Corinthian Colleges Reports Fourth Quarter and Fiscal Year 2011 Results

SANTA ANA, Calif., Aug. 23, 2011 (GLOBE NEWSWIRE) -- Corinthian Colleges, Inc.
(Nasdaq:COCO) reported financial results today for the fourth quarter and fiscal
year ended June 30, 2011. The results for the fourth quarter met or exceeded our
most recent guidance for revenue and earnings per share; new student enrollment
fell slightly below guidance. (Guidance excludes all one-time charges; the
Company recorded an $11.7 million impairment and severance charge in the fourth
quarter.)

"We navigated through a number of challenges in fiscal 2011 and made progress in
several areas," said Jack Massimino, Corinthian chairman and chief executive
officer. "We continued to focus on student completion, and we assisted a record
number of graduates in finding jobs in their fields of study. In the area of
regulatory compliance, we developed and implemented a new compensation program
for front-line admissions and student finance representatives and expanded our
disclosures related to completion, placement and program costs. We took steps to
remain in compliance with the 90/10 Rule, including a new external student
financing program. We also continued to increase the efficiency of our back-end
operations, particularly in the area of cohort default management and financial
aid processing. As a result, we no longer consider two-year CDRs to be a
significant risk for our company."

"As anticipated, the rate of new student enrollment growth declined in the
fourth quarter," Massimino said. "This decline is primarily the result of our
decision to stop enrolling ability-to-benefit (ATB) students as of September 1,
2010. Other factors include general economic conditions, tuition increases
implemented in the second half of fiscal 2011, and operational changes
associated with new federal regulations. We expect the rate of year-over-year
new enrollment declines to slow and then turn positive by the end of fiscal
2012."

"The decline in enrollment has reduced revenue and pressured margins," Massimino
said. "To help offset the decline, we are aligning expenses with revenue and
continuing to pursue several growth initiatives. These include expanding core
program offerings at numerous campuses; opening new campuses, including six
schools opened in fiscal 2011; expanding our online capabilities; and additional
focus on recruiting from the high school market. In addition, based upon our
improvement in cohort default rates, we began enrolling ATB students again on a
limited basis and those enrollments are progressing as planned."

"The final gainful employment rule was published in June, and we have completed
our initial review of the new requirements," Massimino said. "We cannot predict
the impact of the rule with certainty, as there are many open questions. In
general, by using Bureau of Labor Statistics data as allowed in the first three
years, we expect the vast majority of our short-term diploma programs to meet
the required debt-to-income ratios. For our two-year associate degree programs,
we plan to modify the pricing and curriculum structure and replace programs over
time. These changes are consistent with our overall growth strategy and we
believe they will also help mitigate the impact of the rule."

Comparing the fourth quarter of fiscal 2011 with the same quarter of the prior
year:

-- Net revenue was $425.2 million versus $481.1 million, a decrease of
11.6%.

-- Total student population at June 30, 2011 was 93,457 versus 110,105 at
June 30, 2010, a decrease of 15.1%.

-- New student enrollments totaled 24,981 versus 34,384, a decrease of
27.3%. Excluding the impact of the loss of ATB students, pro forma new
student growth declined by approximately 14.9%.

-- Operating income was $6.7 million, or 1.6% of revenue, including an
impairment and severance charge of $11.7 million, compared with
operating income of $55.7 million, or 11.6% of revenue.

-- Net income was $3.4 million, including an impairment and severance
charge of $11.7 million, and a loss from discontinued operations of $1.0
million, compared with net income of $33.9 million.

-- Diluted earnings per share from continuing operations were $0.05, versus
diluted earnings per share of $0.38. Excluding the impairment charge and
its related tax effect, diluted earnings per share from continuing
operations were $0.13.

Financial Review

Impairment, facility closing and severance charge -- During the fourth quarter,
we recorded an impairment and severance charge of $11.7 million. The impairment
charge included $6.9 million associated with the non-recourse sale of student
loans and severance of $4.8 million.

Educational services expenses were 62.2% of revenue in Q4 11 versus 57.2% in Q4
10, the result of higher compensation, facility costs, and student services
expense, against lower net revenues. Bad debt expense was 4.5% of revenue in Q4
11 versus 5.1% in Q4 10. The decrease is primarily attributable to improved
timing of packaging students with financial aid and increased automation of
financial aid processes.

Marketing and admissions expenses were 23.0% of revenue in Q4 11 versus 20.6% in
Q4 10. The increase is primarily the result of higher compensation costs, higher
advertising costs, and higher costs per new student enrollment, against lower
net revenues.

General and administrative expenses were 10.5% of revenue in Q4 11 versus 10.6%
in Q4 10.

The operating margin was 1.6% in Q4 11 versus 11.6% in Q4 10. The decrease is
the result of an impairment and severance charge, declining enrollment in the
ground schools, increased costs for default management and academic personnel,
and expenses associated with our new campuses.

Cash and cash equivalents totaled $107.4 million at June 30, 2011, compared with
$209.4 million at June 30, 2010.

