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DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | 6 Months Ended
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Dec. 31, 2017
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | NOTE 2: DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE On December 4, 2017, Adtalem announced the signing of a definitive agreement to divest DeVry University, pursuant to, and subject to the terms and conditions of a stock purchase agreement with Cogswell Education, LLC, with an expected closing date occurring in early fiscal year 2019. The decision to divest was made based on changes in strategic direction for the Adtalem portfolio of institutions. As the potential sale represents a strategic shift that will have a major effect on Adtalem’s operations and financial results, Devry University is now presented in Adtalem’s financial reporting as a discontinued operation. All periods presented disclose the assets and liabilities as held for sale, and operations and cash flows of DeVry University, which was previously a part of the U.S. Traditional Postsecondary reporting segment, as discontinued operations. In the second quarter of fiscal year 2018, asset impairment charges of $47.2 million were recorded to write-down intangible assets, goodwill, and building and equipment to zero based on the fair value market value of the DeVry University operations. During the second quarter of fiscal year 2018, management also completed the sale of the DeVry University and Carrington co-located campus in Pomona, California, for $11.1 million, which was previously recorded on the Consolidated Balance Sheet as held for sale for $11.3 million, resulting in a $0.2 million realized loss on sale of assets. The assets which were previously recorded as held for sale, the unrealized loss on assets held for sale and the loss on sale of assets associated with the Pomona, California, campus have all been classified within discontinued operations. The following is a summary of balance sheet information of assets and liabilities reported as discontinued operations (in thousands).
|  | December 31, |  | June 30, |  | December 31, |
|  | 2017 |  | 2017 |  | 2016 |
ASSETS: |  |  |  |  |  |  |  |  |  |
Current Assets: |  |  |  |  |  |  |  |  |  |
Cash and Cash Equivalents |  | $ | 902 |  | $ | 1,553 |  | $ | 2,085 |
Restricted Cash |  |  | 5,880 |  |  | 4,358 |  |  | 5,470 |
Accounts Receivable, Net |  |  | 11,206 |  |  | 11,957 |  |  | 22,296 |
Prepaid Expenses and Other |  |  | 10,138 |  |  | 5,748 |  |  | 7,351 |
Total Current Assets Held for Sale |  |  | 28,126 |  |  | 23,616 |  |  | 37,202 |
Land, Building and Equipment Held for Sale, Net |  |  | - |  |  | 37,904 |  |  | 39,967 |
Other Assets: |  |  |  |  |  |  |  |  |  |
Intangible Assets |  |  | - |  |  | 1,645 |  |  | 1,645 |
Goodwill |  |  | - |  |  | 22,196 |  |  | 22,196 |
Perkins Program Fund, Net |  |  | 13,450 |  |  | 13,450 |  |  | 13,450 |
Other Assets, Net |  |  | - |  |  | 999 |  |  | 813 |
Total Other Assets Held for Sale |  |  | 13,450 |  |  | 38,290 |  |  | 38,104 |
Total Assets Held for Sale |  | $ | 41,576 |  | $ | 99,810 |  | $ | 115,273 |
LIABILITIES: |  |  |  |  |  |  |  |  |  |
Current Liabilities: |  |  |  |  |  |  |  |  |  |
Accounts Payable |  | $ | 14,713 |  | $ | 17,868 |  | $ | 15,770 |
Accrued Salaries, Wages and Benefits |  |  | 10,223 |  |  | 14,580 |  |  | 14,184 |
Accrued Liabilities |  |  | 7,287 |  |  | 8,937 |  |  | 7,216 |
Deferred Revenue |  |  | 4,246 |  |  | 1,788 |  |  | 8,557 |
Total Current Liabilities Held for Sale |  |  | 36,469 |  |  | 43,173 |  |  | 45,727 |
Total Liabilities Held for Sale |  | $ | 36,469 |  | $ | 43,173 |  | $ | 45,727 |
The following is a summary of income statement information of operations reported as discontinued operations (in thousands).
|  | Three Months Ended |  | Six Months Ended |
|  | December 31, |  | December 31, |
|  | 2017 |  | 2016 |  | 2017 |  | 2016 |
REVENUE: |  |  |  |  |  |  |  |  |  |  |  |  |
Tuition |  | $ | 86,172 |  | $ | 118,000 |  | $ | 172,840 |  | $ | 230,130 |
Other Educational |  |  | 4,471 |  |  | 4,390 |  |  | 13,550 |  |  | 13,127 |
Total Revenue |  |  | 90,643 |  |  | 122,390 |  |  | 186,390 |  |  | 243,257 |
OPERATING COST AND EXPENSE: |  |  |  |  |  |  |  |  |  |  |  |  |
Cost of Educational Services |  |  | 48,221 |  |  | 60,639 |  |  | 100,397 |  |  | 123,826 |
Student Services and Administrative Expense |  |  | 36,624 |  |  | 44,484 |  |  | 85,896 |  |  | 102,084 |
Restructuring Expense |  |  | 2,209 |  |  | 2,087 |  |  | 7,814 |  |  | 3,785 |
Asset Impairment Charge - Intangible and Goodwill |  |  | 23,841 |  |  | - |  |  | 23,841 |  |  | - |
Asset Impairment Charge - Building and Equipment |  |  | 23,391 |  |  | - |  |  | 23,391 |  |  | - |
Loss on Sale of Assets |  |  | 230 |  |  | - |  |  | 230 |  |  | - |
Regulatory Settlements |  |  | - |  |  | 4,102 |  |  | - |  |  | 4,102 |
Loss on Assets Held for Sale |  |  | - |  |  | 4,764 |  |  | - |  |  | 4,764 |
Total Operating Cost and Expense |  |  | 134,516 |  |  | 116,076 |  |  | 241,569 |  |  | 238,561 |
Operating (Loss) Income from Discontinued Operations |  |  | (43,873) |  |  | 6,314 |  |  | (55,179) |  |  | 4,696 |
Interest Income |  |  | - |  |  | 7 |  |  | - |  |  | 20 |
(Loss) Income from Discontinued Operations Before |  |  |  |  |  |  |  |  |  |  |  |  |
Income Taxes |  |  | (43,873) |  |  | 6,321 |  |  | (55,179) |  |  | 4,716 |
Income Tax Benefit |  |  | 18,453 |  |  | 1,134 |  |  | 20,371 |  |  | 1,952 |
(Loss) Income from Discontinued Operations |  | $ | (25,420) |  | $ | 7,455 |  | $ | (34,808) |  | $ | 6,668 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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