Universal Technical Institute(US:UTI)2025-11-19 22:32Financial Data and Key Metrics Changes - For fiscal year 2025, revenue reached $836 million, representing a 14% year-over-year growth, exceeding the raised guidance range [5][19] - Adjusted EBITDA for the year was $126.5 million, after strategic growth investments of $6.5 million [5][20] - Average full-time active students increased by 10.5% to 24,618, with new student starts rising by 10.8% to 29,793 [17] Business Line Data and Key Metrics Changes - The Concorde division saw a 14.5% increase in both average full-time active students and new student starts for fiscal 2025 [17] - The UTI division experienced an 8% increase in average full-time active students and a 7.9% growth in new student starts [17] Market Data and Key Metrics Changes - The demand for skilled trades and healthcare careers remains strong, with average full-time active students rising more than 10% [5] - New student starts are expected to range between 31,500 and 33,000 for fiscal 2026, driven by healthy demand trends [10] Company Strategy and Development Direction - The company is in the second phase of its North Star strategy, focusing on growth, diversification, and optimization, with plans to open three new campuses in fiscal 2026 [8][9] - Approximately 20 new programs are expected to launch across both divisions in fiscal 2026, aligned with employer demand [9][10] - The company anticipates generating over $1.2 billion in annual revenue and approaching $220 million in adjusted EBITDA by fiscal 2029 [13][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational and financial position of the company, highlighting strong demand for education in skilled trades [21] - The company expects fiscal 2026 to be a year of investment and expansion, with revenue projected between $905 million and $915 million [9][21] - Management noted that the growth story is not linear, with fiscal 2026 and 2027 being build years, and significant returns expected in fiscal 2028 and beyond [11][24] Other Important Information - The company faced temporary delays in cash disbursements due to the Department of Education's verification process, but this is not expected to have long-term impacts [20][34] - Total available liquidity at the end of the quarter was $254.5 million, including short-term investments and remaining capacity on the revolving credit facility [20] Q&A Session Summary Question: What are the expectations for start growth in 2026 between UTI and Concorde segments? - Management expects roughly 8-9% start growth for 2026, similar to the previous year [29][30] Question: Can you clarify the campus openings? - The company plans to open between two and five campuses annually across both divisions [32] Question: What impact has the Department of Education's ID verification measures had on productivity? - Management reported no impact on front-end productivity, with only temporary cash collection delays [34] Question: How did high school recruiting efforts perform compared to expectations? - High school recruiting met expectations, with plans to add resources for 2026 [37][38] Question: What are the tuition increase expectations for 2026? - The company anticipates a 2-3% price increase, varying by program and market [39][40] Question: Can you clarify the expectations for adjusted EBITDA growth starting in 2027? - Marginal growth in adjusted EBITDA is expected over 2026 numbers, with significant growth anticipated in 2028 and 2029 [46] Question: What is the revenue potential of the new campuses once scaled? - Salt Lake City is expected to generate $40 million-$45 million in revenue, while Concorde campuses are projected to bring in $20 million-$25 million [51][52][54]