☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
New Jersey | 57-1150621 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
14 Sylvan Way, Suite A | 07054 | |
Parsippany, NJ | (Zip Code) | |
(Address of principal executive offices) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, no par value per share | LINC | The NASDAQ Stock Market LLC |
Large accelerated filer | Accelerated filer ☒ | |
Non-accelerated filer ☐ | Smaller reporting company ☒ | |
Emerging growth company ☐ |
PART I. | FINANCIAL INFORMATION | |
Item 1. | 1 | |
1 | ||
3 | ||
4 | ||
5 | ||
6 | ||
8 | ||
Item 2. | 25 | |
Item 4. | ||
PART II. | ||
Item 1. | ||
Item 5. | Other Information | 41 |
Item 6. | ||
Item 1. | Financial Statements |
March 31, 2021 | December 31, 2020 | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ | 26,742 | $ | 38,026 | ||||
Accounts receivable, less allowance of $22,539 and $25,174 at March 31, 2021 and December 31, 2020, respectively | 30,604 | 30,021 | ||||||
Inventories | 2,666 | 2,394 | ||||||
Prepaid expenses and other current assets | 10,770 | 3,723 | ||||||
Total current assets | 70,782 | 74,164 | ||||||
PROPERTY, EQUIPMENT AND FACILITIES - At cost, net of accumulated depreciation and amortization of $176,757 and $176,300 at March 31, 2021 and December 31, 2020, respectively | 49,035 | 48,388 | ||||||
OTHER ASSETS: | ||||||||
Noncurrent receivables, less allowance of $3,701 and $3,465 at March 31, 2021 and December 31, 2020, respectively | 17,070 | 16,463 | ||||||
Deferred income taxes, net | 34,473 | 35,718 | ||||||
Operating lease right-of-use assets | 53,155 | 55,187 | ||||||
Goodwill | 14,536 | 14,536 | ||||||
Other assets, net | 802 | 734 | ||||||
Total other assets | 120,036 | 122,638 | ||||||
TOTAL ASSETS | $ | 239,853 | $ | 245,190 |
September 30, 2021 | December 31, 2020 | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ | 47,150 | $ | 38,026 | ||||
Accounts receivable, less allowance of $26,303 and $25,174 at September 30, 2021 and December 31, 2020, respectively | 29,985 | 30,021 | ||||||
Inventories | 3,155 | 2,394 | ||||||
Prepaid income taxes | 238 | 0 | ||||||
Prepaid expenses and other current assets | 2,973 | 3,723 | ||||||
Assets held for sale | 27,452 | 0 | ||||||
Total current assets | 110,953 | 74,164 | ||||||
PROPERTY, EQUIPMENT AND FACILITIES - At cost, net of accumulated depreciation and amortization of $152,217 and $176,300 at September 30, 2021 and December 31, 2020, respectively | 23,251 | 48,388 | ||||||
OTHER ASSETS: | ||||||||
Noncurrent receivables, less allowance of $4,789 and $3,465 at September 30, 2021 and December 31, 2020, respectively | 18,805 | 16,463 | ||||||
Deferred income taxes, net | 32,082 | 35,718 | ||||||
Operating lease right-of-use assets | 53,033 | 55,187 | ||||||
Goodwill | 14,536 | 14,536 | ||||||
Other assets, net | 796 | 734 | ||||||
Total other assets | 119,252 | 122,638 | ||||||
TOTAL ASSETS | $ | 253,456 | $ | 245,190 |
March 31, 2021 | December 31, 2020 | |||||||
LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Current portion of credit agreement | $ | 2,000 | $ | 2,000 | ||||
Unearned tuition | 20,240 | 23,453 | ||||||
Accounts payable | 17,718 | 15,676 | ||||||
Accrued expenses | 10,713 | 16,692 | ||||||
Income taxes payable | 436 | 491 | ||||||
Current portion of operating lease liabilities | 9,370 | 8,504 | ||||||
Other short-term liabilities | 73 | 26 | ||||||
Total current liabilities | 60,550 | 66,842 | ||||||
NONCURRENT LIABILITIES: | ||||||||
Long-term credit agreement | 14,757 | 15,212 | ||||||
Pension plan liabilities | 4,451 | 4,252 | ||||||
Long-term portion of operating lease liabilities | 50,329 | 52,702 | ||||||
Other long-term liabilities | 2,924 | 3,133 | ||||||
Total liabilities | 133,011 | 142,141 | ||||||
COMMITMENTS AND CONTINGENCIES | 0 | 0 | ||||||
SERIES A CONVERTIBLE PREFERRED STOCK | ||||||||
Preferred stock, 0 par value - 10,000,000 shares authorized, Series A convertible preferred shares, 12,700 shares issued and outstanding at March 31, 2021 and December 31, 2020 | 11,982 | 11,982 | ||||||
STOCKHOLDERS’ EQUITY: | ||||||||
Common stock, 0 par value - authorized: 100,000,000 shares at March 31, 2021 and December 31, 2020; issued and outstanding: 26,895,970 shares at March 31, 2021 and 26,476,329 shares at December 31, 2020 | 141,377 | 141,377 | ||||||
Additional paid-in capital | 30,043 | 30,512 | ||||||
Treasury stock at cost - 5,910,541 shares at March 31, 2021 and December 31, 2020 | (82,860 | ) | (82,860 | ) | ||||
Retained earnings | 10,388 | 6,203 | ||||||
Accumulated other comprehensive loss | (4,088 | ) | (4,165 | ) | ||||
Total stockholders’ equity | 94,860 | 91,067 | ||||||
TOTAL LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND EQUITY | $ | 239,853 | $ | 245,190 |
September 30, 2021 | December 31, 2020 | |||||||
LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Current portion of credit agreement | $ | 2,000 | $ | 2,000 | ||||
Unearned tuition | 24,691 | 23,453 | ||||||
Accounts payable | 16,036 | 15,676 | ||||||
Accrued expenses | 15,778 | 16,692 | ||||||
Income taxes payable | 0 | 491 | ||||||
Current portion of operating lease liabilities | 10,314 | 8,504 | ||||||
Other short-term liabilities | 56 | 26 | ||||||
Total current liabilities | 68,875 | 66,842 | ||||||
NONCURRENT LIABILITIES: | ||||||||
Long-term credit agreement | 13,848 | 15,212 | ||||||
Pension plan liabilities | 4,850 | 4,252 | ||||||
Long-term portion of operating lease liabilities | 49,135 | 52,702 | ||||||
Other long-term liabilities | 2,803 | 3,133 | ||||||
Total liabilities | 139,511 | 142,141 | ||||||
COMMITMENTS AND CONTINGENCIES | 0 | 0 | ||||||
SERIES A CONVERTIBLE PREFERRED STOCK | ||||||||
Preferred stock, 0 par value - 10,000,000 shares authorized, Series A convertible preferred shares, 12,700 shares issued and outstanding at September 30, 2021 and December 31, 2020 | 11,982 | 11,982 | ||||||
STOCKHOLDERS’ EQUITY: | ||||||||
Common stock, 0 par value - authorized: 100,000,000 shares at September 30, 2021 and December 31, 2020; issued and outstanding: 26,978,432 shares at September 30, 2021 and 26,476,329 shares at December 31, 2020 | 141,377 | 141,377 | ||||||
