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American Public Education Reports Second Quarter 2013 Results



  American Public Education Reports Second Quarter 2013 Results

Business Wire

CHARLES TOWN, W.Va. -- August 8, 2013

American Public Education, Inc. (NASDAQ: APEI) – parent company of online
learning provider American Public University System (APUS), which operates
through American Military University (AMU) and American Public University
(APU) – announced financial results for the quarter ended June 30, 2013.

Recent Highlights:

  * Net income for the second quarter of 2013 increased 17% to $10.8 million,
    or $0.60 per diluted share, compared to $9.2 million, or $0.51 per diluted
    share, in the same period of 2012.
  * Income from operations before interest income and income taxes in the
    second quarter of 2013 increased 15% to $17.2 million, compared to $15.0
    million in the same period of 2012.
  * Second quarter 2013 revenues increased 9% to $80.9 million, compared to
    $74.5 million in the second quarter of 2012.
  * Net course registrations ^ increased to approximately 99,500 in the second
    quarter of 2013, a year-over-year increase of 7%.
  * Net course registrations by new students in the second quarter of 2013
    were approximately 17,900, a decrease of approximately -9% over the same
    period of 2012.

Financial Results:

Total revenues for the second quarter of 2013 increased 9% to $80.9 million,
compared to total revenues of $74.5 million in the second quarter of 2012.
Income from operations before interest income and income taxes in the second
quarter of 2013 increased 15% to $17.2 million, compared to $15.0 million in
the same period of 2012. Stock-based compensation expense reduced operating
income by approximately $1.0 million in the second quarter of 2013 and $0.9
million in the second quarter of 2012.

Net income for the second quarter of 2013 was $10.8 million, or $0.60 per
diluted share, which includes $0.03 per diluted share in stock-based
compensation expense, net of tax. This compares to net income of $9.2 million,
or $0.51 per diluted share for the second quarter of 2012, including $0.03 per
diluted share in stock-based compensation expense, net of tax. The weighted
average diluted shares outstanding for the second quarter of 2013 and for the
second quarter of 2012 were approximately 17.8 million and 18.2 million,
respectively.

For the six months ended June 30, 2013, total revenues were $164.8 million, an
increase of 10% compared to total revenues of $150.4 million in the same
period of 2012. Income from operations before interest income and income tax
for the six months ended June 30, 2013 increased 18% to $35.4 million,
compared to $29.9 million in the same period of 2012. Stock-based compensation
expense reduced each period's operating income by $2.0 million and $1.9
million, respectively.

Net income for the six months ended June 30, 2013 to $22.1 million, or $1.23
per diluted share, which includes $0.07 per diluted share in stock-based
compensation expense, net of tax. This compares to net income of $18.3
million, or $1.01 per diluted share, in the same period of 2012, including
$0.06 per diluted share in stock-based compensation expense, net of tax. The
weighted average diluted shares outstanding for the six months ended June 30,
2013 and 2012 were approximately 17.9 million and 18.2 million, respectively.

Total cash and cash equivalents as of June 30, 2013 were approximately $128.1
million with no long-term debt. Cash from operations for the three months
ended June 30, 2013 was approximately $34.6 million, compared to $22.7 million
in the same period of 2012. Capital expenditures were approximately $10.9
million for the three months ended June 30, 2013, compared to $18.9 million in
the prior year period. Depreciation and amortization was $3.3 million for the
three months ended June 30, 2013 and $2.7 million for the same period of 2012.

                                                              
Net Course Registrations:
For the three months ended June 30,        2013      2012      % Change
Net Course Registrations by New Students   17,900    19,600    -9%
Net Course Registrations                   99,500    92,900    7%
 
For the six months ended June 30,          2013      2012      % Change
Net Course Registrations by New Students   36,900    40,100    -8%
Net Course Registrations                   209,200   193,900   8%

Note: Net course registrations represent the aggregate number of classes in
which students remain enrolled after the date by which they may drop the
course without financial penalty. Net course registrations and net course
registration growth rates include registrations for certain one-credit courses
(non-lab courses) and other non-credit registrations in the current and prior
year periods.
 

Third Quarter 2013 Outlook:

The following statements are based on current expectations. These statements
are forward-looking and actual results may differ materially. The Company
undertakes no obligation to update publicly any forward-looking statements for
any reason.

American Public Education anticipates third quarter 2013 net course
registrations by new students to decline between -15% and -11% year-over-year;
net course registrations to be approximately flat year-over-year; and revenues
to increase between approximately 0% and 4% over the prior year period. In the
third quarter of 2013, the Company expects net income to be between $0.52 and
$0.56 per diluted share.

