0001261654FALSE00012616542024-08-062024-08-06
____________________________________________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 6, 2024
UNIVERSAL TECHNICAL INSTITUTE, INC.
(Exact name of registrant as specified in its charter)
| | | | | | | | |
| Delaware | 1-31923 | 86-0226984 |
(State or other jurisdiction
of incorporation) | (Commission
File Number) | (IRS Employer
Identification No.) |
| | | | | |
4225 E. Windrose Drive, Suite 200 Phoenix, AZ (Address of principal executive offices) | 85032 (Zip Code) |
(623) 445-9500
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | |
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, $0.0001 par value per share | UTI | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
☐ Emerging growth company
☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 2.02 Results of Operations and Financial Condition.
On August 6, 2024, Universal Technical Institute, Inc. (the "Company") issued a press release reporting its third quarter results for fiscal 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Form 8-K”) and is incorporated into this Item 2.02 by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits | | | | | | | | | | | |
| | | | |
| Exhibit No. | | Description | |
| | | |
| 99.1 | | | |
| 99.2 | | | |
| 99.3 | | | |
| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. | | | | | | | | | | | | | | |
| | | | | |
| | | UNIVERSAL TECHNICAL INSTITUTE, INC. |
| | | | | |
| August 6, 2024 | | By: | | /s/ Troy R. Anderson |
| | | Name: | | Troy R. Anderson |
| | | Title: | | Executive Vice President and Chief Financial Officer |
Exhibit 99.1
Universal Technical Institute Reports Fiscal Year 2024 Third Quarter Results
PHOENIX, ARIZ. - August 6, 2024 - Universal Technical Institute, Inc. (NYSE: UTI), a leading workforce solutions provider of transportation, skilled trades and healthcare education programs, reported financial results for the fiscal 2024 third quarter ended June 30, 2024. Universal Technical Institute, Inc. operates in two reportable segments, Universal Technical Institute (UTI) and Concorde Career Colleges (Concorde), and together with its segments and subsidiaries is referred to as the “Company,” “we,” “us” or “our.”
•Revenue of $177.5 million representing 15.8% growth versus the prior year period.
•Average undergraduate full-time active students growth of 13.4% versus the prior year period, while total new student starts grew 5.0%.
•Net income of $5.0 million and adjusted EBITDA(1) of $18.4 million, both increasing considerably versus the prior year period.
•Reiterating full year guidance for all key metrics, with revenue and new student starts trending towards the higher-end of the previously communicated ranges.
•Also reiterating initial projections for fiscal 2025 which indicate revenue of nearly $800 million and adjusted EBITDA(1) margin of approximately 15%, representing at least 100 basis points of adjusted EBITDA(1) margin expansion versus fiscal 2024.
•Announced organic strategic roadmap that will drive approximately 10% average annual revenue growth and achieve adjusted EBITDA(1) margin approaching 20% between fiscal 2024 and fiscal 2029.
“Our momentum persisted as we moved into the second half of the fiscal year,” said Jerome Grant, CEO of Universal Technical Institute, Inc. “We have been highly focused on ramping up our most recent program launches, enhancing the yield of marketing investments to maximize lead generation and inquiry conversion, and optimizing our workforce and facilities utilization. These initiatives have translated into strong performance across the board as we increased revenue, expanded our margins, and improved our overall operating leverage compared to the prior-year period.
“As this fiscal year comes to a close, we are strongly positioned to meet our fiscal 2024 guidance, and are setting a solid foundation for achieving our initial projections for fiscal 2025. We are nearing the successful completion of the first phase of our multi-year growth and diversification plan, which we have been internally calling our ‘North Star Strategy.’ Now, we are entering the second phase of our North Star Strategy, enabling us to begin rolling out expectations for the next leg of our journey. Through fiscal 2029, we aim to add a minimum of six new programs each year beginning in fiscal 2025 and open at least two new campuses each year across our divisions starting in fiscal 2026. As a result of these actions, we expect to generate a compound annual revenue growth rate of approximately 10% and an adjusted EBITDA margin approaching 20% by the end of fiscal 2029. This next phase will significantly expand our footprint and market presence, positioning us to capitalize on the increasing demand for highly trained ‘skilled collar’ workers in America.
“Overall, we remain committed to executing our organic initiatives – expanding our geographic reach, introducing new program offerings, and adding new partner relationships across programs – in addition to continuing to opportunistically pursue strategic acquisitions. We have a proven track record of enhancing and profitably growing each of our divisions, positioning us as a leading workforce solutions provider. Momentum remains strong, and we are highly confident in our ability to continue executing as we transition into the next stage of our long-term growth plan.”
Financial Results for the Three-Month Period Ended June 30, 2024 Compared to 2023
•Revenues increased 15.8% to $177.5 million compared to $153.3 million primarily due to the growth in both UTI and Concorde average undergraduate full-time active students.
•Operating expenses rose by 11.4% to $170.0 million, compared to $152.6 million primarily due to an increase in expenses associated with new program launches at both UTI and Concorde.
•Operating income increased to $7.4 million, compared to $0.7 million.
•Net income increased to $5.0 million, compared to a net loss of $0.5 million.
•Basic and diluted earnings per share (“EPS”) were $0.09, both compared to a loss per share of $(0.05).
•Adjusted EBITDA(1) increased 60.9% to $18.4 million, compared to $11.4 million.
UTI
•Revenues of $117.1 million, an increase of $16.3 million, or 16.1%, from the prior period revenues of $100.9 million, due primarily to growth in average undergraduate full-time active students.
•Operating expenses were $103.0 million compared to $95.8 million. The increase was primarily due to growth in average undergraduate full-time active students and expenses incurred during the current year for new program launches currently underway and completed over the past year.
•Adjusted EBITDA(1) was $20.7 million compared to $12.6 million.
•Average undergraduate full-time active students increased by 13.0% versus the prior year period, while timing shifts between June and July resulted in a 12.5% decrease in new student starts.
Concorde
•Revenues of $60.3 million, an increase of $7.9 million, or 15.0%, from the prior period revenues of $52.4 million due primarily to growth in average undergraduate full-time active students.
•Operating expenses were $56.6 million compared to $50.5 million. The increase was primarily due to growth in average undergraduate full-time active students and additional expenses incurred during the current year related to new program launches.
•Adjusted EBITDA(1) was $5.9 million compared to $4.0 million.
•Average undergraduate full-time active students increased by 14.0% versus the prior year period, while timing shifts of clinical start opportunities between the third and fourth quarters resulted in an increase in new student starts of 34.8%.
“We delivered strong financial and operational results in the quarter as we met or exceeded our expectations across all metrics,” said Troy Anderson, CFO of Universal Technical Institute, Inc. “The Concorde division continued to outperform as we benefited from our marketing and optimization efforts and expanded program offerings, which yielded solid growth in average undergraduate full-time active students. The UTI division also demonstrated strong progress showing healthy growth in average full-time active students, leading to double digit increases across the top and bottom lines. The decline in new student starts in the UTI division during the quarter reflected timing shifts between June and July and will be more than offset by strong growth in the fourth quarter. Overall, both divisions performed in line with the seasonality we forecasted for the quarter, and we are pleased with our consolidated results for the quarter.
“Moving into the fourth quarter, we remain highly confident in our ability to achieve our guidance for the fiscal year. We are reiterating our full year guidance for all key metrics and currently expect to achieve the higher end of our guidance ranges for revenue and new student starts. We also remain confident in the initial expectations we provided for fiscal year 2025, which are revenue of nearly $800 million and adjusted EBITDA margin expansion of at least 100 basis points compared to fiscal year 2024. Our solid execution and experienced team, coupled with the growing markets we serve, position us well for continued success, and we look forward to further delivering upon the expectations we have set.”
Financial Results for the Nine-Month Period Ended June 30, 2024 Compared to 2023(2)
•Revenues increased 22.7% to $536.3 million compared to $437.1 million primarily due to the growth in both UTI and Concorde average undergraduate full-time active students and the inclusion of two additional months of revenue for Concorde(2).
•Operating expenses rose by 18.2% to $503.5 million, compared to $426.1 million primarily due to the growth in both UTI and Concorde average undergraduate full-time active students, costs associated with program expansions and the inclusion of two additional months of expenses for Concorde(2).
•Operating income increased 197.2% to $32.9 million, compared to $11.1 million.
•Net income increased 312.2% to $23.2 million compared to $5.6 million.
•Basic and diluted EPS were $0.40 and $0.39 compared to $0.03 and $0.03, respectively.
•Adjusted EBITDA(1) increased 45.4% to $65.5 million compared to $45.1 million.
UTI
•Revenues of $355.8 million, an increase of $41.8 million, or 13.3%, from the prior period revenues of $314.0 million, due to the growth in average undergraduate full-time active students.
•Operating expenses were $308.5 million compared to $285.7 million. The increase was primarily due to the growth in average undergraduate full-time active students and expenses incurred during the current year for new program launches currently underway and completed over the past year.
•Adjusted EBITDA(1) was $66.7 million compared to $50.1 million.
•Average undergraduate full-time active students increased by 9.6% from the prior year period while new student starts increased 5.1%.
Concorde(2)
•Revenues of $180.5 million, an increase of $57.4 million, or 46.6%, from the prior period revenues of $123.1 million due to the inclusion of two additional months of revenue during the current year, along with growth in average undergraduate full-time active students.
•Operating expenses were $166.4 million compared to $115.7 million. The increase was due to the inclusion of two additional months of expenses during the current year and additional expenses related to higher average undergraduate students and program launches.
•Adjusted EBITDA(1) was $20.0 million compared to $12.3 million.
•Average undergraduate full-time active students increased by 9.6% versus the prior year period while new student starts increased by 61.3% partially due to the inclusion of two additional months during the current year.
(1) See the "Use of Non-GAAP Financial Information" below. For a detailed reconciliation of the non-GAAP measures, see the tables following the earnings release.
(2) The nine months ended June 30, 2023 reflects UTI results for the full quarter and Concorde results beginning December 1, 2022. Total company year-to-date comparisons are shown on an "as-reported basis."
Balance Sheet and Liquidity
At June 30, 2024, the Company’s total available cash liquidity was $148.5 million which includes $33.0 million available from its revolving credit facility. Capital expenditures (“capex”) for the quarter and year-to date period were $7.0 million and $16.8 million, respectively. The primary driver of capex is the program expansion investments for both UTI and Concorde, along with spending associated with curriculum and equipment refresh and upgrades, facility and leasehold improvements, and IT investments.
For the Company’s most recent investor presentation and quarterly financial supplement, please see its investor relations website at https://investor.uti.edu.
Conference Call
Management will hold a conference call to discuss the financial results for the fiscal 2024 third quarter ended June 30, 2024, on Tuesday, August 6, 2024, at 4:30 p.m. ET.
To participate in the live call, investors are invited to dial (844) 881-0138 (domestic) or (412) 317-6790 (international). A live webcast of the call will be available via the Universal Technical Institute, Inc. investor relations website at https://investor.uti.edu. Please go to the website at least 10 minutes early to register, download and install any necessary audio software. The conference call webcast will be archived for fourteen days at https://investor.uti.edu. Alternatively, the telephone replay can be accessed through August 20, 2024, by dialing (877) 344-7529 (domestic) or (412) 317-0088 (international) and entering passcode 9714765.
Use of Non-GAAP Financial Information
In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company also discloses certain non-GAAP financial information in this press release and may similarly disclose non-GAAP financial information on the related conference call. These financial measures are not recognized measures under GAAP and are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company discloses these non-GAAP financial measures because it believes that they provide investors an additional analytical tool to clarify its results of operations and identify underlying trends. Additionally, the Company believes that these measures may also help investors compare its performance on a consistent basis across time periods. Additional details on our non-GAAP measures and the tables reconciling these measures to the most directly comparable GAAP measure are provided below.
Adjusted EBITDA: The Company defines adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation and amortization, adjusted for stock-based compensation expense and items not considered normal recurring operations.
Adjusted Free Cash Flow: The Company defines adjusted free cash flow as net cash provided by (used in) operating activities less capital expenditures, adjusted for items not considered normal recurring operations.
Management utilizes adjusted figures as performance measures internally for operating decisions, strategic planning, annual budgeting and forecasting. For the periods presented, our adjustments for items that management does not consider to be normal recurring operations include:
•Acquisition-related costs: We have excluded costs associated with both potential and announced acquisitions to allow for comparable financial results to historical operations and forward-looking guidance.
•Integration-related costs for completed acquisitions: We have excluded integration costs related to business structure realignment and new programs for recent acquisitions to allow for comparable financial results to historical operations and forward-looking guidance. In addition, the nature and amount of such charges vary significantly based on the size and timing of the programs. By excluding the referenced expenses from our non-GAAP financial measures, our management is able to further evaluate our ability to utilize existing assets and estimate their long-term value. Furthermore, our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.
•One-time costs associated with new campus openings: During fiscal 2022, we opened new campus locations in Austin, Texas and Miramar, Florida. We continued to incur one-time costs during fiscal 2023 for the campus opening as we completed the build-out of the remaining programs in the new facilities. We disclose any campus adjustments as direct costs (net of any corporate allocations). Outfitting a new campus requires significant facility improvements and modifications, and the purchase of technical equipment and training aids necessary for teaching our programs, the combination of which requires a significant investment by the Company which would not be considered part of normal recurring operations.
•Restructuring charges: In December 2023, we announced plans to consolidate the two Houston, Texas campus locations to align the curriculum, student facing systems, and support services to better serve students seeking careers in in-demand fields. As part of the transition, the MIAT Houston campus, acquired in November 2021, began a phased teach-out in May 2024, and such campus began operating under the UTI brand. MIAT-Houston students who have not completed their programs before their program’s teach-out date may enroll at UTI-Houston to complete their program. Both facilities will remain in use post-consolidation.
•Costs related to the purchase of our campuses: We lease the majority of our campus locations. Over the past three years due to shifts within the real estate environment, we have been presented with the opportunity to purchase three of our campus locations. These purchases are significant capital expenditures and not considered part of normal recurring operations.
To obtain a complete understanding of our performance, these measures should be examined in connection with net income (loss) and net cash provided by (used in) operating activities, determined in accordance with GAAP, as presented in the financial statements and notes thereto included in the annual and quarterly filings with the Securities and Exchange Commission (“SEC”). Because the items excluded from these non-GAAP measures are significant components in understanding and assessing our financial performance under GAAP, these measures should not be considered to be an alternative to net income (loss) or net cash provided by (used in) operating activities as a measure of our operating performance or liquidity. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may define and calculate non-GAAP financial measures differently than we do, limiting their usefulness as a comparative measure across similarly titled performance measures presented by other companies. A reconciliation of the historical non-GAAP financial measures to the most directly comparable GAAP measures is provided below and investors are encouraged to review the reconciliations.
