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Delaware
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86-0226984
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer Identification No.)
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Page
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Number
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PART I.
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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June 30, 2014
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September 30, 2013
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||||
Assets
|
|
(In thousands)
|
||||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
25,129
|
|
|
$
|
35,657
|
|
Restricted cash
|
|
2,737
|
|
|
5,748
|
|
||
Investments, current
|
|
48,143
|
|
|
57,531
|
|
||
Receivables, net
|
|
7,750
|
|
|
11,406
|
|
||
Deferred tax assets, net
|
|
5,984
|
|
|
7,452
|
|
||
Prepaid expenses and other current assets
|
|
17,604
|
|
|
15,553
|
|
||
Total current assets
|
|
107,347
|
|
|
133,347
|
|
||
Investments, less current
|
|
17,797
|
|
|
4,188
|
|
||
Property and equipment, net
|
|
107,095
|
|
|
103,070
|
|
||
Goodwill
|
|
20,579
|
|
|
20,579
|
|
||
Deferred tax assets, net
|
|
11,868
|
|
|
8,835
|
|
||
Other assets
|
|
9,984
|
|
|
9,444
|
|
||
Total assets
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$
|
274,670
|
|
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$
|
279,463
|
|
Liabilities and Shareholders’ Equity
|
|
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|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable and accrued expenses
|
|
$
|
36,151
|
|
|
$
|
39,229
|
|
Deferred revenue
|
|
38,579
|
|
|
46,890
|
|
||
Accrued tool sets
|
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4,062
|
|
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3,971
|
|
||
Lease financing obligation, current
|
|
5,332
|
|
|
—
|
|
||
Income tax payable
|
|
1,086
|
|
|
79
|
|
||
Other current liabilities
|
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2,470
|
|
|
2,192
|
|
||
Total current liabilities
|
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87,680
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92,361
|
|
||
Deferred rent liability
|
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10,784
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|
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11,932
|
|
||
Lease financing obligation, less current
|
|
32,634
|
|
|
—
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|
||
Construction liability
|
|
—
|
|
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27,632
|
|
||
Other liabilities
|
|
9,953
|
|
|
8,768
|
|
||
Total liabilities
|
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141,051
|
|
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140,693
|
|
||
Commitments and contingencies (Note 11)
|
|
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|
||||
Shareholders’ equity:
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|
||||
Common stock, $0.0001 par value, 100,000,000 shares authorized, 30,604,748 shares issued and 24,592,169 shares outstanding at June 30, 2014 and 30,535,847 shares issued and 24,643,520 shares outstanding as of September 30, 2013
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3
|
|
|
3
|
|
||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; 0 shares issued and outstanding
|
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—
|
|
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—
|
|
||
Paid-in capital
|
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174,227
|
|
|
171,087
|
|
||
Treasury stock, at cost, 6,012,579 shares at June 30, 2014 and 5,892,327 shares at September 30, 2013
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|
(90,769
|
)
|
|
(89,346
|
)
|
||
Retained earnings
|
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50,158
|
|
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57,026
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|
||
Total shareholders’ equity
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133,619