Webcast:

A live webcast of the Company’s second quarter earnings conference call will
be broadcast today at 8:00 a.m. Eastern time. This call will be open to
listeners who log in through the Company's investor relations website,
www.AmericanPublicEducation.com.

A replay of the live webcast will also be available starting approximately one
hour after the conclusion of the live conference call. The replay will be
archived and available to listeners for one year.

About American Public Education, Inc.

American Public Education, Inc. (NASDAQ: APEI) is an online provider of higher
education focused primarily on serving the military and public service
communities. American Public University System (APUS), wholly owned by APEI,
operates through American Military University (AMU) and American Public
University (APU). APUS serves more than 100,000 adult learners worldwide and
offers more than 90 degree programs in fields ranging from homeland security,
military studies, intelligence, and criminal justice to technology, business
administration, public health, and liberal arts. Nationally recognized for its
best practices in online higher education, APUS provides an affordable
education through classes taught by experienced faculty who are committed to
the academic achievement of their students.

American Public University System is accredited by The Higher Learning
Commission and is a member of the North Central Association of Colleges and
Schools (www.ncahlc.org). For more information about APUS graduation rates,
median debt of students who completed programs, and other important
information, visit www.apus.edu/disclosure.

Forward Looking Statements

Statements made in this press release regarding American Public Education,
Inc., or its subsidiaries, that are not historical facts are forward-looking
statements based on current expectations, assumptions, estimates and
projections about American Public Education, Inc. and the industry. These
forward-looking statements are subject to risks and uncertainties that could
cause actual future events or results to differ materially from such
statements. Forward-looking statements can be identified by words such as
"anticipate", "believe", "could", "estimate", "expect", "intend", "may",
"should", "will" and "would". These forward-looking statements include,
without limitation, statements regarding expected growth, expected revenues
and expected earnings. Actual results could differ materially from those
expressed or implied by these forward-looking statements as a result of
various factors, including the various risks described in the "Risk Factors"
section and elsewhere in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2012, Quarterly Report on Form 10-Q for the quarter ended
June 30, 2013, and other filings with the SEC. The Company undertakes no
obligation to update publicly any forward-looking statements for any reason,
even if new information becomes available or other events occur in the future.

 
American Public Education, Inc.
Consolidated Statement of Income
(In thousands, except per share data)
 
                                                     Three Months Ended
                                                     June 30,
                                                     2013          2012       
                                                     (Unaudited)
                                                                      
Revenues                                             $ 80,925      $ 74,572   
Costs and expenses:
Instructional costs and services                       27,207        26,249
Selling and promotional                                16,045        14,475
General and administrative                             17,158        16,141
Depreciation and amortization                          3,312         2,715    
                                                                      
Total costs and expenses                               63,722        59,580   
                                                                      
Income from operations before interest income and      17,203        14,992
income taxes
Interest income (expense), net                         88            (34     )
                                                                      
Income before income taxes                             17,291        14,958
Income tax expense                                     6,543         5,717
Equity investment gain (loss), net of taxes            2             -        
                                                                      
Net income                                           $ 10,750      $ 9,241    
                                                                      
                                                                      
Net Income per common share:
Basic                                                  0.61        $ 0.52     
                                                                      
Diluted                                                0.60        $ 0.51     
                                                                      
Weighted average number of common shares:
Basic                                                  17,646        17,911   
                                                                      
Diluted                                                17,836        18,151   
                                                                      
                                                                      
American Public Education, Inc.
Consolidated Statement of Income
(In thousands, except per share data)
 
                                                     Six Months Ended
                                                     June 30,
                                                     2013          2012       
                                                     (Unaudited)
                                                                      
Revenues                                             $ 164,765     $ 150,394  
Costs and expenses:
Instructional costs and services                       55,612        54,102
Selling and promotional                                32,584        28,846
General and administrative                             34,637        32,213
Depreciation and amortization                          6,519         5,371    
                                                                      
Total costs and expenses                               129,352       120,532  
                                                                      
Income from operations before interest income and      35,413        29,862
income taxes
Interest income (expense), net                         153           (13     )
                                                                      
Income before income taxes                             35,566        29,849
Income tax expense                                     13,394        11,525
Equity investment gain (loss), net of taxes            (46     )     -        
                                                                      
Net income                                           $ 22,126      $ 18,324   
                                                                      
                                                                      
Net Income per common share:
Basic                                                  1.25        $ 1.02     
                                                                      
Diluted                                                1.23        $ 1.01     
                                                                      
Weighted average number of common shares:
Basic                                                  17,705        17,882   
                                                                      
Diluted                                                17,948        18,182   

Contact:

American Public Education, Inc.
Harry T. Wilkins, CPA
Executive Vice President and Chief Financial Officer
304-724-3722
or
Christopher L. Symanoskie
Vice President, Investor Relations
703-334-3880
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