Universal Technical Institute Inc. (UTI) recently reported first-quarter 2010 results that topped the Zacks Consensus Estimate on the heels of record enrollment and increased operating margins that boosted the bottom-line.
The quarterly earnings of 38 cents a share outshone the Zacks Consensus Estimate of 25 cents, increasing substantially from 9 cents posted in the prior-year quarter. Universal Technical’s quarterly earnings topped the Zacks Consensus Estimate by 52%. The company’s earnings surprise history for the preceding four quarters varies between negative 100% and positive 300%, with the average being positive 54%.
The educational institute, which provides professional automotive, diesel, collision repair, motorcycle and marine programs, reported that enrollment averaged 18,782 in the quarter. Average capacity utilization jumped 900 basis points year-over-year to 75.2% in the reported quarter.
Higher education sees a countercyclical market in an economic recession when post-secondary enrollments tend to rise as both unemployed and employed workers return to school to re-skill themselves and existing students remain in school for a longer duration compelled by the intensely competitive job market.
Net revenue for the quarter climbed 14.9% year-over-year to $103.5 million, reflecting a rise in average undergraduate full-time student enrollment, increase in tuition fees and less tuition discounts.
Operating income jumped to $15.1 million in the quarter from $3.6 million delivered in the year-ago quarter, whereas operating margin surged to 14.5% from 4% posted in the prior-year quarter.
Universal Technical Institute ended the quarter with cash and cash equivalents of $61.8 million and shareholders’ equity of $118.2 million. Operating cash flow for the quarter was $17.1 million. The company did not buy back any shares in the quarter and has $23.6 million available under its share repurchase authorization.
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