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138,770
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Total liabilities and shareholders’ equity
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$
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274,670
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$
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279,463
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Three Months Ended June 30,
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Nine Months Ended June 30,
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||||||||||||
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2014
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2013
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2014
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2013
|
||||||||
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(In thousands, except per share amounts)
|
||||||||||||||
Revenues
|
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$
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91,316
|
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$
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90,954
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$
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283,047
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$
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284,470
|
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Operating expenses:
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||||||||
Educational services and facilities
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48,682
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49,140
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150,445
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149,288
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|
||||
Selling, general and administrative
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41,561
|
|
|
41,356
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130,030
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130,657
|
|
||||
Total operating expenses
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90,243
|
|
|
90,496
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|
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280,475
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|
|
279,945
|
|
||||
Income from operations
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1,073
|
|
|
458
|
|
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2,572
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|
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4,525
|
|
||||
Other income:
|
|
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|
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|
|
||||||||
Interest income (expense), net
|
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(494
|
)
|
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61
|
|
|
(1,117
|
)
|
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180
|
|
||||
Equity in earnings of unconsolidated affiliate
|
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135
|
|
|
—
|
|
|
343
|
|
|
—
|
|
||||
Other income
|
|
193
|
|
|
97
|
|
|
572
|
|
|
461
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|
||||
Total other income (expense)
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(166
|
)
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158
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|
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(202
|
)
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641
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|
||||
Income before income taxes
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|
907
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|
|
616
|
|
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2,370
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5,166
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|
||||
Income tax expense
|