Forward Looking Statements
All statements contained in this press release and the related conference call, other than statements of historical fact, are "forward-looking" statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). These forward-looking statements which address our expected future business and financial performance, may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will," the negative form of these expressions or similar expressions. Examples of forward-looking statements include, among others, statements regarding (1) the Company’s expectation that it will meet its fiscal year 2024 guidance for new student start growth (decline), revenue growth, net income, diluted earnings per share, Adjusted EBITDA and Adjusted Free Cash Flow; (2) the Company’s expectation that it will continue to expand its value proposition and build a business that can grow in low-to-mid single digits with potential upside, regardless of the economic environment; and (3) the Company’s expectation that it will succeed in new program launches next year. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of its business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could affect our actual results include, among other things, failure of our schools to comply with the extensive regulatory requirements for school operations; our failure to maintain eligibility for federal student financial assistance funds; the effect of current and future Title IV Program regulations arising out of negotiated rulemakings, including any potential reductions in funding or restrictions on the use of funds received through Title IV Programs; the effect of future legislative or regulatory initiatives related to veterans’ benefit programs; continued Congressional examination of the for-profit education sector; our failure to maintain eligibility for or the ability to process federal student financial assistance; regulatory investigations of, or actions commenced against, us or other companies in our industry; changes in the state regulatory environment or budgetary constraints; our failure to execute on our growth and diversification strategy, including effectively identifying, establishing and operating additional schools, programs or campuses; our failure to realize the expected benefits of our acquisitions, or our failure to successfully integrate our acquisitions.; our failure to improve underutilized capacity at certain of our campuses; enrollment declines or challenges in our students’ ability to find employment as a result of macroeconomic conditions; our failure to maintain and expand existing industry relationships and develop new industry relationships; our ability to update and expand the content of existing programs and develop and integrate new programs in a timely and cost-effective manner while maintaining positive student outcomes; a loss of our senior management or other key employees; failure to comply with the restrictive covenants and our ability to pay the amounts when due under the Credit Agreement; the effect of our principal stockholder owning a significant percentage of our capital stock, and thus being able to influence certain corporate matters and the potential in the future to gain substantial control over our company; the effect of public health pandemics, epidemics or outbreak, including COVID-19, and other risks that are described from time to time in our public filings. Further information on these and other potential factors that could affect the financial results or condition may be found in the company's filings with the SEC. Any forward-looking statements made by us in this press
release and the related conference call are based only on information currently available to us and speak only as of the date on which it is made. We expressly disclaim any obligation to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, changes in expectations, any changes in events, conditions or circumstances, or otherwise.
Social Media Disclosure
Universal Technical Institute, Inc uses its websites (https://www.uti.edu/, https://concorde.edu, and https://investor.uti.edu/) and LinkedIn pages (https://www.linkedin.com/school/universal-technical-institute/ and https://www.linkedin.com/school/concorde-career-colleges/) as channels of distribution of information about its programs, its planned financial and other announcements, its attendance at upcoming investor and industry conferences, and other matters. Such information may be deemed material information, and the Company may use these channels to comply with its disclosure obligations under Regulation FD. Therefore, investors should monitor the company's website and its social media accounts in addition to following the company's press releases, SEC filings, public conference calls, and webcasts.
About Universal Technical Institute, Inc.
Universal Technical Institute, Inc. (NYSE: UTI) was founded in 1965 and is a leading workforce solutions provider of transportation, skilled trades and healthcare education programs, whose mission is to serve students, partners, and communities by providing quality education and support services for in-demand careers across a number of highly-skilled fields. The Company is comprised of two divisions: Universal Technical Institute ("UTI") and Concorde Career Colleges ("Concorde"). UTI operates 16 campuses located in 9 states and offers a wide range of transportation and skilled trades technical training programs under brands such as UTI, MIAT College of Technology, Motorcycle Mechanics Institute, Marine Mechanics Institute and NASCAR Technical Institute. Concorde operates across 17 campuses in 8 states and online, offering programs in the Allied Health, Dental, Nursing, Patient Care and Diagnostic fields. For more information, visit www.uti.edu or www.concorde.edu, or visit us on LinkedIn at @UniversalTechnicalInstitute and @Concorde Career Colleges or on X (formerly Twitter) @news_UTI or @ConcordeCareer.
Company Contact:
Troy R. Anderson
Chief Financial Officer
Universal Technical Institute, Inc.
(623) 445-9365
Media Contact:
Susan Aspey
Vice President, Corporate Affairs & External Communications
Universal Technical Institute, Inc.
(202) 549-0534
saspey@uti.edu
Investor Relations Contact:
Matt Glover or Cody Cree
Gateway Group, Inc.
(949) 574-3860
UTI@gateway-grp.com
(Tables Follow)
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| | 2024 | | 2023 | | 2024 | | 2023 |
| Revenues | $ | 177,458 | | | $ | 153,286 | | | $ | 536,329 | | | $ | 437,110 | |
| Operating expenses: | | | | | | | |
| Educational services and facilities | 95,277 | | | 88,377 | | | 285,174 | | | 236,715 | |
| Selling, general and administrative | 74,735 | | | 64,246 | | | 218,286 | | | 189,335 | |
| Total operating expenses | 170,012 | | | 152,623 | | | 503,460 | | | 426,050 | |
| Income from operations | 7,446 | | | 663 | | | 32,869 | | | 11,060 | |
| Other (expense) income: | | | | | | | |
| Interest income | 1,440 | | | 1,632 | | | 4,842 | | | 4,260 | |
| Interest expense | (2,149) | | | (2,957) | | | (7,204) | | | (7,017) | |
| Other income (expense), net | 20 | | | 89 | | | 353 | | | 540 | |
| Total other expense, net | (689) | | | (1,236) | | | (2,009) | | | (2,217) | |
| Income (loss) before income taxes | 6,757 | | | (573) | | | 30,860 | | | 8,843 | |
| Income tax (expense) benefit | (1,772) | | | 64 | | | (7,699) | | | (3,224) | |
| Net income (loss) | $ | 4,985 | | | $ | (509) | | | $ | 23,161 | | | $ | 5,619 | |
| Preferred stock dividends | — | | | (1,263) | | | (1,097) | | | (3,791) | |
| Income (loss) available for distribution | 4,985 | | | (1,772) | | | 22,064 | | | 1,828 | |
| Income allocated to participating securities | — | | | — | | | (2,855) | | | (684) | |
| Net income (loss) available to common shareholders | $ | 4,985 | | | $ | (1,772) | | | $ | 19,209 | | | $ | 1,144 | |
| | | | | | | |
| Earnings per share: | | | | | | | |
| Net income (loss) per share - basic | $ | 0.09 | | | $ | (0.05) | | | $ | 0.40 | | | $ | 0.03 | |
| Net income (loss) per share - diluted | $ | 0.09 | | | $ | (0.05) | | | $ | 0.39 | | | $ | 0.03 | |
| | | | | | | |
Weighted average number of shares outstanding(1): | | | | | | |
| Basic | 53,805 | | | 34,067 | | | 47,956 | | | 33,956 | |
| Diluted | 54,951 | | | 34,067 | | | 49,041 | | | 34,402 | |
(1) On December 18, 2023, the Company exercised in full its right of conversion of the Company’s Series A Preferred Stock which resulted in the conversion of all outstanding Series A Preferred shares into 19,296,843 shares of Common Stock. As of June 30, 2024 there were 53,811,817 shares of Common Stock outstanding.
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value and per share amounts)
(Unaudited)
| | | | | | | | | | | |
| June 30, 2024 | | September 30, 2023 |
| Assets | |
| Cash and cash equivalents | $ | 115,505 | | | $ | 151,547 | |
| Restricted cash | 3,611 | | | 5,377 | |
| | | |
| Receivables, net | 30,024 | | | 25,161 | |
| Notes receivable, current portion | 6,194 | | | 5,991 | |
| Prepaid expenses | 13,650 | | | 9,412 | |
| Other current assets | 7,581 | | | 7,497 | |
| Total current assets | 176,565 | | | 204,985 | |
| Property and equipment, net | 263,252 | | | 266,346 | |
| Goodwill | 28,459 | | | 28,459 | |
| Intangible assets, net | 18,453 | | | 18,975 | |
| Notes receivable, less current portion | 35,164 | | | 30,672 | |
| Right-of-use assets for operating leases | 164,170 | | | 176,657 | |
| Deferred tax asset, net | 6,577 | | | 3,768 | |
| Other assets | 13,401 | | | 10,823 | |
| Total assets | $ | 706,041 | | | $ | 740,685 | |
| Liabilities and Shareholders’ Equity | | | |
| Accounts payable and accrued expenses | $ | 79,846 | | | $ | 69,941 | |
| | | |
| Deferred revenue | 65,977 | | | 85,738 | |
| | | |
| Operating lease liability, current portion | 22,275 | | | 22,481 | |
| Long-term debt, current portion | 2,656 | | | 2,517 | |
| Other current liabilities | 3,007 | | | 4,023 | |
| Total current liabilities | 173,761 | | | 184,700 | |
| Deferred tax liabilities, net | 663 | | | 663 | |
| Operating lease liability | 153,267 | | | 165,026 | |
| Long-term debt | 134,671 | | | 159,600 | |
| Other liabilities | 4,296 | | | 4,729 | |
| Total liabilities | 466,658 | | | 514,718 | |
| Commitments and contingencies | | | |
| Shareholders’ equity: | | | |
Common stock, $0.0001 par value, 100,000 shares authorized, 53,894 and 34,157 shares issued, 53,812 and 34075 shares outstanding. | 5 | | | 3 | |
Preferred stock, $0.0001 par value, 10,000 shares authorized; 0 and 676 shares of Series A Convertible Preferred Stock issued and outstanding, liquidation preference of $100 per share | — | | | — | |
| Paid-in capital - common | 218,150 | | | 151,439 | |
| Paid-in capital - preferred | — | | | 66,481 | |
Treasury stock, at cost, 82 shares | (365) | | | (365) | |
| Retained earnings | 19,669 | | | 5,946 | |
| Accumulated other comprehensive income | 1,924 | | | 2,463 | |
| Total shareholders’ equity | 239,383 | | | 225,967 | |
| Total liabilities and shareholders’ equity | $ | 706,041 | | | $ | 740,685 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| | | | | | | | | | | | | | |
| | Nine Months Ended June 30, |
| | | 2024 | | 2023 |
| Cash flows from operating activities: | | | | |
| Net income | | $ | 23,161 | | | $ | 5,619 | |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | |
| Depreciation and amortization | | 21,562 | | | 18,649 | |
| | | | |
| Amortization of right-of-use assets for operating leases | | 16,468 | | | 15,439 | |
| | | | |
| | | | |
| Bad debt expense | | 5,066 | | | 1,447 | |
| Stock-based compensation | | 5,698 | | | 3,815 | |
| Deferred income taxes | | (2,336) | | | 2,594 | |
| | | | |
| | | | |
| Training equipment credits earned, net | | 1,309 | | | 1,299 | |
| Unrealized loss on interest rate swap | | (539) | | | (151) | |
| Other (gains) losses, net | | 137 | | | (197) | |
| Changes in assets and liabilities: | | | | |
| Receivables | | (9,736) | | | (2,869) | |
| Prepaid expenses | | (7,316) | | | (3,293) | |
| Other assets | | (2,380) | | | 623 | |
| Notes receivable | | (4,695) | | | (22) | |
| Accounts payable, accrued expenses and other current liabilities | | 8,560 | | | (13,949) | |
| Deferred revenue | | (19,761) | | | (16,884) | |
| | | | |
| | | | |
| Operating lease liability | | (15,946) | | | (16,094) | |
| Other liabilities | | (891) | | | (759) | |
| Net cash provided by (used in) operating activities | | 18,361 | | | (4,733) | |
| Cash flows from investing activities: | | | | |
| Cash paid for acquisitions, net of cash acquired | | — | | | (16,381) | |
| Purchase of property and equipment | | (16,769) | | | (48,847) | |
| | | | |
| | | | |
| Proceeds from maturities of held-to-maturity securities | | — | | | 29,000 | |
| Proceeds from insurance policy | | 261 | | | — | |
| | | | |
| Net cash used in investing activities | | (16,508) | | | (36,228) | |
| Cash flows from financing activities: | | | | |
| Proceeds from revolving credit facility | | 36,000 | | | 90,000 | |
| Payments on revolving credit facility | | (59,000) | | | — | |
| Debt issuance costs for long-term debt | | — | | | (484) | |
| Payment of preferred stock cash dividend | | (1,097) | | | (2,528) | |
| Payments on term loans and finance leases | | (1,870) | | | (1,179) | |
| Payment of payroll taxes on stock-based compensation through shares withheld | | (2,191) | | | (761) | |
| Preferred share repurchase | | (11,503) | | | — | |
| | | | |
| Net cash (used in) provided by financing activities | | (39,661) | | | 85,048 | |
| Change in cash, cash equivalents and restricted cash | | (37,808) | | | 44,087 | |
| Cash and cash equivalents, beginning of period | | 151,547 | | | 66,452 | |
| Restricted cash, beginning of period | | 5,377 | | | 3,544 | |
| Cash, cash equivalents and restricted cash, beginning of period | | 156,924 | | | 69,996 | |
| Cash and cash equivalents, end of period | | 115,505 | | | 110,511 | |
| Restricted cash, end of period | | 3,611 | | | 3,572 | |
| Cash, cash equivalents and restricted cash, end of period | | $ | 119,116 | | | $ | 114,083 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
SELECTED SUPPLEMENTAL NON-FINANCIAL AND FINANCIAL INFORMATION BY SEGMENT
(In thousands, except for Student Metrics)
(Unaudited)
Student Metrics
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2024 | | | Three Months Ended June 30, 2023 |
| UTI | | Concorde | | Total | | | UTI | | Concorde | | Total |
| Total new student starts | 2,916 | | | 2,651 | | | 5,567 | | | | 3,333 | | | 1,967 | | | 5,300 | |
| Year-over-year growth (decline) | (12.5) | % | | 34.8 | % | | 5.0 | % | | | 5.3 | % | | — | % | | — | % |
| Average undergraduate full-time active students | 13,041 | | | 8,038 | | | 21,079 | | | | 11,544 | | | 7,050 | | | 18,594 | |
| Year-over-year growth (decline) | 13.0 | % | | 14.0 | % | | 13.4 | % | | | (4.0) | % | | — | % | | — | % |
| End of period undergraduate full-time active students | 12,686 | | | 7,442 | | | 20,128 | | | | 11,908 | | | 6,581 | | | 18,489 | |
| Year-over-year growth (decline) | 6.5 | % | | 13.1 | % | | 8.9 | % | | | (1.4) | % | | — | % | | — | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nine Months Ended June 30, 2024 | | | Nine Months Ended June 30, 2023 |
| UTI | | Concorde | | Total | | | UTI | | Concorde | | Total |
| Total new student starts | 8,070 | | | 7,323 | | | 15,393 | | | | 7,681 | | | 4,540 | | | 12,221 | |
| Year-over-year growth (decline) | 5.1 | % | | 61.3 | % | | 26.0 | % | | | 3.7 | % | | — | % | | — | % |
| Average undergraduate full-time active students | 13,724 | | | 8,263 | | | 21,987 | | | | 12,524 | | | 7,536 | | | 20,060 | |
| Year-over-year growth (decline) | 9.6 | % | | 9.6 | % | | 9.6 | % | | | (2.8) | % | | — | % | | — | % |
| End of period undergraduate full-time active students | 12,686 | | | 7,442 | | | 20,128 | | | | 11,908 | | | 6,581 | | | 18,489 | |
| Year-over-year growth (decline) | 6.5 | % | | 13.1 | % | | 8.9 | % | | | (1.4) | % | | — | % | | — | % |
Financial Summary by Segment and Consolidated
During fiscal 2023, in coordination with the integration of Concorde, we began to reassess our operating model to determine the organizational structure that would best help the Company achieve future growth goals and optimally support the business. Beginning in fiscal 2024, we have executed an internal reorganization to fully transition our operating and reporting model to support a multi-divisional business. As part of the internal reorganization, each of the reportable segments now have dedicated accounting, finance, information technology, and human resources teams. Additionally, human resources and information technology costs that benefit the entire organization are now allocated across UTI, Concorde and Corporate each period based upon relative headcount. As a result, additional costs have moved from Corporate into the UTI segment and to a lesser extent the Concorde segment as resources were redirected to support the segment’s objectives. Due to these changes in allocation methodology, the prior year segment amounts have been recast for comparability to the current year presentation.
