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Company Overview - Laureate Education, Inc. operates five higher education institutions in Mexico and Peru, enrolling over 470,000 students in various degree programs [25] First Quarter 2025 Highlights - New enrollments decreased by 2% compared to Q1 2024, while total enrollments increased by 4% [4] - Adjusted for semester start date timing, new enrollments increased by 7% and total enrollments by 6% [4] - Revenue for Q1 2025 was $236.2 million, a decrease of 14% from Q1 2024 [6][28] - Adjusted EBITDA for Q1 2025 was $5.4 million, down 82% from $30.6 million in Q1 2024 [8][28] Enrollment Performance - In Peru, new enrollments increased by 6% during the primary intake, while total enrollments grew by 5% [5] - In Mexico, new enrollments rose by 8% and total enrollments by 7% during the secondary intake [5] Financial Performance - Operating loss for Q1 2025 was $(13.2) million, compared to operating income of $11.1 million in Q1 2024, a change of $24.3 million [7] - Net loss for Q1 2025 was $(19.6) million, compared to a net loss of $(10.8) million in Q1 2024 [7] - Basic and diluted loss per share for Q1 2025 was $(0.13), compared to $(0.07) in Q1 2024 [7] Balance Sheet and Capital Structure - As of March 31, 2025, the company had $109.8 million in cash and cash equivalents and gross debt of $114.6 million, resulting in net debt of $4.8 million [9] - The company repurchased approximately $42 million of its common stock during Q1 2025, with $56 million remaining under its stock repurchase program [10] 2025 Outlook - The company updated its 2025 guidance, expecting total enrollments to be between 491,000 and 495,000 students, reflecting a growth of 4%-5% compared to 2024 [15] - Revenue is expected to be in the range of $1,560 million to $1,575 million, indicating growth of 0%-1% on an as-reported basis and 6%-7% on an organic constant currency basis [15] - Adjusted EBITDA is projected to be between $473 million and $480 million, reflecting growth of 5%-7% on an as-reported basis and 11%-13% on an organic constant currency basis [15]

Enrollment Trends - New enrollments decreased by 2%, but increased by 7% when adjusted for semester start dates[4] - Total enrollments increased by 4%, with a 6% increase when adjusted for semester start dates[4] - Full-year 2025 guidance includes total enrollments expected to be between 491,000 and 495,000 students, reflecting a growth of 4%-5%[19] - Total enrollments in Mexico increased by 8% year-over-year, reaching 250,200 as of March 31, 2025[28] - Total enrollments in Peru decreased by 9% year-over-year, totaling 226,800 as of March 31, 2025[28] Financial Performance - Reported revenue for Q1 2025 was $236.2 million, a decrease of 14% compared to Q1 2024[7] - Total revenues for Q1 2025 were $236.2 million, a decrease of 14% compared to $275.4 million in Q1 2024[30] - Revenue for full-year 2025 is expected to be in the range of $1,560 million to $1,575 million, indicating growth of 0%-1% on an as-reported basis[19] - Adjusted EBITDA for Q1 2025 was $5.4 million, down from $30.6 million in Q1 2024, impacted by $23 million due to academic calendar timing[8] - Adjusted EBITDA for Q1 2025 was $5.4 million, down 82% from $30.6 million in Q1 2024[38] - Adjusted EBITDA for full-year 2025 is expected to be between $473 million and $480 million, reflecting growth of 5%-7% on an as-reported basis[19] Losses and Expenses - Operating loss for Q1 2025 was $(13.2) million, compared to operating income of $11.1 million in Q1 2024[7] - Net loss for Q1 2025 was $(19.6) million, compared to a net loss of $(10.8) million in Q1 2024[7] - Basic and diluted loss per share for Q1 2025 was $(0.13), compared to $(0.07) in Q1 2024[30] - The adjusted net loss for Q1 2025 was $16.6 million, significantly higher than the adjusted net loss of $2.1 million in Q1 2024, indicating a substantial decline in performance[40] - The diluted loss per share for Q1 2025 was $0.11, compared to $0.01 in Q1 2024, reflecting a deterioration in earnings per share[40] - For Q1 2025, the company reported a net loss of $19.6 million, compared to a net loss of $10.8 million in Q1 2024, representing an increase of 81.5% year-over-year[40] Cash and Liabilities - As of March 31, 2025, Laureate had $109.8 million in cash and cash equivalents, with net debt of $4.8 million[9] - Cash and cash equivalents increased to $109.8 million as of March 31, 2025, up from $91.4 million at the end of 2024[35] - Total liabilities rose to $950.8 million as of March 31, 2025, compared to $903.5 million at the end of 2024[35] Costs and Expenses - Direct costs for Q1 2025 were $238.4 million, down from $254.0 million in Q1 2024, reflecting a decrease of 6.1%[30] - Interest expense decreased to $2.4 million in Q1 2025 from $4.7 million in Q1 2024, a reduction of 48.9%[30] Foreign Currency Impact - The company experienced a foreign currency exchange loss of $3.2 million in Q1 2025, which contributed to the overall financial results[40] Share Count - The diluted weighted average shares outstanding decreased from 157.0 million in Q1 2024 to 147.6 million in Q1 2025, indicating a reduction in share count[40]