Additional paid-in capital | 31,643 | 30,512 | ||||||
Treasury stock at cost - 5,910,541 shares at September 30, 2021 and December 31, 2020 | (82,860 | ) | (82,860 | ) | ||||
Retained earnings | 16,045 | 6,203 | ||||||
Accumulated other comprehensive loss | (4,242 | ) | (4,165 | ) | ||||
Total stockholders’ equity | 101,963 | 91,067 | ||||||
TOTAL LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY | $ | 253,456 | $ | 245,190 |
Three Months Ended March 31, | ||||||||
2021 | 2020 | |||||||
REVENUE | $ | 77,996 | $ | 70,041 | ||||
COSTS AND EXPENSES: | ||||||||
Educational services and facilities | 32,344 | 30,238 | ||||||
Selling, general and administrative | 39,633 | 41,149 | ||||||
Total costs & expenses | 71,977 | 71,387 | ||||||
OPERATING INCOME (LOSS) | 6,019 | (1,346 | ) | |||||
OTHER: | ||||||||
Interest expense | (285 | ) | (354 | ) | ||||
INCOME (LOSS) BEFORE INCOME TAXES | 5,734 | (1,700 | ) | |||||
PROVISION FOR INCOME TAXES | 1,245 | 50 | ||||||
NET INCOME (LOSS) | $ | 4,489 | $ | (1,750 | ) | |||
PREFERRED STOCK DIVIDENDS | 304 | 0 | ||||||
INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | $ | 4,185 | $ | (1,750 | ) | |||
Basic | ||||||||
Net income (loss) per common share | $ | 0.13 | $ | (0.08 | ) | |||
Diluted | ||||||||
Net income (loss) per common share | $ | 0.13 | $ | (0.08 | ) | |||
Weighted average number of common shares outstanding: | ||||||||
Basic | 24,889 | 24,598 | ||||||
Diluted | 24,889 | 24,598 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
REVENUE | $ | 89,059 | $ | 78,792 | $ | 247,520 | $ | 211,303 | ||||||||
COSTS AND EXPENSES: | ||||||||||||||||
Educational services and facilities | 38,105 | 34,251 | 104,143 | 90,733 | ||||||||||||
Selling, general and administrative | 45,209 | 40,700 | 128,159 | 117,011 | ||||||||||||
Loss (gain) on disposition of assets | 0 | 1 | 1 | (96 | ) | |||||||||||
Total costs & expenses | 83,314 | 74,952 | 232,303 | 207,648 | ||||||||||||
OPERATING INCOME | 5,745 | 3,840 | 15,217 | 3,655 | ||||||||||||
OTHER: | ||||||||||||||||
Interest expense | (292 | ) | (278 | ) | (874 | ) | (960 | ) | ||||||||
INCOME BEFORE INCOME TAXES | 5,453 | 3,562 | 14,343 | 2,695 | ||||||||||||
PROVISION FOR INCOME TAXES | 1,614 | 50 | 3,589 | 150 | ||||||||||||
NET INCOME | $ | 3,839 | $ | 3,512 | $ | 10,754 | $ | 2,545 | ||||||||
PREFERRED STOCK DIVIDENDS | 304 | 1,074 | 912 | 1,074 | ||||||||||||
INCOME AVAILABLE TO COMMON SHAREHOLDERS | $ | 3,535 | $ | 2,438 | $ | 9,842 | $ | 1,471 | ||||||||
Basic and diluted | ||||||||||||||||
Net income per common share | $ | 0.11 | $ | 0.08 | $ | 0.30 | $ | 0.05 | ||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic and diluted | 25,135 | 24,822 | 25,043 | 24,721 |
Three Months Ended March 31, | ||||||||
2021 | 2020 | |||||||
Net income (loss) | $ | 4,489 | $ | (1,750 | ) | |||
Other comprehensive income (loss) | ||||||||
Derivative qualifying as a cash flow hedge, net of taxes (nil) | 211 | (748 | ) | |||||
Employee pension plan adjustments, net of taxes (nil) | (134 | ) | 140 | |||||
Comprehensive income (loss) | $ | 4,566 | $ | (2,358 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 3,839 | $ | 3,512 | $ | 10,754 | $ | 2,545 | ||||||||
Other comprehensive income (loss) | ||||||||||||||||
Derivative qualifying as a cash flow hedge, net of taxes (nil) | 65 | 57 | 326 | (786 | ) | |||||||||||
Employee pension plan adjustments, net of taxes (nil) | (134 | ) | 140 | (403 | ) | 420 | ||||||||||
Comprehensive income | $ | 3,770 | $ | 3,709 | $ | 10,677 | $ | 2,179 |
Stockholders’ Equity | Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-in | Treasury | Retained | Accumulated Other Comprehensive | Series A Convertible Preferred Stock | Common Stock | Additional Paid-in | Treasury | Retained | Accumulated Other Comprehensive | Series A Convertible Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Capital | Stock | Earnings | Loss | Total | Shares | Amount | Shares | Amount | Capital | Stock | Earnings | Loss | Total | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - January 1, 2021 | 26,476,329 | $ | 141,377 | $ | 30,512 | $ | (82,860 | ) | $ | 6,203 | $ | (4,165 | ) | $ | 91,067 | 12,700 | $ | 11,982 | 26,476,329 | $ | 141,377 | $ | 30,512 | $ | (82,860 | ) | $ | 6,203 | $ | (4,165 | ) | $ | 91,067 | 12,700 | $ | 11,982 | ||||||||||||||||||||||||||||||||||||
Net income | - | 0 | 0 | 0 | 4,489 | 0 | 4,489 | - | 0 | - | 0 | 0 | 0 | 4,489 | 0 | 4,489 | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock dividend | - | 0 | 0 | 0 | (304 | ) | 0 | (304 | ) | - | 0 | - | 0 | 0 | 0 | (304 | ) | 0 | (304 | ) | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | (134 | ) | (134 | ) | - | 0 | - | 0 | 0 | 0 | 0 | (134 | ) | (134 | ) | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | 211 | 211 | - | 0 | - | 0 | 0 | 0 | 0 | 211 | 211 | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 574,614 | 0 | 493 | 0 | 0 | 0 | 493 | 0 | 0 | 574,614 | 0 | 493 | 0 | 0 | 0 | 493 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | (154,973 | ) | 0 | (962 | ) | 0 | 0 | 0 | (962 | ) | 0 | 0 | (154,973 | ) | 0 | (962 | ) | 0 | 0 | 0 | (962 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE -March 31, 2021 | 26,895,970 | $ | 141,377 | $ | 30,043 | $ | (82,860 | ) | $ | 10,388 | $ | (4,088 | ) | $ | 94,860 | 12,700 | $ | 11,982 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - March 31, 2021 | 26,895,970 | 141,377 | 30,043 | (82,860 | ) | 10,388 | (4,088 | ) | 94,860 | 12,700 | 11,982 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | - | 0 | 0 | 0 | 2,426 | 0 | 2,426 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock dividend | - | 0 | 0 | 0 | (304 | ) | 0 | (304 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | (134 | ) | (134 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | 49 | 49 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 76,195 | 0 | 844 | 0 | 0 | 0 | 844 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - June 30, 2021 | 26,972,165 | $ | 141,377 | $ | 30,887 | $ | (82,860 | ) | $ | 12,510 | $ | (4,173 | ) | $ | 97,741 | 12,700 | $ | 11,982 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | - | 0 | 0 | 0 | 3,839 | 0 | 3,839 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | - | 0 | 0 | 0 | (304 | ) | 0 | (304 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | (134 | ) | (134 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | 65 | 65 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 6,267 | 0 | 756 | 0 | 0 | 0 | 756 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - September 30, 2021 | 26,978,432 | $ | 141,377 | $ | 31,643 | $ | (82,860 | ) | $ | 16,045 | $ | (4,242 | ) | $ | 101,963 | 12,700 | $ | 11,982 |