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
SELECTED SUPPLEMENTAL NON-FINANCIAL AND FINANCIAL INFORMATION BY SEGMENT
(In thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, 2024 | | | Three Months Ended June 30, 2023 |
| | UTI | | Concorde | | Corporate | | Consolidated | | | UTI | | Concorde | | Corporate | | Consolidated |
| Revenue | | $ | 117,134 | | | $ | 60,324 | | | $ | — | | | $ | 177,458 | | | | $ | 100,852 | | | $ | 52,434 | | | $ | — | | | $ | 153,286 | |
| Educational services and facilities | | 57,525 | | | 37,752 | | | — | | | 95,277 | | | | 54,188 | | | 34,189 | | | — | | | 88,377 | |
| Selling, general and administrative | | 45,473 | | | 18,856 | | | 10,406 | | | 74,735 | | | | 41,571 | | | 16,304 | | | 6,371 | | | 64,246 | |
| Total operating expenses | | 102,998 | | | 56,608 | | | 10,406 | | | 170,012 | | | | 95,759 | | | 50,493 | | | 6,371 | | | 152,623 | |
| Net income (loss) | | 12,673 | | | 3,778 | | | (11,466) | | | 4,985 | | | | 3,752 | | | 2,028 | | | (6,289) | | | (509) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended June 30, 2024 | | | Nine Months Ended June 30, 2023 |
| | UTI | | Concorde | | Corporate | | Consolidated | | | UTI | | Concorde | | Corporate | | Consolidated |
| Revenue | | $ | 355,831 | | | $ | 180,498 | | | $ | — | | | $ | 536,329 | | | | $ | 313,985 | | | $ | 123,125 | | | $ | — | | | $ | 437,110 | |
| Educational services and facilities | | 174,993 | | | 110,181 | | | — | | | 285,174 | | | | 158,386 | | | 78,329 | | | — | | | 236,715 | |
| Selling, general and administrative | | 133,526 | | | 56,227 | | | 28,533 | | | 218,286 | | | | 127,324 | | | 37,392 | | | 24,619 | | | 189,335 | |
| Total operating expenses | | 308,519 | | | 166,408 | | | 28,533 | | | 503,460 | | | | 285,710 | | | 115,721 | | | 24,619 | | | 426,050 | |
| Net income (loss) | | 42,886 | | | 14,271 | | | (33,996) | | | 23,161 | | | | 25,277 | | | 7,531 | | | (27,189) | | | 5,619 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
SELECTED SUPPLEMENTAL NON-FINANCIAL AND FINANCIAL INFORMATION BY SEGMENT
(In thousands)
(Unaudited)
Major Expense Categories by Segment and Consolidated
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2024 |
| UTI | | Concorde | | Corporate | | Consolidated |
| Salaries, benefits and tax expense | $ | 50,149 | | | $ | 30,426 | | | $ | 4,045 | | | $ | 84,620 | |
| Bonus expense | 4,115 | | | 1,100 | | | 2,467 | | | 7,682 | |
| Stock-based compensation expense | 518 | | | 56 | | | 1,289 | | | 1,863 | |
| Total compensation and related costs | $ | 54,782 | | | $ | 31,582 | | | $ | 7,801 | | | $ | 94,165 | |
| | | | | | | |
| Advertising expense | $ | 13,169 | | | $ | 6,067 | | | $ | 186 | | | $ | 19,422 | |
| Occupancy expense, net of subleases | 7,686 | | | 5,733 | | | 206 | | | 13,625 | |
| Depreciation and amortization | 5,743 | | | 1,367 | | | 266 | | | 7,376 | |
| Professional and contract services expense | 2,458 | | | 2,351 | | | 3,054 | | | 7,863 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2023 |
| UTI | | Concorde | | Corporate | | Consolidated |
| Salaries, benefits and tax expense | $ | 46,985 | | | $ | 27,153 | | | $ | 3,276 | | | $ | 77,414 | |
| Bonus expense | 1,320 | | | 1,184 | | | 690 | | | 3,194 | |
| Stock-based compensation expense | 280 | | | — | | | 253 | | | 533 | |
| Total compensation and related costs | $ | 48,585 | | | $ | 28,337 | | | $ | 4,219 | | | $ | 81,141 | |
| | | | | | | |
| Advertising expense | $ | 13,346 | | | $ | 5,790 | | | $ | — | | | $ | 19,136 | |
| Occupancy expense, net of subleases | 7,380 | | | 5,816 | | | 153 | | | 13,349 | |
| Depreciation and amortization | 5,121 | | | 1,531 | | | 3 | | | 6,655 | |
| Professional and contract services expense | 2,951 | | | 1,439 | | | 1,854 | | | 6,244 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
SELECTED SUPPLEMENTAL NON-FINANCIAL AND FINANCIAL INFORMATION BY SEGMENT
(In thousands)
(Unaudited)
Major Expense Categories by Segment and Consolidated
| | | | | | | | | | | | | | | | | | | | | | | |
| Nine Months Ended June 30, 2024 |
| UTI | | Concorde | | Corporate | | Consolidated |
| Salaries, benefits and tax expense | $ | 146,278 | | | $ | 89,559 | | | $ | 11,469 | | | $ | 247,306 | |
| Bonus expense | 11,032 | | | 2,786 | | | 4,617 | | | 18,435 | |
| Stock-based compensation expense | 1,301 | | | 133 | | | 4,265 | | | 5,699 | |
| Total compensation and related costs | $ | 158,611 | | | $ | 92,478 | | | $ | 20,351 | | | $ | 271,440 | |
| | | | | | | |
| Advertising expense | $ | 40,422 | | | $ | 19,199 | | | $ | 397 | | | $ | 60,018 | |
| Occupancy expense, net of subleases | 23,028 | | | 17,157 | | | 528 | | | 40,713 | |
| Depreciation and amortization | 16,921 | | | 3,738 | | | 903 | | | 21,562 | |
| Professional and contract services expense | 7,816 | | | 6,979 | | | 8,575 | | | 23,370 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Nine Months Ended June 30, 2023 |
| UTI | | Concorde | | Corporate | | Consolidated |
| Salaries, benefits and tax expense | $ | 137,856 | | | $ | 62,132 | | | $ | 10,991 | | | $ | 210,979 | |
| Bonus expense | 8,854 | | | 1,852 | | | 2,808 | | | 13,514 | |
| Stock-based compensation expense | 1,176 | | | — | | | 2,639 | | | 3,815 | |
| Total compensation and related costs | $ | 147,886 | | | $ | 63,984 | | | $ | 16,438 | | | $ | 228,308 | |
| | | | | | | |
| Advertising expense | $ | 40,874 | | | $ | 13,572 | | | $ | — | | | $ | 54,446 | |
| Occupancy expense, net of subleases | 23,352 | | | 13,644 | | | 436 | | | 37,432 | |
| Depreciation and amortization | 14,990 | | | 3,637 | | | 22 | | | 18,649 | |
| Professional and contract services expense | 8,934 | | | 3,459 | | | 7,080 | | | 19,473 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP FINANCIAL INFORMATION TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, 2024 |
| | UTI | | Concorde | | Corporate | | Consolidated |
| Net income (loss) | $ | 12,673 | | | $ | 3,778 | | | $ | (11,466) | | | $ | 4,985 | |
| Interest income | (4) | | | (138) | | | (1,298) | | | (1,440) | |
| Interest expense | 1,473 | | | 76 | | | 600 | | | 2,149 | |
| Income tax expense | — | | | — | | | 1,772 | | | 1,772 | |
| Depreciation and amortization | 5,743 | | | 1,367 | | | 266 | | | 7,376 | |
| EBITDA | 19,885 | | | 5,083 | | | (10,126) | | | 14,842 | |
| Stock-based compensation expense | 518 | | | 56 | | | 1,289 | | | 1,863 | |
| | | | | | | |
Integration-related costs for completed acquisitions (1) | 237 | | | 726 | | | 690 | | | 1,653 | |
| | | | | | | |
| Restructuring costs | 53 | | | — | | | — | | | 53 | |
| Adjusted EBITDA, non-GAAP | $ | 20,693 | | | $ | 5,865 | | | $ | (8,147) | | | $ | 18,411 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, 2023 |
| | UTI | | Concorde | | Corporate | | Consolidated |
| Net income (loss) | $ | 3,751 | | | $ | 2,028 | | | $ | (6,288) | | | $ | (509) | |
| Interest income | (2) | | | (176) | | | (1,454) | | | (1,632) | |
| Interest expense | 1,363 | | | 89 | | | 1,505 | | | 2,957 | |
| Income tax expense | — | | | — | | | (64) | | | (64) | |
| Depreciation and amortization | 5,121 | | | 1,531 | | | 3 | | | 6,655 | |
| EBITDA | 10,233 | | | 3,472 | | | (6,298) | | | 7,407 | |
| Stock-based compensation expense | 280 | | | — | | | 253 | | | 533 | |
| Acquisition-related costs | — | | | — | | | 221 | | | 221 | |
Integration-related costs for completed acquisitions (1) | 1,721 | | | 517 | | | 712 | | | 2,950 | |
| One-time costs associated with new campus openings | 335 | | | — | | | — | | | 335 | |
| | | | | | | |
| Adjusted EBITDA, non-GAAP | $ | 12,569 | | | $ | 3,989 | | | $ | (5,112) | | | $ | 11,446 | |
(1) Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration-related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability.
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP FINANCIAL INFORMATION TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA
| | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended June 30, 2024 |
| | UTI | | Concorde | | Corporate | | Consolidated |
| Net income (loss) | $ | 42,886 | | | $ | 14,271 | | | $ | (33,996) | | | $ | 23,161 | |
| Interest income | (14) | | | (420) | | | (4,408) | | | (4,842) | |
| Interest expense | 4,460 | | | 239 | | | 2,505 | | | 7,204 | |
| Income tax expense | — | | | — | | | 7,699 | | | 7,699 | |
| Depreciation and amortization | 16,921 | | | 3,738 | | | 903 | | | 21,562 | |
| EBITDA | 64,253 | | | 17,828 | | | (27,297) | | | 54,784 | |
| Stock-based compensation expense | 1,300 | | | 133 | | | 4,265 | | | 5,698 | |
| | | | | | | |
Integration-related costs for completed acquisitions (1) | 964 | | | 2,072 | | | 1,888 | | | 4,924 | |
| | | | | | | |
| Restructuring costs | 141 | | | — | | | — | | | 141 | |
| Adjusted EBITDA, non-GAAP | $ | 66,658 | | | $ | 20,033 | | | $ | (21,144) | | | $ | 65,547 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended June 30, 2023 |
| | UTI | | Concorde | | Corporate | | Consolidated |
| Net income (loss) | $ | 25,277 | | | $ | 7,531 | | | $ | (27,189) | | | $ | 5,619 | |
| Interest income | (9) | | | (340) | | | (3,911) | | | (4,260) | |
| Interest expense | 3,223 | | | 212 | | | 3,582 | | | 7,017 | |
| Income tax expense | — | | | — | | | 3,224 | | | 3,224 | |
| Depreciation and amortization | 14,990 | | | 3,637 | | | 22 | | | 18,649 | |
| EBITDA | 43,481 | | | 11,040 | | | (24,272) | | | 30,249 | |
| Stock-based compensation expense | 1,176 | | | — | | | 2,639 | | | 3,815 | |
| Acquisition-related costs | — | | | — | | | 2,318 | | | 2,318 | |
Integration-related costs for completed acquisitions (1) | 3,138 | | | 1,267 | | | 1,980 | | | 6,385 | |
| One-time costs associated with new campus openings | 2,309 | | | — | | | — | | | 2,309 | |
| | | | | | | |
| Adjusted EBITDA, non-GAAP | $ | 50,104 | | | $ | 12,307 | | | $ | (17,335) | | | $ | 45,076 | |
UNIVERSAL TECHNICAL INSTITUTE, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP FINANCIAL INFORMATION TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
Reconciliation of Net Cash Provided by (Used in) Operating Activities to Adjusted Free Cash Flow
| | | | | | | | | | | |
| | Nine Months Ended June 30, |
| | 2024 | | 2023 |
| Net cash provided by (used in) operating activities, as reported | $ | 18,361 | | | $ | (4,733) | |
| Purchase of property and equipment | (16,769) | | | (48,847) | |
| Free cash flow, non-GAAP | 1,592 | | | (53,580) | |
| Adjustments: | | | |
| | | |
| Cash outflow to purchase the Orlando, Florida campus | — | | | 26,156 | |
| | | |
| Cash outflow for acquisition-related costs | — | | | 2,286 | |
Cash outflow for integration-related costs for completed acquisitions(2) | 5,204 | | | 5,761 | |
Cash outflow for integration-related property and equipment(2) | 3,535 | | | 8,803 | |
| Cash outflow for restructuring costs and property and equipment | 540 | | | — | |
| Cash outflow for one-time costs associated with new campus openings | — | | | 2,309 | |
| Cash outflow for property and equipment associated with new campus openings | — | | | 6,689 | |
| | | |
| | | |
| Adjusted free cash flow, non-GAAP | $ | 10,871 | | | $ | (1,576) | |
(2) Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Cash outflow for integration-related costs for completed acquisitions” and “Cash outflow for integration-related property and equipment.” In prior quarters, these costs were presented in the lines labeled ““Cash outflow for start-up costs for new campuses and programs expansion” and “Cash outflow for property and equipment for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability.
