Learning Care (NASDAQ:LCGI)
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Learning Care Group, Inc. (NASDAQ:LCGI), a leading
provider of early child care and education services, today announced
operating results for the 16 weeks (first quarter 2006) ended July 22,
2005. Highlights for the quarter included an increase in net income of
118%, as well as improved margins.
"We are excited to report today a significant increase in net
income at Learning Care Group, more than doubling results reported
during the same period last year," announced Bill Davis, President and
Chief Executive Officer. "The positive results from this quarter are
reflective of Company-wide initiatives to continue corporate growth,
while fulfilling our mission to impact and inspire life-long
learning."
Revenue for first quarter 2006 increased $5.0 million, or 7.8%,
from the same period last year to $70.0 million. Childtime Learning
Centers revenue increased $2.7 million, with comparable (centers open
18 months or longer) Childtime center revenue increasing 6.1%. Tutor
Time Learning Centers revenue increased $2.2 million, with comparable
Tutor Time center revenue increasing 5.8%. Comparable Learning Center
revenues were achieved through a combination of increased tuition
rates (approximately 3%) and enrollments (approximately 3%). Franchise
Operations revenue increased $0.2 million, or 7.9%, from the same
period last year to $2.5 million.
Tutor Time franchisee-owned centers reported revenue of $44.7
million for the quarter, an increase of 8.8% from the same period last
year, with comparable center revenue increasing 11.1% for the quarter.
First quarter 2006 systemwide revenue, which include revenues from
franchisee-owned and company-owned centers, grew to $112.2 million, an
increase of 8.2% from the same period last year.
"Improvements to the Company's Franchise Operations revenue this
quarter primarily came as a result of royalties generated from the
revenue increases experienced by Tutor Time franchisees, and
secondarily through franchise fees for newly opened centers,"
explained Davis. "By purposefully directing resources to support
current franchisees, as well as to develop and capitalize new leads,
the Company is creating an environment poised for continued growth. We
have been very successful in building a platform for ongoing franchise
development. We have signed 11 new franchisees since April, 2005."
Gross profit for first quarter 2006 increased $2.3 million, or
25.8%, from the same period last year to $11.5 million. This increase
consisted of a $2.1 million increase in Learning Center Operations
gross profit and a $0.2 million increase in Franchise Operations gross
profit. Gross profit was 16.4% of revenues for first quarter 2006
compared to 14.0% for the same period last year. The increase in
Learning Center gross profit was a result of increased revenues and
improved labor efficiencies; a decrease in center level operating
expenses as a percentage of revenue, resulting from improved food
costs; and a decrease in occupancy costs as a percentage of revenue,
resulting from increased revenues. The increase in Franchise
Operations gross profit was the result of increased revenue.
Operating income for first quarter 2006 increased $1.3 million
from the same period last year to $2.9 million. The improvement was
primarily attributable to increased gross profit ($2.3 million),
offset by a gain on the sale of assets occurring in the previous year
($0.5 million) increased general and administrative expenses ($0.3
million) and an increase in provision for doubtful accounts ($0.2
million).
Net income improved to $2.1 million for first quarter 2006,
compared to $1.0 million for the same period last year. The
improvement was primarily attributable to increased operating income
of $1.3 million partially offset by discontinued operations, net of
taxes ($0.2 million).
First quarter 2006 net income per share was $0.11 and $0.10 on a
basic and diluted basis, respectively, as compared to net income of
$0.05 on a basic and diluted basis for the same period last year.
"Learning Care Group's operating and financial initiatives, aided
by the improved economy, have lead to increased enrollments and
improved cost management, resulting in a gross profit improvement of
2.4% of revenue. Additionally, the Company was able to more than
double net income for the quarter, even with a $0.5 million reduction
in gain on disposal of assets," detailed Davis. "Our plan is to
continue to improve our utilization, which stood at 63.9% of licensed
capacity for the quarter. We are confident our continued focus on
innovation and teamwork, and superior customer service will help
support continued growth throughout this fiscal year and well into the
future."
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Selected Income Statement Data (Unaudited)
($ in thousands, except per share data)
======================================================================
16 Weeks Ended
======================================================================
July 22, 2005 July 23, 2004
------------------------------- ----------------- --------------------
Revenue $ 69,972 $ 64,933
------------------------------- ----------------- --------------------
Gross profit $ 11,451 $ 9,103
------------------------------- ----------------- --------------------
Operating income $ 2,904 $ 1,649
------------------------------- ----------------- --------------------
Net income $ 2,092 $ 957
------------------------------- ----------------- --------------------
Basic net income per share $ 0.11 $ 0.05
------------------------------- ------------------ -------------------
Diluted net income per share $ 0.10 $ 0.05
======================================================================
Selected Balance Sheet Data (Unaudited)
(in thousands)
======================================================================
July 22, 2005 April 2, 2004
--------------------------------- ------------------ -----------------
Total Current Assets $14,660 $15,771
--------------------------------- ------------------ -----------------
Total Assets $85,883 $87,357
--------------------------------- ------------------ -----------------
Total Current Liabilities $24,124 $25,126
--------------------------------- ------------------ -----------------
Total Liabilities $43,427 $47,023
--------------------------------- ------------------ -----------------
Shareholders' Equity $42,456 $40,334
======================================================================
*T
About Learning Care Group, Inc.
Learning Care Group, Inc. is the parent company of Tutor Time
Child Care/Learning Centers and Childtime Learning Centers. As one of
the nation's premier child care providers, the Company has grown into
a network of 460 centers, including operations in 25 states and
internationally. For more information on the Learning Care Group
please call 248-697-9000 or visit www.learningcaregroup.com.
Statements included herein that are not historical facts are
forward-looking statements pursuant to the safe harbor provisions of
the Private/Securities Litigation Reform Act of 1995. Forward-looking
statements, including beliefs of future profitability, involve a
number of risks and uncertainties, including, but not limited to,
continuation of federal and state assistance programs, demand for
child care as well as general economic conditions, pricing and
competition. Accordingly, actual results could differ materially from
those projected in such forward-looking statements.