May 2 For-profit college chain Education Management Corp posted a third-quarter loss due to a huge impairment charge and the company forecast a weak fourth-quarter profit as student enrollments fell.
The company forecast fourth-quarter profit of 6 cents to 8 cents per share, while analysts expected earnings of 12 cents per share, according to Thomson Reuters I/B/E/S.
Total enrollments at its colleges fell 9.3 percent to 134,900 students, as of March 31.
EDMC owns the Art Institutes, Argosy University, Brown Mackie College and South University.
Enrollments at for-profit colleges had taken a hit after a U.S. government crackdown on high levels of student debt forced them to tighten admission standards or risk losing federal aid.
EDMC posted a third-quarter net loss of $417.1 million, or $3.31 per share, compared with net income of $73 million, or 53 cents per share, a year ago.
The company said it took a goodwill impairment charge of $495.4 million due to current and projected future enrollment trends.
Excluding items, profit was 33 cents per share.
Revenue fell percent to $702.5 million.
Analysts were looking for earnings of 28 cents per share on revenue of $688.1 million.
Shares of the Pittsburgh, Pennsylvania-based company closed at $12.31 on Wednesday on the Nasdaq. They have fallen about 60 percent so far this year.