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Universal Technical Institute (UTI) 6 Aug 24 2024 Q3 Earnings call transcript

AInvestWednesday, Aug 7, 2024 7:08 pm ET
1min read

Universal Technical Institute (UTI) held its Q3 2024 earnings call, featuring insights into its operational and financial performance. The company's focus on growth, diversification, and optimization is highlighted, with a strong emphasis on its North Star Strategy.

Financial Highlights

UTI reported a near 16% growth in revenue to $177.5 million and a 13% increase in average undergraduate full-time active students. Net income reached $5 million, with diluted earnings per share at $0.09, and adjusted EBITDA at $18.4 million, marking a 61% increase. These figures demonstrate the company's robust growth and financial health.

Strategic Initiatives

UTI has been executing its North Star Strategy, aimed at profitably growing the business and creating durable shareholder value. The strategy includes expanding and diversifying the company, with a focus on healthcare and skilled trades sectors. The company has seen significant success in this regard, with a 400% increase in the company's stock price since 2017.

Operational Updates

The company's Concorde division has been outperforming, with a nearly 35% year-over-year growth in starts. This growth is attributed to clinical programs like sonography and dental hygiene, as well as the launch of a new nursing program in Jacksonville, Florida. The UTI division, too, has seen growth, with the launch of new programs and the consolidation of operations in Houston.

Future Outlook

UTI is planning to launch at least 6 new programs per year and open new campuses, with the first two expected in 2026. The company aims to achieve a compound annual revenue growth rate of approximately 10% between 2024 and 2029, with adjusted EBITDA margins approaching 20% by 2029. These plans demonstrate UTI's commitment to continued growth and innovation.

Market Outlook

Despite economic uncertainties, UTI remains optimistic about the demand for skilled labor in transportation, skilled trades, and healthcare sectors. The company's 80-plus percent in field employment rates across both divisions underscore its ability to provide industry-aligned education, ensuring positive outcomes for its students.

In conclusion, UTI's Q3 2024 earnings call highlights its strong operational and financial performance, strategic initiatives, and future outlook. The company's focus on growth, diversification, and optimization, as part of its North Star Strategy, positions it well for continued success in the education sector.

Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.