Long term debt and capital leases (including current portion) totaled $331.8
million at June 30, 2011, compared with $314.3 million at June 30, 2010.

Cash flow from operations was $15.0 million in fiscal 2011, versus $204.3
million in fiscal 2010. The decline in cash flow is primarily related to the
decline in our net income and the timing of cash payments and receipts related
to working capital.

Capital expenditures were $110.7 million in fiscal 2011, versus $83.5 million in
fiscal 2010. The increase is primarily the result of investments in new
campuses.

Guidance

The following guidance excludes one-time charges:

Revenue

Time Period Diluted EPS New
Student Growth
---------------- ------------------------- -----------------------
-----------------------

Q1 12 $414 -- $424 million $(0.04) -- $(0.02)
(23)% -- (25)%
---------------- ------------------------- -----------------------
-----------------------

FY 12 N/A $0.30 -- $0.35
N/A
---------------- ------------------------- -----------------------
-----------------------

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 www.cci.edu (Investor
Relations/Webcasts & Presentations.) The call will be archived on www.cci.edu
after the call. A telephonic playback of the conference call will also be
available through 11:00 p.m. PT, Tuesday, August 30. The playback can be reached
by dialing (888) 642-1687 (domestic) or (706) 645-9291(international) and using
pass code 81220210.

About Corinthian

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 122 Everest, Heald and WyoTech campuses, and
also offer degrees exclusively online. For more information, go to
http://www.cci.edu/.

The Corinthian Colleges, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=8848

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; expected savings from our decision to align organizational
expenses with lower enrollments; the success of our growth initiatives and our
ability to grow enrollments over the long term; our ability to manage student
outcomes; our ability to comply with new federal regulations, including the
gainful employment 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:
recently promulgated Department of Education rules; inquiries by the Senate HELP
committee; the company's effectiveness in its regulatory and accreditation
compliance efforts; 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, including
state attorneys general and the U.S. Department of Education's Office of the
Inspector General; 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; potential increased competition; bad debt
expense or reduced revenue associated with requesting students to pay more of
their educational expenses while in school; risks associated with the company's
new student lending program through ASFG; 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 twelve
months
For the three months ended ended

June 30, June 30,

2011 2010 2011
2010
------------ ------------ ------------
------------
(Unaudited) (Unaudited)

Net revenues $ 425,237 $ 481,087 $ 1,868,796 $
1,756,192
Operating expenses:

Educational services 264,473 275,276 1,111,870
966,894
General and administrative 44,696 50,963 205,124
192,554
Marketing and admissions 97,696 99,164 414,778
355,980
Impairment, facility

closing, and severance

charges 11,667 -- 220,058
--
------------ ------------ ------------
------------

Total operating expenses 418,532 425,403 1,951,830
1,515,428
------------ ------------ ------------
------------

Income (loss) from operations 6,705 55,684 (83,034)
240,764

Interest (income) (309) (222) (922)
(1,148)
Interest expense 2,469 1,543 8,530
5,010

Other (income) expense (109) (141) (3,429)
(4,229)
------------ ------------ ------------
------------
Pre-tax income (loss) from

operations 4,654 54,504 (87,213)
241,131

Provision for income taxes 243 20,609 22,482
95,228
------------ ------------ ------------
------------
Income (loss) from continuing

operations $ 4,411 $ 33,895 $ (109,695)
$ 145,903
(Loss) income from discontinued

operations, net of tax (1,043) (45) (1,470)
68
------------ ------------ ------------
------------

Net Income (loss) 3,368 33,850 (111,165)
145,971
============ ============ ============
============

Income (loss) per common share

--- Basic:

Income (loss) from

continuing operations $ 0.05 $ 0.38 $ (1.28)
$ 1.66
Loss from discontinued

operations $ (0.01) $ (0.00) $ (0.02)
$ 0.00

Income (loss) per common share

--- Diluted:

Income (loss) from

continuing operations $ 0.05 $ 0.38 $ (1.28)
$ 1.65
Loss from discontinued

operations $ (0.01) $ (0.00) $ (0.02)
$ 0.00

Weighted average number of

common shares outstanding:

Basic 84,612 88,109 85,388
87,696
Diluted 84,736 88,853 85,388
88,707

Selected Consolidated Balance

Sheet Data

June 30, June 30,

2011 2010

Cash and cash equivalents $ 107,430 $ 209,419

Receivables, net (including

long term notes receivable) $ 245,989 $ 163,495

Current assets $ 421,507 $ 437,722

Total assets $ 1,204,225 $ 1,389,420

Current liabilities $ 222,670 $ 297,311

Long-term debt and capital

leases (including current

portion) $ 331,792 $ 314,259

Total liabilities $ 639,158 $ 698,386

Total stockholders' equity $ 565,067 $ 691,034

CONTACT: Investors:
Anna Marie Dunlap
SVP Investor Relations
714-424-2678

Media:
Kent Jenkins
VP Public Affairs Communications
202-682-9494