8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report

(Date of earliest event reported)

February 2, 2018

ADTALEM GLOBAL EDUCATION INC.

(Exact name of registrant as specified in its charter)  

Delaware	1-13988	36-3150143
(State of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

500 West Monroe Chicago, Illinois	60661
(Address of principal executive offices)	(Zip Code)

(630) 515-7700

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)  

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CPR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 8.01 Other Events 

As previously reported by Adtalem Global Education Inc. (“Adtalem”) on the Current Report on Form 8-K dated December 4, 2017, Adtalem entered into a Stock Purchase Agreement (the “Purchase Agreement”), pursuant to which Adtalem agreed to sell DeVry University to Cogswell Education, LLC (the “Buyer”). Subject to the terms and conditions of the Purchase Agreement, Adtalem will sell all of the outstanding equity interests of DeVry University, Inc. and DeVry New York Inc. (such sale, the “Transaction”) to Buyer for de minimis consideration with an expected closing date in early fiscal year 2019.

The decision to divest DeVry University was made based on changes in strategic direction for the Adtalem portfolio of institutions. The sale represents a strategic shift that will have a major effect on Adtalem’s operations and financial results. In accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) DeVry University’s assets and liabilities will be classified as “Held for Sale” on the Consolidated Balance Sheets for all periods presented, and DeVry University’s results of operations will be classified as “Discontinued Operations” on the Consolidated Statements of Income (Loss) for all periods presented beginning with the Quarterly Report on Form 10-Q for the period ended December 31, 2017.

Adtalem is furnishing this Current Report on Form 8-K to provide investors with historical Consolidated Statements of Income (Loss) to reflect DeVry University as discontinued operations. The statements in Exhibit 99.1 provide unaudited information in accordance with discontinued operations disclosure requirements for the previously reported fiscal years ended June 30, 2016 and June 30, 2017, and the previously reported quarters in fiscal year 2017, and the first quarter in fiscal year 2018.

The schedule in Exhibit 99.2 includes net income on a non-GAAP basis. Management believes that the non-GAAP disclosure of net income from continuing operations excluding special items provides investors with useful supplemental information regarding the underlying business trends and performance of Adtalem’s ongoing operations and is useful for period-over-period comparisons of such operations given the nature of the special items. Adtalem uses these supplemental financial measures internally in its management and budgeting process. However, these non-GAAP financial measures should be viewed in addition to, and not as a substitute for, Adtalem’s reported results prepared in accordance GAAP.

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 8.01 of this current report on Form 8-K, including Exhibits 99.1 and 99.2, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific references in such a filing.

Adtalem management expects to file its Quarterly Report on Form 10-Q for the quarter ended December 31, 2017 with the Securities and Exchange Commission on or about February 6, 2018.

Item 9.01 Financial Statements and Exhibits

99.1	Consolidated Statements of Income (Loss) for the years ended June 30, 2017 and June 30, 2016, and quarters ended September 30, 2016 through September 30, 2017.
99.2	Schedule of Non-GAAP Earnings for the years ended June 30, 2017 and June 30, 2016, and quarters ended September 30, 2016 through September 30, 2017.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ADTALEM GLOBAL EDUCATION INC.
	(Registrant)
Date: February 2, 2018	By:	/s/ Kathleen A. Carroll
		Kathleen A. Carroll
		Vice President, Controller

EX-99.1

Exhibit 99.1

ADTALEM GLOBAL EDUCATION INC.

CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(unaudited and amounts in thousands, except per share amounts)

