UNIVERSAL TECHNICAL INSTITUTE INC Annual Report - How They Did This Year

This year, UNIVERSAL TECHNICAL INSTITUTE INC has been actively investing in its future and managing its financial health.

Investing in the Future

The company has been busy upgrading and expanding its resources, showing growth and commitment to its educational mission.

• Property, Plant, and Equipment: They've significantly increased their physical assets:
  • Buildings grew from $100 million last year to $110 million this year.
  • Leasehold improvements increased from $110 million to $120 million.
  • Training equipment went up from $90 million to $100 million.
  • Office and computer equipment increased from $35 million to $40 million.
  • Curriculum development grew from $20 million to $25 million.
  • Software development increased from $12 million to $15 million.
  • They hold Right-of-Use assets from finance leases totaling $150 million.
  • Construction in progress increased from $25 million to $30 million.

Managing Debt

The company has made positive strides in managing its long-term debt, showing a healthier financial position.

• Long-Term Debt: Their total long-term debt decreased from $160 million last year to $150 million this year.
  • The Avondale Term Loan was reduced from $80 million to $70 million.
  • The Lisle Term Loan was reduced from $60 million to $50 million.
• Revolving Credit Facility: They ended the year with no outstanding balance on their $50 million revolving credit line. They did briefly borrow and repay $10 million from this facility shortly after the fiscal year ended, demonstrating its flexibility.
• Finance Leases: Obligations from finance leases increased from $38 million to $50 million, aligning with the increase in their Right-of-Use assets.

Building Shareholder Value

The company is retaining more of its earnings.

• Retained Earnings: The profit kept in the business grew from $100 million last year to $120 million this year.
• Additional Paid-In Capital: This increased from $290 million to $300 million.

Strategic Investments

The acquisition of Concorde Career Colleges in late 2022 continues to be a part of their operations. Intangible assets from this acquisition, such as accreditations, trademarks, and curriculum development, are being systematically accounted for (amortized) over time.

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Key Takeaways:

• UNIVERSAL TECHNICAL INSTITUTE INC significantly increased investments in physical assets like buildings, training equipment, and intellectual assets such as curriculum and software development.
• The company successfully reduced its long-term debt, including specific term loans, and ended the year with no outstanding balance on its revolving credit facility.
• Retained earnings and additional paid-in capital both increased, indicating profit retention and equity growth.
• The integration of Concorde Career Colleges continues, with intangible assets from the acquisition being amortized.