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537
|
|
|
320
|
|
|
1,845
|
|
|
2,228
|
|
||||
Net income
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|
$
|
370
|
|
|
$
|
296
|
|
|
$
|
525
|
|
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$
|
2,938
|
|
Earnings per share:
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|
|
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||||||||
Net income per share - basic
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$
|
0.02
|
|
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$
|
0.01
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|
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$
|
0.02
|
|
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$
|
0.12
|
|
Net income per share - diluted
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
0.02
|
|
|
$
|
0.12
|
|
Weighted average number of shares outstanding:
|
|
|
|
|
|
|
||||||||||
Basic
|
|
24,618
|
|
|
24,420
|
|
|
24,641
|
|
|
24,527
|
|
||||
Diluted
|
|
24,918
|
|
|
24,580
|
|
|
24,905
|
|
|
24,620
|
|
||||
Cash dividends declared per common share
|
|
$
|
0.10
|
|
|
$
|
0.10
|
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
|
|
|
|
|
|
|
|
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Total
|
||||||||||||
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Common Stock
|
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Paid-in
|
|
Treasury Stock
|
|
Retained
|
|
Shareholders’
|
||||||||||||||||
|
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Shares
|
|
Amount
|
|
Capital
|
|
Shares
|
|
Amount
|
|
Earnings
|
|
Equity
|
||||||||||||
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(In thousands)
|
||||||||||||||||||||||||
Balance at September 30, 2013
|
|
30,536
|
|
|
$
|
3
|
|
|
$
|
171,087
|
|
|
5,892
|
|
|
$
|
(89,346
|
)
|
|
$
|
57,026
|
|
|
$
|
138,770
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
525
|
|
|
525
|
|
|||||
Issuance of common stock under employee plans
|
|
88
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Shares withheld for payroll taxes
|
|
(19
|
)
|
|
—
|
|
|
(237
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(237
|
)
|
|||||
Tax charge from employee stock plans
|
|
—
|
|
|
—
|
|
|
(945
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(945
|
)
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
4,322
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,322
|
|
|||||
Treasury stock repurchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
121
|
|
|
(1,423
|
)
|
|
—
|
|
|
(1,423
|
)
|
|||||
Cash dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,393
|
)
|
|
(7,393
|
)
|
|||||
Balance at June 30, 2014
|
|
30,605
|
|
|
$
|
3
|
|
|
$
|
174,227
|
|
|
6,013
|
|
|
$
|
(90,769
|
)
|
|
$
|
50,158
|
|
|
$
|
133,619
|
|
|
|
Nine Months Ended June 30,
|
||||||
|
|
2014
|
|
2013
|
||||
|
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
525
|
|
|
$
|
2,938
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
14,461
|
|
|
16,917
|
|
||
Amortization of assets subject to financing obligation
|
|
1,086
|
|
|
—
|
|
||
Amortization of held-to-maturity investments
|
|
1,869
|
|
|
1,462
|
|
||
Bad debt expense
|
|
2,891
|
|
|
3,679
|
|
||
Stock-based compensation
|
|
4,322
|
|
|
4,436
|
|
||
Excess tax benefit from stock-based compensation
|
|
(7
|
)
|
|
—
|
|
||
Deferred income taxes
|
|
(2,510
|
)
|
|
(1,727
|
)
|
||
Equity in earnings of unconsolidated affiliate
|
|
(343
|
)
|
|
—
|
|
||
Net training equipment credits earned
|
|
(892
|
)
|
|
(1,348
|
)
|
||
Loss on disposal of property and equipment
|
|
385
|
|
|
84
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
765
|
|
|
647
|
|
||
Prepaid expenses and other current assets
|
|
(1,731
|
)
|
|
1,716
|
|
||
Other assets
|
|
(442
|
)
|
|
(935
|
)
|
||
Accounts payable and accrued expenses
|
|
(3,878
|
)
|
|
(7,810
|
)
|
||
Deferred revenue
|
|
(8,311
|
)
|
|
(14,450
|
)
|
||
Income tax payable/receivable
|
|
1,007
|
|
|
(566
|
)
|
||
Accrued tool sets and other current liabilities
|
|
662
|
|
|
917
|
|
||
Deferred rent liability
|
|
(1,148
|
)
|
|
(866
|
)
|
||
Other liabilities
|
|