Stockholders’ Equity | Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-in | Treasury | Accumulated | Accumulated Other Comprehensive | Series A Convertible Preferred Stock | Common Stock | Additional Paid-in | Treasury | Accumulated | Accumulated Other Comprehensive | Series A Convertible Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Capital | Stock | Deficit | Loss | Total | Shares | Amount | Shares | Amount | Capital | Stock | Deficit | Loss | Total | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - January 1, 2020 | 25,231,710 | $ | 141,377 | $ | 30,145 | $ | (82,860 | ) | $ | (42,058 | ) | $ | (3,456 | ) | $ | 43,148 | 12,700 | $ | 11,982 | 25,231,710 | $ | 141,377 | $ | 30,145 | $ | (82,860 | ) | $ | (42,058 | ) | $ | (3,456 | ) | $ | 43,148 | 12,700 | $ | 11,982 | ||||||||||||||||||||||||||||||||||
Net loss | - | 0 | 0 | 0 | (1,750 | ) | 0 | (1,750 | ) | - | 0 | - | 0 | 0 | 0 | (1,750 | ) | 0 | (1,750 | ) | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | 140 | 140 | - | 0 | - | 0 | 0 | 0 | 0 | 140 | 140 | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | (748 | ) | (748 | ) | - | 0 | - | 0 | 0 | 0 | 0 | (748 | ) | (748 | ) | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 1,191,262 | 0 | 291 | 0 | 0 | 0 | 291 | 0 | 0 | 1,191,262 | 0 | 291 | 0 | 0 | 0 | 291 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | (58,451 | ) | 0 | (172 | ) | 0 | 0 | 0 | (172 | ) | 0 | 0 | (58,451 | ) | 0 | (172 | ) | 0 | 0 | 0 | (172 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - March 31, 2020 | 26,364,521 | $ | 141,377 | $ | 30,264 | $ | (82,860 | ) | $ | (43,808 | ) | $ | (4,064 | ) | $ | 40,909 | 12,700 | $ | 11,982 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - March 31, 2020 | 26,364,521 | 141,377 | 30,264 | (82,860 | ) | (43,808 | ) | (4,064 | ) | 40,909 | 12,700 | 11,982 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | - | 0 | 0 | 0 | 783 | 0 | 783 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | 140 | 140 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | (95 | ) | (95 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 111,376 | 0 | 325 | 0 | 0 | 0 | 325 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - June 30, 2020 | 26,475,897 | $ | 141,377 | $ | 30,589 | $ | (82,860 | ) | $ | (43,025 | ) | $ | (4,019 | ) | $ | 42,062 | 12,700 | $ | 11,982 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | - | 0 | 0 | 0 | 3,512 | 0 | 3,512 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | - | 0 | (1,074 | ) | 0 | 0 | 0 | (1,074 | ) | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee pension plan adjustments | - | 0 | 0 | 0 | 0 | 140 | �� | 140 | - | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative qualifying as cash flow hedge | - | 0 | 0 | 0 | 0 | 57 | 57 | - | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock | 17,096 | 0 | 670 | 0 | 0 | 0 | 670 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net share settlement for equity-based compensation | (16,664 | ) | 0 | (72 | ) | 0 | 0 | 0 | (72 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE - September 30, 2020 | 26,476,329 | $ | 141,377 | $ | 30,113 | $ | (82,860 | ) | $ | (39,513 | ) | $ | (3,822 | ) | $ | 45,295 | 12,700 | $ | 11,982 |
Three Months Ended March 31, | ||||||||
2021 | 2020 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income (loss) | $ | 4,489 | $ | (1,750 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Depreciation and amortization | 1,901 | 1,890 | ||||||
Amortization of deferred finance charges | 45 | 45 | ||||||
Deferred income taxes | 1,245 | 0 | ||||||
Fixed asset donations | (29 | ) | (220 | ) | ||||
Provision for doubtful accounts | 4,181 | 6,551 | ||||||
Stock-based compensation expense | 493 | 291 | ||||||
(Increase) decrease in assets: | ||||||||
Accounts receivable | (5,371 | ) | (11,835 | ) | ||||
Inventories | (272 | ) | (227 | ) | ||||
Prepaid income taxes and income taxes receivable | 0 | 71 | ||||||
Prepaid expenses and current assets | (7,059 | ) | (6 | ) | ||||
Other assets, net | 429 | (127 | ) | |||||
Increase (decrease) in liabilities: | ||||||||
Accounts payable | 782 | (2,195 | ) | |||||
Accrued expenses | (5,979 | ) | 723 | |||||
Unearned tuition | (3,213 | ) | (5,127 | ) | ||||
Income taxes payable | (55 | ) | 0 | |||||
Other liabilities | 114 | (31 | ) | |||||
Total adjustments | (12,788 | ) | (10,197 | ) | ||||
Net cash used in operating activities | (8,299 | ) | (11,947 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (1,219 | ) | (1,287 | ) | ||||
Net cash used in investing activities | (1,219 | ) | (1,287 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Payments on borrowings | (500 | ) | (26,500 | ) | ||||
Proceeds from borrowings | 0 | �� | 11,000 | |||||
Dividend payment for preferred stock | (304 | ) | 0 | |||||
Credit of deferred finance fees | 0 | 3 | ||||||
Net share settlement for equity-based compensation | (962 | ) | (172 | ) | ||||
Net cash used in financing activities | (1,766 | ) | (15,669 | ) | ||||
NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (11,284 | ) | (28,903 | ) | ||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of period | 38,026 | 38,644 | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of period | $ | 26,742 | $ | 9,741 |
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 10,754 | $ | 2,545 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 5,620 | 5,546 | ||||||
Amortization of deferred finance charges | 136 | 136 | ||||||
Deferred income taxes | 3,636 | 0 | ||||||
Loss (gain) on disposition of assets | 1 | (96 | ) | |||||
Fixed asset donations | (2,050 | ) | (334 | ) | ||||
