Expansion Efforts Launched in Texas, New York, and California - Discussions
Underway with Over 150 School Districts Nationwide
Company's Goal is at least $100 Million Division within 3 years - Up from
Current Revenues of $30 Million
NEW YORK, Nov. 18 /PRNewswire-FirstCall/ --
Edison Schools Inc. (Nasdaq: EDSN), the nation's leading private manager of
public schools, announced today its entry into the After-School and
Supplemental Services businesses. The company also indicated that it is
expanding its Summer School business from one state, Missouri, to four, with
expansion now being launched in Texas, New York, and California. Edison said
it will house all three service offerings within one business unit to be led
by Dr. Larrie Reynolds, who has built Edison's highly successful Summer School
business. Under Dr. Reynolds' leadership, revenues for Edison's Summer School
business tripled, from $11mm to $30mm, between FY01 and FY02. Edison says its
objective is $100 million in combined revenues of Summer School, After-School,
and Supplemental Services within three years.
Edison Summer Schools, which enrolled over 30,000 students at 178 sites
last summer, will continue to build on its formula of "adventure learning,"
blending rigorous academic programs with arts and crafts and other popular
programs. Edison's After-School programs will build upon this successful
strategy. In After-School, the company indicated that it will offer both
government-funded and parent-pay programs. Edison's supplemental services
will include offerings such as tutoring outside the regular school day. The
company has been approved as a supplemental service provider in California,
New York, and Texas, and is currently pursuing applications in 7 additional
states.
"We are seeing significant interest in all three of these product
offerings," said Larrie Reynolds, President of Edison Summer Schools. "We
already have discussions and negotiations underway with over 150 districts.
We are well into our marketing efforts and expect completion of most of our
contracts for these services in the November and December periods. We are
expecting excellent growth this year-and in the years ahead."
"These are all natural extensions of Edison's core competency: the
management of instructional services for K-12 students," said Jim Howland, the
company's Chief Development Officer. "For a decade we have been offering turn-
key, whole-school-management for year-round schools. Now client districts can
take advantage of our instructional and operational expertise before and after
school and in the summer. These services are an important business-within-our-
business, and, if disaggregated, would be an impressive, nicely-profitable,
stand-alone company."
Edison recently raised its EBITDA estimates for the total company in the
current fiscal year by 30%, saying it expects to generate annual EBITDA of $26
million. The company also said that it expects to post positive net income in
the fourth quarter of this fiscal year, the first quarterly net income in the
company's 10-year history. In addition, Edison announced that it expects to
generate approximately $50 to $70 million in incremental cash flow during the
next three quarters from refinancing of a portion of its notes receivable from
charter schools (approximately $30-$50 million), and improvements in the
collection of receivables from its managed schools customers (approximately
$20 million). The company's balance sheet remains strong with shareholder
equity of $219 million or $4.07 per share, including $31.5 million of cash on
hand at September 30, 2002. The company expects to end the year with cash on
the balance sheet of approximately $25 million. This amount would be after
material reduction in the company's debt level and substantial investment in
FY04 new business.
ABOUT EDISON SCHOOLS
Edison is the nation's largest private manager of public schools. Edison
educates approximately 110,000 students in 150 full year schools and 178
summer schools. Through contracts with local school districts, states, and
public charter school boards, Edison assumes educational and operational
responsibility for individual schools in return for funding that is generally
comparable to that spent on other public schools in the area. Over the course
of three years of intensive research, Edison's team of leading educators and
scholars developed an innovative curriculum and school design. Edison opened
its first four schools in August 1995, and has grown rapidly in every
subsequent year.
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
November 18, 2002. 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 November 18, 2002.
SOURCE Edison Schools Inc.
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Related links:
http://www.edisonschools.com
CONTACT:
Adam Tucker of Edison Schools Inc.,
+1-212-419-1645
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