Lincoln Educational Services(US:LINC)2025-11-10 20:00Revenue and Income - Revenue for the three months ended September 30, 2025, was $141,389,000, representing a 23.5% increase from $114,410,000 in the same period of 2024[18] - Operating income for the nine months ended September 30, 2025, was $12,577,000, compared to $4,248,000 for the same period in 2024, indicating a significant improvement[18] - Net income for the three months ended September 30, 2025, was $3,799,000, slightly down from $3,953,000 in the same period of 2024[18] - Net income for the nine months ended September 30, 2025, was $7,298,000, compared to $3,057,000 for the same period in 2024, representing a 138% increase[21] - Total revenues for the three months ended September 30, 2025, amounted to $141.4 million, compared to $114.4 million for the same period in 2024, reflecting a year-over-year increase of approximately 23.5%[45] - For the nine months ended September 30, 2025, total revenues reached $375.4 million, up from $320.7 million in the same period of 2024, representing a growth of about 17.1%[45] Assets and Liabilities - Total current assets decreased to $77,332,000 as of September 30, 2025, from $111,252,000 as of December 31, 2024[14] - Total assets increased to $466,939,000 as of September 30, 2025, compared to $436,556,000 as of December 31, 2024[14] - Total liabilities rose to $281,085,000 as of September 30, 2025, up from $258,292,000 as of December 31, 2024[14] - The company has a total stockholders' equity of $185,854,000 as of September 30, 2025, an increase from $178,264,000 as of December 31, 2024[14] Cash Flow and Investments - Cash flows from operating activities provided $15,803,000 in 2025, contrasting with a cash outflow of $993,000 in 2024[21] - The net cash used in investing activities was $67,633,000 for the nine months ended September 30, 2025, compared to $22,199,000 in 2024[21] - Capital expenditures for the nine months ended September 30, 2025, were $68,127,000, significantly higher than $32,094,000 in 2024[21] Expenses - The company experienced a 20.5% increase in selling, general, and administrative expenses for the three months ended September 30, 2025, totaling $77,811,000 compared to $63,339,000 in 2024[18] - Total costs and expenses for the three months ended September 30, 2025, were $135.104 million, up from $108.588 million in 2024, representing a 24.4% increase[91] - Operating income for the three months ended September 30, 2025, was $6.285 million, compared to $5.822 million in 2024, reflecting an 8% increase[91] Compliance and Regulatory Issues - The company is facing uncertainties regarding compliance with federal laws and regulations, which may impact future operations and funding[12] Campus Expansion - The company opened a new campus in Houston, Texas, in Q3 2025, with additional campuses planned in Hicksville, New York, and Rowlett, Texas, expected to open by the end of 2026 and Q1 2027, respectively[25] Stock and Compensation - The company’s stock-based compensation expense increased to $4,081,000 in 2025 from $3,354,000 in 2024[21] - The Company increased the aggregate number of shares available under the LTIP from 2,000,000 to 4,000,000 shares, approved by shareholders on May 5, 2023[73] - For the three months ended September 30, 2025, the expense related to Restricted Stock Awards was $1.5 million, up from $1.2 million in the same period of 2024, representing a 25% increase[77] - The outstanding Restricted Stock Awards under the LTIP had an aggregate intrinsic value of $18.3 million as of September 30, 2025, compared to $11.5 million in the prior year, indicating a 59.1% increase[77] Credit Losses and Receivables - The company reported a provision for credit losses of $42,584,000 for the nine months ended September 30, 2025, compared to $40,823,000 in 2024[21] - The allowance for credit losses for student receivables increased from $53,811 in 2024 to $65,572 in 2025, reflecting a growth of approximately 21.5%[107] - Write-offs for the same period rose from $32,605 in 2024 to $33,866 in 2025, representing an increase of approximately 3.9%[107] - The ending balance of student receivables at the end of the period was $74,290 in 2025, up from $62,029 in 2024, marking an increase of about 19.7%[109] Lease Obligations - The Company entered into one new operating lease during the nine months ended September 30, 2025, with no lease modifications[52] - Total lease payments as of September 30, 2025, amounted to $235,567,000 for operating leases and $55,991,000 for finance leases[54] - Cash paid for operating leases during the nine months ended September 30, 2025, was $12,509,000, a decrease of 7.1% from $13,465,000 in 2024[52] Financial Reporting and Standards - The company has adopted new accounting standards for segment reporting and income tax disclosures, which will enhance the transparency of financial reporting starting from fiscal years beginning after December 15, 2023[32][34] - The company did not record any interest and penalties expense associated with uncertain tax positions during the nine months ended September 30, 2025, as there were no uncertain tax positions[39] - The company is currently evaluating the impact of new tax legislation enacted on July 4, 2025, but does not expect it to have a material impact on financial results for the current year[40]