745
|
|
|
284
|
|
||
Net cash provided by operating activities
|
|
9,456
|
|
|
5,378
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchase of property and equipment
|
|
(7,787
|
)
|
|
(6,646
|
)
|
||
Proceeds from disposal of property and equipment
|
|
40
|
|
|
54
|
|
||
Purchase of investments
|
|
(46,333
|
)
|
|
(60,138
|
)
|
||
Proceeds received upon maturity of investments
|
|
40,243
|
|
|
51,135
|
|
||
Return of capital contribution from unconsolidated affiliate
|
|
238
|
|
|
—
|
|
||
Decrease in restricted cash
|
|
3,020
|
|
|
1,000
|
|
||
Net cash used in investing activities
|
|
(10,579
|
)
|
|
(14,595
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Payment of cash dividend
|
|
(7,393
|
)
|
|
(7,356
|
)
|
||
Repayment of financing obligation
|
|
(359
|
)
|
|
—
|
|
||
Payment of payroll taxes on stock-based compensation through shares withheld
|
|
(237
|
)
|
|
(198
|
)
|
||
Proceeds from issuance of common stock under employee plans
|
|
—
|
|
|
395
|
|
||
Excess tax benefit from stock-based compensation
|
|
7
|
|
|
—
|
|
||
Purchase of treasury stock
|
|
(1,423
|
)
|
|
(5,373
|
)
|
||
Net cash used in financing activities
|
|
(9,405
|
)
|
|
(12,532
|
)
|
||
Net decrease in cash and cash equivalents
|
|
(10,528
|
)
|
|
(21,749
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
35,657
|
|
|
45,665
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
25,129
|
|
|
$
|
23,916
|
|
|
|
Nine Months Ended June 30,
|
||||||
|
|
2014
|
|
2013
|
||||
|
|
(In thousands)
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
||||
Taxes paid
|
|
$
|
3,411
|
|
|
$
|
4,521
|
|
Training equipment obtained in exchange for services
|
|
$
|
2,107
|
|
|
$
|
1,006
|
|
Change in accrued capital expenditures during the period
|
|
$
|
305
|
|
|
$
|
(1,682
|
)
|
Construction period construction liability - construction in progress
|
|
$
|
5,868
|
|
|
$
|
21,326
|
|
Construction period financing obligation - building
|
|
$
|
4,825
|
|
|
$
|
—
|
|
Construction liability recognized as financing obligation
|
|
$
|
33,500
|
|
|
$
|
—
|
|
Interest paid
|
|
$
|
1,342
|
|
|
$
|
1
|
|
|
|
|
|
|
|
|
|
Estimated
|
||||||||
|
|
Amortized
|
|
Gross Unrealized
|
|
Fair Market
|
||||||||||
|
|
Cost
|
|
Gains
|
|
Losses
|
|
Value
|
||||||||
Due in less than 1 year:
|
|
|
|
|
|
|
|
|
||||||||
Municipal bonds
|
|
$
|
36,398
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
36,415
|
|
Corporate bonds
|
|
10,028
|
|
|
1
|
|
|
(6
|
)
|
|
10,023
|
|
||||
Certificates of deposit
|
|
1,717
|
|
|
—
|
|
|
—
|
|
|
1,717
|
|
||||
Due in 1 - 2 years:
|
|
|
|
|
|
|
|
|
||||||||
Municipal bonds
|
|
8,178
|
|
|
14
|
|
|
—
|
|
|
8,192
|
|
||||
Corporate bonds
|
|
6,646
|
|
|
—
|
|
|
(13
|
)
|
|
6,633
|
|
||||
Certificates of deposit
|
|
2,973
|
|
|
—
|
|
|
—
|
|
|
2,973
|
|
||||
|
|
$
|
65,940
|
|
|
$
|
32
|
|
|
$
|
(19
|
)
|
|
$
|
65,953
|
|
|
|
|
|
|
|
|
|
Estimated
|
||||||||
|
|
Amortized
|
|
Gross Unrealized
|
|
Fair Market
|
||||||||||
|
|
Cost
|
|
Gains
|
|
Losses
|
|
Value
|
||||||||
Due in less than 1 year:
|
|
|
|
|
|
|
|
|
||||||||
Municipal bonds
|
|
$
|
40,942
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
40,964
|
|
Corporate bonds
|
|
11,684
|
|
|
2
|
|
|
(7
|
)
|
|
11,679
|
|
||||
Certificates of deposit
|
|
4,905
|
|
|
—
|
|
|
—
|
|
|
4,905
|
|
||||
Due in 1 - 2 years:
|
|
|
|
|
|
|
|
|
||||||||
Municipal bonds
|
|
3,943
|
|
|
4
|
|
|
—
|
|
|
3,947
|
|
||||
Certificates of deposit
|
|
245
|
|
|
—
|
|
|
—
|
|
|
245
|
|
||||
|
|
$
|
61,719
|
|
|
$
|
28
|
|
|
$
|
(7
|
)
|
|
$
|
61,740
|
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
|
June 30, 2014
|
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Money market funds
|
|
$
|
12,740
|
|
|
$
|
12,740
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate bonds
|
|
16,656
|
|
|
16,656
|
|
|
—
|
|
|
—
|
|
||||
Municipal bonds
|
|
44,607
|
|
|
—
|
|
|
44,607
|
|
|
—
|
|
||||
Certificates of deposit
|
|
4,690
|
|
|
—
|
|
|
4,690
|
|
|
—
|
|
||||
Commercial paper
|
|
5,000
|
|
|
—
|
|
|
5,000
|
|
|
—
|
|
||||
Total assets at fair value on a recurring basis
|
|
$
|
83,693
|
|
|
$
|
29,396
|
|
|
$
|
54,297