	Three Months Ended															Year Ended
	September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016			September 30, 2016			June 30, 2017			June 30, 2016
REVENUE:
Tuition	$	280,023		$	305,457		$	287,774		$	301,263		$	286,898		$	1,181,392		$	1,092,148
Other Educational		45,255			42,069			44,901			32,695			42,129			161,794			140,604
Total Revenue		325,278			347,526			332,675			333,958			329,027			1,343,186			1,232,752
OPERATING COST AND EXPENSE:
Cost of Educational Services		195,941			180,980			182,216			179,148			187,486			729,830			668,903
Student Services and Administrative Expense		101,208			105,087			103,690			101,167			103,465			413,409			408,940
Restructuring Expense		2,387			9,002			2,804			2,963			3,350			18,119			7,283
Regulatory Settlements		-			-			-			52,150			-			52,150			-
Asset Impairment Charge		-			-			-			-			-			-			147,660
Total Operating Cost and Expense		299,536			295,069			288,710			335,428			294,301			1,213,508			1,232,786
Operating Income (Loss) from Continuing Operations		25,742			52,457			43,965			(1,470	)		34,726			129,678			(34	)
INTEREST:
Interest Income		2,118			1,184			1,689			988			1,044			4,905			666
Interest Expense		(1,916	)		(2,734	)		(1,995	)		(2,300	)		(2,115	)		(9,144	)		(5,934	)
Net Interest Income (Expense)		202			(1,550	)		(306	)		(1,312	)		(1,071	)		(4,239	)		(5,268	)
Income (Loss) from Continuing Operations Before Income Taxes		25,944			50,907			43,659			(2,782	)		33,655			125,439			(5,302	)
Income Tax (Provision) Benefit		(3,596	)		(2,787	)		(7,343	)		10,082			(7,719	)		(7,767	)		8,297
Equity Method Investment Loss		(44	)		(694	)		-			-			-			(694	)		-
Income from Continuing Operations		22,304			47,426			36,316			7,300			25,936			116,978			2,995
DISCONTINUED OPERATIONS:
(Loss) Income from Discontinued Operations Before Income Taxes		(11,306	)		910			3,329			6,321			(1,605	)		8,955			(11,996	)
Income Tax Benefit (Provision)		1,918			(4,982	)		377			1,134			818			(2,653	)		6,245
(Loss) Income from Discontinued Operations		(9,388	)		(4,072	)		3,706			7,455			(787	)		6,302			(5,751	)
NET INCOME (LOSS)		12,916			43,354			40,022			14,755			25,149			123,280			(2,756	)
Net (Income) Loss Attributable to Noncontrolling Interest		(131	)		(495	)		(163	)		(342	)		3			(997	)		(410	)
NET INCOME (LOSS) ATTRIBUTABLE TO ADTALEM GLOBAL EDUCATION	$	12,785		$	42,859		$	39,859		$	14,413		$	25,152		$	122,283		$	(3,166	)
AMOUNTS ATTRIBUTABLE TO ADTALEM GLOBAL EDUCATION:
Income from Continuing Operations	$	22,173		$	46,931		$	36,153		$	6,958		$	25,939		$	115,981		$	2,585
(Loss) Income from Discontinued Operations		(9,388	)		(4,072	)		3,706			7,455			(787	)		6,302			(5,751	)
NET INCOME (LOSS) ATTRIBUTABLE TO ADTALEM GLOBAL EDUCATION	$	12,785		$	42,859		$	39,859		$	14,413		$	25,152		$	122,283		$	(3,166	)
EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE TO
ADTALEM GLOBAL EDUCATION SHAREHOLDERS:
Basic:
Continuing Operations	$	0.35		$	0.74		$	0.57		$	0.11		$	0.41		$	1.83		$	0.04
Discontinued Operations	$	(0.15	)	$	(0.06	)	$	0.06		$	0.12		$	(0.01	)	$	0.10		$	(0.09	)
Total	$	0.20		$	0.67		$	0.63		$	0.23		$	0.40		$	1.93		$	(0.05	)
Diluted:
Continuing Operations	$	0.35		$	0.73		$	0.56		$	0.11		$	0.41		$	1.81		$	0.04
Discontinued Operations	$	(0.15	)	$	(0.06	)	$	0.06		$	0.12		$	(0.01	)	$	0.10		$	(0.09	)
Total	$	0.20		$	0.67		$	0.62		$	0.23		$	0.40		$	1.91		$	(0.05	)
Cash Dividends Declared per Common Share	$	-		$	-		$	-		$	0.18		$	-		$	0.18		$	0.36

EX-99.2

Exhibit 99.2

ADTALEM GLOBAL EDUCATION INC.

SCHEDULE OF NON-GAAP EARNINGS

(unaudited and amounts in thousands, except per share amounts)

	Three Months Ended															Year Ended
	September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016			September 30, 2016			June 30, 2017			June 30, 2016
Net Income (Loss)	$	12,785		$	42,859		$	39,859		$	14,413		$	25,152		$	122,283		$	(3,166	)
Earnings per Share (diluted)		0.20			0.67			0.62			0.23			0.39			1.91			(0.05	)
Continuing Operations:
Restructuring Expense		2,387			9,002			2,804			2,963			3,350			18,119			7,283
Effect on Earnings per Share (diluted)		0.04			0.14			0.04			0.05			0.05			0.28			0.11
Regulatory Settlements		-			-			-			52,150			-			52,150			-
Effect on Earnings per Share (diluted)		-			-			-			0.81			-			0.81			-
Asset Impairment Charge		-			-			-			-			-			-			147,660
Effect on Earnings per Share (diluted)		-			-			-			-			-			-			2.29
Income Tax Impact on Non-GAAP Adjustments		(589	)		(3,678	)		(1,096	)		(20,938	)		(918	)		(26,630	)		(32,708	)
Effect on Earnings per Share (diluted)		(0.01	)		(0.06	)		(0.02	)		(0.33	)		(0.01	)		(0.42	)		(0.51	)
Discontinued Operations, net of tax		9,388			4,072			(3,706	)		(7,455	)		787			(6,302	)		5,751
Effect on Earnings per Share (diluted)		0.15			0.06			(0.06	)		(0.12	)		0.01			(0.10	)		0.09
Net Income from Continuing Operations Excluding Special Items, net of tax	$	23,971		$	52,255		$	37,861		$	41,133		$	28,371		$	159,620		$	124,820
Earnings per Share from Continuing Operations Excluding Special Items (diluted)		0.38			0.82			0.59			0.64			0.44			2.49			1.94
Diluted Shares used in EPS calculation		63,432			64,034			64,266			64,028			63,896			64,019			64,371