Provision for doubtful accounts | 19,816 | 21,692 | ||||||
Stock-based compensation expense | 2,093 | 1,286 | ||||||
(Increase) decrease in assets: | ||||||||
Accounts receivable | (22,122 | ) | (35,946 | ) | ||||
Inventories | (761 | ) | (1,258 | ) | ||||
Prepaid income taxes and income taxes payable | (729 | ) | 272 | |||||
Prepaid expenses and current assets | 725 | 1,296 | ||||||
Other assets, net | 274 | (77 | ) | |||||
Increase (decrease) in liabilities: | ||||||||
Accounts payable | (186 | ) | 1,656 | |||||
Accrued expenses | (914 | ) | 4,663 | |||||
CARES Act student funds liability | 0 | 1,073 | ||||||
CARES Act institutional funds liability | 0 | 10,387 | ||||||
Unearned tuition | 1,238 | (4,057 | ) | |||||
Other liabilities | 219 | 1,438 | ||||||
Total adjustments | 6,996 | 7,677 | ||||||
Net cash provided by operating activities | 17,750 | 10,222 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (5,252 | ) | (3,554 | ) | ||||
Proceeds from insurance | 0 | 97 | ||||||
Net cash used in investing activities | (5,252 | ) | (3,457 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Payments on borrowings | (1,500 | ) | (27,501 | ) | ||||
Proceeds from borrowings | 0 | 11,000 | ||||||
Dividend payment for preferred stock | (912 | ) | (1,074 | ) | ||||
Credit of deferred finance fees | 0 | 3 | ||||||
Net share settlement for equity-based compensation | (962 | ) | (244 | ) | ||||
Net cash used in financing activities | (3,374 | ) | (17,816 | ) | ||||
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 9,124 | (11,051 | ) | |||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of period | 38,026 | 38,644 | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of period | $ | 47,150 | $ | 27,593 |
Three Months Ended March 31, | ||||||||
2021 | 2020 | |||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||||||||
Cash paid for: | ||||||||
Interest | $ | 331 | $ | 327 | ||||
Income taxes | $ | 0 | $ | 1 | ||||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Liabilities accrued for or noncash purchases of fixed assets | $ | 1,329 | $ | 721 |
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||||||||
Cash paid for: | ||||||||
Interest | $ | 795 | $ | 845 | ||||
Income taxes | $ | 681 | $ | 121 | ||||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Liabilities accrued for or noncash purchases of fixed assets | $ | 2,684 | $ | 1,847 |
1. | DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION |
2. | NET INCOME |
Three Months Ended March 31, | ||||||||
(in thousands, except share data) | 2021 | 2020 | ||||||
Numerator: | ||||||||
Net income (loss) | $ | 4,489 | $ | (1,750 | ) | |||
Less: preferred stock dividend | (304 | ) | (308 | ) | ||||
Less: allocation to preferred stockholders | (699 | ) | 0 | |||||
Less: allocation to restricted stockholders | (252 | ) | 0 | |||||
Net income (loss) allocated to common stockholders | $ | 3,234 | $ | (2,058 | ) | |||
Basic income (loss) per share: | ||||||||
Denominator: | ||||||||
Weighted average common shares outstanding | 24,888,615 | 24,598,346 | ||||||
Basic income (loss) per share | $ | 0.13 | $ | (0.08 | ) | |||
Diluted income (loss) per share: | ||||||||
Denominator: | ||||||||
Weighted average number of: | ||||||||
Common shares outstanding | 24,888,615 | 24,598,346 | ||||||
Dilutive potential common shares outstanding: | ||||||||
Series A Preferred Stock | 0 | 0 | ||||||
Unvested restricted stock | 0 | 0 | ||||||
Stock options | 0 | 0 | ||||||
Dilutive shares outstanding | 24,888,615 | 24,598,346 | ||||||
Diluted income (loss) per share | $ | 0.13 | $ | (0.08 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
(in thousands, except share data) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Numerator: | ||||||||||||||||
Net income | $ | 3,839 | $ | 3,512 | $ | 10,754 | $ | 2,545 | ||||||||
Less: preferred stock dividend | (304 | ) | (1,074 | ) | (912 | ) | (1,074 | ) | ||||||||
Less: allocation to preferred stockholders | (582 | ) | (433 | ) | (1,629 | ) | (259 | ) | ||||||||
Less: allocation to restricted stockholders | (232 | ) | (120 | ) | (635 | ) | (65 | ) | ||||||||
Net income allocated to common stockholders | $ | 2,721 | $ | 1,885 | $ | 7,579 | $ | 1,147 | ||||||||
Basic income per share: | ||||||||||||||||
Denominator: | ||||||||||||||||
Weighted average common shares outstanding | 25,135,381 | 24,821,665 | 25,043,357 | 24,720,817 | ||||||||||||
Basic income per share | $ | 0.11 | $ | 0.08 | $ | 0.30 | $ | 0.05 | ||||||||
Diluted income per share: | ||||||||||||||||
Denominator: | ||||||||||||||||
Weighted average number of: | ||||||||||||||||
Common shares outstanding | 25,135,381 | 24,821,665 | 25,043,357 | 24,720,817 | ||||||||||||
Dilutive potential common shares outstanding: | ||||||||||||||||
Series A Preferred Stock | 0 | 0 | 0 | 0 | ||||||||||||
Unvested restricted stock | 0 | 0 | 0 | 0 | ||||||||||||
Dilutive shares outstanding | 25,135,381 | 24,821,665 | 25,043,357 | 24,720,817 | ||||||||||||
Diluted income per share | $ | 0.11 | $ | 0.08 | $ | 0.30 | $ | 0.05 |
Three Months Ended March 31, | ||||||||
(in thousands, except share data) | 2021 | 2020 | ||||||
Series A Preferred Stock | 0 | 5,448,802 | ||||||
Unvested restricted stock | 697,458 | 613,701 | ||||||
697,458 | 6,062,503 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
(in thousands, except share data) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Series A Preferred Stock | 5,381,356 | 0 | 5,381,356 | 0 | ||||||||||||
Unvested restricted stock | 815,383 | 767,056 | 823,662 | 566,370 | ||||||||||||
6,196,739 | 767,056 | 6,205,018 | 566,370 |
3. | REVENUE RECOGNITION |
Three months ended March 31, 2021 | ||||||||||||||
a | Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | |||||||||||
Timing of Revenue Recognition | ||||||||||||||
Services transferred at a point in time | $ | 3,520 | $ | 1,333 | $ | 4,853 | ||||||||
Services transferred over time | 52,150 | 20,993 | 73,143 | |||||||||||
Total revenues | $ | 55,670 | $ | 22,326 | $ | 77,996 |
Three months ended March 31, 2020 | ||||||||||||||
a | Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | |||||||||||
Timing of Revenue Recognition | ||||||||||||||
