CARMEL, Ind. (AP) â¿¿ ITT Educational Services Inc., which offers job training, said Thursday that its first-quarter enrollment fell, but it raised its outlook and its net income beat Wall Street analysts' expectations.
Enrollment at for-profit schools has been hurt by a federal government crackdown on student lending. The U.S. Department of Education put new regulations in place last summer that forced these companies to tighten enrollment standards or risk losing the ability to dole out federal student aid, a key source of their revenue.
ITT said that its new-student enrollment decreased 17 percent, compared with a year earlier, and its total enrollment fell more than 15 percent. But its revenue per student rose 3 percent to $4,666.
ITT, based in Carmel, Ind., offers degrees in subjects such as computer programing and web development through its ITT Technical Institutes and Daniel Webster Colleges. The industry saw enrollment rise during the recession as unemployment rose and people sought new skills to improve their job prospects. But regulatory changes and criticism of the industry have taken a toll the past year.A number of companies have cut costs and raised fees in response. ITT's quarterly net income fell to $61.1 million, or $2.38 per share, versus $85.4 million, or $2.91 per share, in the same quarter last year. Revenue fell nearly 11 percent to $341.8 million. Analysts polled by FactSet had expected adjusted earnings of $2.12 per share and revenue of $334.7 million. The company said it raised its outlook for adjusted full-year earnings to a range from $8 to $9 per share, compared with a previous range from $7.50 to $8.50. Investors sent its shares up $3.59, or 5.8 percent, to $66 by early afternoon. They have traded between $50.22 and $95.52 in the past 52 weeks.