The GE rule was scheduled to become effective on July 1, 2012, but prior to that date it was struck down by a U.S. District Court. Given the court's decision, the future of the GE rule is uncertain. Irrespective of the rule we plan to remain focused on ensuring that our students continue to receive value for their educational investment.

90/10 Compliance — The 90/10 Rule requires that no more than 90% of the company's revenue be derived from Title IV funds. The 90/10 Rule is applied to each OPEID, of which we have 44 in continuing operations. Each OPEID, or institution, consists of a main campus and its branches. As expected, two of our institutions exceeded the 90% threshold in fiscal 2012. An OPEID must exceed the 90% threshold for two consecutive years before it loses access to Title IV funding. Given the information currently available, we do not expect either of these institutions to exceed the 90% threshold for a second year.

Cal Grant Program Changes — The California legislature approved a budget in June 2012 which eliminated Cal Grant eligibility for new students at certain for-profit institutions beginning with the 2012-13 academic year. In addition, the maximum Cal Grant award amounts for continuing students was cut by 24 percent. Most of the company's Cal Grant funding is concentrated at Heald College. Heald students in California received approximately $17 million in Cal Grant funding in fiscal 2012. Given the changes in Cal Grant eligibility, new Heald students will have to replace Cal Grant funding with other alternatives such as additional federal or private loans.


The following guidance is for continuing operations and excludes one-time charges:  
Time Period Revenue Diluted EPS New Student Growth
Q1 13 $395 - $405  million $0.03 - $0.05 (1)% - 1% (flat)

Conference Call Today

We will host a conference call today at 12:00 p.m. Eastern Time (9:00 a.m. PT), to discuss fourth quarter results. The call will be open to all interested investors through a live audio web cast at (Investors/Events & Presentations.) The call will be archived on after the call. A telephonic playback of the conference call will also be available through 11:00 p.m. PT, Monday, August 27. The playback can be reached by dialing (800) 585-8367 and using pass code 99627124.

About Corinthian Colleges

Corinthian is one of the largest post-secondary education companies in North America. Our mission is to change students' lives. We offer diploma and degree programs that prepare students for careers in demand or for advancement in their chosen fields. Our program areas include health care, business, criminal justice, transportation technology and maintenance, construction trades and information technology. We have 116 Everest, Heald and WyoTech campuses, and also offer degrees online. For more information, go to .

The Corinthian Colleges, Inc. logo is available at

Certain statements in this press release may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. The company intends that all such statements be subject to the "safe-harbor" provisions of that Act. Such statements include, but are not limited to, those regarding our beliefs and expectations regarding enrollment growth or declines in future periods; the effect of new programs on our financial results; our ability to strengthen operations and improve service and value to students; our ability to manage student outcomes; our ability to comply with new federal regulations; potential impacts on the Company as a result of changes to Cal Grant funding and changes by the California legislature that impact the future receipt of such funding; our future cohort default rates; our ability to maintain compliance with the federal 90/10 Rule; and the statements under the heading "Guidance" above. Many factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements or elsewhere, including: potential negative effects from the loss of ATB students; the uncertain outcome of the Department of Education's rule making related to gainful employment, which could change the manner in which we conduct our business; the company's effectiveness in its regulatory and accreditation compliance efforts; changes by the California legislature that impact the eligibility of the Company's students to receive Cal Grants; the Company's potential inability to affect the default rates of its students on their federal student loans; the outcome of ongoing reviews and inquiries by accrediting, state and federal agencies; the outcome of pending litigation against the company; risks associated with variability in the expense and effectiveness of the company's advertising and promotional efforts; the uncertain future impact of the company's new student information system and the company's new financial aid processing system; potential increased competition; bad debt expense or reduced revenue associated with requesting students to pay more of their educational expenses while in school; the potential inability or failure of the company to employ underwriting guidelines that will limit the risk of higher student loan defaults and higher bad debt expense; changes in general macroeconomic and market conditions (including credit and labor market conditions, the unemployment rate and the rates of change of each such item); and the other risks and uncertainties described in the company's filings with the U.S. Securities and Exchange Commission. The historical results achieved by the company are not necessarily indicative of its future prospects. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Corinthian Colleges, Inc.
(In thousands, except per share data)
Consolidated Statements of Operations    
  For the three months ended For the twelve months ended
  June 30, June 30,
  2012 2011 2012 2011
  (Unaudited) (Unaudited)    
Net revenues  $ 394,774  $ 408,152  $ 1,605,472  $ 1,784,080
Operating expenses:        
Educational services  235,891  248,455  974,229  1,046,503
General and administrative  44,557  44,696  175,572  205,124
Marketing and admissions  96,907  92,023  395,258  388,962
Impairment, facility closing, and severance charges  1,032  11,667  18,270  220,058
Total operating expenses  378,387  396,841  1,563,329  1,860,647
Income (loss) from operations  16,387  11,311  42,143  (76,567)
Interest (income)  (204)  (309)  (1,773)  (896)
Interest expense   1,354  2,469  9,128  8,529
Other expense (income)   5,059  (107)  11,633  (3,418)
Pre-tax income (loss) from continuing operations  10,178  9,258  23,155  (80,782)
Provision (benefit) for income taxes  1,888  2,270  7,011  25,295
Income (loss) from continuing operations  8,290  6,988  16,144  (106,077)
(Loss) income from discontinued operations, net of tax  (14,782)  (3,620)  (26,389)  (5,088)
Net (loss) income  $ (6,492)  $ 3,368  $ (10,245)  $ (111,165)
Income (loss) per common share - Basic:    
Income (loss) from continuing operations  $ 0.10  $ 0.08  $ 0.19  $ (1.24)
Loss from discontinued operations  $ (0.18)  $ (0.04)  $ (0.31)  $ (0.06)
Net (loss) income  $ (0.08)  $ 0.04  $ (0.12)  $ (1.30)
Income (loss) per common share - Diluted:    
Income (loss) from continuing operations  $ 0.10  $ 0.08  $ 0.19  $ (1.24)
Loss from discontinued operations  $ (0.18)  $ (0.04)  $ (0.31)  $ (0.06)
Net (loss) income  $ (0.08)  $ 0.04  $ (0.12)  $ (1.30)
Weighted average number of common shares outstanding:  
Basic  85,178  84,612  84,982  85,388
Diluted  86,112  84,736  85,581  85,388
Selected Consolidated Balance Sheet Data    
   June 30,   June 30,     
   2012   2011     
Cash and cash equivalents  $ 72,525  $ 107,430    
Receivables, net (including long term notes receivable)  $ 199,094  $ 238,910    
Current assets  $ 352,607  $ 435,663    
Total assets  $ 1,064,513  $ 1,204,225    
Current liabilities  $ 282,758  $ 227,361    
Debt and capital leases (including current portion)  $ 148,974  $ 331,792    
Total liabilities  $ 499,598  $ 639,158    
Total stockholders' equity  $ 564,915  $ 565,067    
CONTACT: Investors:         Anna Marie Dunlap         SVP Investor Relations         714-424-2678                  Media:         Kent Jenkins         VP Public Affairs Communications         202-682-9494

Corinthian Colleges, Inc. Logo

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