Services transferred at a point in time | $ | 2,498 | $ | 1,073 | $ | 3,571 | ||||||||
Services transferred over time | 46,558 | 19,912 | 66,470 | |||||||||||
Total revenues | $ | 49,056 | $ | 20,985 | $ | 70,041 |
Three months ended September 30, 2021 | Nine months ended September 30, 2021 | ||||||||||||||||||||||||
Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | ||||||||||||||||||||
Timing of Revenue Recognition | |||||||||||||||||||||||||
Services transferred at a point in time | $ | 6,203 | $ | 1,618 | $ | 7,821 | $ | 14,788 | $ | 4,234 | $ | 19,022 | |||||||||||||
Services transferred over time | 58,747 | | 22,491 | 81,238 | 162,798 | 65,700 | 228,498 | ||||||||||||||||||
Total revenues | $ | 64,950 | $ | 24,109 | $ | 89,059 | $ | 177,586 | $ | 69,934 | $ | 247,520 |
Three months ended September 30, 2020 | Nine months ended September 30, 2020 | ||||||||||||||||||||||||
Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | Transportation and Skilled Trades Segment | Healthcare and Other Professions Segment | Consolidated | ||||||||||||||||||||
Timing of Revenue Recognition | |||||||||||||||||||||||||
Services transferred at a point in time | $ | 5,520 | $ | 1,466 | $ | 6,986 | $ | 10,056 | $ | 3,479 | $ | 13,535 | |||||||||||||
Services transferred over time | 51,308 | 20,498 | 71,806 | 138,743 | 59,025 | 197,768 | |||||||||||||||||||
Total revenues | $ | 56,828 | $ | 21,964 | $ | 78,792 | $ | 148,799 | $ | 62,504 | $ | 211,303 |
4. | LEASES |
Three Months Ended March 31, | ||||||||
2021 | 2020 | |||||||
Operating cash flow information: | ||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 3,208 | $ | 3,840 | ||||
Non-cash activity: | ||||||||
Lease liabilities arising from obtaining right-of-use assets | $ | 50 | $ | 50 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Operating cash flow information: | ||||||||||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 3,972 | $ | 3,894 | $ | 11,009 | $ | 11,537 | ||||||||
Non-cash activity: | ||||||||||||||||
Lease liabilities arising from obtaining right-of-use assets | $ | 1,220 | $ | 6,311 | $ | 4,421 | $ | 15,092 |
March 31, | ||||||||
2021 | 2020 | |||||||
Weighted-average remaining lease term | 5.96 years | 6.06 years | ||||||
Weighted-average discount rate | 11.27 | % | 12.82 | % |
As of September 30, | ||||||||
2021 | 2020 | |||||||
Weighted-average remaining lease term | 5.49 years | 6.29 years | ||||||
Weighted-average discount rate | 10.77 | % | 11.38 | % |
Year ending December 31, | ||||
2021 (excluding the three months ended March 31, 2021) | $ | 11,507 | ||
2022 | 14,761 | |||
2023 | 13,463 | |||
2024 | 12,318 | |||
2025 | 10,761 | |||
2026 | 7,821 | |||
Thereafter | 10,561 | |||
Total lease payments | 81,192 | |||
Less: imputed interest | (21,493 | ) | ||
Present value of lease liabilities | $ | 59,699 |
Year ending December 31, | ||||
2021 (excluding the nine months ended September 30, 2021) | $ | 3,938 | ||
2022 | 15,926 | |||
2023 | 14,981 | |||
2024 | 13,413 | |||
2025 | 11,399 | |||
2026 | 3,241 | |||
Thereafter | 15,441 | |||
Total lease payments | 78,339 | |||
Less: imputed interest | (18,890 | ) | ||
Present value of lease liabilities | $ | 59,449 |
5. | GOODWILL AND LONG-LIVED ASSETS |
Gross Goodwill Balance | Accumulated Impairment Losses | Net Goodwill Balance | ||||||||||
Balance as of January 1, 2021 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 | |||||
Adjustments | 0 | - | 0 | |||||||||
Balance as of March 31, 2021 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 |
Gross Goodwill Balance | Accumulated Impairment Losses | Net Goodwill Balance | ||||||||||
Balance as of January 1, 2021 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 | |||||
Adjustments | 0 | - | 0 | |||||||||
Balance as of September 30, 2021 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 |
Gross Goodwill Balance | Accumulated Impairment Losses | Net Goodwill Balance | ||||||||||
Balance as of January 1, 2020 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 | |||||
Adjustments | 0 | - | 0 | |||||||||
Balance as of March 31, 2020 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 |
Gross Goodwill Balance | Accumulated Impairment Losses | Net Goodwill Balance | ||||||||||
Balance as of January 1, 2020 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 | |||||
Adjustments | 0 | - | 0 | |||||||||
Balance as of September 30, 2020 | $ | 117,176 | $ | (102,640 | ) | $ | 14,536 |
6. | LONG-TERM DEBT |
March 31, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | |||||||||||||
Credit agreement | $ | 17,333 | $ | 17,833 | $ | 16,333 | $ | 17,833 | ||||||||
Deferred Financing Fees | (576 | ) | (621 | ) | (485 | ) | (621 | ) | ||||||||
16,757 | 17,212 | 15,848 | 17,212 | |||||||||||||
Less current maturities | (2,000 | ) | (2,000 | ) | (2,000 | ) | (2,000 | ) | ||||||||
$ | 14,757 | $ | 15,212 | $ | 13,848 | $ | 15,212 |
Year ending December 31, | ||||||||
2021 | $ | 1,500 | ||||||
2021 (excluding the nine months ended September 30, 2021) | $ | 500 | ||||||
2022 | 2,000 | 2,000 | ||||||
2023 | 2,000 | 2,000 | ||||||
2024 | 11,833 | 11,833 | ||||||
$ | 17,333 | $ | 16,333 |
7. | STOCKHOLDERS’ EQUITY |
Shares | Weighted Average Grant Date Fair Value Per Share | |||||||
Nonvested restricted stock outstanding at December 31, 2020 | 1,572,159 | $ | 2.77 | |||||
Granted | 574,614 | 5.83 | ||||||
Canceled | 0 | 0 | ||||||
Vested | (383,226 | ) | 2.76 | |||||
Nonvested restricted stock outstanding at March 31, 2021 | 1,763,547 | 3.77 |
Shares | Weighted Average Grant Date Fair Value Per Share | |||||||
Nonvested restricted stock outstanding at December 31, 2020 | 1,572,159 | $ | 2.77 | |||||
Granted | 657,076 | 5.97 | ||||||
Canceled | 0 | 0 | ||||||
Vested | (498,936 | ) | 3.04 | |||||
Nonvested restricted stock outstanding at September 30, 2021 | 1,730,299 | 3.87 |
Shares | Weighted Average Exercise Price Per Share | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value (in thousands) | ||||||||
Outstanding at December 31, 2020 | 81,000 | $ | 7.79 | 1.17 years | $ | 0 | |||||
Granted/Vested | 0 | 0 | 0 | ||||||||
Canceled | 0 | 0 | 0 | ||||||||
Outstanding at March 31, 2021 | 81,000 | 7.79 | 0.92 years | 0 | |||||||
