|K12 Inc. Reports First Quarter Fiscal 2018 with Revenue of $228.8 Million|
Financial Highlights for the Three Months Ended
To supplement our financial statements presented in accordance with
Generally Accepted Accounting Principles (GAAP), we are also presenting
adjusted operating income (loss) and adjusted EBITDA. Management
believes that these additional metrics provide useful information to our
investors as an indicator of performance because they exclude non-cash
stock-based compensation expenses. Non-GAAP Financial Highlights for the
Three Months Ended
Comments from Management
“The growth in our managed public school business underscores the demand
we see for online and blended school options across the country” said
Capital expenditures for the three months ended
Revenue and Enrollment Data
The Company’s revenues are generally in three categories -- Managed Public School Programs (where K12 provides substantially all management, technology and academic support services in addition to curriculum, learning systems and instructional services), Institutional (Non-managed Public School Programs – curriculum, technology and other educational services where K12 does not provide primary administrative oversight, and Institutional Software and Services – educational software and services provided to school districts, public schools and other educational institutions), and Private Pay Schools and Other (private schools for which it charges student tuition and makes direct consumer sales) – The following table sets forth the Company’s revenues for the periods indicated:
The following table sets forth average enrollment data for the periods indicated. These figures exclude enrollments from classroom pilot programs and consumer programs.
Revenue per Enrollment Data
The following table sets forth revenue per average enrollment data for students in Public School Programs for the periods indicated.
The Company is forecasting the following for the full year, fiscal 2018:
The Company is forecasting the following for the second quarter, fiscal 2018:
Special Note on Forward-Looking Statements
This press release contains certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. We
have tried, whenever possible, to identify these forward-looking
statements using words such as “anticipates,” “believes,” “estimates,”
“continues,” “likely,” “may,” “opportunity,” “potential,” “projects,”
“will,” “expects,” “plans,” “intends” and similar expressions to
identify forward looking statements, whether in the negative or the
affirmative. These statements reflect our current beliefs and are based
upon information currently available to us. Accordingly, such
forward-looking statements involve known and unknown risks,
uncertainties and other factors which could cause our actual results,
performance or achievements to differ materially from those expressed
in, or implied by, such statements. These risks, uncertainties, factors
and contingencies include, but are not limited to: reduction of per
pupil funding amounts at the schools we serve; inability to achieve
sufficient levels of new enrollments to sustain or to grow our business
model; failure of the schools we serve to comply with regulations
resulting in a loss of funding, an obligation to repay funds previously
received or contractual remedies; declines or variations in academic
performance outcomes as curriculum and testing standards evolve; harm to
our reputation resulting from poor performance or misconduct by
operators or us in any school in our industry and in any school in which
we operate; legal and regulatory challenges from opponents of virtual
public education, public charter schools or for-profit education
companies; discrepancies in interpretation of legislation by regulatory
agencies that may lead to payment or funding disputes; termination of
our contracts with schools due to a loss of authorizing charter; failure
to enter into new school contracts or renew existing contracts, in part
or in their entirety; unsuccessful integration of mergers, acquisitions
and joint ventures; failure to further develop, maintain and enhance our
technology, products, services and brands; inadequate recruiting,
training and retention of effective teachers and employees; infringement
of our intellectual property; entry of new competitors with
superior competitive technologies and lower prices; disruptions to our
Internet-based learning and delivery systems resulting from
cyber-attacks; and other risks and uncertainties associated with our
business described in the Company’s filings with the
The Company will discuss its first quarter fiscal year 2018 financial
results during a conference call scheduled for
The conference call will be webcast and available at http://public.viavid.com/index.php?id=126720. Please access the web site at least 15 minutes prior to the start of the call.
To participate in the live call, investors and analysts should dial
(877) 407-4019 (domestic) or (201) 689-8337 (international) at
A replay of the call will be available starting on
The financial statements set forth below are not the complete set of K12
Inc.’s financial statements for the three months ended
Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), we have presented adjusted operating income (loss) and adjusted EBITDA. These measures are not measurements recognized under GAAP.
This information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. Management believes that the presentation of these non-GAAP measures provides useful information to investors regarding our results of operations because it is an indicator of performance with the removal of stock-based compensation which assists both investors and management in analyzing and benchmarking the performance and value of our business.
We believe adjusted EBITDA is useful to an investor in evaluating our operating performance because it is both widely used to measure a company's operating performance without regard to items such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets, and to present a meaningful measure of corporate performance exclusive of our capital structure and the method by which assets were acquired.
Our management uses adjusted EBITDA and adjusted operating income (loss):
Other companies may define these non-GAAP measures differently and, as a result, our use of these non-GAAP measures may not be directly comparable to adjusted EBITDA, and adjusted operating income (loss) used by other companies. Although we use these non-GAAP measures as financial measures to assess the performance of our business, the use of non-GAAP measures is limited as they include and/or do not include certain items not included and/or included in the most directly comparable GAAP measure.
Adjusted EBITDA and adjusted operating income (loss) should be considered in addition to, and not as a substitute for, income or loss from operations, net income or loss, and earnings or loss per share prepared in accordance with GAAP as a measure of performance. Adjusted EBITDA is not intended to be a measure of liquidity. You are cautioned not to place undue reliance on these non-GAAP measures.
A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below.