Laureate Education(LAUR) - 2022 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for Q2 2022 was $385 million, with adjusted EBITDA at $144 million, both exceeding previous guidance [20] - On an organic constant currency basis, revenue and adjusted EBITDA increased by 17% and 33% respectively for Q2 2022 [22] - Year-to-date performance showed revenue and adjusted EBITDA growth of 14% and 33% respectively [22] Business Line Data and Key Metrics Changes - In Mexico, Q2 revenue grew by 16%, with adjusted EBITDA increasing by 13% year-over-year [23][25] - In Peru, Q2 revenue grew by 17% year-over-year, with adjusted EBITDA up 18% [27] Market Data and Key Metrics Changes - Total enrollments in June year-to-date increased by 11% compared to the prior year [9] - In Mexico, new enrollments were up 15% versus the prior year through June [25] - In Peru, new enrollments were up 7% year-over-year, with total enrollment volume up 15% [26] Company Strategy and Development Direction - The company aims to provide 40% to 60% of taught hours online across its institutions, allowing for capital-light growth [11] - The focus remains on delivering affordable high-quality education while enhancing brand reputation in Mexico and Peru [12][13] - The company is committed to defining specific KPIs related to its ESG agenda in the second half of the year [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience during economic downturns, citing past performance during financial crises [42][44] - The company is preparing for potential inflation impacts and is implementing productivity initiatives to maintain affordability [45] Other Important Information - The company has completed a $650 million share repurchase authorization program [17] - As of June 30, the company held a net cash position of $18 million [30] - The company plans to distribute remaining net proceeds from the Walden sale in the second half of the year [18] Summary of Q&A Session Question: Economic slowdown impact on businesses in Mexico and Peru - Management noted that the company has historically performed well through economic cycles, with a focus on maintaining affordability and productivity initiatives [42][44] Question: Current status of tuition levels and pricing - Management indicated satisfaction with current pricing, which is aligned with internal inflation expectations, particularly in Mexico [47] Question: Reduction in corporate costs and operational issues - Management confirmed that the rightsizing of corporate headquarters is progressing well without operational friction, targeting a reduction in G&A costs [55]