Vested as of March 31, 2021 | 81,000 | 7.79 | 0.92 years | 0 | |||||||
Exercisable as of March 31, 2021 | 81,000 | 7.79 | 0.92 years | 0 |
Shares | Weighted Average Exercise Price Per Share | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value (in thousands) | ||||||||||
Outstanding at December 31, 2020 | 81,000 | $ | 7.79 | 1.17 years | $ | 0 | |||||||
Granted/Vested | 0 | 0 | 0 | ||||||||||
Canceled | 0 | 0 | 0 | ||||||||||
Outstanding at September 30, 2021 | 81,000 | 7.79 | 0.42 years | 0 | |||||||||
Vested as of September 30, 2021 | 81,000 | 7.79 | 0.42 years | 0 | |||||||||
Exercisable as of September 30, 2021 | 81,000 | 7.79 | 0.42 years | 0 |
8. | INCOME TAXES |
9. | COMMITMENTS AND CONTINGENCIES |
10. | SEGMENTS |
For the Three Months Ended March 31, | ||||||||||||||||||||||||
Revenue | Operating Income (Loss) | |||||||||||||||||||||||
2021 | % of Total | 2020 | % of Total | 2021 | 2020 | |||||||||||||||||||
Transportation and Skilled Trades | $ | 55,670 | 71.4 | % | $ | 49,056 | 70.0 | % | $ | 12,324 | $ | 4,840 | ||||||||||||
Healthcare and Other Professions | 22,326 | 28.6 | % | 20,985 | 30.0 | % | 2,949 | 2,000 | ||||||||||||||||
Corporate | 0 | 0 | (9,254 | ) | (8,186 | ) | ||||||||||||||||||
Total | $ | 77,996 | 100.0 | % | $ | 70,041 | 100.0 | % | $ | 6,019 | $ | (1,346 | ) |
Total Assets | ||||||||
March 31, 2021 | December 31, 2020 | |||||||
Transportation and Skilled Trades | $ | 134,111 | $ | 133,078 | ||||
Healthcare and Other Professions | 32,453 | 32,753 | ||||||
Corporate | 73,289 | 79,359 | ||||||
Total | $ | 239,853 | $ | 245,190 |
For the Three Months Ended September 30, | ||||||||||||||||||||||||
Revenue | Operating Income (Loss) | |||||||||||||||||||||||
2021 | % of Total | 2020 | % of Total | 2021 | 2020 | |||||||||||||||||||
Transportation and Skilled Trades | $ | 64,950 | 72.9 | % | $ | 56,828 | 72.1 | % | $ | 11,842 | $ | 9,138 | ||||||||||||
Healthcare and Other Professions | 24,109 | 27.1 | % | 21,964 | 27.9 | % | 1,833 | 1,654 | ||||||||||||||||
Corporate | 0 | 0 | (7,930 | ) | (6,952 | ) | ||||||||||||||||||
Total | $ | 89,059 | 100.0 | % | $ | 78,792 | 100.0 | % | $ | 5,745 | $ | 3,840 |
For the Nine Months Ended September 30, | ||||||||||||||||||||||||
Revenue | Operating Income (Loss) | |||||||||||||||||||||||
2021 | % of Total | 2020 | % of Total | 2021 | 2020 | |||||||||||||||||||
Transportation and Skilled Trades | $ | 177,586 | 71.7 | % | $ | 148,799 | 70.4 | % | $ | 35,423 | $ | 18,848 | ||||||||||||
Healthcare and Other Professions | 69,934 | 28.3 | % | 62,504 | 29.6 | % | 7,743 | 6,388 | ||||||||||||||||
Corporate | 0 | 0 | (27,949 | ) | (21,581 | ) | ||||||||||||||||||
Total | $ | 247,520 | 100.0 | % | $ | 211,303 | 100.0 | % | $ | 15,217 | $ | 3,655 |
Total Assets | ||||||||
September 30, 2021 | December 31, 2020 | |||||||
Transportation and Skilled Trades | $ | 132,948 | $ | 133,078 | ||||
Healthcare and Other Professions | 33,516 | 32,753 | ||||||
Corporate | 86,992 | 79,359 | ||||||
Total | $ | 253,456 | $ | 245,190 |
11. | FAIR VALUE |
March 31, 2021 | ||||||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||
Financial Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 26,742 | $ | 26,742 | $ | 0 | $ | 0 | $ | 26,742 | ||||||||||
Prepaid expenses and other current assets | 10,770 | 0 | 10,770 | 0 | 10,770 | |||||||||||||||
Financial Liabilities: | ||||||||||||||||||||
Accrued expenses | $ | 10,713 | $ | 0 | $ | 10,713 | $ | 0 | $ | 10,713 | ||||||||||
Other short term liabilities | 73 | 0 | 73 | 0 | 73 | |||||||||||||||
Derivative qualifying cash flow hedge | 666 | 0 | 666 | 0 | 666 | |||||||||||||||
Credit facility | 16,757 | 0 | 15,222 | 0 | 15,222 |
September 30, 2021 | ||||||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||
Financial Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 47,150 | $ | 47,150 | $ | 0 | $ | 0 | $ | 47,150 | ||||||||||
Prepaid expenses and other current assets | 2,973 | 0 | 2,973 | 0 | 2,973 | |||||||||||||||
Financial Liabilities: | ||||||||||||||||||||
Accrued expenses | $ | 15,778 | $ | 0 | $ | 15,778 | $ | 0 | $ | 15,778 | ||||||||||
Other short term liabilities | 56 | 0 | 56 | 0 | 56 | |||||||||||||||
Derivative qualifying cash flow hedge | 552 | 0 | 552 | 0 | 552 | |||||||||||||||
Credit facility | 15,848 | 0 | 14,488 | 0 | 14,488 |
December 31, 2020 | ||||||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||
Financial Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 38,026 | $ | 38,026 | $ | 0 | $ | 0 | $ | 38,026 | ||||||||||
Prepaid expenses and other current assets | 3,723 | 0 | 3,723 | 0 | 3,723 | |||||||||||||||
Financial Liabilities: | ||||||||||||||||||||
Accrued expenses | $ | 16,692 | $ | 0 | $ | 16,692 | $ | 0 | $ | 16,692 | ||||||||||
Other short term liabilities | 26 | 0 | 26 | 0 | 26 | |||||||||||||||
Derivative qualifying cash flow hedge | 877 | 0 | 877 | 0 | 877 | |||||||||||||||
Credit facility | 17,212 | 0 | 15,487 | 0 | 15,487 |
March 31, 2021 | December 31, 2020 | |||||||||||||||
Liability(1) | Liability(1) | |||||||||||||||
Notional | Fair Value | Notional | Fair Value | |||||||||||||
Derivative derived as a hedging instrument: | ||||||||||||||||
Interest Rate Swap | $ | 17,333 | $ | 666 | $ | 17,833 | $ | 877 |
September 30, 2021 | December 31, 2020 | |||||||||||||||
Liability(1) | Liability(1) | |||||||||||||||
Notional | Fair Value | Notional | Fair Value | |||||||||||||
Derivative derived as a hedging instrument: | ||||||||||||||||
Interest Rate Swap | $ | 16,333 | $ | 552 | $ | 17,833 | $ | 877 |
(1) | The Company’s derivative liability is measured at fair value using observable market inputs such as interest rates and our own credit risk as well as an evaluation of our counterparty’s credit risk. Based on these inputs the derivative liability is classified within Level 2 of the valuation hierarchy. The liability is included in other long-term liabilities in the condensed consolidated balance sheets. |
Three Months Ended | ||||||||
March 31, 2021 | March 31, 2020 | |||||||
Interest expense | ||||||||
Interest Rate Swap | $ | 100 | $ | 100 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Interest Expense | ||||||||||||||||
