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UPDATE 2-ITT Educational sees no respite from enrollment slide
* Q3 student sign-ups down 16 pct
* Sees 2012 adjusted EPS of $8-$8.10
* CEO says cannot predict when enrollments will grow
* Shares tumble 13 percent
By A. Ananthalakshmi
Oct 25 (Reuters) - ITT Educational Services Inc said it cannot predict when a nine-quarter slide in new student enrollments will come to an end, spooking investors awaiting a recovery in the for-profit education industry.
Shares of the company, which runs the ITT Technical Institutes and Daniel Webster College and offers several online courses, fell as much as 13 percent to a 10-year low of $21.82 on Thursday.
ITT's shares, which have fallen about 55 percent since the beginning of the year, had jumped 9 percent earlier in the day after the company reported a profit that beat analysts' estimates.
"We cannot provide any specific predictions regarding when we may return to year-over-year growth in new student enrollments," Chief Executive Kevin Modany said on a conference call with analysts.
ITT had said in July it expected enrollments to grow at some point in 2012. Sign-ups for the recently-ended third quarter fell 16 percent, with enrollments in online programs declining at almost twice the rate of residential programs.
The company forecast another decline in the fourth quarter and cut its full-year earnings forecast.
CEO Modany said ITT was finding it difficult to convert student inquiries into enrollments and that the company was redoubling its efforts to communicate effectively with potential students worried about the cost of their education.
The company is also eyeing cost-saving measures, including potential future campus closures.
"We will not hesitate to adjust the number of our campuses should we believe it be operationally and financially appropriate to do so," CFO Dan Fitzpatrick said on the call.
"However, we do not have any immediate plans to make any material changes to our campus locations," he added. ITT currently operates more than 140 campuses across the United States.
ITT has also been trimming its workforce to fall in line with student enrollments, he said.
The for-profit education industry has struggled to attract students since a U.S. government scrutiny revealed high student debt loads and low graduation rates.
New federal rules that were put in place last year, weak demand and negative publicity have also hurt enrollments.
A recovery in enrollments has proven to be far from smooth as concerns about debt and the credibility of program offerings have kept students away from for-profit colleges.
Market leader Apollo Group Inc last week said it would cut about 800 jobs and shut down 25 campuses to save costs amid declining profit and lower student enrollments.
ITT on Thursday lowered its full-year adjusted earnings forecast to be between $8 and $8.10 per share. It had earlier forecast earnings of up to $9 per share.
Net income fell to $42.9 million, or $1.83 per share, in the third quarter, from $67.3 million, or $2.48 per share, a year earlier. Revenue declined 13 percent to $314.7 million.
Analysts expected a profit of $1.76 per share, on revenue of $317.1 million, according to Thomson Reuters I/B/E/S.
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