After First Six Months of Fiscal Year, Company Says it is 'On-Course' to Meet
the Year's Guidance of $26mm in EBITDA
NEW YORK, Feb. 13 /PRNewswire-FirstCall/ --
Edison Schools Inc. (Nasdaq: EDSN), the nation's leading private manager of
public schools, announced today that it expects to post net income of
approximately $11 million in this year's April to June quarter. This would be
the first quarterly profit in the company's ten year history.
"Though much work remains over the next few months, we now have more
visibility into our fourth quarter, with the marketing efforts for our summer
program being substantially complete. As we expect, we will see significant
growth in our summer school revenues. Our marketing efforts for our summer
program are substantially complete and, as we expected, we will see
significant growth in our summer school revenues. If we continue to execute
on the cost side of our business, we are confident of a net income in the
$11 million range for the period," said Chris Whittle, the company's CEO and
Founder. "This would be a very important event for the Edison team and a
dramatic turn around from a $48.9 million loss in the same period last year."
In addition, after completing its first six months of the fiscal year, the
company said that it remains on-course to achieve its guidance of $26 million
in EBITDA (excluding non-cash stock compensation charges) for the year ending
June 30, 2003. This would be the first year the company has posted positive
annual EBITDA (excluding non-cash stock compensation charges) and would
represent a significant improvement over last fiscal year's performance which
was an EBITDA loss of $52.7 million, excluding effects of non-cash stock
compensation.
The company said it would report detailed financial results for the second
quarter later today, February 13, and that it will post positive EBITDA
(excluding non-cash stock compensation charges) for that quarter of
approximately $2.9 million, up about three-fold from approximately $900,000 in
the same period last year. The company said its net loss for the second
quarter was approximately $9.1 million, an improvement of 22% over the same
period last year.
Edison also provided, for the first time, specific quarterly guidance for
the third and fourth quarters of this year. It expects to produce positive
EBITDA (excluding non-cash stock compensation charges) of approximately
$6 million and $27 million, respectively, in the third and fourth quarters.
The approximately $3 million increase in EBITDA between the second and third
quarters will partially result from the signing of three previously unsigned
contracts (which deferred GSC of approximately $1 million); a $1 million
reduction in central spend versus the second quarter; and school pre-opening
and re-engineering costs of approximately $1 million that occurred in the
second quarter but will not reoccur in the third quarter. The significant
increase in EBITDA from the third to the fourth quarter will be due primarily
to the operations of Edison's summer school program.
Given the above positive trends in its business, Edison announced that
during the third quarter it is planning to refinance certain of its debt
facilities to achieve lower overall financing costs. This may result in
certain non-cash charges caused by accelerating the amortization of fees
associated with prior financing arrangements.
About Edison
Founded in 1992, Edison partners with school districts and charter boards
to raise student achievement through its research-based school design, aligned
assessment systems, interactive professional development, integrated use of
technology and other proven program features. Edison students are achieving
annual academic gains well above national norms. Edison Schools now serves
more than 110,000 public school students in over 20 states through four
different business channels: (1) the management of schools for school
districts, (2) charter schools, (3) summer and after-school programs, and
(4) achievement management solutions for school systems. The company operates
149 full-year schools and 178 summer schools.
Between 1992 and 1995 and in on-going efforts, Edison's team of leading
educators and scholars have conducted intensive research to develop its school
design and support systems. Edison opened its first four schools in August
1995, and has grown rapidly in every subsequent year. For more information,
please visit http://www.edisonschools.com.
Any statements in this press release and any other press release issued by
Edison on or about the date hereof about future expectations, plans and
prospects for Edison, including statements containing the words "believes,"
"anticipates," "plans," "expects," "will," and similar expressions, constitute
forward-looking statements within the meaning of The Private Securities
Litigation Reform Act of 1995. Actual results may differ materially from
those indicated by such forward-looking statements as a result of various
important factors, including the risk factors discussed in our most recent
annual report on form 10-K/A filed with the SEC. The forward-looking
statements included in this press release represent Edison's estimates as of
February 13, 2003. Edison anticipates that subsequent events and developments
will cause its estimates to change. While Edison may elect to update these
forward-looking statements at some point in the future, Edison specifically
disclaims any obligation to do so. These forward-looking statements should
not be relied upon as representing Edison's estimates or views as of any date
subsequent to February 13, 2003.
SOURCE Edison Schools Inc.
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Related links:
http://www.edisonschools.com
CONTACT:
Chris Scarlata, Chief Financial Officer,
+1-212-419-1645, or Adam Tucker, VP, Communications,
+1-212-419-1602, both of Edison Schools Inc.
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