Career Education Corporation (CECO) saw its loss narrow to $0.69 million, or $0.01 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $45.24 million, or $0.67 a share.
Revenue during the quarter dropped 17.62 percent to $167.62 million from $203.48 million in the previous year period. Operating margin for the quarter stood at negative 0.42 percent as compared to a negative 21.62 percent for the previous year period.
Operating loss for the quarter was $0.71 million, compared with an operating loss of $43.99 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $4.76 million compared with $2.70 million in the prior year period. At the same time, adjusted EBITDA margin improved 151 basis points in the quarter to 2.84 percent from 1.33 percent in the last year period.
“Increased student retention at our University Group and responsible execution of our teach-out campuses marked another quarter of improved operating performance. We are encouraged by the modest total enrollment growth at the University Group and are making meaningful progress towards our goal of responsible growth, sustained profitability and cash generation,” said Todd Nelson, President and Chief Executive Officer. “We will continue to make investments in various student serving areas of our operations to further enhance student retention and outcomes and focus on improving operating efficiencies across all our businesses. As a result of the positive trends we have been experiencing, we are updating our year end cash and adjusted EBITDA outlook we provided last quarter.”
Operating cash flow turns positive
Career Education Corporation has generated cash of $15.71 million from operating activities during the nine month period as against cash outgo of $21 million in the last year period. The company has spent $37.85 million cash to meet investing activities during the nine month period as against cash outgo of $4.40 million in the last year period.
Cash flow from financing activities was $11.03 million for the nine month period, up 3,221.39 percent or $10.69 million, when compared with the last year period.
Cash and cash equivalents stood at $55.66 million as on Sep. 30, 2016, down 19.26 percent or $13.28 million from $68.94 million on Sep. 30, 2015.
Working capital increases sharply
Career Education Corporation has recorded an increase in the working capital over the last year. It stood at $128.98 million as at Sep. 30, 2016, up 41.26 percent or $37.67 million from $91.31 million on Sep. 30, 2015. Current ratio was at 1.99 as on Sep. 30, 2016, up from 1.49 on Sep. 30, 2015.
Days sales outstanding went up to 16 days for the quarter compared with 14 days for the same period last year.
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