Enrollment and Revenue - The company has approximately 477,000 students enrolled across five institutions in Mexico and Peru, with revenues of $236.2 million for the year-to-date 2025, where Mexico contributes 80% and Peru contributes 20%[71]. - The higher education market in Mexico is characterized by a significant imbalance, with private education providers constituting approximately 39% of the total market, while in Peru, private universities account for about 76%[75]. - The majority of revenue is derived from tuition and educational services, with changes in revenue driven by student enrollment and pricing strategies[78]. - Enrollment is a key business metric, indicating future revenue trends, and is influenced by new enrollments, continuing student enrollments, and attrition rates[74]. - The company emphasizes maintaining and increasing tuition rates and student enrollments to support financial performance amid competitive pressures[66]. - Revenues decreased by $39.2 million to $236.2 million for the three months ended March 31, 2025, a 14% decline compared to $275.4 million in the same period of 2024[87]. - The Mexico segment reported revenues of $189.3 million, a 12% decrease from $214.1 million in the prior year, while the Peru segment's revenues decreased by 23% to $46.9 million[96]. - Organic enrollment in the Mexico segment increased by 8%, contributing an additional $15.7 million in revenues despite the overall decline[101]. Financial Performance - Adjusted EBITDA fell to $5.4 million for the 2025 fiscal quarter, an 82% decrease from $30.6 million in the 2024 fiscal quarter[94]. - The operating loss for the 2025 fiscal quarter was $(13.2) million, a significant decline from an operating income of $11.1 million in the previous year[89]. - The overall net loss attributable to Laureate Education, Inc. was $(19.5) million, an 81% increase in loss compared to $(10.8) million in the previous year[85]. - Income tax expense decreased by $7.4 million to $2.5 million, primarily due to larger losses in Peru during the 2025 fiscal quarter[91]. - The Peru segment's Adjusted EBITDA decreased by 87% to $(38.8) million, largely due to unfavorable academic calendar timing[104]. - Corporate revenues remained minimal at $0.1 million, with Adjusted EBITDA slightly declining by 2% to $(8.8) million[106]. Costs and Expenses - Direct costs are primarily variable and trend with enrollment, including labor, operating costs, and marketing expenses aimed at future enrollments[79]. - The consolidated income tax provision is impacted by federal, state, and foreign income taxes, with the effective tax rate fluctuating based on the mix of earnings[83]. Cash Flow and Capital Management - As of March 31, 2025, the company had cash and cash equivalents of $109.8 million, with $102.9 million held by foreign subsidiaries[114]. - The company generated $57.8 million in cash from operating activities for the three months ended March 31, 2025, an increase of $24.6 million from $33.2 million in the same period of 2024[124]. - Total capital expenditures for the three months ended March 31, 2025, were $4.6 million, a decrease from $15.9 million in the same period of 2024[120]. - Cash used in investing activities decreased by $11.4 million to $(4.6) million for the 2025 fiscal quarter compared to $(16.0) million for the 2024 fiscal quarter[125]. - Cash flow from financing activities resulted in an outflow of $(34.6) million for the 2025 fiscal quarter, a change of $53.0 million from an inflow of $18.4 million in the 2024 fiscal quarter[126]. - The company maintains a revolving credit facility with a borrowing capacity of up to $155.0 million, of which $30.0 million was utilized as of March 31, 2025[111]. - The company had $30.0 million in borrowings under the Senior Secured Credit Facility and $33.7 million in other debt as of March 31, 2025[116]. - The company’s finance lease obligations and sale-leaseback financings amounted to $50.9 million as of March 31, 2025[116]. - Restricted cash balances totaled $7.1 million as of March 31, 2025, up from $6.5 million as of December 31, 2024[113]. Strategic Plans and Risks - The company plans to grow operations organically by adding new programs, expanding target demographics, and increasing capacity at existing and new campus locations[72]. - The company faces risks associated with operating in Mexico and Peru, including economic, political, and regulatory challenges, as well as foreign currency fluctuations[72]. - The decrease in revenues was primarily due to a $37.6 million negative impact from foreign currency exchange rates, mainly from the weakening of the Mexican peso against the USD[87]. - The company announced a stock repurchase program of up to $100 million, with approximately $56.1 million remaining to be repurchased as of March 31, 2025[121].

