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Segment Reporting
 3 Months Ended
Mar. 31, 2016
Segment Reporting [Abstract]  
Segment Reporting

12. SEGMENT REPORTING

Our segments are determined in accordance with FASB ASC Topic 280—Segment Reporting and are based upon how the Company analyzes performance and makes decisions. Each segment represents a group of postsecondary education providers that offer a variety of degree and non-degree academic programs. These segments are organized by key market segments to enhance operational alignment and, for our two universities, to enhance brand focus within each segment to more effectively execute our strategic plan. As of March 31, 2016, our four segments are:

University Group:

 

¨

     Colorado Technical University (CTU) places a strong focus on providing industry-relevant degree programs to meet the needs of our students for employment and of employers for a well-educated workforce and offers academic programs in the career-oriented disciplines of business studies, information systems and technologies, criminal justice, computer science and engineering, and health sciences. Students pursue their degrees through fully-online programs through CTU Online, local campuses and blended formats, which combine campus-based and online education. As of March 31, 2016, students enrolled at CTU represented approximately 49% of our total enrollments. Approximately 92% of CTU’s enrollments are fully online.

 

 

¨

     American InterContinental University (AIU) focuses on helping busy professionals get the degree they need to move forward in their career as efficiently as possible and collectively offers academic programs in the career-oriented disciplines of business studies, information technologies, criminal justice and design technologies. Students pursue their degrees through fully-online programs through AIU Online, local campuses and blended formats, which combine campus-based and online education. As of March 31, 2016, students enrolled at AIU represented approximately 29% of our total enrollments. Approximately 91% of AIU’s enrollments are fully online.

Career Schools Group:

Campuses included in our Career School segments include those which are currently being taught out or those which have completed their teach-out activities or have been sold subsequent to January 1, 2015. As a result of a change in accounting guidance, campuses which have closed or have been sold subsequent to January 1, 2015 no longer meet the criteria for discontinued operations and remain reported within continuing operations on our unaudited condensed consolidated financial statements. Campuses in teach-out employ a gradual teach-out process, enabling them to continue to operate while current students have a reasonable opportunity to complete their course of study; they no longer enroll new students

 

¨

     Culinary Arts includes our Le Cordon Bleu institutions in North America (“LCB”) which offer hands on educational programs in the career-oriented disciplines of culinary arts and patisserie and baking in the commercial-grade kitchens of Le Cordon Bleu. LCB also provides online programs in culinary arts and hotel and restaurant management. These campuses are all expected to complete their teach-out activities during 2017. As of March 31, 2016, students enrolled at LCB represented approximately 16% of our total enrollments.

 

 

¨

     Transitional Group includes our non-LCB campuses which are in teach-out or those which have been closed or sold subsequent to January 1, 2015. Our Transitional Group offers academic programs primarily in the career-oriented discipline of health education complemented by certain programs in business studies and information technology, as well as fashion design, film and video production, graphic design, interior design and visual communications. The campuses within the Transitional Group that have not yet ceased operations as of March 31, 2016 will complete their teach-outs on varying dates through 2018. As of March 31, 2016, students enrolled at the Transitional Group campuses represented approximately 6% of our total enrollments. During the first quarter of 2016, the Company completed the teach-out of one Transitional Group campus, CTU Sioux Falls, which continues to be reported as part of the Transitional Group as of March 31, 2016.

Summary financial information by reporting segment is as follows (dollars in thousands):

 

 

 

For the Quarter Ended March 31,

 

 

 

Revenue

 

 

Operating (Loss) Income

 

 

 

2016

 

 

% of Total

 

 

2015

 

 

% of Total

 

 

2016

 

 

2015

 

CTU (1)

 

$

91,966

 

 

 

46.2

%

 

$

85,127

 

 

 

37.5

%

 

$

19,237

 

 

$

14,616

 

AIU

 

 

52,973

 

 

 

26.6

%

 

 

53,066

 

 

 

23.4

%

 

 

1,907

 

 

 

(2,887

)

Total University Group

 

 

144,939

 

 

 

72.9

%

 

 

138,193

 

 

 

60.9

%

 

 

21,144

 

 

 

11,729

 

Corporate and Other

 

 

-

 

 

 

0.0

%

 

 

39

 

 

 

0.0

%

 

 

(5,812

)

 

 

(5,860

)

Subtotal

 

 

144,939

 

 

 

72.9

%

 

 

138,232

 

 

 

60.9

%

 

 

15,332

 

 

 

5,869

 

Culinary Arts

 

 

38,623

 

 

 

19.4

%

 

 

44,712

 

 

 

19.7

%

 

 

3,106

 

 

 

243

 

Transitional Group

 

 

15,324

 

 

 

7.7

%

 

 

44,070

 

 

 

19.4

%

 

 

(11,459

)

 

 

(30,470

)

Total

 

$

198,886

 

 

 

100.0

%

 

$

227,014

 

 

 

100.0

%

 

$

6,979

 

 

$

(24,358

)

 

 

 

 

Total Assets as of  (2)

 

 

 

March 31, 2016

 

 

December 31, 2015

 

CTU

 

$

72,164

 

 

$

76,577

 

AIU

 

 

55,247

 

 

 

53,087

 

Total University Group

 

 

127,411

 

 

 

129,664

 

Corporate and Other

 

 

320,554

 

 

 

372,405

 

Subtotal

 

 

447,965

 

 

 

502,069

 

Culinary Arts

 

 

67,948

 

 

 

71,197

 

Transitional Group

 

 

25,347

 

 

 

28,584

 

Discontinued Operations

 

 

8,976

 

 

 

9,065

 

Total

 

$

550,236

 

 

$

610,915

 

 

(1)     First quarter of 2016 operating income included an adjustment of $2.4 million related to increased bad debt expense for a specific group of students. These students are experiencing greater time lags while completing the financial aid application process due to increased verification procedures implemented by ED, thus management updated its estimates regarding collectability.

(2)

Total assets do not include intercompany receivable or payable activity between schools and corporate and investments in subsidiaries.