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
|
September 30, 2013
|
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Money market funds
|
|
$
|
23,135
|
|
|
$
|
23,135
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate bonds
|
|
11,679
|
|
|
11,679
|
|
|
—
|
|
|
—
|
|
||||
Municipal bonds
|
|
44,911
|
|
|
—
|
|
|
44,911
|
|
|
—
|
|
||||
Certificates of deposit
|
|
5,150
|
|
|
—
|
|
|
5,150
|
|
|
—
|
|
||||
Total assets at fair value on a recurring basis
|
|
$
|
84,875
|
|
|
$
|
34,814
|
|
|
$
|
50,061
|
|
|
$
|
—
|
|
|
|
Liability Balance at
September 30, 2013 |
|
Postemployment
Benefit Charges |
|
Cash Paid
|
|
Other
Non-cash (1) |
|
Liability Balance at
June 30, 2014 |
||||||||||
Severance
|
|
$
|
1,714
|
|
|
$
|
1,123
|
|
|
$
|
(1,281
|
)
|
|
$
|
85
|
|
|
$
|
1,641
|
|
Other
|
|
2
|
|
|
66
|
|
|
(34
|
)
|
|
(12
|
)
|
|
22
|
|
|||||
Total
|
|
$
|
1,716
|
|
|
$
|
1,189
|
|
|
$
|
(1,315
|
)
|
|
$
|
73
|
|
|
$
|
1,663
|
|
(1)
|
Primarily relates to the expiration of benefits not used within the time offered under the separation agreement and non-cash severance.
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Weighted average number of shares
|
|
(In thousands)
|
||||||||||
Basic shares outstanding
|
|
24,618
|
|
|
24,420
|
|
|
24,641
|
|
|
24,527
|
|
Dilutive effect related to employee stock plans
|
|
300
|
|
|
160
|
|
|
264
|
|
|
93
|
|
Diluted shares outstanding
|
|
24,918
|
|
|
24,580
|
|
|
24,905
|
|
|
24,620
|
|
|
|
Depreciable
Lives (in years) |
|
June 30, 2014
|
|
September 30, 2013
|
||||
Land
|
|
—
|
|
$
|
1,456
|
|
|
$
|
1,456
|
|
Buildings and building improvements
|
|
35
|
|
50,306
|
|
|
13,741
|
|
||
Leasehold improvements
|
|
1-28
|
|
38,252
|
|
|
48,062
|
|
||
Training equipment
|
|
3-10
|
|
84,514
|
|
|
82,270
|
|
||
Office and computer equipment
|
|
3-10
|
|
36,874
|
|
|
37,206
|
|
||
Curriculum development
|
|
5
|
|
18,716
|
|
|
18,716
|
|
||
Software developed for internal use
|
|
3-5
|
|
12,100
|
|
|
10,895
|
|
||
Vehicles
|
|
5
|
|
1,176
|
|
|
1,005
|
|
||
Construction in progress
|
|
—
|
|
8,669
|
|
|
33,158
|
|
||
|
|
|
|
252,063
|
|
|
246,509
|
|
||
Less accumulated depreciation and amortization
|
|
|
|
(144,968
|
)
|
|
(143,439
|
)
|
||
|
|
|
|
$
|
107,095
|
|
|
$
|
103,070
|
|
|
|
June 30, 2014
|
||
Buildings and building improvements
|
|
$
|
33,500
|
|
Construction in progress
|
|
4,825
|
|
|
Less accumulated depreciation and amortization
|
|
(1,086
|
)
|
|
Assets financed by financing obligation, net
|
|
$
|
37,239
|
|
Years ending September 30,
|
|
Financing Obligations
|
|
Operating Leases
|
||||
2014 (Remaining)
|
|
$
|
947
|
|
|
$
|
91
|
|
2015
|
|
2,928
|
|
|
297
|
|
||
2016
|
|
2,907
|
|
|
291
|
|
||
2017
|
|
2,971
|
|
|
291
|
|
||
2018
|
|
3,037
|
|
|
291
|
|
||
Thereafter
|
|
46,719
|
|
|
3,832
|
|
||
Total future minimum lease obligation
|
|
$
|
59,509
|
|
|
$
|
5,093
|
|
Financing obligation on building recorded during construction period
|
|
4,504
|
|
|
|
|||
Less imputed interest on financing obligation
|
|
(25,687
|
)
|
|
|
|||
Less imputed accrued land lease obligation
|
|
(360
|
)
|
|
|
|||
Net present value of financing obligation
|
|
$
|
37,966
|
|
|
|
|
|
June 30, 2014
|
|
September 30, 2013
|
||||||||||
|
|
Carrying Value (In thousands)
|
|
Ownership Percentage
|
|
Carrying Value (In thousands)
|
|
Ownership Percentage
|
||||||
Investment in unconsolidated affiliate
|
|
$
|
4,105
|
|
|
27.972
|
%
|
|
$
|
4,000
|
|
|
27.972
|
%
|
|
|
Nine Months Ended June 30,
|
||||||
|
|
2014
|
|
2013
|
||||
Balance at beginning of period
|
|
$
|
4,000
|
|
|
$
|
4,000
|
|
Equity in earnings of unconsolidated affiliate
|
|
343
|
|
|
—
|
|
||
Return of capital contribution from unconsolidated affiliate
|
|
(238
|
)
|
|
—
|
|
||
Balance at end of period
|
|
$
|
4,105
|
|
|
$
|
4,000
|
|
|
|
June 30, 2014
|
|
September 30, 2013
|
||||
Accounts payable
|
|
$
|
9,625
|
|
|
$
|
13,758
|
|
Accrued compensation and benefits
|
|
19,274
|
|
|
16,858
|
|
||
Other accrued expenses
|
|
7,252
|
|
|
8,613
|
|
||
|
|
$
|
36,151
|
|
|
$
|
39,229
|
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
|
Inception
