The Company reported income from continuing operations attributable to Apollo Group for the three months ended February 29, 2012, of $63.9 million, or $0.51 per share (126.5 million weighted average diluted shares outstanding), compared to a loss from continuing operations attributable to Apollo Group of $66.6 million, or $0.47 per share (142.4 million weighted average diluted shares outstanding) for the three months ended February 28, 2011.

Results for the second quarter of fiscal year 2012 included restructuring and other charges of $16.1 million associated with the Company’s real estate rationalization plan.

Results for the second quarter of fiscal year 2011 included the following:
  • Goodwill and other intangible asset impairment charges of $219.9 million for the BPP subsidiary of Apollo Global ($188.3 million net of the portion attributable to noncontrolling interests).
  • A $1.6 million charge representing an accrual for incremental post-judgment interest and other estimated costs related to the Policeman’s Annuity and Benefit Fund of Chicago securities class action lawsuit.
  • A $5.0 million tax benefit, net of noncontrolling interests, associated with these charges. The Company did not record a tax benefit associated with the goodwill impairment as it is not deductible for tax purposes.

Excluding the special items noted above, income from continuing operations attributable to Apollo Group for the three months ended February 29, 2012, was $73.8 million, or $0.58 per share (126.5 million weighted average diluted shares outstanding), compared to income from continuing operations attributable to Apollo Group of $118.2 million, or $0.83 per share (142.7 million weighted average diluted shares outstanding) for the three months ended February 28, 2011. (See the reconciliation of GAAP financial information to non-GAAP financial information in the tables section of this press release.)

Operating Expenses

Instructional and student advisory increased $7.9 million, or 1.9%, to $429.5 million in the second quarter of fiscal year 2012 compared to the second quarter of fiscal year 2011, which represents a 410 basis point increase as a percentage of net revenue. The expense increase was primarily related to the Company’s initiatives, including technology, to more effectively support students and improve their educational outcomes.

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