Universal Technical Institute, Inc. Q3 2024 Investor Presentation August 6, 2024
2 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). Forward-looking statements may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will," the negative form of these expressions or similar expressions. These statements are based on our management’s current beliefs, expectations and assumptions about future events, conditions and results and on information currently available to us. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements or events and circumstances reflected in the forward-looking statements will occur. Discussions containing these forward-looking statements may be found, among other places, in the Sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K, in our subsequent Quarterly Reports on Form 10-Q and certain of our current reports on Form 8-K, as well as any amendments thereto, filed with the Securities and Exchange Commission (the “SEC”). In addition, statements that refer to projections of earnings, revenue, costs or other financial items in future periods; anticipated growth and trends in our business or key markets; cost synergies, growth opportunities and other potential financial and operating benefits; future growth and revenues; future economic conditions and performance; anticipated performance of curriculum; plans, objectives and strategies for future operations; and other characterizations of future events or circumstances, and all other statements that are not statements of historical fact are forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks, uncertainties and assumptions that could cause actual results to differ materially from those anticipated or implied in our forward-looking statements due to a number of factors, including, but not limited to, those set forth under the section entitled “Risk Factors” in our filings with the SEC. Factors that might cause such a difference include, but are not limited to, failure of our schools to comply with the extensive regulatory requirements for school operations; our failure to maintain eligibility for federal student financial assistance funds; the effect of current and future Title IV Program regulations arising out of negotiated rulemakings, including any potential reductions in funding or restrictions on the use of funds received through Title IV Programs; the effect of future legislative or regulatory initiatives related to veterans’ benefit programs; continued Congressional examination of the for-profit education sector; our failure to maintain eligibility for or the ability to process federal student financial assistance; regulatory investigations of, or actions commenced against, us or other companies in our industry; changes in the state regulatory environment or budgetary constraints; our failure to execute on our growth and diversification strategy, including effectively identifying, establishing and operating additional schools, programs or campuses; our failure to realize the expected benefits of our acquisitions, or our failure to successfully integrate our acquisitions; our failure to improve underutilized capacity at certain of our campuses; enrollment declines or challenges in our students’ ability to find employment as a result of macroeconomic conditions; our failure to maintain and expand existing industry relationships and develop new industry relationships; our ability to update and expand the content of existing programs and develop and integrate new programs in a timely and cost-effective manner while maintaining positive student outcomes; a loss of our senior management or other key employees; failure to comply with the restrictive covenants and our ability to pay the amounts when due under the Credit Agreement; the effect of our principal stockholder owning a significant percentage of our capital stock, and thus being able to influence certain corporate matters and the potential in the future to gain substantial control over our company; the effect of public health pandemics, epidemics or outbreak, including COVID-19, and other risks that are described from time to time in our filings with the SEC. Given these risks, uncertainties and other factors, many of which are beyond our control, you should not place undue reliance on these forward-looking statements. Neither we nor any other person makes any representation as to the accuracy or completeness of these forward-looking statements and, except as required by law, we assume no obligation to update these forward-looking statements publicly, or to revise any forward-looking statements, even if new information becomes available in the future. This presentation also contains estimates and other statistical data made by independent parties, and by us, relating to market size and growth and other data about our industry and our business. This data involves several assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree of uncertainty and risk.
3 Leading Workforce Solutions Education Provider 20k+ Active Students 4 / 5 Grads Employed Within 1 Year1 35+ Program Offerings HealthcareTransportation and Skilled Trades $720-730M FY2024 Revenue Guidance $102-104M FY2024 Adj. EBITDA Guidance Addressing Skills Gaps Through 2 In-Demand Industry Segments 33 Campuses Nationwide Strong Financial Outlook* 1 On average, across 35+ programs and 33 campuses nationwide. Employment rates may vary significantly by program and by campus. See slides 16 and 18 of this presentation as well as UTI.edu/disclosures and the individual campus pages on Concorde.edu for additional information. * See slide 14 for additional details. $37-41M FY2024 Net Income Guidance “Company expecting average annual revenue growth of ~10% through FY’29 and approaching 20% adjusted EBITDA margin by FY’29” [as announced 8/5/24]
4 High-quality, state-of-the- industry technical and healthcare training facilities supporting successful student outcomes
5 Compelling Ongoing Investment Thesis 1 Per recent years’ accreditor reporting results. See slides 16 and 18 in this presentation as well as uti.edu/disclosures and the individual campus pages on concorde.edu for additional information. Leading educational platforms serving critical, in-demand markets with favorable long-term trends Strong student outcomes1 and positive regulatory metrics driven by enterprise-wide emphasis on our students Consistently meeting or exceeding expectations while executing on a repeatable and scalable growth strategy Successful and ongoing transformation efforts supporting optimized operating model and margin expansion Healthy balance sheet and disciplined capital allocation plan driving continued growth and shareholder value creation Universal Technical Institute, Inc.
6 Diversified Platform of In-Demand Programs Practical/Vocational/Registered Nursing Dental Hygienist/Assistant Healthcare Administration Medical Assistant Respiratory TherapyRobotics and Automation Welding Auto/Diesel/Motorcycle/Marine Technician Aviation Maintenance, Airframe and Powerplant Energy Technology and Wind Power • Estimated FY 2024 Revenue = ~$485M • ~15k Students • 15+ programs across Transportation, Energy, & Skilled Trades • 16 Campuses in 9 States • In-person and Hybrid/Blended formats • Estimated FY 2024 Revenue = ~$240M • ~8k Students • 20+ programs in Dental, Allied Health, Nursing, Patient Care and Diagnostics • 17 Campuses in 8 States • In-person, Hybrid/Blended, and Fully Online formats Ex am pl e Pr og ra m s Ex am pl e Pr og ra m s Note: See appendix for more details by segment
7 Acquisitions and Program Expansions MIAT (Closed FY22), Concorde (Closed FY23) Marketing and Admissions Optimization Increased high school and local emphasis New Programs and Curriculum Multiple program expansions, MSATs, On-Base Military Programs, Electric Vehicle Curriculum Real Estate Rationalization $15M+ run-rate EBITDA benefit Blended Learning Acceleration and enhancement New Campuses Bloomfield, NJ 2018; Austin, TX 2022; Miramar, FL 2022 Continuing a Multi-Year Transformation Journey $317.0 $331.5 $300.8 $335.1 $418.8 $607.4 $725.0 $200.0 $300.0 $400.0 $500.0 $600.0 $700.0 2018 2019 2020 2021 2022 2023 2024 Net Income ($33M) Adj EBITDA ($6M) Net Income $39M Adj EBITDA $103M Note: FY24 figures align to midpoints of relevant Company guidance ranges For detailed reconciliations of Non-GAAP measures see the Appendix
8 Delivering on Expectations and Creating Shareholder Value Share Price: ~$3.00 Market Cap: ~$70M Share Price: ~$17.25 Market Cap: ~$930M Note: Analyst Consensus, Share Price, and Market Capitalization figures updated as of Market close 8/5/2024 Revenue ($M) FY'21 FY'22 FY'23 FY'24E Early Estimate - - - $700+ Original Guidance (mid) $340 $412 $603 $710 Revised Guidance (mid) - $414 $603 $725 Analyst Consensus $338 $409 $597 $725 Actual $335 $415 $607 Adj. EBITDA* ($M) FY'21 FY'22 FY'23 FY'24E Early Estimate - - - ~$100 Original Guidance (mid) $33 $53 $60 $100 Revised Guidance (mid) - $54 $63 $103 Analyst Consensus $33 $52 $60 $103 Actual $34 $56** $64 *For detailed reconciliations of Non-GAAP measures see the Appendix **As-reported FY22 Adj EBITDA. Accounting for stock-based compensation, the revised FY22 Adj EBITDA was $60M as shown elsewhere in this presentation
9 0% 5% 10% 15% 20% 25% 30% JO B G R O W TH 2 02 2- 20 32 ANNUAL JOB OPENINGS 2022-2032 In-Demand Offerings Across Transportation, Skilled Trades, and Healthcare 50% Nursing Dental Hygienists & Assistants Physical and Occupational Therapy Assistants Healthcare Administration Medical Assistants Ex am pl e C on co rd e H ea lth ca re P ro gr am s Ex am pl e U TI T ra ns po rta tio n, En er gy , & Sk ille d Tr ad e Pr og ra m s Wind Turbine Service Technicians Aircraft Mechanics & Technicians Welding HVACR Mechanics & Installers Auto Body Repairers Auto/Diesel Technicians Note: Projections as per the Occupational Outlook Handbook published by the U.S. Bureau of Labor Statistics www.bls.gov, September 2023. Job openings include those due to net employment changes and net replacements.
10 Healthcare Platform & Program Expansions Accelerating Growth and Diversification 10 Diversified Revenue Mix UTI UTI + Concorde Expanded Student Demographics UTI UTI + Concorde 14,380 26,000 $725M$419M Transportation Skilled Trades B2B Healthcare Male Female Healthcare support occupations are projected to grow the fastest of all occupational groups, at 15.4% from 2022 to 20322 Overall employment in healthcare occupations is expected to result in almost 2 million new jobs annually from 2022- 20321, driven by an aging workforce and an increasing demand for healthcare services 1 U.S. Bureau of Labor Statistics “Occupational Outlook Handbook” September 6, 2023 2 U.S. Bureau of Labor Statistics “Employment Projections: 2022-2032 Summary” September 6, 2023 3 “Tradespeople wanted: The need for critical trade skills in the US” McKinsey & Company April 9, 2024 Demand [for tradespeople] in US industry is projected to remain high due to infrastructure needs, a surge in real estate redevelopment, and the energy transition.3 FY2022 FY2024 Outlook FY2022 FY2024 Outlook Diversification Value Proposition Note: FY24 outlook aligns to midpoint of Company’s guidance
11 Maximizing Program Expansion Opportunities Leveraging recent acquisitions and optimized real estate footprint to drive growth through new program offerings within existing campuses. UTI Campuses Concorde Campuses UTI & Concorde Campuses * Program not yet open at this location; some still pending regulatory approvals ** Phlebotomy only, no Sterile Processing program at this location UTI Program Expansions Programs & Locations Aviation Long Beach, CA Avondale, AZ Miramar, FL Austin, TX Long Beach, CA Avondale, AZ Mooresville, NC Bloomfield, NJ* Sacramento, CA* Lisle, IL Rancho Cucamonga, CA Lisle, IL Mooresville, NC Exton, PA Rancho Cucamonga, CA Welding Sacramento, CA Lisle, IL Rancho Cucamonga, CA Concorde Program Expansions Programs & Locations Cardiovascular Sonography San Bernadino, CA Orlando, FL San Diego, CA Dental Hygiene Miramar, FL Jacksonville, FL Portland, OR Diagnostic Medical Sonography Orlando, FL Respiratory Therapy Online Option Short Programs Phlebotomy & Sterile Processing Technician Aurora, CO* Miramar, FL Dallas, TX* North Hollywood, CA* Garden Grove, CA* Orlando, FL Grand Prarie, TX Portland, OR* Jacksonville, FL San Antonio, TX* Kansas City, MO Southaven, MS** Memphis, TN Tampa, FL Industrial Maintenance Wind Power HVACR Robotics & Automation
~ “North Star” Strategy Expected to Drive Continued Growth 12 New Campus Additions Leverage blended learning and refined program mix formats to expand geographic footprint Program Expansions Acquired MIAT and Concorde programs provide more expansion opportunities New Program Offerings Acquisitions and new program development efforts provide future opportunities Optimized for Growth and Scale Investments in centralized functions, systems and processes provide platform for continued scaling of the business Acquisitions Strategic and disciplined approach for evaluating new opportunities Note: FY24 outlook aligns to midpoint of Company’s guidance, FY25 per Company’s preliminary commentary, and FY25-FY29 initiatives are per Company’s strategic announcement 8/5/24 Organic Growth New/Expansion Programs New Campuses Net Income Margin ~5% Adj EBITDA Margin ~14% Adj EBITDA Margin Approaching 20% Adj EBITDA Margin ~15%
13 Business Outlook Fiscal 2024 Guidance
14 Fiscal 2024 Guidance $ millions except EPS 1 Beginning in FY23, Net Income and EPS impacted by a significant effective tax rate increase due to the valuation allowance reversal in FY2022, increased interest expense, and higher D&A 2 Beginning in FY23 Adj EBITDA excludes stock-based compensation; prior years updated for comparison Note: for detailed reconciliations of Non-GAAP measures see the Appendix* FY24 Revenue and New Student Starts expected to be at the higher end of their respective guidance ranges as per management commentary August 6, 2024 “Higher end” * “Higher end” *
15 Appendix
16 Business Overview • 15+ programs for in-demand fields across transportation and skilled trades • Program Mix (2023 Revenue): – Auto/Diesel 73%, Other Transportation 12%, Welding 8%, Other Skilled Trades 3%, and Industry Training 4% • Current expansion plans for 18 programs4 into existing campuses beginning FY23 including Aviation, Wind Energy, Robotics, HVACR, Welding, and Industrial Maintenance. More may follow. Mission Statement To serve our students, partners, and communities by providing quality education and support services for in-demand careers. Universal Technical Institute Division Overview A leading provider of transportation, energy and skilled trades technical training, driven to change the world one life at a time by helping people achieve their dreams. 1 As of September 30, 2023. 2 Based on most recent reporting periods. Ratios represent averages across UTI’s 4 OPEIDs, though individual program results may vary significantly from the mean. Note that due to the COVID-19 pandemic, ED paused all loan payments from March 13, 2020 through September 30, 2023, significantly decreasing default rates. 3 Aggregated rates based on reporting in the ACCSC 2023 annual reports. Each of the ACCSC program outcomes is evaluated individually. The ACCSC reports exclude graduates from the employment rate calculation who were not available for employment because of continuing education, military service, health, incarceration, death or international student status. See UTI.edu/disclosures for further information. 4 Some still pending regulatory approval Summary Statistics Founded 1965 Revenue1 $429M Operating Inc.1 (Margin) $56M (13.0%) Adj. EBITDA1 (Margin) $85M (19.7%) Locations 16 Campuses in 9 States Key Metrics Enrollment ~15K Students Cohort Default Rate2 0% 90/10 Ratio2 ~64% Graduation Rate3 ~65% Employment Rate3 ~80% Composite Score: Calculated and reported only at an enterprise level. Reported score for FYE 9/30/23 was 1.6. Note: for detailed reconciliations of Non-GAAP measures see the Appendix