|
||||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
to date
|
||||||||||
Tuition and interest income excluded
|
|
$
|
6,289
|
|
|
$
|
5,236
|
|
|
$
|
20,542
|
|
|
$
|
18,068
|
|
|
$
|
90,401
|
|
Amounts collected and recognized
|
|
(951
|
)
|
|
(601
|
)
|
|
(2,497
|
)
|
|
(1,619
|
)
|
|
(7,519
|
)
|
|||||
Amounts written off
|
|
(2,173
|
)
|
|
(1,646
|
)
|
|
(6,436
|
)
|
|
(4,102
|
)
|
|
(27,431
|
)
|
|||||
Net amount excluded during the period
|
|
$
|
3,165
|
|
|
$
|
2,989
|
|
|
$
|
11,609
|
|
|
$
|
12,347
|
|
|
$
|
55,451
|
|
|
|
Nine Months Ended June 30,
|
||||||
|
|
2014
|
|
2013
|
||||
Balance at beginning of period
|
|
$
|
59,767
|
|
|
$
|
42,880
|
|
Loans extended
|
|
18,390
|
|
|
15,930
|
|
||
Interest accrued
|
|
2,134
|
|
|
2,686
|
|
||
Amounts collected and recognized
|
|
(2,497
|
)
|
|
(1,619
|
)
|
||
Amounts written off
|
|
(6,436
|
)
|
|
(4,102
|
)
|
||
Balance at end of period
|
|
$
|
71,358
|
|
|
$
|
55,775
|
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
$
|
88,772
|
|
|
$
|
88,982
|
|
|
$
|
274,955
|
|
|
$
|
278,145
|
|
Other
|
|
2,544
|
|
|
1,972
|
|
|
8,092
|
|
|
6,325
|
|
||||
Consolidated
|
|
$
|
91,316
|
|
|
$
|
90,954
|
|
|
$
|
283,047
|
|
|
$
|
284,470
|
|
Income from operations
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
$
|
1,965
|
|
|
$
|
852
|
|
|
$
|
4,631
|
|
|
$
|
6,175
|
|
Other
|
|
(892
|
)
|
|
(394
|
)
|
|
(2,059
|
)
|
|
(1,650
|
)
|
||||
Consolidated
|
|
$
|
1,073
|
|
|
$
|
458
|
|
|
$
|
2,572
|
|
|
$
|
4,525
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
$
|
4,983
|
|
|
$
|
5,482
|
|
|
$
|
15,276
|
|
|
$
|
16,644
|
|
Other
|
|
83
|
|
|
86
|
|
|
271
|
|
|
273
|
|
||||
Consolidated
|
|
$
|
5,066
|
|
|
$
|
5,568
|
|
|
$
|
15,547
|
|
|
$
|
16,917
|
|
Net income
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
$
|
826
|
|
|
$
|
511
|
|
|
$
|
1,496
|
|
|
$
|
3,869
|
|
Other
|
|
(456
|
)
|
|
(215
|
)
|
|
(971
|
)
|
|
(931
|
)
|
||||
Consolidated
|
|
$
|
370
|
|
|
$
|
296
|
|
|
$
|
525
|
|
|
$
|
2,938
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
June 30, 2014
|
|
September 30, 2013
|
||||||||
Goodwill
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
|
|
|
|
|
|
$
|
20,579
|
|
|
$
|
20,579
|
|
||
Other
|
|
|
|
|
|
|
|
—
|
|
|
—
|
|
||||
Consolidated
|
|
|
|
|
|
|
|
$
|
20,579
|
|
|
$
|
20,579
|
|
||
Total assets
|
|
|
|
|
|
|
|
|
||||||||
Postsecondary education
|
|
|
|
|
|
|
|
$
|
268,752
|
|
|
$
|
272,178
|
|
||
Other
|
|
|
|
|
|
|
|
5,918
|
|
|
7,285
|
|
||||
Consolidated
|
|
|
|
|
|
|
|
$
|
274,670
|
|
|
$
|
279,463
|
|
•
|
The amount of Title IV financial aid available decreased during 2012 which increased the difference between the amount of Title IV financial aid our students are eligible for and the cost of education; this difference requires students and their families to obtain additional financing;
|
•
|
Incentive compensation changes which became effective July 1, 2011 limited the means by which we may compensate our admissions representatives and required changes to our compensation and performance management processes. We are continuing to adapt to those changes within the organization, including implementing significant compensation changes for our field admissions representatives which became effective July 1, 2014;
|
•
|
Competition for prospective students continues to increase from within our sector as well as with traditional post secondary educational institutions;
|
•
|
The state of the general macro-economic environment and its impact on price sensitivity and the ability and willingness of students and their families to incur debt; and
|
•
|
Unemployment; during periods when the unemployment rate declines or remains stable as it has in recent years, prospective students have more employment options.
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Revenues
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||
Educational services and facilities
|
|
53.3
|
%
|
|
54.0
|
%
|
|
53.2
|
%
|
|
52.5
|
%
|
Selling, general and administrative
|
|
45.5
|
%
|
|
45.5
|
%
|
|
45.9
|
%
|
|
45.9
|
%
|
Total operating expenses
|
|
98.8
|
%
|
|
99.5
|
