Revenue Up 13 Straight Quarters; Microsoft Tie-ins Anchor It in Market
The stock market is still hot on tech infrastructure stocks, but with the tech labor market tight as a drum it’s also starting to pay attention to the teachers of the new economy.
Santa Ana-based New Horizons Computer Learning Centers Inc., which operates more than 250 training centers in 45 countries and trains more than 2.4 million students per year about high tech, has seen its stock nearly double this year.
“We’re performing pretty well,” said Thomas J. Bresnan, president and CEO of New Horizons. “People recognize that the education and training sector is a good place to invest.”
Corinthian Colleges, another Santa Ana-based education company that operates 43 colleges, has also seen its stock nearly triple in recent months, from a low of 16 in March to its current 41. And Bresnan pointed out that another education-related company, DeVry Inc., of Oakbrook Terrace, Ill., also has seen a run-up in its stock.
“There’s been a return to glory for the sector,” said Bresnan. “Over the years, there’s been a shakeout of companies that haven’t delivered results. The companies that have performed well are getting recognition.”
New Horizons is getting national recognition. The Sept. 4 issue of Fortune magazine ranked New Horizons No. 88 on its list of the 100 fastest growing companies in the United States. The magazine said that over the past three years, the company averaged annual growth of 48% in earnings per share and 40% in revenue and had a 38% annual return for stockholders.
According to Fortune, New Horizons “is bigger than the numbers suggest. If franchise operations are included, revenues totaled $435 million last year.”
Also this month, Microsoft tapped New Horizons as its “Big Day Partner.” New Horizons will be managing Microsoft’s series of more than 500 seminars targeted at small businesses in small communities throughout the United States. The free seminars will teach small businesses how to improve information management in business-to-business relationships, e-commerce, Web site development, hosting and Internet services.
New Horizons already trains more people on Microsoft products than any other entity in the world.
Bresnan said this latest deal won’t be a big money maker in itself, but could pay dividends later.
“It’s an effective way to leverage our net worth,” he said. “It introduces us to clients that we might not see otherwise.”
In its second-quarter earnings report, New Horizons posted a revenue increase of 31% to $36.6 million and a 28% earnings increase to $3.2 million,its 13th consecutive quarter of revenue and earnings growth. System-wide revenues, which include revenues for both company-owned and franchised training centers, totaled $136.4 million, up 24% from $109.9 million in the same period last year.
The International Data Corp. (IDC) recently ranked New Horizons as the third-largest IT training company in the world, behind IBM and Oracle. The study said the worldwide market for IT training was $19.4 billion in 1999, and New Horizons increased its worldwide market share to 2.2% last year, up from 2.1% in 1998.n