17 UTI Division Programs by Location MSAT = Manufacturer-Specific Advanced Training (offerings vary by location) Note some programs above have been announced but are not yet open at all locations shown 1 UTI Avondale and Motorcycle Mechanics Institute Phoenix 2 UTI Houston and MIAT Houston 3 UTI Orlando and Orlando Motorcycle & Marine Mechanics Institutes Austin, Texas Avondale, Arizona1 Bloomfield, New Jersey Canton, Michigan Dallas, Texas Exton, Pennsylvania Houston, Texas2 Lisle, Illinois Long Beach, California Miramar, Florida Mooresville, North Carolina Orlando, Florida3 Rancho Cucamonga, California Sacramento, California Transportation Airframe & Powerplant Automotive Collision Diesel Marine Motorcycle MSAT NASCAR Tech Energy Energy Technology Wind Power Skilled Trades CNC Machining HVACR Industrial Maintenance Non-Destrictive Testing Robotics & Automation Welding
18 Business Overview • 20+ programs for in-demand healthcare professional degrees and certifications • Program Mix (2023 Revenue): – Dental 29%, Allied Health 26%, Patient Care 21%, Nursing 17%, and Diagnostic 8% • Expanding new programs into existing campuses in Fiscal 2024 including Dental Hygiene, Cardiovascular Sonography, & Diagnostic Medical Sonography, in addition to launching select online programs. Healthcare education provider focused on preparing America’s next generation of healthcare professionals for rewarding careers in areas such as dental, patient care, nursing and allied health. 1 As of September 30, 2023, for the 10-month post-acquisition period of 12/1/22-09/30/23 2 Based on most recent reporting periods and represent approximate averages across Concorde’s 12 OPEIDs, though individual program results may vary significantly from the mean. 90/10 Title IV metric ranges from 63% to 86%. Note that due to the COVID-19 pandemic, ED paused all loan payments from March 13, 2020 through September 30, 2023, significantly decreasing default rates. 3 Aggregated rates for the 14 campuses accredited by ACCSC based on reporting in the ACCSC 2023 annual reports and excludes the two campuses not accredited by ACCSC. Each of the ACCSC program outcomes is evaluated individually. The ACCSC reports exclude graduates from the employment rate calculation who were not available for employment because of continuing education, military service, health, incarceration, death or international student status. See disclosures on the individual campus pages on Concorde.edu for additional information. Mission Statement To prepare committed students for successful employment in a rewarding health care profession through high-caliber training, real world experience and student-centered support. . Summary Statistics Founded 1968 Revenue1 $178M Operating Inc.1 (Margin) $11M (5.9%) Adj. EBITDA1 (Margin) $16M (9.1%) Locations 17 Campuses in 8 States Key Metrics Enrollment ~8K Students Cohort Default Rate2 0% 90/10 Ratio2 ~72% Graduation Rate3 ~71% Employment Rate3 ~86% Concorde Career Colleges Division Overview Composite Score: Calculated and reported only at an enterprise level. Reported score for FYE 9/30/23 was 1.6. Note: for detailed reconciliations of Non-GAAP measures see the Appendix
19 Concorde Division Programs by Location Note some programs above have been announced but are not yet open Kansas City location includes both a main campus and a smaller satellite campus Aurora, Colorado Dallas, Texas Garden Grove, California Grand Prarie, Texas Jacksonville, Florida Kansas City, Missouri Memphis, Tennessee Miramar, Florida North Hollywood, California Orlando, Florida Portland, Oregon San Antonio, Texas San Bernadino, California San Diego, California Southaven, Mississippi Tampa, Florida Online Nursing Nursing (BS) Nursing Practice (AS/AAS) Practical / Vocational Nursing (Diploma) RN to BSN Dental Dental Assisting (AS/AAS) Dental Assisting (Diploma) Dental Hygiene (AS/AAS) Diagnostic Cardiovascular Sonography (AS/AAS) Diagnostic Medical Sonography (AS/AAS) Neurodiagnostic Technology (AS/AAS) Polysomnographic Technology (Diploma) Radiologic Technology (AS/AAS) Patient Care Massage Therapy (Diploma) Occupational Therapy Assistant (AS/AAS) Physical Therapist Assistant (AS/AAS) Respiratory Therapy (AS/AAS) Surgical Technology (AS/AAS) Allied Health Dental Hygiene (BS) Healthcare Administration (BS) Medical Assistant (Diploma) Medical Assisting (AS/AAS) Medical Office Administration (Diploma) Medical Office Professional (AS/AAS) Medical Office Professional (Diploma) Pharmacy Technician (AS/AAS) Pharmacy Technician (Diploma) Phlebotomy Technicial (Diploma) Sterile Processing Technician (Diploma)
20 Illustrative Organic Growth Opportunities ($10) $0 $10 $20 $30 $40 Year 0/1 Year 2 Year 3 Year 4 Year 5 New Campus* ($0.5) $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 Year 0/1 Year 2 Year 3 Year 4 Year 5 HVACR (UTI) ($1) $0 $1 $2 $3 $4 $5 Year 0/1 Year 2 Year 3 Year 4 Year 5 Dental Hygiene (Concorde) Note: Financial projections based on management’s current beliefs, expectations and assumptions about future events, conditions and results. Representative figures include startup expenses and are not fully burdened (i.e. exclude allocated corporate and marketing costs and working capital considerations) Growth strategy expected to include additional program expansions and new campuses. Below examples are for directional guidance on financial impact. HVACR Program Dental Hygiene Program UTI Division Concorde Division CapEx Requirement $8M-$25M ~$0.6M ~$2.3M IRR (10-year) 30%-40%+ 70%+ 30%+ Sq Footage Requirement 35,000-105,000 ft2 4,000 ft2 7,500 ft2 Avg Students 600-1,200 ~80 ~70 New Campus *Pro forma optimized campus projections shown. Actual financial profiles will vary by location and program mix. = UTI = Concorde
21 Differentiated Industry Partnerships UTI’s relationships with more than 35 leading brands, and other industry and employer partners for both UTI and Concorde, provide unique value propositions and competitive differentiation for our schools and students. On 8/1/24 the Company announced a first-of-its-kind partnership with Heartland Dental to develop a co-branded campus for dental hygiene and dental assistant programs.
22 • June 2016: Coliseum Holdings purchased 700,000* shares of Series A Convertible Preferred Stock for $70 million – Initial 700,000 shares were convertible into 21,021,021 shares of common stock (~30:1) – Subject to NYSE voting and conversion caps, and certain education regulatory approval limitations • February 2020: Stockholders approved removal of NYSE voting and conversion caps • September 2020: Coliseum distributed all 700,000 shares to affiliates (incl. Coliseum entities) and non-affiliates – Affiliates received 24.9% (from 39.2%) of outstanding shares on an as-converted basis > Education regulatory limitation remains; voting and conversion cap of 9.99% of outstanding shares – Non-Affiliates received remaining 14.3% of outstanding shares on an as-converted basis; no voting or conversion caps on an individual basis Background Dividends • 7.5% annual dividend: ~$5.1 million was paid in cash in semi-annual installments in March and September 2023, and a final cash payment of $1.1 million was made in December 2023 in conjunction with the conversion • By Preferred Holders: Convertible to common at any time at the option of the holder, subject to any caps – Coliseum & Affiliates subject to education regulatory approval cap of 9.99%, must request removal by UTI • By UTI**: When the daily VWAP of UTI common stock is ≥$8.33 for 20 consecutive trading days (excluding trading windows closed to insiders), UTI may require conversion of any/all outstanding preferred stock into common, subject to removal of any capsConversion Terms History of Preferred Stock All remaining preferred shares outstanding converted to common on 12/18/2023 * As of September 30,2023, preferred shares outstanding totaled 675,885 following conversion by one of the preferred holders in June 2022 Note: Above is intended as a summary only and is subject in its entirety to the actual terms contained in our filings with the SEC. Additional details may be found in the Company’s public filings including its 10-Ks, 8-Ks, proxy statements and the 2016 Certificate of Designations ** On December 18, 2023, the company satisfied the conditions necessary to allow it to convert all remaining Series A preferred shares into common shares. Immediately preceding the conversion, the Company repurchased ~33k preferred shares. Total outstanding common shares increased by ~19.3 million as a result of the conversion. Coliseum Capital controlled 9.3 million shares, or 17.3% of outstanding common stock as of June 30, 2024.
23 Non-GAAP Information
24 In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company also discloses certain non-GAAP financial information. These financial measures are not recognized measures under GAAP and are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company discloses these non-GAAP financial measures because it believes that they provide investors an additional analytical tool to clarify its results of operations and identify underlying trends. Additionally, the Company believes that these measures may also help investors compare its performance on a consistent basis across time periods. The Company defines adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation and amortization, adjusted for stock-based compensation expense and items not considered normal recurring operations. The Company defines adjusted free cash flow as net cash provided by (used in) operating activities less capital expenditures, adjusted for items not considered normal recurring operations. Management utilizes adjusted figures as performance measures internally for operating decisions, strategic planning, annual budgeting and forecasting. For the periods presented, our adjustments for items that management does not consider to be normal recurring operations include: • Acquisition-related costs: We have excluded costs associated with both potential and announced acquisitions to allow for comparable financial results to historical operations and forward-looking guidance. • Integration-related costs for completed acquisitions: We have excluded integration costs related to business structure realignment and new programs for recent acquisitions to allow for comparable financial results to historical operations and forward-looking guidance. In addition, the nature and amount of such charges vary significantly based on the size and timing of the programs. By excluding the referenced expenses from our non- GAAP financial measures, our management is able to further evaluate our ability to utilize existing assets and estimate their long-term value. Furthermore, our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance. • One-time costs associated with new campus openings: During fiscal 2022, we opened new campus locations in Austin, Texas and Miramar, Florida. We continued to incur one-time costs during fiscal 2023 for the campus opening as we completed the build-out of the remaining programs in the new facilities. We disclose any campus adjustments as direct costs (net of any corporate allocations). Outfitting a new campus requires significant facility improvements and modifications, and the purchase of technical equipment and training aids necessary for teaching our programs, the combination of which requires a significant investment by the Company which would not be considered part of normal recurring operations. • Restructuring charges: In December 2023, we announced plans to consolidate the two Houston, Texas campus locations to align the curriculum, student facing systems, and support services to better serve students seeking careers in in-demand fields. As part of the transition, the MIAT Houston campus, acquired in November 2021, began a phased teach-out in May 2024, and such campus began operating under the UTI brand. MIAT-Houston students who have not completed their programs before their program’s teach-out date may enroll at UTI-Houston to complete their program. Both facilities will remain in use post-consolidation. • Costs related to the purchase of our campuses: We lease the majority of our campus locations. Over the past three years due to shifts within the real estate environment, we have been presented with the opportunity to purchase three of our campus locations. These purchases are significant capital expenditures and not considered part of normal recurring operations. To obtain a complete understanding of our performance, these measures should be examined in connection with net income (loss) and net cash provided by (used in) operating activities, determined in accordance with GAAP, as presented in the financial statements and notes thereto included in the annual and quarterly filings with the SEC. Because the items excluded from these non-GAAP measures are significant components in understanding and assessing our financial performance under GAAP, these measures should not be considered to be an alternative to net income (loss) or net cash provided by (used in) operating activities as a measure of our operating performance or liquidity. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may define and calculate non-GAAP financial measures differently than we do, limiting their usefulness as a comparative measure across similarly titled performance measures presented by other companies. A reconciliation of the historical non-GAAP financial measures to the most directly comparable GAAP measures is included in the following slides and investors are encouraged to review the reconciliations. Information reconciling forward-looking adjusted EBITDA and adjusted free cash flow to the most directly comparable GAAP financial measure is unavailable to the company without unreasonable effort. The company is not able to provide a quantitative reconciliation of forward-looking adjusted EBITDA or adjusted free cash flow to the most directly comparable GAAP financial measure because certain items required for such reconciliation are uncertain, outside of the company’s control and/or cannot be reasonably predicted, including but not limited to the provision for (benefit from) income taxes. Preparation of such reconciliation would require a forward-looking statement of income and statement of cash flows prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to the company without unreasonable effort. Use of Non-GAAP Financial Information
25 Adjusted EBITDA Reconciliation ($ in thousands) 1. Beginning in FY2023 UTI includes stock-based compensation in its non-GAAP add-backs to EBITDA; FY2022 has been restated above for comparison 2. Costs related to both announced and potential acquisition targets. 3. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration-related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 4. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses. 5. In December 2023, the Company announced plans to consolidate its MIAT-Houston and UTI-Houston operations beginning in fiscal 2024 and completing in early fiscal 2025 6. During the fourth quarter of 2022, we completed a branding study and determined that the carrying value of the MIAT trademarks and trade name exceeded its fair value and recorded an intangible asset impairment charge of $2.0 million during the year ended September 30, 2022. 7. Lease accounting adjustments from our campus optimization efforts. These are primarily non-cash except for a lease termination payment related to our Orlando campus. Notes: The acquisition of MIAT closed on November 1, 2021, and Concorde closed on December 1, 2022, impacting comparability across periods; Expected adjustments outlined for FY 2024 are illustrative only and may differ from what is realized, either in the amounts &/or the categories shown Net income, as reported ~$39,000 $12,322 $25,848 Interest expense (income), net ~3,500 3,795 1,495 Income tax expense (benefit) ~15,500 5,765 (5,407) Depreciation and amortization ~30,500 25,215 16,884 EBITDA ~$88,500 $47,097 $38,820 Stock-based compensation expense(1) ~7,400 3,848 4,337 Acquisition-related costs(2) − 2,374 4,239 Integration-related costs for completed acquisitions(3) ~6,800 8,585 1,691 One-time costs associated with new campus openings(4) − 2,341 9,177 Restructuring costs(5) ~300 − − Intangible asset impairment(6) − − 2,000 Facility lease accounting adjustments(7) − − (64) Adjusted EBITDA, non-GAAP ~$103,000 $64,245 $60,200 FY2024 Guidance Range $102,000-$104,000 Actual Fiscal 2023 Actual Fiscal 2022 Guidance Midpoint Fiscal 2024