Group 1: Company Overview - Atlanta Braves Holdings (BATRK) is part of the Consumer Discretionary group, which consists of 257 companies and ranks 12 in the Zacks Sector Rank [2] - BATRK currently holds a Zacks Rank of 1 (Strong Buy), indicating a favorable outlook for the stock [3] Group 2: Performance Analysis - In the past quarter, the Zacks Consensus Estimate for BATRK's full-year earnings has increased by 28.5%, reflecting improved analyst sentiment [4] - Year-to-date, BATRK has gained approximately 1.1%, while the average return for Consumer Discretionary stocks has declined by 10.2%, showcasing BATRK's outperformance [4] - BATRK belongs to the Leisure and Recreation Services industry, which has seen a decline of about 20.2% this year, further highlighting BATRK's relative strength [6] Group 3: Comparison with Peers - Laureate Education (LAUR) is another Consumer Discretionary stock that has outperformed the sector with a year-to-date return of 4.7% [5] - The consensus EPS estimate for Laureate Education has risen by 14.9% over the past three months, and it also holds a Zacks Rank of 1 (Strong Buy) [5]

Group 1: Company Overview - Laureate Education (LAUR) is part of the Consumer Discretionary sector, which includes 268 individual stocks and currently holds a Zacks Sector Rank of 10 [2] - The Zacks Rank for LAUR is 1 (Strong Buy), indicating a favorable outlook based on earnings estimate revisions and improving earnings outlooks [3] Group 2: Performance Metrics - The Zacks Consensus Estimate for LAUR's full-year earnings has increased by 9.4% over the past quarter, reflecting stronger analyst sentiment and an improving earnings outlook [4] - Year-to-date, LAUR has returned 5.5%, outperforming the Consumer Discretionary sector average return of -4.1% [4] Group 3: Industry Context - Laureate Education belongs to the Schools industry, which consists of 18 individual stocks and currently ranks 30 in the Zacks Industry Rank; this industry has gained an average of 4.7% year-to-date [6] - In contrast, Lionsgate Studios Corp. (LION), another outperforming stock in the Consumer Discretionary sector, belongs to the Media Conglomerates industry, which has seen a decline of -5.7% year-to-date [6]

Core Insights - The Zacks Rank system emphasizes earnings estimates and revisions to identify winning stocks, with value investing being a preferred strategy in various market conditions [1] - Zacks has introduced the Style Scores system to highlight stocks with specific characteristics, particularly those with high grades in the Value category [2] Company Analysis: Laureate Education (LAUR) - Laureate Education (LAUR) currently holds a Zacks Rank of 1 (Strong Buy) and an A grade for Value, indicating strong investment potential [3] - The stock has a P/E ratio of 12.39, which is lower than the industry average of 14.91, suggesting it may be undervalued [3] - Over the past year, LAUR's Forward P/E has fluctuated between a high of 13.71 and a low of 9.90, with a median of 11.29 [3] - LAUR's P/B ratio stands at 3.12, which is favorable compared to the industry average P/B of 3.47, indicating solid valuation metrics [4] - The P/B ratio has ranged from a high of 3.32 to a low of 2.22 over the past year, with a median of 2.63 [4] - The combination of these valuation metrics suggests that LAUR is likely undervalued, supported by a strong earnings outlook [5]

