Lincoln Educational Services (LINC) Q4 2023 earnings summary

Executive summary

• FY23 revenue rose 10.3% to $376.6M, new student starts increased 11.4%, and year-end student population reached 13,270, up 8.8% YoY; all 2023 guidance metrics were exceeded.

• Strong demand and start growth supported a 2024 growth outlook; year-end liquidity was $80.3M with no debt outstanding.

Financial highlights

• Q4 revenue increased 13.6% to $102.5M, excluding the Transitional segment; adjusted EBITDA was $15.7M, adjusted net income $10.0M, and EPS $0.23.

• FY23 campus-operations revenue rose 10.3% to $376.6M; adjusted EBITDA was $26.5M, adjusted net income $14.8M, and EPS $0.86.

• Q4 GAAP net income was $6.8M; net cash provided by operating activities was $21.9M.

• FY23 consolidated revenue was $378.1M, up 8.6% YoY; Transitional segment revenue fell 78.6% to $1.5M.

Outlook and guidance

• FY24 revenue guidance is $410M–$420M; adjusted EBITDA $35M–$40M; adjusted net income $10M–$15M.

• FY24 new-start growth guidance is 7%–12%; capital expenditures are expected at $65M–$70M.

• Start momentum carried into Q1; the year began with over 1,000 more students than the comparable prior-year start.

• Lincoln 10.0 hybrid-platform transition is targeted for completion by year-end 2024, with lower instructional costs as a share of revenue anticipated in 2025.