%
|
|
99.1
|
%
|
|
98.4
|
%
|
Income (loss) from operations
|
|
1.2
|
%
|
|
0.5
|
%
|
|
0.9
|
%
|
|
1.6
|
%
|
Interest income (expense), net
|
|
(0.5
|
)%
|
|
0.1
|
%
|
|
(0.4
|
)%
|
|
0.1
|
%
|
Other income
|
|
0.3
|
%
|
|
0.1
|
%
|
|
0.3
|
%
|
|
0.1
|
%
|
Total other income (expense)
|
|
(0.2
|
)%
|
|
0.2
|
%
|
|
(0.1
|
)%
|
|
0.2
|
%
|
Income (loss) before income taxes
|
|
1.0
|
%
|
|
0.7
|
%
|
|
0.8
|
%
|
|
1.8
|
%
|
Income tax expense (benefit)
|
|
0.6
|
%
|
|
0.4
|
%
|
|
0.6
|
%
|
|
0.8
|
%
|
Net income (loss)
|
|
0.4
|
%
|
|
0.3
|
%
|
|
0.2
|
%
|
|
1.0
|
%
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Salaries expense
|
|
$
|
21,811
|
|
|
$
|
21,576
|
|
|
$
|
65,975
|
|
|
$
|
64,728
|
|
Employee benefits and tax
|
|
4,035
|
|
|
4,405
|
|
|
12,530
|
|
|
13,012
|
|
||||
Stock-based compensation
|
|
148
|
|
|
177
|
|
|
449
|
|
|
441
|
|
||||
Bonus expense
|
|
211
|
|
|
125
|
|
|
482
|
|
|
786
|
|
||||
Compensation and related costs
|
|
26,205
|
|
|
26,283
|
|
|
79,436
|
|
|
78,967
|
|
||||
Occupancy costs
|
|
8,696
|
|
|
9,207
|
|
|
27,242
|
|
|
27,653
|
|
||||
Depreciation and amortization expense
|
|
4,609
|
|
|
4,699
|
|
|
13,926
|
|
|
14,091
|
|
||||
Other educational services and facilities expense
|
|
3,747
|
|
|
3,490
|
|
|
11,301
|
|
|
11,304
|
|
||||
Supplies and maintenance
|
|
2,321
|
|
|
2,076
|
|
|
7,260
|
|
|
6,630
|
|
||||
Tools and training aids expense
|
|
1,959
|
|
|
1,826
|
|
|
6,814
|
|
|
6,500
|
|
||||
Contract services expense
|
|
1,145
|
|
|
1,559
|
|
|
4,466
|
|
|
4,143
|
|
||||
|
|
$
|
48,682
|
|
|
$
|
49,140
|
|
|
$
|
150,445
|
|
|
$
|
149,288
|
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Salaries expense
|
|
$
|
18,171
|
|
|
$
|
17,381
|
|
|
$
|
54,350
|
|
|
$
|
53,815
|
|
Employee benefits and tax
|
|
3,610
|
|
|
3,816
|
|
|
11,158
|
|
|
11,845
|
|
||||
Stock-based compensation
|
|
1,068
|
|
|
1,254
|
|
|
3,873
|
|
|
3,995
|
|
||||
Bonus expense
|
|
641
|
|
|
304
|
|
|
1,461
|
|
|
2,178
|
|
||||
Compensation and related costs
|
|
23,490
|
|
|
22,755
|
|
|
70,842
|
|
|
71,833
|
|
||||
Advertising expense
|
|
9,139
|
|
|
9,065
|
|
|
30,234
|
|
|
28,158
|
|
||||
Other selling, general and administrative expenses
|
|
5,858
|
|
|
5,660
|
|
|
18,892
|
|
|
17,966
|
|
||||
Contract services expense
|
|
1,051
|
|
|
1,028
|
|
|
3,649
|
|
|
3,946
|
|
||||
Bad debt expense
|
|
901
|
|
|
1,059
|
|
|
2,891
|
|
|
3,679
|
|
||||
Depreciation and amortization expense
|
|
773
|
|
|
1,159
|
|
|
2,517
|
|
|
3,661
|
|
||||
Legal services expense
|
|
349
|
|
|
630
|
|
|
1,005
|
|
|
1,414
|
|
||||
|
|
$
|
41,561
|
|
|
$
|
41,356
|
|
|
$
|
130,030
|
|
|
$
|
130,657
|
|
|
|
Three Months Ended June 30,
|
|
Nine Months Ended June 30,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Net income
|
|
$
|
370
|
|
|
$
|
296
|
|
|
$
|
525
|
|
|
$
|
2,938
|
|
Interest expense (income), net
|
|
494
|
|
|
(61
|
)
|
|
1,117
|
|
|
(180
|
)
|
||||
Income tax expense
|
|
537
|
|
|
320
|
|
|
1,845
|
|
|
2,228
|
|
||||
Depreciation and amortization
|
|
5,382
|
|
|
5,858
|
|
|
16,443
|
|
|
17,752
|
|
||||
EBITDA
|
|
$
|
6,783
|
|
|
$
|
6,413
|
|
|
$
|
19,930
|
|
|
$
|
22,738
|
|
ISSUER PURCHASES OF EQUITY SECURITIES
|
||||||||||||||
Period
|
|
(a) Total Number of Shares Purchased
(1)
|
|
(b) Average Price Paid per Share
|
|
(c) Total Number of Shares Purchased as Part of Publicly Announced Plans Or Programs
|
|
(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans Or Programs
(In thousands) (2) |
||||||
April 1-30, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
17,348
|
|
May 1-31, 2014
|
|
89,252
|
|
|
$
|
11.31
|
|
|
89,252
|
|
|
$
|
16,339
|
|
June 1-30, 2014
|
|
38,291
|
|
|
$
|
11.78
|
|
|
—
|
|
|
$
|
16,339
|
|
Total
|
|
127,543
|
|
|
|
|
89,252
|
|
|
$
|
16,339
|
|
(1)
|
Shares purchased in June represent shares of common stock withheld by us as payment of the individual's tax obligations on the vesting of shares of our common stock which were granted subject to forfeiture restrictions under our 2003 Incentive Compensation Plan (the 2003 Plan). Such shares are returned to the pool of shares issuable under the 2003 Plan.
