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Learning Tree International Announces Third Quarter 2017 Results
[August 08, 2017]

Learning Tree International Announces Third Quarter 2017 Results


Learning Tree International, Inc. (OTCQX: LTRE) announced today its revenues and results of operations for its third quarter 2017, which ended June 30, 2017.

In its third quarter of fiscal year 2017, Learning Tree reported revenues of $16.4 million, loss from operations of $0.5 million, and a net loss of $0.9 million, or $(0.07) per share. These results compare with revenues of $21.1 million, loss from operations of $3.0 million, and net loss of $2.8 million, or $(0.21) per share, in Learning Tree's third quarter of fiscal year 2016. The 22.2% decline in revenues for our third quarter of fiscal year 2017 when compared to the third quarter of fiscal year 2016, was partially offset by a 27.7% reduction in cost of revenues. Total operating expenses decreased 31.8% quarter over quarter, from $10.8 million to $7.4 million.

For the first nine months of fiscal year 2017, Learning Tree reported revenues of $51.0 million, loss from operations of $3.1 million, and a net loss of $3.6 million, or $(0.27) per share. These results compare with revenues of $59.9 million, loss from operations of $10.5 million, and a net loss of $10.5 million, or $(0.79) per share, for the first nine months of fiscal year 2016. The results for the first nine months of fiscal year 2017 includes an additional restructuring charge of $0.4 million related to our Reston, Virginia facility due to changes in estimates used to calculate the original charge. Excluding the restructuring charge, the loss from operations for the first nine months of fiscal year 2017 would have been $2.7 million.

At June 30, 2017, our capital resources consisted of cash and cash equivalents of $5.1 million. We have entered into a financing and security agreement that provides us with access to borrow through advances of funds up to a maximum aggregate principal amount of $3.0 million. To date, we have not borrowed any funds under the financing and security agreement.

Conference Call and Webcast

Learning Tree will host an investor conference call to discuss its results for the third quarter and future outlook at 4:30 p.m. ET, August 8, 2017. To participate, call (888) 419-5570 or +1 (617) 896-9871 (International Callers) and enter pass code: 396 447 18 at least five minutes before 4:30pm (ET) / 1:30pm (PT) on Tuesday, August 8, 2017; or, go to Learning Tree's Investor website at www.learningtree.com/investor to gain access and listen to the live webcast. A webcast replay of the investor conference call will be available for 90 days via the Internet through the Investor Relations section of Learning Tree's website at www.learningtree.com/investor. We have also filed our Quarterly Report on Form 10-Q for our third quarter of fiscal year 2017 with the Securities and Exchange Commission ("SEC (News - Alert)") which is available at the SEC's Internet site (http://www.sec.gov).

About Learning Tree International, Inc.

Established in 1974, Learning Tree is a leading provider of IT and management training to business and government organizations worldwide. In addition, Learning Tree provides Workforce Optimization Solutions - a modern approach to delivering learning and development services that improves the adoption of skills, and accelerates the implementation of technical and business processes required to improve IT service delivery. These services include: needs assessments, skill gaps analyses, blended learning solutions, and Project Acceleration Workshops.

Over 2.4 million professionals have enhanced their skills through Learning Tree's extensive library of proprietary and partner content on topics including: web development, cyber security, program and project management, Agile (News - Alert), operating systems, networking, cloud computing, leadership, and more. Courses are offered at Learning Tree Education Centers and training locations around the world, on-site at client facilities, or via Learning Tree AnyWareTM, the company's web-based, remote-attendance platform.

To learn more, call 1-888-THE-TREE (843-8733) or visit LearningTree.com.

Non-GAAP Financial Measures

The non-GAAP financial measures related to the exclusion of the restructuring charge presented in the first paragraph are used by our management and our Board of Directors, in addition to our GAAP results, to facilitate the assessment of our financial performance and to assess our performance compared to our annual budget and strategic plans. These non-GAAP financial measures complement our GAAP reporting and are presented to provide investors, analysts and others information that we use to manage and evaluate our performance. This information supplements our GAAP reported results, and should not be viewed in isolation from, or as a substitute for, our GAAP results. Accordingly, this financial information should be read in conjunction with our consolidated financial statements, and notes thereto, included in our quarterly reports on Form 10-Q and our annual report on Form 10-K.

