DeVry Inc. Announces Third-Quarter Results

http://www.businesswire.com/news/home/20100422006750/en

* Undergraduate enrollment at DeVry University increases 26 percent
* Chamberlain to open two new locations in July
* Apollo College and Western Career College change name to Carrington Colleges

DOWNERS GROVE, Ill.--(Business Wire)--
DeVry Inc. (NYSE:DV), a global provider of educational services, today reported
results for its fiscal 2010 third-quarter and nine-month period ended March 31,
2010. DeVry`s strong performance was driven by continued solid execution of its
growth and diversification strategy and unwavering focus on academic quality.

Three Months Ended March 31, 2010:

* Revenues increased 29 percent to $504.4 million
* Net income increased 60 percent to $81.2 million
* Diluted earnings per share increased 60 percent to $1.12

Nine Months Ended March 31, 2010:

* Revenues rose 32 percent to $1,408.5 million
* Net income increased 62 percent to $208.3 million
* Diluted earnings per share increased 63 percent to $2.88

"We continued to achieve favorable enrollment trends during this quarter, as
students were attracted by the value proposition of our educational offerings,
which includes high quality programs and services and a strong track record of
academic outcomes for students," said Daniel Hamburger, DeVry`s president and
chief executive officer. "We remain committed to investing in quality and
providing the access and capacity needed to educate our country`s workforce to
compete in the midst of a tough economy."

Business Highlights

Business, Technology, and Management Segment

DeVry University

DeVry University continued to report strong undergraduate enrollment growth,
with new enrollments in the spring increasing 24.0 percent to 17,715 students,
compared with 14,288 last year. Total student enrollment increased 25.6 percent
to 66,909 students, compared with 53,259 in spring 2009.

For the January 2010 session, graduate coursetakers enrolled in master`s degree
programs at DeVry University and its Keller Graduate School of Management rose
to 22,679, an increase of 16.5 percent over January 2009. For the March 2010
session, the number of graduate coursetakers was 22,343, an increase of 15.4
percent over prior year.

The total number of online undergraduate and graduate coursetakers in the March
2010 session increased 21.5 percent to 67,744 versus 55,745 in the same session
a year ago.

DeVry University continued to make investments in academic quality and student
outcomes during the quarter. It hired additional career service advisors and has
accelerated the implementation of its successful Student Central concept, which
brings all key services together in one place, and proactively supports students
from the time they enroll to when they graduate. Student Central will be
implemented in all DeVry University locations by the end of fiscal 2010.

Medical and Healthcare Segment

Ross University

In the January 2010 term, new students increased 14.4 percent to 699, compared
to 611 students last year. Total students increased 8.0 percent to 4,669
compared to 4,323 students in the same term last year.

An element of the growth strategy at Ross University School of Medicine was the
development of a clinical education center located in Freeport, Grand Bahama.
The clinical site was expected to mitigate capacity constraints at the main
campus in Dominica. However, the projected volume of Ross students studying in
Freeport has not been realized due to factors including an unforeseen delay in
the review process in California (one of four states requiring notification) and
caution on the part of existing students considering Freeport. Accordingly, Ross
is executing revised plans to add capacity in Dominica as it continues to work
toward resolution of these matters at its Freeport location. The Freeport site
remains a part of Ross` long-term growth plans. These near-term challenges
coupled with Ross` dedication to academic quality will mean slowing new student
enrollment for at least the upcoming May and September terms. Management remains
confident in Ross` long-term opportunities for growth.

Chamberlain College of Nursing

Chamberlain's new student enrollment in spring 2010 increased 75.4 percent to
2,168 students, compared to 1,236 in spring 2009. Total student enrollment rose
72.2 percent to 6,691 students compared with 3,885 during the same period last
year.

Chamberlain received approvals by the boards of nursing in Virginia and Illinois
for its new campuses in Crystal City, Va., and Chicago, which are scheduled to
open in July 2010. Both are co-locations with DeVry University.

