Universal Technical Institute, Inc. (NYSE: UTI) reported financial results for the fiscal 2018 second quarter ended March 31, 2018.
Revenues for the quarter were $80.7 million, compared to $82.5 million for the prior year period. The year-over-year revenue variance was primarily attributable to a 4.4 percent decrease in UTI’s average student population.
Operating expenses for the quarter were $89.5 million, compared to $81.8 million for the prior year period. The increase was primarily attributable to planned increases in compensation costs, which were largely a result of our graduate-based compensation program for our admissions representatives, contract services, and advertising expense; these increases were all aligned with our previously announced strategic growth transformation.
Operating loss for the quarter was $8.8 million compared to operating income of $0.7 million for the prior year period.
Net loss for the quarter was $8.8 million, compared to $1.7 million for the prior year period.
Kim McWaters, UTI’s President and Chief Executive Officer, stated, “In the second quarter of 2018, we demonstrated good traction on leading indicators for our business, as we generated a greater number of higher converting inquiries and increased enrollment applications by seven percent as compared to 2017. We are now in the initial implementation phases of the Transformation Plan announced in March and expect to see a positive impact on our operational results starting in the fourth quarter. We remain on track to open our third metro campus in Bloomfield, NJ, and community, employer and prospective student response has been overwhelmingly positive. Both the Transformation Plan and our new campus represent significant investment in the long-term profitable growth of UTI, with positive financial benefits beginning in fiscal 2019.”
Six Month Results
For the first six months of its Fiscal 2018, revenues were $161.8 million, compared to $166.7 million for the prior year period. The year-over-year revenue variance was attributable to a 5.2 percent decrease in UTI’s average student population.
Operating expenses were $174.2 million, compared to $164.6 million for the prior year period. The increase was primarily attributable to planned increases in contract services, advertising, graduate based admissions compensation, and professional accounting service expenses.
The company reported an operating loss was $12.4 million compared to operating income of $2.1 million for the prior year period.