Core Points - Laureate Education, Inc. will participate in upcoming conferences, including a presentation by CEO Eilif Serck-Hanssen at the Morgan Stanley Brazil Education Corporate Access Day on April 15, 2025 [1] - The company operates five higher education institutions in Mexico and Peru, serving over 450,000 students through various degree programs [3] Conference Details - The Morgan Stanley 17th Annual Latin America Executive Conference is scheduled for April 2-3, 2025, in New York City [5] - The 2025 Jefferies Latin American Summit will take place on April 8-9, 2025, also in New York City [5] Company Overview - Laureate Education is committed to academic quality and innovation, aiming for market-leading employability outcomes and increased accessibility to higher education [3]

Group 1 - Laureate Education (LAUR) is a strong performer in the Consumer Discretionary sector, with a year-to-date return of approximately 9%, outperforming the sector average of 3.2% [4] - The Zacks Rank for Laureate Education is 1 (Strong Buy), indicating positive analyst sentiment and an improving earnings outlook, with a 9.4% increase in the consensus estimate for full-year earnings over the past 90 days [3] - The Schools industry, to which Laureate Education belongs, has an average year-to-date return of 5.4%, further highlighting LAUR's strong performance relative to its peers [5] Group 2 - The Consumer Discretionary group, which includes 267 companies, is currently ranked 9 within the Zacks Sector Rank, reflecting the overall strength of the sector [2] - Another notable stock in the Consumer Discretionary sector is Lionsgate Studios Corp. (LION), which has a year-to-date return of 12.1% and a Zacks Rank of 2 (Buy) [4][5] - The Media Conglomerates industry, which includes Lionsgate Studios, has a lower year-to-date return of 3.3% and is ranked 85, indicating that LAUR is performing better than some of its industry peers [6]

Financial Data and Key Metrics Changes - In Q4 2024, revenue was $423 million, and adjusted EBITDA was $141 million, representing a 10% year-over-year increase in revenue on an organic constant currency basis, driven by a 5% increase in total enrollment volume [21][22] - For the full year 2024, revenue was $1.567 billion, with adjusted EBITDA of $450 million, resulting in an adjusted EBITDA margin of 28.7%, a historic high for the company [23][24] - Full year net income was $296 million, leading to earnings per share of $1.92 [24] Business Line Data and Key Metrics Changes - In Mexico, new enrollments increased by 4% for the year, with revenue growth of 10% driven by an 8% increase in average total enrollments [29] - In Peru, new enrollments increased by 6% for the year, with revenue growth of 4% driven by a 2% increase in average total enrollments [32] Market Data and Key Metrics Changes - The company remains the largest higher education provider in Mexico and Peru, with strong demand for quality higher education driven by rising participation rates and strong wage premiums for graduates [9][14] - Peru's GDP growth for 2025 is expected to reach approximately 3%, indicating a recovery from the recent recession [16] Company Strategy and Development Direction - The company plans to open four new campuses for its value brands, with two expected to launch in 2025, marking the first new campus launches since 2019 [13] - The focus remains on enhancing academic offerings and expanding digital education capabilities [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the economic environment in Mexico, despite geopolitical uncertainties, and expects GDP growth of about 1% for 2025 [15][53] - The company anticipates flat to slightly down reported revenues for 2025, but expects growth in adjusted EBITDA and unlevered free cash flow due to local currency revenue growth and margin expansion efforts [19][41] Other Important Information - The company returned over $100 million to shareholders in 2024 and has returned nearly $3 billion since 2019 through share repurchases and cash distributions [8][33] - The company introduced new non-GAAP metrics for adjusted net income and adjusted earnings per share to provide a clearer picture of underlying profitability [25][26] Q&A Session Summary Question: Impact of tariffs and economic environment in Mexico - Management acknowledged that while tariffs do not directly impact the business, a slowdown in foreign direct investment and CapEx spending has affected GDP growth, which in turn impacts enrollments [48][49] Question: Current capital allocation policy - The company aims for a 50% free cash flow conversion on EBITDA, with plans to return 50% of available free cash flow to shareholders after supporting growth [55][56] Question: Tax rate and Peru intake - The effective tax rate is expected to be below 40%, and management is optimistic about the Peru intake due to improving market conditions and GDP growth expectations [62][64]