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AMERICAN PUBLIC EDUCATION, INC. Reports Operating Results (10-Q)

November 08, 2010 | About:
10qk

10qk

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AMERICAN PUBLIC EDUCATION, INC. (APEI) filed Quarterly Report for the period ended 2010-09-30.

American Public Education, Inc. has a market cap of $494.29 million; its shares were traded at around $26.75 with a P/E ratio of 18.07 and P/S ratio of 3.32. APEI is in the portfolios of Lee Ainslie of Maverick Capital, RS Investment Management, Ron Baron of Baron Funds, Pioneer Investments, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net course registrations increased 25% and 32% for the three and nine month period ended September 30, 2010 over the three and nine month period ended September 30, 2009, respectively. Our revenue increased from $36.5 million to $48.3 million, or by 32%, and $105.3 million to $141.9 million, or by 35%, for the three and nine month period ended September 30, 2010 over the three month and nine month period ended September 30, 2009, respectively. Operating margins decreased to 19.3% from 23.0% and 24.1% from 24.6% for the three month and nine month period ended September 30, 2010 over the three and nine month period ended September 30, 2009, respectively.

Costs and Expenses. Costs and expenses for the three months ended September 30, 2010 were $39.0 million, an increase of $10.9 million, or 39%, compared to $28.1 million for the three months ended September 30, 2009. Costs and expenses as a percentage of revenues increased to 80.7% for the three months ended September 30, 2010 from 77.0% for the three months ended September 30, 2009.

General and administrative expenses. Our general and administrative expenses for the three months ended September 30, 2010 were $8.2 million representing an increase of 27% from $6.5 million for the three months ended September 30, 2009. The increase in expense was a result of an increase in expenditures for stock-based compensation, recruiting, financial aid processing fees, and an increase in expenditures for technology, staffing, and facilities required to support a larger student body. In addition, in connection with preparing responses to the request for information from the U.S. Senate Committee on Health, Education, Labor and Pensions relating to the Committee s hearings on for-profit colleges, we incurred $326,000 in additional legal fees and related expenses. General and administrative expenses as a percentage of revenues decreased to 17.0% for the three months ended September 30, 2010 from 17.7% for the three months ended September 30, 2009. The decrease was primarily due to efficiencies realized through a higher volume of students and the number of staff and related expenses increasing at a slower rate than enrollment.

Costs and Expenses. Costs and expenses for the nine months ended September 30, 2010 were $107.7 million, an increase of $28.3 million, or 36%, compared to $79.4 million for the nine months ended September 30, 2009. Costs and expenses as a percentage of revenues increased to 75.9% for the nine months ended September 30, 2010 from 75.4% for the nine months ended September 30, 2009. This increase resulted from the factors described below.

Instructional costs and services expenses. Our instructional costs and services expenses for the nine months ended September 30, 2010 were $54.9 million, representing an increase of 31% from $41.9 million for the nine months ended September 30, 2009. This increase was directly related to an increase in the number of classes offered due to the increase in net course registrations. Instructional costs and services expenses as a percentage of revenues were 38.7% for the nine months ended September 30, 2010, compared to 39.7% for the nine months ended September 30, 2009.

General and administrative expenses. Our general and administrative expenses for the nine months ended September 30, 2010 were $23.3 million representing an increase of 25% from $18.6 million for the nine months ended September 30, 2009. The increase in expense was a result of an increase in expenditures for stock-based compensation, recruiting, financial aid processing fees, and an increase in expenditures for technology, staffing, and facilities required to support a larger student body. In addition, in connection with preparing responses to the request for information from the U.S. Senate Committee on Health, Education, Labor and Pensions relating to the Committee s hearings on for-profit colleges, we incurred $326,000 in additional legal fees and related expenses. General and administrative expenses as a percentage of revenues decreased to 16.4% for the nine months ended September 30, 2010 from 17.7% for the nine months ended September 30, 2009. The decrease was primarily due to efficiencies realized through a higher volume of students and the number of staff and related expenses increasing at a slower rate than enrollment.

Read the The complete Report

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