U.S. Education (Apollo College/Western Career College/Carrington Colleges)

New student enrollment at U.S. Education decreased 2.4 percent to 4,218
students, compared with 4,323 in spring 2009. New student enrollment was
impacted by the recovering economy, internal execution issues and capacity
limitations as U.S. Education prepares to open new locations in the coming
months. Total enrollment increased 9.9 percent to a record 12,009 students,
compared with 10,928 for the same period last year.

In March, Western Career College and Apollo College announced that they will be
renamed Carrington College California and Carrington College, respectively. The
name change takes effect on July 1, 2010. All 19 campuses will bear the
Carrington name within California and throughout the Western U.S.

Professional Education Segment

Becker Professional Education

Results for this segment continue to be relatively flat. Nevertheless, Becker
continues to execute on its long-term growth strategy. During the quarter,
Becker signed an agreement that makes its full array of CFA exam preparation
offerings, including live classroom courses, available to CFA candidates in
Switzerland. Becker is now a trusted partner to 97 of the top 100 accounting
firms and 15 of the top 20 CFA Societies around the world.

Other Educational Services Segment

DeVry Brasil (Fanor/Ruy Barbosa/Area1)

For the March 2010 term, new students decreased 5.9 percent to 2,718, compared
to 2,887 students last year driven by volatility in graduate school enrollments
and delays in new program rollouts. Total students increased 0.4 percent to
11,789 compared to 11,742 students in the same term last year. During the
quarter, Fanor`s Fortaleza campus prepared for the launch in the coming semester
of two new programs in environmental engineering and physical education, while
Ruy Barbosa prepared to launch five new bachelor`s degree programs, including
nursing, physiotherapy and nutrition, this coming semester. In addition, for the
second year in a row, Ruy Barbosa was named the number one school in Salvador
and number one among all private institutions in the country based on academic
outcomes on the OAB exam, which is equivalent to the bar exam in the U.S.

Balance Sheet/Cash Flow

For the first nine months of fiscal 2010, DeVry generated $481.3 million of
operating cash flow, driven by the continuation of strong operating results and
working capital management. As of March 31, 2010, cash, marketable securities
and investment balances totaled $501.7 million and outstanding borrowings were
$44.8 million.

Share Repurchase Plan

During the quarter, DeVry initiated its third share repurchase program,
repurchasing $6.4 million of common stock at an average cost of $63.37 per
share.

Conclusion

"We will continue to invest in our programs, services and infrastructure to help
our students succeed," said Hamburger. "With 32 million more Americans expected
to be insured by 2014 and employment figures showing early signs of recovery,
our schools are well-positioned at the intersection of these two trends to help
high school students and working adults obtain the skills they need to achieve
their career aspirations."

Conference Call and Webcast Information

DeVry will host a conference call on April 22, 2010, at 3:30 p.m. Central
Daylight Time (4:30 p.m. Eastern Daylight Time) to discuss its fiscal 2010
third-quarter results. The conference call will be led by Daniel Hamburger,
president and chief executive officer, and Rick Gunst, chief financial officer.

For those wishing to participate by telephone, dial (800) 798-2864 (domestic) or
(617) 614-6206(international). Use passcode 84712230 or say "DeVry Call." DeVry
will also broadcast the conference call live via the Internet. Interested
parties may access the webcast through the Investor Relations section of the
company's Web site, or
http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=93880&eventID=2683566.
Please access the Web site at least 15 minutes prior to the start of the call to
register, download and install any necessary audio software.

DeVry will archive a telephone replay of the call until May 4, 2010. To access
the replay, dial (888) 286-8010 (domestic) or (617) 801-6888 (international),
passcode: 80031472. To access the Webcast replay, please visit DeVry`s Web site
at www.devryinc.com.

About DeVry Inc.

DeVry`s purpose is to empower its students to achieve their educational and
career goals. DeVry (NYSE: DV, member S&P 500 Index) is a global provider of
educational services and the parent organization of Advanced Academics, Apollo
College, Becker Professional Education, Chamberlain College of Nursing, DeVry
Brasil, DeVry University, Ross University Schools of Medicine and Veterinary
Medicine, and Western Career College. These institutions offer a wide array of
programs in business, healthcare and technology and serve students in secondary
through postsecondary education as well as accounting and finance professionals.
For more information, please call 630.353.3800 or visit http://www.devryinc.com.