|
(2)
|
On December 20, 2011, our Board of Directors authorized the repurchase of up to $25.0 million of our common stock in the open market or through privately negotiated transactions. We may terminate or limit the share repurchase program at any time without prior notice.
|
|
|
|
|
|
|
|
|
|
|
|
UNIVERSAL TECHNICAL INSTITUTE, INC.
|
|
|
||
|
|
|
|
|
|||
Dated:
|
August 6, 2014
|
|
By:
|
|
/s/ Eugene S. Putnam, Jr.
|
|
|
|
|
|
|
|
Eugene S. Putnam, Jr.
|
|
|
|
|
|
|
|
President and Chief Financial Officer
|
|
|
|
|
|
|
|
(Principal Financial Officer and Duly Authorized Officer)
|
|
|
Number
|
|
Description
|
|
|
|
10.1
|
|
Employment Agreement, by and between Kimberly J. McWaters and Universal Technical Institute, Inc., effective April 8, 2014. (Incorporated by reference to Exhibit 10.1 to a Form 8-K filed by the Registrant on April 11, 2014.)
|
|
|
|
10.2
|
|
Employment Agreement, by and between Eugene S. Putnam, Jr. and Universal Technical Institute, Inc., effective April 8, 2014. (Incorporated by reference to Exhibit 10.2 to a Form 8-K filed by the Registrant on April 11, 2014.)
|
|
|
|
10.3
|
|
Amended and Restated Employment Agreement, by and between Kenneth J. Cranston and Universal Technical Institute, Inc., effective April 8, 2014. (Incorporated by reference to Exhibit 10.3 to a Form 8-K filed by the Registrant on April 11, 2014.)
|
|
|
|
10.4
|
|
Second Amendment to Employment Agreement, by and between Kimberly J. McWaters and Universal Technical Institute, Inc., effective March 7, 2014. (Incorporated by reference to Exhibit 10.1 to a Form 8-K filed by the Registrant on March 11, 2014.)
|
|
|
|
10.5
|
|
Second Amendment to Employment Agreement, by and between Eugene S. Putnam, Jr. and Universal Technical Institute, Inc., effective March 7, 2014. (Incorporated by reference to Exhibit 10.2 to a Form 8-K filed by the Registrant on March 11, 2014.)
|
|
|
|
10.6
|
|
First Amendment to Employment Agreement, by and between Kenneth J. Cranston and Universal Technical Institute, Inc., effective March 7, 2014. (Incorporated by reference to Exhibit 10.3 to a Form 8-K filed by the Registrant on March 11, 2014.)
|
|
|
|
10.7
|
|
Form of Indemnification Agreement by and between Registrant and its directors and officers.
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
|
|
|
|
32.2
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
|
|
|
|
101
|
|
The following financial information from our Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Income Statements; (iii) Condensed Consolidated Statement of Shareholders’ Equity; (iv) Condensed Consolidated Statements of Cash Flows; and (v) Notes to Condensed Consolidated Financial Statements.
|
|
UNIVERSAL TECHNICAL INSTITUTE, INC.
|
|
|
|
|
|
By:
|
|
Name:
|
|
Title:
|
|
Address:16220 N. Scottsdale Road
Suite 100
Scottsdale, AZ 85254
|
|
|
|
|
|
Indemnitee:
|
|
|
|
|
|
By:
|
|
Name:
|
|
Address:
|
1.
|
I have reviewed this Report on Form 10-Q of Universal Technical Institute, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
1.
|
I have reviewed this Report on Form 10-Q of Universal Technical Institute, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented.
|