Interest Rate Swap | $ | 100 | $ | 100 | $ | 200 | $ | 100 |
Three Months Ended | ||||||||
March 31, 2021 | March 31, 2020 | |||||||
Interest expense | ||||||||
Interest Rate Swap | $ | 211 | $ | (748 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Derivative qualifying as cash flow hedge | ||||||||||||||||
Interest rate swap income (loss) | $ | 65 | $ | 56 | $ | 326 | $ | (786 | ) |
12. | COVID-19 PANDEMIC AND CARES ACT |
13. |
Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Three Months Ended March 31, | Three Months Ended Sept 30, | Nine Months Ended Sept 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Revenue | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||
Costs and expenses: | ||||||||||||||||||||||||
Educational services and facilities | 41.5 | % | 43.2 | % | 42.8 | % | 43.5 | % | 42.1 | % | 42.9 | % | ||||||||||||
Selling, general and administrative | 50.8 | % | 58.7 | % | 50.8 | % | 51.7 | % | 51.8 | % | 55.4 | % | ||||||||||||
Total costs and expenses | 92.3 | % | 101.9 | % | 93.6 | % | 95.2 | % | 93.9 | % | 98.3 | % | ||||||||||||
Operating Income (loss) | 7.7 | % | -1.9 | % | ||||||||||||||||||||
Operating income | 6.4 | % | 4.8 | % | 6.1 | % | 1.7 | % | ||||||||||||||||
Interest expense, net | -0.3 | % | -0.5 | % | -0.3 | % | -0.4 | % | -0.4 | % | -0.5 | % | ||||||||||||
Income (loss) from opeartions before income taxes | 7.4 | % | -2.4 | % | ||||||||||||||||||||
Income before income taxes | 6.1 | % | 4.4 | % | 5.8 | % | 1.2 | % | ||||||||||||||||
Provision for income taxes | 1.6 | % | 0.1 | % | 1.8 | % | 0.1 | % | 1.4 | % | 0.1 | % | ||||||||||||
Net Income (loss) | 5.8 | % | -2.5 | % | ||||||||||||||||||||
Net Income | 4.3 | % | 4.3 | % | 4.3 | % | 1.1 | % |
Three Months Ended March 31, | Three Months Ended September 30, | |||||||||||||||||||||||
2021 | 2020 | % Change | 2021 | 2020 | % Change | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Transportation and Skilled Trades | $ | 55,670 | $ | 49,056 | 13.5 | % | $ | 64,950 | $ | 56,828 | 14.3 | % | ||||||||||||
Healthcare and Other Professions | 22,326 | 20,985 | 6.4 | % | ||||||||||||||||||||
HOPS | 24,109 | 21,964 | 9.8 | % | ||||||||||||||||||||
Total | $ | 77,996 | $ | 70,041 | 11.4 | % | $ | 89,059 | $ | 78,792 | 13.0 | % | ||||||||||||
Operating Income (Loss): | ||||||||||||||||||||||||
Transportation and Skilled Trades | $ | 12,324 | $ | 4,840 | 154.6 | % | $ | 11,842 | $ | 9,138 | 29.6 | % | ||||||||||||
Healthcare and Other Professions | 2,949 | 2,000 | 47.5 | % | 1,833 | 1,654 | 10.8 | % | ||||||||||||||||
Corporate | (9,254 | ) | (8,186 | ) | -13.0 | % | (7,930 | ) | (6,952 | ) | -14.1 | % | ||||||||||||
Total | $ | 6,019 | $ | (1,346 | ) | 547.2 | % | $ | 5,745 | $ | 3,840 | 49.6 | % | |||||||||||
Starts: | ||||||||||||||||||||||||
Transportation and Skilled Trades | 2,339 | 1,720 | 36.0 | % | 3,976 | 3,982 | -0.2 | % | ||||||||||||||||
Healthcare and Other Professions | 1,209 | 996 | 21.4 | % | 1,454 | 1,528 | -4.8 | % | ||||||||||||||||
Total | 3,548 | 2,716 | 30.6 | % | 5,430 | 5,510 | -1.5 | % | ||||||||||||||||
Average Population: | ||||||||||||||||||||||||
Transportation and Skilled Trades | 8,032 | 7,305 | 10.0 | % | 8,863 | 8,349 | 6.2 | % | ||||||||||||||||
Leave of Absence - COVID-19 | (15 | ) | (33 | ) | 54.5 | % | (9 | ) | (333 | ) | 97.3 | % | ||||||||||||
Transportation and Skilled Trades Excluding Leave of Absence - COVID-19 | 8,017 | 7,272 | 10.2 | % | 8,854 | 8,016 | 10.5 | % | ||||||||||||||||
Healthcare and Other Professions | 4,409 | 3,987 | 10.6 | % | 4,326 | 4,286 | 0.9 | % | ||||||||||||||||
Leave of Absence - COVID-19 | (90 | ) | (22 | ) | -309.1 | % | (2 | ) | (137 | ) | 98.5 | % | ||||||||||||
Healthcare and Other Professions Excluding Leave of Absence - COVID-19 | 4,319 | 3,965 | 8.9 | % | 4,324 | 4,149 | 4.2 | % | ||||||||||||||||
Total | 12,441 | 11,292 | 10.2 | % | 13,189 | 12,635 | 4.4 | % | ||||||||||||||||
Total Excluding Leave of Absence - COVID-19 | 12,336 | 11,237 | 9.8 | % | 13,178 | 12,165 | 8.3 | % | ||||||||||||||||
End of Period Population: | ||||||||||||||||||||||||
Transportation and Skilled Trades | 8,212 | 7,250 | 13.3 | % | 9,473 | 8,811 | 7.5 | % | ||||||||||||||||
Leave of Absence - COVID-19 | (19 | ) | (131 | ) | 85.5 | % | - | (67 | ) | 100.0 | % | |||||||||||||
Transportation and Skilled Trades Excluding Leave of Absence - COVID-19 | 8,193 | 7,119 | 15.1 | % | 9,473 | 8,744 | 8.3 | % | ||||||||||||||||
Healthcare and Other Professions | 4,532 | 4,021 | 12.7 | % | 4,533 | 4,462 | 1.6 | % | ||||||||||||||||
Leave of Absence - COVID-19 | (79 | ) | (193 | ) | 59.1 | % | - | (37 | ) | 100.0 | % | |||||||||||||
Healthcare and Other Professions Excluding Leave of Absence - COVID-19 | 4,453 | 3,828 | 16.3 | % | 4,533 | 4,425 | 2.4 | % | ||||||||||||||||
Total | 12,744 | 11,271 | 13.1 | % | 14,006 | 13,273 | 5.5 | % | ||||||||||||||||
Total Excluding Leave of Absence - COVID-19 | 12,646 | 10,947 | 15.5 | % | 14,006 | 13,169 | 6.4 | % |
Nine Months Ended September 30, | ||||||||||||
2021 | 2020 | % Change | ||||||||||
Revenue: | ||||||||||||
Transportation and Skilled Trades | $ | 177,586 | $ | 148,799 | 19.3 | % | ||||||
HOPS | 69,934 | 62,504 | 11.9 | % | ||||||||
Total | $ | 247,520 | $ | 211,303 | 17.1 | % | ||||||
Operating Income (Loss): | ||||||||||||
Transportation and Skilled Trades | $ | 35,423 | $ | 18,848 | 87.9 | % | ||||||
Healthcare and Other Professions | 7,743 | 6,388 | 21.2 | % | ||||||||
Corporate | (27,949 | ) | (21,581 | ) | -29.5 | % | ||||||
Total | $ | 15,217 | $ | 3,655 | 316.3 | % | ||||||
Starts: | ||||||||||||
Transportation and Skilled Trades | 8,824 | 8,004 | 10.2 | % | ||||||||
Healthcare and Other Professions | 3,857 | 3,651 | 5.6 | % | ||||||||
Total | 12,681 | 11,655 | 8.8 | % | ||||||||
Average Population: | ||||||||||||
Transportation and Skilled Trades | 8,312 | 7,651 | 8.6 | % | ||||||||
Leave of Absence - COVID-19 | (16 | ) | (260 | ) | 93.8 | % | ||||||
Transportation and Skilled Trades Excluding Leave of Absence - COVID-19 | 8,296 | 7,391 | 12.2 | % | ||||||||
Healthcare and Other Professions | 4,414 | 4,176 | 5.7 | % | ||||||||
