wardell, President and Chief Executive Officer and Patrick Unzicker, Chief Financial Officer and Treasurer.

I'd like to remind you that this conference call will contain forward-looking statements which are based on the expectations, estimates, and projections of management as of today. The forward-looking statements in our discussion are subject to various assumptions, risks, uncertainties, and other factors that are difficult to predict which could cause actual results to differ materially from those expressed or implied in these statements.

These statements are not guarantees of future performance and therefore undue reliance should not be placed upon them. We refer you to our Annual Report on Form 10-K for the year ended June 30th, 2018 and other recent filings with the SEC for a more detailed discussion of the risks that could impact our future operating results and financial condition. We disclaim any intentions or obligations to update or revise any forward-looking statements except as required by law.

During today's call, we will refer to non-GAAP financial measures, which are intended to supplement, though not substitute for, our most directly comparable GAAP measures. Our press release, which contains the financial and other quantitative information to be discussed today, as well as a reconciliation of non-GAAP to GAAP measures, is also available on our website.

Telephone and webcast replays of today's call are available for 30 days. To access the replays, please refer to today's release.

And with that, I'd now turn the call over to Lisa.

Lisa W. Wardell

Good afternoon, and thank you for joining our second quarter fiscal 2019 earnings call. During the quarter, we delivered growing enrollments in our medical and healthcare segment and strong results in our professional education segment, driven by the refreshed product differentiation in the Becker business and continued growth in ACAMS.

Through our January 2019 term, Adtalem new student enrollment increased 4.9% while total student enrollment increased 2.9% from the prior year. Compared to the prior year period, second quarter 2019 revenue increased nearly 3% and operating income increased approximately 17%, aided largely by a one-time benefit from insurance proceeds related to hurricanes Irma and Maria.

Excluding the one-time insurance benefit and other special items, operating income decreased by about 5%, in line with our expectations. Further, we achieved several major milestones in the quarter, including the successful completion of the DeVry University and Carrington College transfers of ownership, as well as the permanent relocation of the Ross University School of Medicine to Barbados.

These initiatives required tremendous energy from the entire team. And with their successful conclusion, we are