26 Adjusted Free Cash Flow Reconciliation ($ in thousands) 1. In February 2022 we purchased our Lisle, IL campus, and in March 2023 we purchased the three primary buildings and related land at our Orlando, FL campus. 2. Costs related to both announced and potential acquisition targets. 3. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Cash outflow for integration-related costs for completed acquisition" and "Cash outflow for integration-related property and equipment." In prior quarters, these costs were presented in a line labeled “Cash outflow for start-up costs for new campuses and program expansion" and "Cash outflow for property and equipment for new campuses and program expansion." As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 4. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses. 5. In December 2023, the Company announced plans to consolidate its MIAT-Houston and UTI-Houston operations beginning in fiscal 2024 and completing in early fiscal 2025 6. Adjustments reflect the cash paid in accordance with previous CEO Kimberly J. McWaters’s Retirement Agreement and Release of Claims, dated October 31, 2019. 7. Lease accounting adjustments from our campus optimization efforts. These are primarily non-cash except for a lease termination payment related to our Orlando campus. Note: Expected adjustments outlined for FY 2024 are illustrative only and may differ from what is realized, either in the amounts &/or the categories shown Guidance Midpoint Fiscal 2024 Actual Fiscal 2023 Actual Fiscal 2022 Cash flow provided by operating activities, as reported ~$84,500 $49,148 $46,031 Purchase of property and equipment ~(30,000) (56,685) (79,450) Free cash flow, non-GAAP ~54,500 ($7,537) ($33,419) Adjustments Cash outflow to purchase campuses(1) − 26,156 28,680 Cash outflow for acquisition-related costs(2) − 2,347 3,923 Cash outflow for integration-related costs for completed acquisitions(3) ~6,800 7,768 1,436 Cash outflow for integration-related PP&E(3) ~1,900 10,530 − Cash outflow for one-time costs associated with new campus openings(4) − 2,341 5,136 Cash outflow for PP&E associated with new campus openings(4) − 7,484 28,579 Cash outflow for restructuring costs and PP&E(5) ~800 − − Cash outflow for severance payments due to CEO transition(6) − − 32 Cash outflow for facility lease accounting adjustments(7) − − 575 Adjusted Free Cash Flow, non-GAAP ~$64,000 $49,089 $34,942 FY2024 Guidance Range $62,000-$66,000
27
August 6, 2024 Universal Technical Institute, Inc. Q3 FY24 Financial Supplement
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). Forward-looking statements may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will," the negative form of these expressions or similar expressions. These statements are based on our management’s current beliefs, expectations and assumptions about future events, conditions and results and on information currently available to us. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements or events and circumstances reflected in the forward-looking statements will occur. Discussions containing these forward-looking statements may be found, among other places, in the Sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K, in our subsequent Quarterly Reports on Form 10-Q and certain of our current reports on Form 8-K, as well as any amendments thereto, filed with the Securities and Exchange Commission (the “SEC”). In addition, statements that refer to projections of earnings, revenue, costs or other financial items in future periods; anticipated growth and trends in our business or key markets; cost synergies, growth opportunities and other potential financial and operating benefits; future growth and revenues; future economic conditions and performance; anticipated performance of curriculum; plans, objectives and strategies for future operations; and other characterizations of future events or circumstances, and all other statements that are not statements of historical fact are forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks, uncertainties and assumptions that could cause actual results to differ materially from those anticipated or implied in our forward-looking statements due to a number of factors, including, but not limited to, those set forth under the section entitled “Risk Factors” in our filings with the SEC. Important factors that could affect our actual results include, among other things, failure of our schools to comply with the extensive regulatory requirements for school operations; our failure to maintain eligibility for federal student financial assistance funds; the effect of current and future Title IV Program regulations arising out of negotiated rulemakings, including any potential reductions in funding or restrictions on the use of funds received through Title IV Programs; the effect of future legislative or regulatory initiatives related to veterans’ benefit programs; continued Congressional examination of the for-profit education sector; our failure to maintain eligibility for or the ability to process federal student financial assistance; regulatory investigations of, or actions commenced against, us or other companies in our industry; changes in the state regulatory environment or budgetary constraints; our failure to execute on our growth and diversification strategy, including effectively identifying, establishing and operating additional schools, programs or campuses; our failure to realize the expected benefits of our acquisitions, or our failure to successfully integrate our acquisitions; our failure to improve underutilized capacity at certain of our campuses; enrollment declines or challenges in our students’ ability to find employment as a result of macroeconomic conditions; our failure to maintain and expand existing industry relationships and develop new industry relationships; our ability to update and expand the content of existing programs and develop and integrate new programs in a timely and cost-effective manner while maintaining positive student outcomes; a loss of our senior management or other key employees; failure to comply with the restrictive covenants and our ability to pay the amounts when due under the Credit Agreement; the effect of our principal stockholder owning a significant percentage of our capital stock, and thus being able to influence certain corporate matters and the potential in the future to gain substantial control over our company; the effect of public health pandemics, epidemics or outbreak, including COVID-19, and other risks that are described from time to time in our public filings. Given these risks, uncertainties and other factors, many of which are beyond our control, you should not place undue reliance on these forward-looking statements. Neither we nor any other person makes any representation as to the accuracy or completeness of these forward-looking statements and, except as required by law, we assume no obligation to update these forward-looking statements publicly, or to revise any forward-looking statements, even if new information becomes available in the future. This presentation also contains estimates and other statistical data made by independent parties, and by us, relating to market size and growth and other data about our industry and our business. This data involves several assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree of uncertainty and risk. PAGE 2
Consolidated Q3 2024 Highlights Q3 2024 Revenue $177.5 million Net Income $5.0 million Adjusted EBITDA $18.4 million Diluted Earnings Per Share $0.09 PAGE 3 ■ Delivered Q3 results that met or exceeded expectations for all key metrics. ■ New student starts of 5,567 representing 5.0% growth versus the prior year period, with UTI seeing the impact of timing shifts between June and July which resulted in a 12.5% decline year over year, and Concorde benefiting from timing shifts of clinical start opportunities between the third and fourth quarters, resulting in an increase of 34.8% year over year. ■ Revenue of $177.5 million representing 15.8% growth versus the prior year period, with UTI and Concorde achieving 16.1% and 15.0% growth, respectively. ■ Significant increases in key profitability measures year over year, with a net loss in the prior year period and Adjusted EBITDA increasing by 61%. ■ $149 million of total liquidity (including $33 million of revolver capacity) provides ample available funds for any potential business needs or new opportunities that may arise. ■ Reiterated confidence in previously increased FY2024 guidance ranges, noting Revenue and New Student Starts are trending towards the higher end. ■ The Company also announced 5-year strategic targets with a Revenue CAGR of ~10% and Adjusted EBITDA margin approaching 20% by FY2029. See Company press release dated 8/5/2024
Consolidated Q3 2024 Summary Results ($ in millions) ($ in millions, except for student data) 3 Mos. 6/30/24 3 Mos. 6/30/23 YoY Change 9 Mos. 6/30/24 9 Mos. 6/30/23(2) YoY Change Revenues $177.5 $153.3 15.8% $536.3 $437.1 22.7% Operating expenses $170.0 $152.6 11.4% $503.5 $426.1 18.2% Ed Services $95.3 $88.4 7.8% $285.2 $236.7 20.5% SG&A $74.7 $64.2 16.3% $218.3 $189.3 15.3% Income from operations $7.4 $0.7 $6.8 $32.9 $11.1 $21.8 Net interest and other expense $(0.7) $(1.2) $0.5 $(2.0) $(2.2) $0.2 Income tax (expense) benefit $(1.8) $0.1 $(1.8) $(7.7) $(3.2) $(4.5) Net income (loss) $5.0 $(0.5) $5.5 $23.2 $5.6 $17.5 Adjusted EBITDA(1) $18.4 $11.4 $7.0 $65.5 $45.1 $20.5 Operating cash flow $10.0 $(0.4) $10.4 $18.4 $(4.7) $23.1 Adjusted free cash flow(1) $7.2 $0.4 $6.7 $10.9 $(1.6) $12.4 Capital expenditures $7.0 $10.2 $(3.2) $16.8 $48.8 $(32.1) PAGE 4 1. For a detailed reconciliation of Non-GAAP measures, see slides 16-21. 2. The acquisition of Concorde closed on December 1, 2022. As such, the nine months ended June 30, 2023 only includes seven months of Concorde activity.
Consolidated Statements of Operations Trend ($ in thousands, except EPS) 3 Mos. 6/30/24 3 Mos. 3/31/24 3 Mos. 12/31/23 12 Mos. 9/30/23(3) 3 Mos. 9/30/23 3 Mos. 6/30/23 3 Mos. 3/31/23 3 Mos. 12/31/22(3) 12 Mos. 9/30/22 Revenues $ 177,458 $ 184,176 $ 174,695 $ 607,408 $ 170,298 $ 153,286 $ 163,820 $ 120,004 $ 418,765 Operating expenses: Educational services and facilities 95,277 97,488 92,409 329,870 93,155 88,377 86,930 61,408 207,233 SG&A 74,735 75,496 68,055 256,139 66,804 64,246 70,941 54,148 189,158 Total operating expenses $ 170,012 $ 172,984 $ 160,464 $ 586,009 $ 159,959 $ 152,623 $ 157,871 $ 115,556 $ 396,391 Income from operations 7,446 11,192 14,231 21,399 10,339 663 5,949 4,448 22,374 Total other expense, net (689) (638) (682) (3,312) (1,095) (1,236) (706) (275) (1,933) Income tax (expense) benefit(1) (1,772) (2,767) (3,160) (5,765) (2,541) 64 (1,763) (1,525) 5,407 Net income (loss)(1) $ 4,985 $ 7,787 $ 10,389 $ 12,322 $ 6,703 $ (509) $ 3,480 $ 2,648 $ 25,848 Preferred stock dividends — — (1,097) (5,069) (1,278) (1,263) (1,251) (1,277) (5,159) Income (loss) available for distribution $ 4,985 $ 7,787 $ 9,292 $ 7,253 $ 5,425 $ (1,772) $ 2,229 $ 1,371 $ 20,689 Income allocated to participating securities $ — $ — $ (2,855) $ (2,712) $ (2,025) $ — $ (833) $ (514) $ (7,847) Net income (loss) available to common shareholders $ 4,985 $ 7,787 $ 6,437 $ 4,541 $ 3,400 $ (1,772) $ 1,396 $ 857 $ 12,842 Net income (loss) per share, diluted $ 0.09 $ 0.14 $ 0.17 $ 0.13 $ 0.10 $ (0.05) $ 0.04 $ 0.02 $ 0.38 EBITDA(2) $ 14,842 $ 18,513 $ 21,429 $ 47,097 $ 16,848 $ 7,407 $ 12,821 $ 10,021 $ 38,820 Total Shares Outstanding (Period End) 53,812 53,801 53,732 34,075 34,075 34,151 34,149 33,925 33,775 Weighted Average Diluted Shares Outstanding 54,951 54,770 37,439 34,479 34,824 34,067 34,553 34,408 33,743 PAGE 5 1. Net income for the twelve months ended September 30, 2022 includes an income tax benefit from the reversal of a majority of our valuation allowance. 2. For a detailed reconciliation of Non-GAAP measures, see slides 16-21. 3. The acquisition of Concorde closed on December 1, 2022. As such, the three months ended December 31, 2022 and the twelve months ended September 30, 2023 only includes one and ten months of Concorde activity, respectively.
Consolidated Results of Operations Trend Percent of Revenue 3 Mos. 3 Mos. 3 Mos. 12 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 12 Mos. 6/30/24 3/31/24 12/31/23 9/30/23(2) 9/30/23 6/30/23 3/31/23 12/31/22(2) 9/30/22 Revenues 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Operating Expenses: Educational services and facilities 53.7% 52.9% 52.9% 54.3% 54.7% 57.7% 53.1% 51.2% 49.5% SG&A 42.1% 41.0% 39.0% 42.2% 39.2% 41.9% 43.3% 45.1% 45.2% Total operating expenses 95.8% 93.9% 91.9% 96.5% 93.9% 99.6% 96.4% 96.3% 94.7% Income from operations 4.2% 6.1% 8.1% 3.5% 6.1% 0.4% 3.6% 3.7% 5.3% Total other expense, net (0.4)% (0.3)% (0.4)% (0.5)% (0.6)% (0.7)% (0.4)% (0.2)% (0.5)% Income tax (expense) benefit(1) (1.0)% (1.5)% (1.8)% (0.9)% (1.5)% —% (1.1)% (1.3)% 1.3% Net income (loss)(1) 2.8% 4.2% 5.9% 2.0% 3.9% (0.3)% 2.1% 2.2% 6.1% Preferred stock dividends —% —% (0.6)% (0.8)% (0.8)% (0.8)% (0.8)% (1.1)% (1.2)% Income (loss) available for distribution 2.8% 4.2% 5.3% 1.2% 3.2% (1.2)% 1.4% 1.1% 4.9% Income allocated to participating securities —% —% (1.6)% (0.4)% (1.2)% —% (0.5)% (0.4)% (1.9)% Net income (loss) available to common shareholders 2.8% 4.2% 3.7% 0.7% 2.0% (1.2)% 0.9% 0.7% 3.1% EBITDA(3) 8.4% 10.1% 12.3% 7.8% 9.9% 4.8% 7.8% 8.4% 9.3% PAGE 6 1. Net income for the twelve months ended September 30, 2022 includes an income tax benefit from the reversal of a majority of our valuation allowance. 2. The acquisition of Concorde closed on December 1, 2022. As such, the three months ended December 31, 2022 and the twelve months ended September 30, 2023 only includes one and ten months of Concorde activity, respectively. 3. For a detailed reconciliation of Non-GAAP measures, see slides 16-21.
Quarterly Trend – Segment Key Metrics ($ in millions, except revenue per student amounts) ($ in millions, except for student data) 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 6/30/24 3/31/24 12/31/23 9/30/23 6/30/23 6/30/24 3/31/24 12/31/23 9/30/23 6/30/23 UTI UTI UTI UTI UTI Concorde Concorde Concorde Concorde Concorde New student starts 2,916 2,840 2,314 6,500 3,333 2,651 2,640 2,032 3,892 1,967 Y/Y growth/(decline) (12.5)% 19.6% 17.2% 9.0% 5.3% 34.8% 17.2% 533.0% —% —% Average undergraduate full-time active students 13,041 13,810 14,321 12,883 11,544 8,038 8,506 8,244 8,008 7,050 Average student Y/Y growth/(decline) 13.0% 10.3% 6.0% 1.4% (4.0)% 14.0% 8.9% 6.6% —% —% Revenue per student $9,000 $8,900 $8,100 $8,900 $8,700 $7,500 $7,200 $7,200 $6,900 $7,400 Revenues $117.1 $123.3 $115.4 $115.3 $100.9 $60.3 $60.9 $59.3 $55.0 $52.4 Y/Y growth/(decline) 16.1% 14.7% 9.3% 4.2% (0.1)% 15.0% 8.2% 311.8% —% —% Income from operations $14.1 $18.1 $15.1 $14.5 $5.1 $3.7 $3.2 $7.1 $3.1 $1.9 Margin 12.0% 14.7% 13.1% 12.6% 5.1% 6.1% 5.3% 12.0% 5.6% 3.6% Adjusted EBITDA(1) $20.7 $24.4 $21.6 $21.5 $12.6 $5.9 $5.4 $8.8 $4.0 $4.0 Adjusted EBITDA margin 17.7% 19.8% 18.7% 18.6% 12.5% 9.8% 8.9% 14.8% 7.3% 7.6% PAGE 7 1. For a detailed reconciliation of Non-GAAP measures, see slides 16-21. . Note: Corporate results are not included within these metrics as they do not have any student data.
3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 6/30/24 6/30/24 6/30/24 6/30/24 6/30/23 6/30/23 6/30/23 6/30/23 UTI Concorde Corporate Consolidated UTI Concorde Corporate Consolidated Revenues $ 117,134 $ 60,324 $ — $ 177,458 $ 100,852 $ 52,434 $ — $ 153,286 Ed Services 57,525 37,752 — 95,277 54,188 34,189 — 88,377 SG&A 45,473 18,856 10,406 74,735 41,571 16,304 6,371 64,246 Total operating expenses 102,998 56,608 10,406 170,012 95,759 50,493 6,371 152,623 Income (loss) from operations 14,136 3,716 (10,406) 7,446 5,093 1,941 (6,371) 663 Net income (loss) 12,673 3,778 (11,466) 4,985 3,752 2,028 (6,289) (509) EBITDA(1) 19,885 5,083 (10,126) 14,842 10,233 3,472 (6,298) 7,407 Adjusted EBITDA(1) 20,693 5,865 (8,147) 18,411 12,569 3,989 (5,112) 11,446 Adjusted EBITDA margin 17.7% 9.8% —% 10.4% 12.5% 7.6% —% 7.5% Segment Results of Operations: Third Quarter ($ in thousands) PAGE 8 1. For a detailed reconciliation of Non-GAAP measures, see slides 16-21.