Cautionary Statement Regarding Forward Looking Statements

The statements contained herein that are not historical facts are forward-looking statements based on management's current expectations and beliefs concerning future developments and their potential effects on Learning Tree. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of Learning Tree. There can be no assurance that future developments affecting Learning Tree will be the same as those anticipated. Learning Tree cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. Investors should not put undue reliance on these forward-looking statements, since they are based on key assumptions about future risks and uncertainties. Some of these risks and uncertainties that could affect Learning Tree and its business include, but are not limited to the following: our ability to continue as a going concern; our ability to obtain additional liquidity in amounts and on terms acceptable to the Company; our ability to reverse our trend of declining year over year revenues, negative cash flows from operations, and maintain liquidity; our ability to successfully implement our new strategies to increase revenue and to achieve our cost reduction goals; competition; international operations, including currency fluctuations; attracting and retaining qualified personnel; intellectual property, including having to defend potential infringement claims; implementation of partnerships with third party providers of courses and or course material; efficient delivery and scheduling of Learning Tree's courses; technology development and new technology introduction; the timely development, introduction, and customer acceptance of our courses and other products; a majority of our outstanding common stock is beneficially owned by our chairman and his spouse; risks associated with cyber security; changing economic and market conditions; and adverse weather conditions, strikes, acts of war or terrorism and other external events. Learning Tree is not undertaking any obligation to update forward-looking statements contained herein to reflect future events, developments or changed circumstances.

In order to help the reader assess the factors and risks in Learning Tree's business that could cause actual results to differ materially from those expressed in the forward looking statements, Learning Tree discusses in its 2016 Annual Report on Form 10-K ("Form 10-K"), those risks in Item 1A, "Risk Factors", as well as in its other filings with the SEC. Please read the Form 10-K, including the Risk Factors included therein, which is filed with the SEC and available at the SEC's Internet site (http://www.sec.gov).



 
Table 1
LEARNING TREE INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(all amounts in thousands, except per share data)
       
 

 

Three Months Ended

 

Nine Months Ended

 

June 30,

 

July 1,

 

June 30,

 

July 1,

 

2017

 

2016

 

2017

 

2016

(unaudited) (unaudited) (unaudited) (unaudited)
 
Revenues $ 16,404 $ 21,073

$

51,027

$

59,892

Cost of revenues 9,572   13,232   29,790   37,745  
Gross profit 6,832   7,841   21,237   22,147  
 
Operating expenses:
Course development 663 1,354 2,184 3,990
Sales and marketing 3,199 4,710 10,261 14,219
General and administrative 3,509 4,750 11,511 14,408
Restructuring Charge -   -   386   -  
Total operating expenses 7,371   10,814   24,342   32,617  
 
Loss from operations (539 ) (2,973 ) (3,105 ) (10,470 )
Other income (expense), net (259 ) 194   (169 ) 185  

Loss from operations before income taxes

(798 ) (2,779 ) (3,274 ) (10,285 )
Provision for income tax 79   51   331   195  
 
Net loss

$

(877

)

$

(2,830

)

$

(3,605

)

$

(10,480

)
 
Loss per share basic and diluted:
Basic and diluted loss per share $ (0.07 ) $ (0.21 )

$

(0.27

) $

(0.79

)
 
 
 
LEARNING TREE INTERNATIONAL, INC. AND SUBSIDIARIES Table 2
CONDENSED CONSOLIDATED BALANCE SHEETS
(all amounts in thousands)
 

 

June 30,

 

September 30,

 

2017

 

2016

 

(unaudited)

 
Cash and cash equivalents $ 5,104 $ 8,540
Trade accounts receivable, net 7,787 9,538
Prepaid expenses and other 2,995   3,548  
Total current assets 15,886 21,626
Depreciable assets, net and other 8,802   9,981  
Total assets $ 24,688   $ 31,607  
 
Accounts payable and accrued liabilities $ 10,268 $ 11,149
Deferred revenues 18,880   21,017  
Total current liabilities 29,148 32,166
Other long term liabilities 8,962   9,230  
Total liabilities 38,110   41,396  
 
Stockholders' equity (13,422 ) (9,789 )
Total liabilities and stockholders' equity $ 24,688   $ 31,607  


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