Corinthian Colleges posts 3Q loss of $1 million

Corinthian Colleges loses money in 3rd quarter; names Leon Panetta, Marc Morial to board

Associated Press

SANTA ANA, Calif. (AP) -- Corinthian Colleges Inc. said Tuesday that it lost money in its fiscal third quarter, pressured by a decline in new student enrollments.

The Santa Ana, Calif., company, which runs Everest, Heald and WyoTech colleges and offers online degrees, lost $1 million, or 1 cent per share, for the three months ended March 31. That compares with a profit of $4.1 million, or 5 cents per share, a year earlier.

Earnings from continuing operations dropped to 3 cents per share from 14 cents per share. Stripping out impairment and severance charges in both periods, earnings from continuing operations were 4 cents per share compared with 16 cents per share.

Analysts polled by FactSet expected earnings of 6 cents per share.

Revenue fell 2 percent to $400.2 million from $407.9 million. Wall Street was looking for $406.2 million.

New student enrollments dropped 5.7 percent to 26,738, while total student population declined 6.2 percent to 87,776.

Chairman and CEO Jack Massimino said in a statement that the drop in new student enrollments was mostly because of the loss of ability-to-benefit students at its Everest schools as well as a slight decline in online student enrollments. Ability-to-benefit students lack high school diplomas.

For the fourth quarter, Corinthian anticipates adjusted earnings from continuing operations of 3 cents to 5 cents per share. Revenue is expected in a range of $378 million to $388 million.

Analysts predict earnings of 4 cents per share on revenue of $386.2 million.

Corinthian also announced that Leon Panetta, former U.S. Secretary of Defense and director of the Central Intelligence Agency, and Marc Morial, president and CEO of the National Urban League, have joined its board. The National Urban League is one of the biggest civil rights and urban advocacy organizations in the U.S.

Panetta previously served on the board from 2008 to 2009.

All of Corinthian's board members serve one-year terms and will stand for election at its annual shareholders meeting in November.

The company's stock shed 1 cent to $2 in morning trading.

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