9 Mos. 9 Mos. 9 Mos. 9 Mos. 9 Mos. 9 Mos. 9 Mos. 9 Mos. 6/30/24 6/30/24 6/30/24 6/30/24 6/30/23 6/30/23 6/30/23 6/30/23 UTI Concorde Corporate Consolidated UTI Concorde Corporate Consolidated Revenues $ 355,831 $ 180,498 $ — $ 536,329 $ 313,985 $ 123,125 $ — $ 437,110 Ed Services 174,993 110,181 — 285,174 158,386 78,329 — 236,715 SG&A 133,526 56,227 28,533 218,286 127,324 37,392 24,619 189,335 Total operating expenses 308,519 166,408 28,533 503,460 285,710 115,721 24,619 426,050 Income (loss) from operations 47,312 14,090 (28,533) 32,869 28,275 7,404 (24,619) 11,060 Net income (loss) 42,886 14,271 (33,996) 23,161 25,277 7,531 (27,189) 5,619 EBITDA(1) 64,253 17,828 (27,297) 54,784 43,481 11,040 (24,272) 30,249 Adjusted EBITDA(1) $ 66,658 $ 20,033 $ (21,144) $ 65,547 $ 50,104 $ 12,307 $ (17,335) $ 45,076 Adjusted EBITDA margin 18.7 % 11.1 % — % 12.2 % 16.0 % 10.0 % — % 10.3 % Segment Results of Operations: Year-to-Date ($ in thousands) PAGE 9 1. For a detailed reconciliation of Non-GAAP measures, see slides 16-21.
Segment Expense Details: Third Quarter ($ in thousands) 3 Mos. % of 3 Mos. % of 3 Mos. % of 3 Mos. % of 06/30/2024 Segment 06/30/2024 Segment 06/30/2024 Consolidated 06/30/2024 Consolidated UTI Revenue Concorde Revenue Corporate Revenue Consolidated Revenue EDUCATIONAL SERVICES AND FACILITIES EXPENSES: Compensation and related costs $ 31,115 26.6 % $ 23,653 39.2 % $ — — % $ 54,768 30.9 % Occupancy Costs 7,558 6.5 % 5,544 9.2 % — — % 13,102 7.4 % Depreciation and amortization expense 5,651 4.8 % 1,167 1.9 % — — % 6,818 3.8 % Supplies, maintenance and student expense 7,206 6.2 % 4,075 6.8 % — — % 11,281 6.4 % Contract service expense 698 0.6 % 501 0.8 % — — % 1,199 0.7 % Other educational services and facilities expense 5,297 4.5 % 2,812 4.7 % — — % 8,109 4.6 % Total $ 57,525 49.1 % $ 37,752 62.6 % $ — — % $ 95,277 53.7 % SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES: Compensation and related costs $ 23,667 20.2 % $ 7,929 13.1 % $ 7,801 4.4 % $ 39,397 22.2 % Advertising and marketing costs 13,169 11.2 % 6,067 10.1 % 186 0.1 % 19,422 10.9 % Professional and contract service expense 1,760 1.5 % 1,850 3.1 % 3,054 1.7 % 6,664 3.8 % Other selling general and administrative expense 6,877 5.9 % 3,010 5.0 % (635) (0.4) % 9,252 5.2 % Total $ 45,473 38.8 % $ 18,856 31.3 % $ 10,406 5.9 % $ 74,735 42.1 % COMPENSATION AND RELATED COST SUMMARY: Salaries, employee benefit and tax expense $ 50,149 42.8 % $ 30,426 50.4 % $ 4,045 2.3 % $ 84,620 47.7 % Bonus expense 4,115 3.5 % 1,100 1.8 % 2,467 1.4 % 7,682 4.3 % Stock based compensation 518 0.4 % 56 0.1 % 1,289 0.7 % 1,863 1.0 % Total compensation and related costs $ 54,782 46.8 % $ 31,582 52.4 % $ 7,801 4.4 % $ 94,165 53.1 % PAGE 10
Segment Expense Details: Year-to-Date ($ in thousands) 9 Mos. % of 9 Mos. % of 9 Mos. % of 9 Mos. % of 06/30/2024 Segment 06/30/2024 Segment 06/30/2024 Consolidated 06/30/2024 Consolidated UTI Revenue Concorde Revenue Corporate Revenue Consolidated Revenue EDUCATIONAL SERVICES AND FACILITIES EXPENSES: Compensation and related costs $ 90,263 25.4 % $ 69,717 38.6 % $ — — % $ 159,980 29.8 % Occupancy Costs 22,602 6.4 % 16,531 9.2 % — — % 39,133 7.3 % Depreciation and amortization expense 16,628 4.7 % 3,179 1.8 % — — % 19,807 3.7 % Supplies, maintenance and student expense 25,721 7.2 % 12,287 6.8 % — — % 38,008 7.1 % Contract service expense 2,733 0.8 % 1,530 0.8 % — — % 4,263 0.8 % Other educational services and facilities expense 17,046 4.8 % 6,937 3.8 % — — % 23,983 4.5 % Total $ 174,993 49.2 % $ 110,181 61.0 % $ — — % $ 285,174 53.2 % SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES: Compensation and related costs $ 68,348 19.2 % $ 22,761 12.6 % $ 20,351 3.8 % $ 111,460 20.8 % Advertising and marketing costs 40,422 11.4 % 19,199 10.6 % 397 0.1 % 60,018 11.2 % Professional and contract service expense 5,083 1.4 % 5,449 3.0 % 8,575 1.6 % 19,107 3.6 % Other selling general and administrative expense 19,673 5.5 % 8,818 4.9 % (790) (0.1) % 27,701 5.2 % Total $ 133,526 37.5 % $ 56,227 31.2 % $ 28,533 5.3 % $ 218,286 40.7 % COMPENSATION AND RELATED COST SUMMARY: Salaries, employee benefit and tax expense $ 146,278 41.1 % $ 89,559 49.6 % $ 11,469 2.1 % $ 247,306 46.1 % Bonus expense 11,032 3.1 % 2,786 1.5 % 4,617 0.9 % 18,435 3.4 % Stock based compensation 1,301 0.4 % 133 0.1 % 4,265 0.8 % 5,699 1.1 % Total compensation and related costs $ 158,611 44.6 % $ 92,478 51.2 % $ 20,351 3.8 % $ 271,440 50.6 % PAGE 11
New Student Starts Details 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 3 Mos. 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Total Segment Total New Student Starts 5,567 5,480 4,346 10,392 5,300 4,626 Y/Y growth/(decline)(1) 5.0% 18.5% —% —% —% —% UTI Segment Total New Student Starts 2,916 2,840 2,314 6,500 3,333 2,374 Y/Y growth/(decline)(2) (12.5)% 19.6% 17.2% 9.0% 5.3% 4.4% High School New Student Starts 708 631 640 4,044 1,195 539 Y/Y growth/(decline) (40.8)% 17.1% 14.3% 6.8% 15.8% 0.2% Adult New Student Starts 1,586 1,579 1,154 1,919 1,613 1,320 Y/Y growth/(decline) (1.7)% 19.6% 13.9% 11.0% (2.9)% 3.7% Military New Student Starts 622 630 520 537 525 515 Y/Y growth/(decline) 18.5% 22.3% 29.7% 19.3% 11.0% 11.0% Concorde Segment Total New Student Starts 2,640 2,640 2,032 3,892 1,967 2252 Y/Y growth/(decline)(1)(2) 34.8% 17.2% —% —% —% —% Core New Student Starts 1,556 1,556 1,375 1,986 1,325 1,384 Y/Y growth/(decline)(1) 20.6% 12.4% —% —% —% —% Clinical New Student Starts 1,084 1,084 657 1,906 642 868 Y/Y growth/(decline)(1) 64.0% 24.9% —% —% —% —% PAGE 12 1. The acquisition of Concorde closed on December 1, 2022. Therefore, there is no year-over-year comparability for the Total segment and Concorde segment during the earlier periods. 2. UTI is seeing the impact of timing shifts between June and July which resulted in a 12.5% decline year over year, and Concorde benefiting from timing shifts of clinical start opportunities between the third and fourth quarters, resulting in an increase of 34.8% year over year.
Consolidated Balance Sheet and Cash Flow Summary ($ in thousands) At: 6/30/24 9/30/23 Cash & cash equivalents $ 115,505 $ 151,547 Restricted cash 3,611 5,377 Total current assets 176,565 204,985 PP&E (net) 263,252 266,346 Right-of-use assets for operating leases 164,170 176,657 Goodwill and intangible assets 46,912 47,434 Total assets 706,041 740,685 Operating lease liability – current 22,275 22,481 Long term debt, current portion 2,656 2,517 Total current liabilities 173,761 184,700 Operating lease liability – LT 153,267 165,026 Long-term debt 134,671 159,600 Total liabilities 466,658 514,718 Stockholders’ equity 239,383 225,967 Total liabilities & equity $ 706,041 $ 740,685 9 Mos. 6/30/24 9 Mos. 6/30/23(1) Net cash provided by (used in) operating activities $ 18,361 $ (4,733) Purchase of property and equipment, excluding new campus purchase (16,769) (7,810) Purchase of Orlando, Florida campus buildings and associated land — (26,156) Cash paid for acquisition, net of cash acquired — (16,381) Purchase of held-to-maturity securities, net — 29,000 Net cash used in investing activities (16,508) (36,228) Proceeds from revolving credit facility 36,000 90,000 Payments on revolving credit facility (59,000) — Payment of preferred stock cash dividend (1,097) (2,528) Preferred share conversion (11,503) — Net cash provided by/(used in) financing activities (39,661) 85,048 Change in cash and restricted cash (37,808) 44,087 Ending balance of cash and restricted cash 119,116 114,083 PAGE 13 1. The acquisition of Concorde closed on December 1, 2022. As such, the nine months ended June 30, 2023 only includes seven months of Concorde activity. Note: On December 18, 2023, the Company exercised in full its right of conversion of the Company’s Series A Preferred Stock which resulted in the conversion of all outstanding Series A Preferred shares into 19,296,843 shares of Common Stock.
Earnings Per Share Trend and Guidance ($ in thousands, except EPS) Guidance Actual Actual Actual Actual Actual Actual Actual Actual Fiscal 2024 Midpoint 3 Mos. 6/30/24 3 Mos. 3/31/24 3 Mos. 12/31/23 12 Mos. 9/30/23(1) 3 Mos. 9/30/23 3 Mos. 6/30/23 3 Mos. 3/31/23 3 Mos. 12/31/22(1) Net Income (loss) ~$37,000-41,000 $ 4,985 $ 7,787 $ 10,389 $ 12,322 $ 6,702 $ (509) $ 3,480 $ 2,648 Less: Preferred stock dividend declared (1,097) — — (1,097) (5,069) (1,278) (1,263) (1,251) (1,277) Net income (loss) available for distribution ~$38,000 4,985 7,787 9,292 7,253 5,424 (1,772) 2,229 1,371 Income allocated to participating securities (2,855) — — (2,855) (2,712) (2,025) — (833) (514) Net income (loss) available to common shareholders ~$35,000 $ 4,985 $ 7,787 $ 6,437 $ 4,541 $ 3,399 $ (1,772) $ 1,396 $ 857 Weighted average basic shares outstanding ~49,000 53,805 53,757 36,434 33,985 34,070 34,067 33,999 33,805 Basic income (loss) per common share ~$0.68-0.73 $ 0.09 $ 0.14 $ 0.18 $ 0.13 $ 0.10 $ (0.05) $ 0.04 $ 0.03 Weighted average basic shares outstanding ~49,000 53,805 53,757 36,434 33,985 34,070 34,067 33,999 33,805 Dilutive effect related to employee stock plans ~1,000 1,146 1,013 1,005 494 754 — 554 603 Weighted average diluted shares outstanding ~50,000 54,951 54,770 37,439 34,479 34,824 34,067 34,553 34,408 Diluted income (loss) per common share ~$0.68-0.73 $ 0.09 $ 0.14 $ 0.17 $ 0.13 $ 0.10 $ (0.05) $ 0.04 $ 0.02 PAGE 14 1. The acquisition of Concorde closed on December 1, 2022. As such, the three months ended December 31, 2022 and the twelve months ended September 30, 2023 only includes one and ten months of Concorde activity, respectively. Note: With the December 18, 2023 conversion of all remaining Series A preferred shares into common shares, the two-class EPS calculation method the Company has employed previously will no longer be applicable. While it was used for Q1 FY2024 and will remain in place for year-to-date calculations to account for the Preferred shares before conversion, the remaining quarters in FY24 and beyond will employ the more traditional basic and diluted EPS methodology.
