Corinthian Shares Drop on Quarterly LossMonday, August 20, 2012
Santa Ana-based Corinthian Colleges Inc. reported a $6.5 million loss for the latest quarter, a swing from a year-earlier profit of $3.4 million.
Shares of the for-profit educator slumped 11% during morning hours, to a market value of $208.7 million.
Quarterly revenue dropped 3% to $394.8 million from the same time a year ago. Analysts on average had expected $403.2 million.
Corinthian’s fiscal fourth-quarter loss was attributed in part to “a loss from discontinued operations of $14.8 million,” according to the company.
It would have notched an adjusted profit of $8.6 million had it not been for the chunk of one-time charges, the company said.
Corinthian’s current-quarter projections point to a profit of between $2.6 million and $4.3 million on revenue in the $395 million to $405 million range.
Corinthian operates 116 campuses of Everest, Heald and WyoTech colleges in the U.S. and Canada. It also offers online degrees. Its market value reached $1.6 billion a few years ago, before increased scrutiny over student loans at for-profit school operators led to stricter federal lending standards that pinched enrollments.
Corinthian has sold about a dozen campuses in recent months, and did a sale-leaseback deal for five Heald facilities.
Chief Executive Jack Massimino said the company has “reduced operating expenses to align with our lower student population and [taken] steps to close or sell nine underperforming campuses.”
Student population totaled 91,460 at the end of June, up 1% from a year earlier. The number of new students was 25,839, up more than 8%.
“The increase [in the rate of new student enrollment] is the result of several factors, including growth at the Everest ground schools, continued growth at Everest University Online, and an easier comparable to the fourth quarter of last year,” Massimino said.
The company expects new student growth to stay flat for the current quarter.
Separately, Corinthian has signed a new lease for its Santa Ana headquarters, a 163,734-square-foot lease at Griffin Towers off the Costa Mesa (55) Freeway.
Corinthian has been based in Griffin Towers for over a decade, but was said to be eyeing other locations in the area for a potential relocation.
Terms of the lease were not immediately disclosed. The new deal appears to be a slight reduction in space for Corinthian, which employs about 800 people in OC. See more details in the Aug. 20 print edition of the Orange County Business Journal.