Certain statements contained in this release concerning DeVry's future
performance, including those statements concerning DeVry's expectations or
plans, may constitute forward-looking statements subject to the Safe Harbor
Provision of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements generally can be identified by phrases such as DeVry
Inc. or its management "believes," "expects," "anticipates," "foresees,"
"forecasts," "estimates" or other words or phrases of similar import. Actual
results may differ materially from those projected or implied by these
forward-looking statements. Potential risks, uncertainties and other factors
that could cause results to differ are described more fully in Item 1A, "Risk
Factors," in DeVry's most recent Annual Report on Form 10-K for the year ending
June 30, 2009 and filed with the Securities and Exchange Commission on August
26, 2009.

Selected Operating Data (in thousands, except per share data)

Third Quarter
FY 2010 FY 2009 Change
Revenues $504,385 $391,882 +28.7 %
Net Income $81,152 $50,886 +59.5 %
Earnings per Share (diluted) $1.12 $0.70 +60.0 %
Number of common shares (diluted) 72,387 72,653 (0.4 %)

Nine Months
FY 2010 FY 2009 Change
Revenues $1,408,507 $1,065,214 +32.2 %
Net Income $208,333 $128,581 +62.0 %
Earnings per Share (diluted) $2.88 $1.77 +62.7 %
Number of common shares (diluted) 72,271 72,624 (0.5 %)

Use of Non-GAAP Financial Information and Supplemental Reconciliation Schedule

DeVry executed certain real estate transactions in the three and nine month
periods ended March 31, 2009, which resulted in significant lease termination
charges and/or losses on the sale of facilities. The following table illustrates
the effects of the real estate transactions on DeVry`s earnings. Management
believes that the non-GAAP disclosure of net income and earnings per share
provides investors with useful supplemental information regarding the underlying
business trends and performance of DeVry`s ongoing operations and is useful for
period-over-period comparisons of such operations given the discrete nature of
these real estate transactions. DeVry uses these supplemental financial measures
internally in its budgeting process. However, these non-GAAP financial measures
should be viewed in addition to, and not as a substitute for, DeVry`s reported
results prepared in accordance with GAAP. The following table reconciles these
items to the relevant GAAP information (in thousands, except per share data):

Third Quarter First Nine-Months
FY2010 FY2009 FY2010 FY2009
Net Income $81,152 $50,886 $208,333 $128,581
Earnings per Share (diluted) $1.12 $0.70 $2.88 $1.77

Loss on Real Estate Transaction (net of tax) -- $2,543 -- $2,543
Effect on Earnings per Share (diluted) -- $0.04 -- $0.04

Net Income Excluding the Loss on Real Estate Transaction (net of tax) $81,152 $53,429 $208,333 $131,124
Earnings per Share (diluted) Excluding the Loss on Real Estate Transaction $1.12 $0.74 $2.88 $1.81

Spring 2010 Enrollment Results

2010 2009 Change
DeVry University
Undergraduate(1)
New students 17,715 14,288 +24.0%
Total students 66,909 53,259 +25.6%

Graduate coursetakers(1)(2)
January 22,679 19,475 +16.5%
March 22,343 19,357 +15.4%

Online coursetakers(2)(3) - March 67,744 55,745 +21.5%

Chamberlain College of Nursing - March(1)
New students 2,168 1,236 +75.4%
Total students 6,691 3,885 +72.2%

Ross University - January
New students 699 611 +14.4%
Total students 4,669 4,323 +8.0%

Apollo College/Western Career College
(U.S. Education) - March
New students 4,218 4,323 (2.4)%
Total students 12,009 10,928 +9.9%

DeVry Brasil
New students 2,718 2,887 (5.9)%
Total students 11,789 11,742 +0.4%

Graduate Employment Statistics Period PercentEmployed 3 Average Salary
DeVry University (Undergraduate)(4) Oct 08-Feb 09-Jun 09 87.7% $44,186