Leverage as of 6/30/2024 Current Loan Balances $137.3M LTM EBITDA $84.7 Cash & Cash Equivalents $115.5 Gross Leverage Ratio 1.62x Net Leverage Ratio 0.26x Debt Term Loan: Avondale Campus (Fifth Third Bank) Original Note Amount $31.2M Inception Date 5/12/2021 Rate* Fixed/Float Maturity 7 years Current Note Balance $28.6M Term Loan: Lisle Campus (Valley National Bank) Original Note Amount $38.0M Inception Date 4/14/2022 Rate** Fixed/Float Maturity 7 years Current Note Balance $37.1M Revolver (Fifth Third Bank) Total Capacity $100.0M Inception Date 11/21/2022 Rate*** Float Maturity 3 years Current Loan Balance $67.0M 9/30/2024 proforma leverage calculation is based upon midpoint of the adjusted EBITDA guidance range and projected year-end cash balance, both of which will depend on actual company performance. Note: FY24 proforma cash and debt balances assume partial revolver paydown, though actual use of revolver will continue to be evaluated throughout the year. Any reduction to the outstanding revolver balance would benefit gross leverage but have no impact on net leverage. Leverage Ratios PAGE 15 *Avondale rate is 50% fixed at 3.50% + 50% Floating @ SOFR plus 2% Margin **Lisle rate is 50% fixed at 4.69% + 50% Floating @ SOFR plus 2% Margin ***Revolver rate is floating at SOFR plus 2.10%-2.15% Margin and Spread. See our Quarterly Reports on Form 10-Q for more details Proforma Leverage 9/30/2024 Projected Note Balances ~$120.6M LTM EBITDA - FY24 Guidance midpoint ~$103.0M Cash & Cash Equivalents (projected) ~$150.0M Gross Leverage Ratio ~1.17x Net Leverage Ratio -0.29x
Use of Non-GAAP Financial Information PAGE 16 In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company also discloses certain non-GAAP financial information. These financial measures are not recognized measures under GAAP and are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company discloses these non-GAAP financial measures because it believes that they provide investors an additional analytical tool to clarify its results of operations and identify underlying trends. Additionally, the Company believes that these measures may also help investors compare its performance on a consistent basis across time periods. The Company defines adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation and amortization, adjusted for stock-based compensation expense and items not considered normal recurring operations. The Company defines adjusted free cash flow as net cash provided by (used in) operating activities less capital expenditures, adjusted for items not considered normal recurring operations. Management utilizes adjusted figures as performance measures internally for operating decisions, strategic planning, annual budgeting and forecasting. For the periods presented, our adjustments for items that management does not consider to be normal recurring operations include: • Acquisition-related costs: We have excluded costs associated with both potential and announced acquisitions to allow for comparable financial results to historical operations and forward-looking guidance. • Integration-related costs for completed acquisitions: We have excluded integration costs related to business structure realignment and new programs for recent acquisitions to allow for comparable financial results to historical operations and forward-looking guidance. In addition, the nature and amount of such charges vary significantly based on the size and timing of the programs. By excluding the referenced expenses from our non- GAAP financial measures, our management is able to further evaluate our ability to utilize existing assets and estimate their long-term value. Furthermore, our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance. • One-time costs associated with new campus openings: During fiscal 2022, we opened new campus locations in Austin, Texas and Miramar, Florida. We continued to incur one-time costs during fiscal 2023 for the campus opening as we completed the build-out of the remaining programs in the new facilities. We disclose any campus adjustments as direct costs (net of any corporate allocations). Outfitting a new campus requires significant facility improvements and modifications, and the purchase of technical equipment and training aids necessary for teaching our programs, the combination of which requires a significant investment by the Company which would not be considered part of normal recurring operations. • Restructuring charges: In December 2023, we announced plans to consolidate the two Houston, Texas campus locations to align the curriculum, student facing systems, and support services to better serve students seeking careers in in-demand fields. As part of the transition, the MIAT-Houston campus, acquired in November 2021, began a phased teach-out in May 2024, and such campus began operating under the UTI brand. MIAT- Houston students who have not completed their programs before their program’s teach-out date may enroll at UTI-Houston to complete their program. Both facilities will remain in use, operated by UTI-Houston post- consolidation. • Costs related to the purchase of our campuses: We lease the majority of our campus locations. Over the past three years due to shifts within the real estate environment, we have been presented with the opportunity to purchase three of our campus locations. These purchases are significant capital expenditures and not considered part of normal recurring operations. To obtain a complete understanding of our performance, these measures should be examined in connection with net income (loss) and net cash provided by (used in) operating activities, determined in accordance with GAAP, as presented in the financial statements and notes thereto included in the annual and quarterly filings with the SEC. Because the items excluded from these non-GAAP measures are significant components in understanding and assessing our financial performance under GAAP, these measures should not be considered to be an alternative to net income (loss) or net cash provided by (used in) operating activities as a measure of our operating performance or liquidity. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may define and calculate non-GAAP financial measures differently than we do, limiting their usefulness as a comparative measure across similarly titled performance measures presented by other companies. A reconciliation of the historical non-GAAP financial measures to the most directly comparable GAAP measures is included in the following slides and investors are encouraged to review the reconciliations. Information reconciling forward-looking adjusted EBITDA and adjusted free cash flow to the most directly comparable GAAP financial measure is unavailable to the company without unreasonable effort. The company is not able to provide a quantitative reconciliation of forward-looking adjusted EBITDA or adjusted free cash flow to the most directly comparable GAAP financial measure because certain items required for such reconciliation are uncertain, outside of the company’s control and/or cannot be reasonably predicted, including but not limited to the provision for (benefit from) income taxes. Preparation of such reconciliation would require a forward-looking statement of income and statement of cash flows prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to the company without unreasonable effort.
Consolidated Adjusted EBITDA Reconciliation Trend ($ in thousands) QUARTER-TO-DATE 3 Mos. 6/30/24 3 Mos. 3/31/24 3 Mos. 12/31/23 12 Mos. 9/30/23(9) 3 Mos. 9/30/23 3 Mos. 6/30/23 3 Mos. 3/31/23 3 Mos. 12/31/22(9) 12 Mos. 9/30/22 Net income (loss), as reported(1) $ 4,985 $ 7,787 $ 10,389 $ 12,322 $ 6,703 $ (509) $ 3,480 $ 2,648 $ 25,848 Interest expense (income), net 709 757 896 3,795 1,038 1,325 832 600 1,495 Income tax expense (benefit) 1,772 2,767 3,160 5,765 2,541 (64) 1,763 1,525 (5,407) Depreciation and amortization 7,376 7,202 6,984 25,215 6,566 6,655 6,746 5,248 16,884 EBITDA $ 14,842 $ 18,513 $ 21,429 $ 47,097 $ 16,848 $ 7,407 $ 12,821 $ 10,021 $ 38,820 Stock-based compensation expense(2) 1,863 2,353 1,482 3,848 33 533 2,113 1,169 4,337 Acquisition-related costs(3) — — — 2,374 56 221 1,322 775 4,239 Integration-related costs for completed acquisitions(4) 1,653 1,696 1,574 8,585 2,200 2,950 1,951 1,484 1,691 One-time costs associated with new campus openings(5) — — — 2,341 32 335 984 990 9,177 Restructuring costs(6) 53 45 43 — — — — — — Intangible asset impairment(7) — — — — — — — — 2,000 Facility lease accounting adjustments(8) — — — — — — — — (64) Adjusted EBITDA, non-GAAP $ 18,411 $ 22,607 $ 24,528 $ 64,245 $ 19,169 $ 11,446 $ 19,191 $ 14,439 $ 60,200 PAGE 17 1. Net income for the twelve months ended September 30, 2022 includes an income tax benefit from the reversal of a majority of our valuation allowance. 2. Starting in fiscal 2023, stock-based compensation expense is included in Adjusted EBITDA. All prior periods have been recast for comparability. 3. Costs related to both announced and potential acquisition targets. 4. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration-related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 5. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses. 6. On December 5, 2023, UTI announced plans to consolidate the two Houston, Texas campus locations to better align with our business strategy. 7. During the fourth quarter of 2022, we completed a branding study and determined that the carrying value of the MIAT trademarks and trade name exceeded its fair value and recorded an intangible asset impairment charge of $2.0 million during the year ended September 30, 2022. 8. Lease accounting adjustments from our campus optimization efforts. These are primarily non-cash except for a lease termination payment related to our Orlando campus. 9. The acquisition of Concorde closed on December 1, 2022. As such, the three months ended December 31, 2022 and the twelve months ended September 30, 2023 only includes one and ten months of Concorde activity, respectively.
Consolidated Adjusted EBITDA Reconciliation Trend ($ in thousands) YEAR-TO-DATE 9 Mos. 6/30/24 6 Mos. 3/31/24 3 Mos. 12/31/23 12 Mos. 9/30/23(9) 9 Mos. 6/30/23(9) 6 Mos. 3/31/23(9) 3 Mos. 12/31/22(9) 12 Mos. 9/30/22 Net income, as reported(1) $ 23,161 $ 18,176 $ 10,389 $ 12,322 $ 5,619 $ 6,128 $ 2,648 $ 25,848 Interest expense (income), net 2,362 1,653 896 3,795 2,757 1,432 600 1,495 Income tax expense (benefit) 7,699 5,927 3,160 5,765 3,224 3,288 1,525 (5,407) Depreciation and amortization 21,562 14,186 6,984 25,215 18,649 11,994 5,248 16,883 EBITDA $ 54,784 $ 39,942 $ 21,429 $ 47,097 $ 30,249 $ 22,842 $ 10,021 $ 38,820 Stock-based compensation expense(2) 5,698 3,835 1,482 3,848 3,815 3,282 1,169 4,337 Acquisition-related costs(3) — — — 2,374 2,318 2,097 775 4,239 Integration-related costs for completed acquisitions(4) 4,924 3,271 1,574 8,585 6,385 3,435 1,484 1,691 One-time costs associated with new campus openings(5) — — — 2,341 2,309 1,974 990 9,177 Restructuring costs(6) 141 88 43 — — — — — Intangible asset impairment(7) — — — — — — — 2,000 Facility lease accounting adjustments(8) — — — — — — — (64) Adjusted EBITDA, non-GAAP $ 65,547 $ 47,136 $ 24,528 $ 64,245 $ 45,076 $ 33,630 $ 14,439 $ 60,200 PAGE 18 1. Net income for the twelve months ended September 30, 2022 includes an income tax benefit from the reversal of a majority of our valuation allowance. 2. Starting in fiscal 2023, stock-based compensation expense is included in Adjusted EBITDA. All prior periods have been recast for comparability. 3. Costs related to both announced and potential acquisition targets. 4. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration- related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 5. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses.. 6. On December 5, 2023, UTI announced plans to consolidate the two Houston, Texas campus locations to better align with our business strategy. 7. During the fourth quarter of 2022, we completed a branding study and determined that the carrying value of the MIAT trademarks and trade name exceeded its fair value and recorded an intangible asset impairment charge of $2.0 million during the year ended September 30, 2022. 8. Lease accounting adjustments from our campus optimization efforts. These are primarily non-cash except for a lease termination payment related to our Orlando campus. 9. The acquisition of Concorde closed on December 1, 2022 impacting comparability for the remaining periods within fiscal 2023.
Adjusted EBITDA Reconciliation By Segment ($ in thousands) QUARTER-TO-DATE 3 Mos. 6/30/24 3 Mos. 6/30/24 3 Mos. 6/30/24 3 Mos. 6/30/23 3 Mos. 6/30/23 3 Mos. 6/30/23 UTI Concorde Corporate UTI Concorde Corporate Net income (loss), as reported $ 12,673 $ 3,778 $ (11,466) $ 3,752 $ 2,028 $ (6,289) Interest expense (income), net 1,469 (62) (698) 1,361 (87) 51 Income tax expense (benefit) — — 1,772 — — (64) Depreciation and amortization 5,743 1,367 266 5,121 1,531 3 EBITDA $ 19,885 $ 5,083 $ (10,126) $ 10,234 $ 3,472 $ (6,299) Stock-based compensation expense(1) 518 56 1,289 280 — 253 Acquisition-related costs(2) — — — — — 221 Integration-related costs for completed acquisitions(3) 237 726 690 1,721 517 712 One-time costs associated with new campus openings(4) — — — 335 — — Restructuring costs(5) 53 — — — — — Adjusted EBITDA, non-GAAP $ 20,693 $ 5,865 $ (8,147) $ 12,570 $ 3,989 $ (5,113) PAGE 19 1. Starting in FY2023, stock-based compensation expense is included in Adjusted EBITDA. All prior periods have been recast for comparability. 2. Costs related to both announced and potential acquisition targets 3. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration- related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 4. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses.. 5. On December 5, 2023, UTI announced plans to consolidate the two Houston, Texas campus locations to better align with our business strategy.
Adjusted EBITDA Reconciliation By Segment ($ in thousands) YEAR-TO-DATE 9 Mos. 6/30/24 9 Mos. 6/30/24 9 Mos. 6/30/24 9 Mos. 6/30/23 9 Mos. 6/30/23(1) 9 Mos. 6/30/23 UTI Concorde Corporate UTI Concorde Corporate Net income (loss), as reported $ 42,886 $ 14,271 $ (33,996) $ 25,277 $ 7,531 $ (27,189) Interest expense (income), net 4,446 (181) (1,903) 3,214 (128) (329) Income tax expense (benefit) — — 7,699 — — 3,224 Depreciation and amortization 16,921 3,738 903 14,990 3,637 22 EBITDA $ 64,253 $ 17,828 $ (27,297) $ 33,275 $ 7,568 $ (18,001) Stock-based compensation expense(2) 1,300 133 4,265 1,176 — 2,639 Acquisition-related costs(3) — — — — — 2,318 Integration-related costs for completed acquisitions(4) 964 2,072 1,888 3,138 1,267 1,980 One-time costs associated with new campus openings(5) — — — 2,309 — — Restructuring costs(6) 141 — — — — — Adjusted EBITDA, non-GAAP $ 66,658 $ 20,033 $ (21,144) $ 39,898 $ 8,835 $ (11,064) PAGE 20 1. The acquisition of Concorde closed on December 1, 2022. As such, the nine months ended June 30, 2023 only includes seven months of Concorde activity. 2. Starting in FY2023, stock-based compensation expense is included in Adjusted EBITDA. All prior periods have been recast for comparability. 3. Costs related to both announced and potential acquisition targets 4. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Integration-related costs for completed acquisitions.” In prior quarters, these costs were presented in a line labeled “Start-up costs for new campuses and program expansion.” As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 5. The Austin, TX and Miramar, FL campuses opened during FY2022. The adjustment reflects one-time opening costs incurred for both campuses.. 6. On December 5, 2023, UTI announced plans to consolidate the two Houston, Texas campus locations to better align with our business strategy.
Consolidated Adjusted Free Cash Flow ($ in thousands) 9 Mos. 6/30/24(4) 9 Mos. 6/30/23(5) Cash flow provided by operating activities, as reported $18,361 $(4,733) Purchase of property and equipment (16,769) (48,847) Free cash flow, non-GAAP 1,592 (53,580) Adjustments: Cash outflow to purchase the Orlando, Florida campus — 26,156 Cash outflow for acquisition-related costs(1) — 2,286 Cash outflow for integration-related costs for completed acquisitions(2) 5,204 5,761 Cash outflow for integration-related property and equipment(2) 3,535 8,803 Cash outflow for one-time costs associated with new campus openings(3) — 2,309 Cash outflow for property and equipment associated with new campus openings(3) — 6,689 Cash outflow for restructuring costs and property and equipment(4) 540 — Adjusted free cash flow, non-GAAP $10,871 $(1,576) 1. Costs related to both announced and potential acquisition targets. 2. Costs related to integrating the MIAT programs at the UTI campuses and launching Concorde programs that were previously approved by regulatory bodies prior to the acquisition are presented in “Cash outflow for integration-related costs for completed acquisition" and "Cash outflow for integration-related property and equipment." In prior quarters, these costs were presented in a line labeled “Cash outflow for start-up costs for new campuses and program expansion" and "Cash outflow for property and equipment for new campuses and program expansion." As the nature of the spend and activity are more aligned to integration, we have updated our presentation and recast the prior year for comparability. 3. The Austin, TX and Miramar, FL campuses opened during FY2022 The adjustment reflects one-time opening costs incurred for both campuses . 4. On December 5, 2023, UTI announced plans to consolidate the two Houston, Texas campus locations to better align with our business strategy. 5. The acquisition of Concorde closed on December 1, 2022. As such, the nine months ended June 30, 2023 only includes seven months of Concorde activity. PAGE 21
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- DefinitionThe Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
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| Balance Type: |
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| Period Type: |
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| X |
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| Namespace Prefix: |
dei_ |
| Data Type: |
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| Balance Type: |
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| Period Type: |
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| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 13e
-Subsection 4c
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| X |
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-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
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| Namespace Prefix: |
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| Data Type: |
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| Balance Type: |
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| Period Type: |
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| X |
- DefinitionTitle of a 12(b) registered security. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b
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| Namespace Prefix: |
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| Data Type: |
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| Period Type: |
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| X |
- DefinitionName of the Exchange on which a security is registered. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
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| Namespace Prefix: |
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| Balance Type: |
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| Period Type: |
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| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Section 14a
-Number 240
-Subsection 12
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| Namespace Prefix: |
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| Data Type: |
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| X |
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| Period Type: |
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|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
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| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
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