Leave of Absence - COVID-19 | (44 | ) | (188 | ) | 76.6 | % | ||||||
Healthcare and Other Professions Excluding Leave of Absence - COVID-19 | 4,370 | 3,988 | 9.6 | % | ||||||||
Total | 12,726 | 11,827 | 7.6 | % | ||||||||
Total Excluding Leave of Absence - COVID-19 | 12,666 | 11,379 | 11.3 | % | ||||||||
End of Period Population: | ||||||||||||
Transportation and Skilled Trades | 9,473 | 8,811 | 7.5 | % | ||||||||
Leave of Absence - COVID-19 | - | (67 | ) | 100.0 | % | |||||||
Transportation and Skilled Trades Excluding Leave of Absence - COVID-19 | 9,473 | 8,744 | 8.3 | % | ||||||||
Healthcare and Other Professions | 4,533 | 4,462 | 1.6 | % | ||||||||
Leave of Absence - COVID-19 | - | (37 | ) | 100.0 | % | |||||||
Healthcare and Other Professions Excluding Leave of Absence - COVID-19 | 4,533 | 4,425 | 2.4 | % | ||||||||
Total | 14,006 | 13,273 | 5.5 | % | ||||||||
Total Excluding Leave of Absence - COVID-19 | 14,006 | 13,169 | 6.4 | % |
• | Revenue increased $28.8 million, or 19.3% to $177.6 million for the nine months ended September 30, 2021 from $148.8 million in the prior year comparable period. The increase in revenue was driven by several factors including average student population, up 12.2%, driven by a 10.2% increase in student starts, a 6.3% increase in average revenue per student and the normalization of our revenue stream with the return to in-person instruction at all of our campuses. |
• | Revenue increased $7.4 million, or 11.9% to $69.9 million for the nine months ended September 30, 2021 from $62.5 million in the prior year comparable period. The increase in revenue was driven by several factors including average student population, up 9.6%, driven by a 5.6% increase in student starts, a 2.1% increase in average revenue per student and the normalization of our revenue stream with the return to in-person instruction at all of our campuses. |
Three Months Ended March 31, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net cash used in operating activities | $ | (8,299 | ) | $ | (11,947 | ) | ||||||||||
Net cash provided by operating activities | $ | 17,750 | $ | 10,222 | ||||||||||||
Net cash used in investing activities | (1,219 | ) | (1,287 | ) | (5,252 | ) | (3,457 | ) | ||||||||
Net cash used in financing activities | (1,766 | ) | (15,669 | ) | (3,374 | ) | (17,816 | ) |
March 31, | December 31, | |||||||||||||||
2021 | 2020 | September 30, 2021 | December 31, 2020 | |||||||||||||
Credit agreement | $ | 17,333 | $ | 17,833 | $ | 16,333 | $ | 17,833 | ||||||||
Deferred Financing Fees | (576 | ) | (621 | ) | (485 | ) | (621 | ) | ||||||||
16,757 | 17,212 | 15,848 | 17,212 | |||||||||||||
Less current maturities | (2,000 | ) | (2,000 | ) | (2,000 | ) | (2,000 | ) | ||||||||
$ | 14,757 | $ | 15,212 | $ | 13,848 | $ | 15,212 |
Item 4. | CONTROLS AND PROCEDURES |
Item 1. | LEGAL PROCEEDINGS |
Item 5. | OTHER INFORMATION |
Item 6. | EXHIBITS |
Exhibit Number | Description | |
3.1 | Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 7, 2005. | |
3.2 | Certificate of Amendment, dated November 14, 2019, to the Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 of the Company’s Registration Statement on Form S-3 filed October 6, 2020). | |
3.3 | Bylaws of the Company, as amended on March 8, 2019 (incorporated by reference to the Company’s Form 8-K filed June 28 2005). | |
10.1 | Contract for the Purchase of Real Estate, dated as of September 24, 2021, by and between Nashville Acquisition, LLC and SLC Development, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed September 28, 2021). | |
10.2 | Agreement for Purchase and Sale of Property, dated as of September 24, 2021 by and between Lincoln Technical Institute, Inc. and LNT Denver (Multi) LLC (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K filed September 28, 2021). | |
10.3 | Consent and Waiver Letter Agreement dated as of September 23, 2021, by and among Lincoln Educational Services Corporation and certain of its subsidiaries, and Sterling National Bank (incorporated by reference to Exhibit 10.3 of the Company’s Form 8-K filed September 28, 2021). | |
31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32** | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101* | The following financial statements from Lincoln Educational Services Corporation’s Quarterly Report on Form 10-Q for the quarter ended | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* | Filed herewith. |
** | Furnished herewith. This exhibit will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. |
LINCOLN EDUCATIONAL SERVICES CORPORATION | |||
Date: | By: | /s/ Brian Meyers | |
Brian Meyers | |||
Executive Vice President, Chief Financial Officer and Treasurer |
Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 7, 2005. | ||
Certificate of Amendment, dated November 14, 2019, to the Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 of the Company’s Registration Statement on Form S-3 filed October 6, 2020). | ||
Bylaws of the Company, as amended on March 8, 2019 (incorporated by reference to the Company’s Form 8-K filed June 28 2005). | ||
Contract for the Purchase of Real Estate, dated as of September 24, 2021, by and between Nashville Acquisition, LLC and SLC Development, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed September 28, 2021). | ||
Agreement for Purchase and Sale of Property, dated as of September 24, 2021 by and between Lincoln Technical Institute, Inc. and LNT Denver (Multi) LLC (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K filed September 28, 2021). | ||
Consent and Waiver Letter Agreement dated as of September 23, 2021, by and among Lincoln Educational Services Corporation and certain of its subsidiaries, and Sterling National Bank (incorporated by reference to Exhibit 10.3 of the Company’s Form 8-K filed September 28, 2021). | ||
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
101* | The following financial statements from Lincoln Educational Services Corporation’s Quarterly Report on Form 10-Q for the quarter ended | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* | Filed herewith. |
** | Furnished herewith. This exhibit will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. |