| IPO Company Profile |
| Current Quote | News | SEC Filings | Peer IPO Companies |
| Career Education Corporation |
| 2800 West Higgins Road, Suite 790, Hoffman Estates, IL 60195 * (847) 781-3600 |
| The company is one of the largest providers of private for profit postsecondary education in North America. The Company operates nine schools, with 18 compuses located in 13 states and two Canadian provinces. |
| Manager | Tier | Phone |
| CS First Boston | Lead Manager | (212) 325-2000 |
| Salomon Smith Barney | Co-manager | (212) 723-7300 |
| NASNTL: | CECO | Service: | SIC 8249 | |
| Type of Shares: | Common Shares | Filing Date: | 10/10/97 | |
| U.S. Shares: | 2,850,000 | Offer Date: | 1/28/98 | |
| Non-U.S. Shares: | 0 | Filing Range: | $13.00 - $15.00 | |
| Primary Shares: | 2,850,000 | Offer Price: | $16.00 | |
| Secondary Shares: | 0 | Gross Spread: | $1.12 | |
| Offering Amount: | $39,900,000 | Selling: | $0.67 | |
| Expenses: | $0 | Reallowance: | $0.10 | |
| Post-IPO Shares: | - |
| Issuer's Law Firm: | Katten Muchin & Zavis |
| Bank's Law Firm: | Sidley & Austin |
| Auditor: | Arthur Andersen |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Audited Income | Balance Sheet | ||
| 12/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $33.58 | $25.65 | $14.79 | Assets: | $100.77 |
| Net Income: | $1.50 | -$0.10 | -$0.13 | Curr Assets: | $19.15 |
| EPS: | Liabilities: | $66.69 | |||
| Prior EPS: | Curr Liab: | $15.40 | |||
| Cash Flow/Oper: | $5.28 | -$2.80 | $0.57 | Equity: | $34.08 |
| Cash Flow/Fin: | $8.08 | $42.94 | -$1.70 | Cash: | $9.74 |
| Cash Flow/Inv: | -$9.52 | -$38.19 | -$0.36 | Working Cap: | $3.75 |
| Competition |
| The postsecondary education market, consisting in the U.S. of approximately 7,000 accredited universities, colleges and schools, is highly fragmented and competitive, with no single institution having a significant market share. CEC's schools compete with traditional public and private two-year and four- year colleges and universities, other proprietary schools and alternatives to higher education such as immediate employment and military service. Certain private and public colleges and universities may offer courses of study similar to those of the Company's schools. Some public institutions are able to charge lower tuition than the Company's schools due in part to government subsidies, government and foundation grants, tax-deductible contributions and other financial sources not available to proprietary schools. However, tuition at private, non-profit institutions is, on average, higher than the average tuition rates of the Company's schools. Other proprietary career-oriented schools also offer programs that compete with those of the Company's schools. The Company believes that its schools compete with other educational institutions principally based upon quality of their educational programs, reputation in the business community, costs of programs and employability of graduates. Some of the Company's competitors in both the public and private sectors may have substantially greater financial and other resources than the Company. Changes in the regulatory environment have stimulated consolidation in the postsecondary education industry. Regulations adopted in recent years have tightened standards for educational content, established stricter permissible student outcomes (i.e., completion, placement and federal loan default rates) and created more stringent standards for the evaluation of a school's financial responsibility and administrative capability. As a result, certain career-oriented schools have been forced to close because they lacked sufficient quality or financial resources or could not manage the increased regulatory burden. At the same time, despite increasing demand, potential new entrants face significant barriers to entry due to the highly regulated nature of the industry and the considerable expense of start-up operations. |
| Business Plan |
| The Company was founded based upon a business and operating strategy which it believes has enabled it to achieve significant improvements in the performance of its acquired schools. The Company believes this strategy will enable it to continue to capitalize on the favorable economic, demographic and social trends which are driving demand for career-oriented education, thereby strengthening its position as a premier, professionally managed system of career-oriented postsecondary educational institutions. The key elements of the Company's business and operating strategy are as follows: (I) Focusing on Core Curricula, (ii) Adapting and Expanding Educational Programs, (iii) Direct Response Marketing, (iv) Improving Student Retention, (v) Emphasizing Employment of Graduates, (vi) Making Capital Investment and (vii) Emphasizing School Management Autonomy and Accountability. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for repayment of certain indebtedness, payment of dividends on Preferred Stock and general corporate purposes including capital expenditures, possible future acquisitions of schools and working capital. |
| Officer Name | Title | Age |
| John M. Larson | President, Chief Executive Officer, Secretary and Director | 46 |
| William A. Klettke | Senior Vice President, Chief Financial Officer and Treasurer | 45 |