1 Includes both onsite and online students
2 The term "coursetaker" refers to the number of courses taken by a student. Thus one student taking two courses equals two coursetakers.
3 Includes all degree levels at DeVry University
4 Three-term average; includes graduates of associate and bachelor`s degree programs

Chart 1: RemainingDeVry Inc. Calendar 2010 Announcements & Events

Aug 12, 2010 Fiscal 2010 Year-End Earnings and Summer Enrollment
DeVry University, (Undergraduate and Graduate)
Chamberlain College of Nursing

Ross University

Carrington Colleges

Oct 26, 2010 Fiscal 2011 First Quarter Earnings and Enrollment
DeVry University (graduate)
Ross University

DeVry Brasil

Dec 9, 2010 Most recent enrollment results; press release, no conference call
DeVry University (Undergraduate and Graduate)
Chamberlain College of Nursing

Carrington Colleges

DEVRY INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
PRELIMINARY

March 31, June 30, March 31,
2010 2009 2009

ASSETS

Current Assets

Cash and Cash Equivalents $ 439,897 $ 165,202 $ 294,979
Marketable Securities and Investments 61,781 60,174 1,743
Restricted Cash 55,869 5,339 22,246
Accounts Receivable, Net 155,902 104,413 179,954
Deferred Income Taxes, Net 22,489 21,562 17,850
Prepaid Expenses and Other 32,645 28,756 33,033

Total Current Assets 768,583 385,446 549,805

Land, Buildings and Equipment

Land 53,965 53,694 50,816
Buildings 283,367 250,542 237,581
Equipment 385,703 328,637 313,053
Construction In Progress 8,958 10,587 8,420

731,993 643,460 609,870

Accumulated Depreciation and Amortization (359,981 ) (335,889 ) (332,132 )

Land, Buildings and Equipment, Net 372,012 307,571 277,738

Other Assets

Intangible Assets, Net 196,003 203,195 184,654
Goodwill 515,052 512,568 494,579
Perkins Program Fund, Net 13,450 13,450 13,450
Investments - - 57,461
Other Assets 15,127 12,069 13,182

Total Other Assets 739,632 741,282 763,326

TOTAL ASSETS $ 1,880,227 $ 1,434,299 $ 1,590,869

DEVRY INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
PRELIMINARY

March 31, June 30, March 31,
2010 2009 2009

LIABILITIES

Current Liabilities

Current Portion of Debt $ 44,757 $ 104,811 $ 115,063
Accounts Payable 89,152 71,564 66,212
Accrued Salaries, Wages and Benefits 69,552 74,174 53,724
Accrued Expenses 55,019 39,162 48,923
Advance Tuition Payments 24,170 27,642 26,413
Deferred Tuition Revenue 366,113 74,664 276,104

Total Current Liabilities 648,763 392,017 586,439

Non-Current Liabilities

Revolving Loan - 20,000 20,000
Deferred Income Taxes, Net 48,281 51,895 58,518
Deferred Rent and Other 51,059 40,257 29,274

Total Non-current Liabilities 99,340 112,152 107,792

TOTAL LIABILITIES 748,103 504,169 694,231

NON-CONTROLLING INTEREST 4,518 3,188 -

SHAREHOLDERS' EQUITY

Common Stock, $0.01 par value, 200,000,000 Shares Authorized;
71,231,000, 71,233,000 and 71,582,000 Shares issued
and outstanding at March 31, 2010, June 30, 2009
and March 31, 2009, respectively. 733 729 729
Additional Paid-in Capital 217,805 197,096 186,815
Retained Earnings 991,295 791,677 760,350
Accumulated Other Comprehensive Income 9,995 7,157 737
Treasury Stock, at Cost (2,077,000, 1,663,000 and 1,267,000
Shares, Respectively) (92,222 ) (69,717 ) (51,993 )

TOTAL SHAREHOLDERS' EQUITY 1,127,606 926,942 896,638

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,880,227 $ 1,434,299 $ 1,590,869

