Career Education Corporation (CECO) has reported a 71.94 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $5.18 million, or $0.07 a share in the quarter, compared with $3.01 million, or $0.04 a share for the same period last year. Revenue during the quarter dropped 18.49 percent to $162.11 million from $198.89 million in the previous year period. Total expenses were 93.97 percent of quarterly revenues, down from 96.49 percent for the same period last year. This has led to an improvement of 252 basis points in operating margin to 6.03 percent.
Operating income for the quarter was $9.78 million, compared with $6.98 million in the previous year period.
“First quarter results were better than expected, and we continue to pursue sustainable and responsible growth opportunities within our University Group,” said Todd Nelson, president and chief executive officer. “Efficiency in our operations as well as growth in total enrollments resulted in a 31 percent increase in operating income for the University Group. We believe our strategy of investing in student-serving University Group processes is driving improved student retention and engagement while increasing the overall stability of our operations. For 2017, we expect modest enrollment growth within the University Group and remain confident in the long-term outlook we provided.”
Operating cash flow remains negative
Career Education Corporation has spent $39.05 million cash to meet operating activities during the quarter as against cash outgo of $10.19 million in the last year period. Cash flow from investing activities was $3.59 million for the quarter as against cash outgo of $8.75 million in the last year period.
The company has spent $0.79 million cash to carry out financing activities during the quarter as against cash outgo of $38.27 million in the last year period.
Cash and cash equivalents stood at $13.27 million as on Mar. 31, 2017, down 77.61 percent or $46 million from $59.27 million on Mar. 31, 2016.
Working capital declines
Career Education Corporation has witnessed a decline in the working capital over the last year. It stood at $82.64 million as at Mar. 31, 2017, down 22.93 percent or $24.59 million from $107.23 million on Mar. 31, 2016. Current ratio was at 1.67 as on Mar. 31, 2017, down from 1.79 on Mar. 31, 2016.
Days sales outstanding went up to 17 days for the quarter compared with 16 days for the same period last year.
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