DEVRY INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands Except for Per Share Amounts)
(Unaudited)
PRELIMINARY

For The Quarter For The Nine Months
Ended March 31, Ended March 31,

2010 2009 2010 2009

REVENUES:
Tuition $ 468,143 $ 360,629 $ 1,318,491 $ 981,800
Other Educational 36,242 31,253 90,016 83,414

Total Revenues 504,385 391,882 1,408,507 1,065,214

OPERATING COSTS AND EXPENSES:
Cost of Educational Services 214,300 178,201 610,748 484,921
Loss on Real Estate Transactions - 3,977 - 3,977
Student Services and Administrative Expense 168,065 137,917 487,425 395,177

Total Operating Costs and Expenses 382,365 320,095 1,098,173 884,075

Operating Income 122,020 71,787 310,334 181,139

INTEREST AND OTHER INCOME (EXPENSE):
Interest Income 476 776 1,550 4,628
Interest Expense (336 ) (484 ) (1,253 ) (2,013 )
Net Investment Gain (Loss) 81 970 1,225 (748 )

Net Interest and Other Income (Expense) 221 1,262 1,522 1,867

Income Before Income Taxes 122,241 73,049 311,856 183,006

Income Tax Provision 41,321 22,163 103,775 54,425

NET INCOME 80,920 50,886 208,081 128,581

Net Loss Attributable to Noncontrolling Interest 232 - 252 -

NET INCOME ATTRIBUTABLE TO DEVRY INC. $ 81,152 $ 50,886 $ 208,333 $ 128,581

EARNINGS PER COMMON SHARE ATTRIBUTABLE
TO DEVRY INC. SHAREHOLDERS
Basic $ 1.14 $ 0.71 $ 2.92 $ 1.80
Diluted $ 1.12 $ 0.70 $ 2.88 $ 1.77

Cash Dividend Declared per Common Share $ - $ - $ 0.10 $ 0.08

DEVRY INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
PRELIMINARY
For The Nine Months
Ended March 31,
2010 2009

CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $208,081 $128,581
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Stock-Based Compensation Expense 7,901 6,513
Depreciation 38,381 29,480
Amortization 9,328 6,897
Provision for Refunds and Uncollectible Accounts 71,094 53,103
Deferred Income Taxes (4,807 ) 83
Loss on Disposals of Land, Buildings and Equipment 398 2,297
Unrealized Net (Gain) Loss on Investments (1,225 ) 2,014
Changes in Assets and Liabilities, Net of Effects from
Acquisitions of Businesses:
Restricted Cash (50,516 ) (18,012 )
Accounts Receivable (122,113 ) (148,927 )
Prepaid Expenses And Other 2,834 (2,324 )
Accounts Payable 17,560 (5,834 )
Accrued Salaries, Wages, Expenses and Benefits 16,558 18,250
Advance Tuition Payments (3,595 ) 4,696
Deferred Tuition Revenue 291,449 211,115

NET CASH PROVIDED BY OPERATING ACTIVITIES 481,328 287,932

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures (101,599 ) (50,708 )
Payments for Purchases of Businesses, Net of Cash Acquired - (287,462 )
Marketable Securities Purchased (47 ) (49 )
Other (700 ) -

NET CASH USED IN INVESTING ACTIVITIES (102,346 ) (338,219 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Exercise of Stock Options 9,632 11,048
Proceeds from Stock issued Under Employee Stock Purchase Plan 756 1,805
Repurchase of Common Stock for Treasury (22,671 ) (15,703 )
Cash Dividends Paid (12,839 ) (10,015 )
Excess Tax Benefit from Stock-Based Payments 2,728 3,350
Borrowings Under Revolving Credit Facility 70,000 230,000
Repayments Under Revolving Credit Facility (150,000 ) (140,000 )
Borrowings Under Collateralized Line of Credit 242 46,306
Repayments Under Collateralized Line of Credit (296 ) (1,243 )

NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (102,448 ) 125,548

Effects of Exchange Rate Differences (1,839 ) 2,519

NET INCREASE IN CASH AND CASH EQUIVALENTS 274,695 77,780

Cash and Cash Equivalents at Beginning of Period 165,202 217,199

Cash and Cash Equivalents at End of Period $439,897 $294,979

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid During the Period for:
Interest $684 $1,845
Income Taxes, Net 92,126 33,130

Non-cash Investing Activity:
Accretion of Noncontrolling Interest Put Option 1,582 -

DEVRY INC.
SEGMENT INFORMATION
(Dollars in Thousands)
(Unaudited)
PRELIMINARY

For The Quarter For The Nine Months
Ended March 31, Ended March 31,
Increase Increase
2010 2009 (Decrease) 2010 2009 (Decrease)
REVENUES:
Business, Technology and Management $ 334,603 $ 260,180 28.6 % $ 931,365 $ 738,334 26.1 %
Medical and Healthcare 132,640 105,013 26.3 % 375,572 256,270 46.6 %
Professional Education 22,828 22,545 1.3 % 58,823 60,273 -2.4 %
Other Educational Services 14,314 4,144 245.4 % 42,747 10,337 313.5 %

Total Consolidated Revenues 504,385 391,882 28.7 % 1,408,507 1,065,214 32.2 %

OPERATING INCOME:
Business, Technology and Management 85,751 39,712 115.9 % 219,964 102,037 115.6 %
Medical and Healthcare 30,951 26,115 18.5 % 89,249 68,132 31.0 %
Professional Education 8,147 9,524 -14.5 % 17,840 21,773 -18.1 %
Other Educational Services (1,414 ) (220 ) NM (7,231 ) (2,422 ) NM
Reconciling Items:
Amortization Expense (1,618 ) (2,958 ) -45.3 % (9,189 ) (6,793 ) 35.3 %
Depreciation and Other 203 (386 ) NM (299 ) (1,588 ) -81.2 %

Total Consolidated Operating Income 122,020 71,787 70.0 % 310,334 181,139 71.3 %

INTEREST AND OTHER INCOME (EXPENSE):
Interest Income 476 776 -38.7 % 1,550 4,628 -66.5 %
Interest Expense (336 ) (484 ) -30.6 % (1,253 ) (2,013 ) -37.8 %
Net Investment Gain (Loss) 81 970 -91.6 % 1,225 (748 ) NM

Net Interest and Other Income (Expense) 221 1,262 -82.5 % 1,522 1,867 -18.5 %

Total Consolidated Income before Income Taxes $ 122,241 $ 73,049 67.3 % $ 311,856 $ 183,006 70.4 %

The following table displays the pro forma results of operations for the Medical and Healthcare segment as if U.S. Education was a part of DeVry's business for the entire nine month periods ended March 31, 2010 and 2009. No quarterly pro forma information is presented because U.S. Education was a part of DeVry's business for the entire quarterly periods ended March 31, 2010 and 2009. This non-GAAP disclosure of operating results is not preferable to GAAP disclosure but is shown as a supplement to such
disclosure to aid comparability between the periods.

For The Nine Months
Ended March 31,

2010 2009 Increase

Medical and Healthcare Revenue as Reported $375,572 $256,270 46.6 %
U.S. Education Revenue (1) - 35,907 NM
Pro forma Medical and Healthcare Revenue $375,572 $292,177 28.5 %

Medical and Healthcare Operating Income as Reported $89,249 $68,132 31.0 %
U.S. Education Operating Income as Adjusted (1) (2) - 5,350 NM
Pro forma Medical and Healthcare Operating Income $89,249 $73,482 21.5 %

(1) For the portion of the period not owned by DeVry. U.S. Education, which was acquired on September 18, 2008, contributed $64 million of revenue growth in the nine months ended March 31, 2010.
(2) Adjusted for non-recurring acquisition related charges along with an allocation of home office expenses in the first quarter ended September 30, 2008.

DeVry Inc.
Investor Contact:
Joan Bates
jbates@devry.com
(630) 353-3800
or
Media Contact:
Larry Larsen
llarsen@sardverb.com
(312) 895-4717

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