Q4 2021 American Public Education Inc Earnings Call
Could've Officer, Rick Sunderland Executive Vice President and Chief Financial Officer, and Steve Summers, Senior Vice President and Chief strategy and corporate development Officer materials for the conference call today are available under the events and presentations section of the API website. Please note that statements made during this conference call and any accompanying presentation materials regarding API.
<unk> and its subsidiaries that are not historical facts may be forward looking statements based on current expectations assumptions estimates and projections about API in the industry in some cases forward looking statements maybe identified by words, such as anticipate believe seek could estimate expect can may plan should will would and similar.
Awards are there opposites.
We're looking statements include without limitation statements regarding expected growth registrations in enrollments revenue net income earnings per share and EBITDA earnings guidance expected benefits of the acquisition of Rasmussen University future impacts of the COVID-19 pandemic on enrollments as the pandemic abates organizational changes plans with respect to <unk>.
Recent current and future initiatives and future demand or expectations for online enrollment in nursing education.
Forward looking statements are subject to risks and uncertainty that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include among others risks related to actions taken by the department of defense, our branches of the U S armed forces, including actions related to the disruption and suspension of the tuition assistance program challenge.
As with integrating acquisitions regulatory matters competitive pressures and those described in today's press release and in the company's Form 10-K filed with the SEC today and in other SEC filings. The company undertakes no obligation to update publicly any forward looking statement for any reason unless required by law, even if new information becomes available.
Or other events occur in the future. This presentation contains references to non-GAAP financial information that we use to measure our business a reconciliation between the non-GAAP financial measures. We use in the most directly comparable GAAP measures are located in the appendix to our presentation and in our financial statements management believes that our presentation of non-GAAP financial information provides you.
Useful supplemental information to investors regarding our results of operations and should only be considered in addition to and not as a substitute for or superior to any measure of financial performance prepared in accordance with GAAP I will now turn the call over to our CEO Angela Selden Angy. Please go ahead.
Thank you Ryan and thank you all for joining us today and for your interest in American public education.
2021 was a highly transformative year for API as we accelerated and expanded our efforts in educating the service minded.
First by successfully acquiring Rasmussen University.
Which roughly doubled the size of API in terms of revenue.
I became the number one educator of pre licensure AVN NPN nurses in the United States.
And diversify this revenue to one third nursing, one third military and veterans and one third online education.
Next we acquired graduate school USA on January one 2022.
Created API platform for career and workforce training further diversifying our revenue streams by educating the service minded federal workforce.
In addition to our inorganic growth activities, we have many accomplishment for which to be proud.
Including record enrollment growth at <unk> College of nursing.
Rebound in registration momentum at Apus.
With record military enrollment.
And year over year enrollment growth and record nursing enrollment at Rasmussen.
All while maintaining a strong commitment to regulatory and public company compliance across the enterprise.
This includes a reaffirmation of accreditation by the higher learning Commission or HFC at Rasmussen in December 2020 ended in.
In August 2021.
Both which have been awarded an open pathway designation, which affords institutions greater opportunity to pursue institutional improvement projects than the alternative standard pathway designation.
Before we move to detailed financial result, and enrollment momentum I would like to take a moment to discuss API distinctive position in America's economy and society.
One that we believe is unique and puts API squarely at the center of.
America's greatest strength.
America has the best post secondary education system on the planet.
Where students from all over the world flock to attend University here.
Api's institutions have achieved top quality accreditation.
Attracting students attending our institutions from over 90 countries during 2021 alone.
America has the world's strongest military.
And API has the honor of being the number one educator of active duty military and veterans.
America has the worlds fast healthcare systems and providers.
<unk> now has the honor of educating the largest number of AVN in pn pre licensure nurses in the United States.
And finally America has the most accessible and efficient capital markets in the world.
API as a public company has successfully leveraged those capital markets and in particular in 2021 to strategically grow.
We believe API is the only company at the intersection of America's greatest strength.
Secondary education military healthcare and capital markets.
Our education of service minded military and veteran students provide steady enrollment and increasing market share.
Our national Nursing platform is a growth engine squarely positioned to help mitigate the chronic nursing shortage.
And our over 350 programs and certificates at.
S Rasmussen, Honduras, and GSE USA provide accessible affordable high quality education, and ongoing professional development to students at any stage of their career journey.
It's no better time to invest in the future of America by investing in API.
During today's call I will be providing more detail on the enrollment momentum at Aps Rasmussen in Honduras.
Before turning the call over to Rick to review key financial metrics and the results for the fourth quarter and full year of 2021.
Slide four is a brief reminder of the educational offerings at API.
<unk> origins began at Apus purpose built to enable active duty military to uniquely access their earned education benefit through inclusive adaptable education.
This inspired our vision of educating service minded students and we did so with the goal of keeping college education affordable.
<unk> acquisition of Honduras College of nursing in 2013 was a springboard into nursing education. Another service minded career in a high demand field.
With the acquisition of <unk> and University API created the largest AVN in PDP and pre licensure nursing platform in the United States, creating new nurses to help meet decided as chronic nursing shortage.
And with the addition of graduate school USA and its focus on training the federal workforce.
Its purpose is tightly aligned with educating the service minded students and represents a strong adjacency to aps's core military and veteran student offerings.
On slide five Youll see an overview of API national nursing platform and our market opportunities in the face of this chronic nursing shortage.
Through Rasmussen and Han growth <unk> is the largest AVN in pn pre licensure nursing educator in the United States, creating new nurses at its 30 campuses.
The Bureau of Labor and Statistics recently published its updated annual job projections and registered nurses licensed practical nurses and vocational nurses are expected to increase 9% to over $4 1 million by 2030 <unk>.
Larger than the national average across all jobs.
Over the next 10 years each year there are expected to be approximately 195000 registered nurse openings and another 61000 licensed practical and vocational nurse openings.
2021, and <unk> numbers suggest that only 72% of the annual licensed practical nurse job demand can be met through present practical nurse graduates.
A 2021 American Association of critical care nurse survey of more than 6500 nurses.
That 92% believe the pandemic has depleted nurses at their hospitals over the past 18 months and as a result, their careers will be shorter than they intended and.
66% felt their experiences during the pandemic have caused them to consider leaving nursing.
The BLS has indicated that overall resignations and healthcare are up 50% since the start of the pandemic.
And currently 43% of the nursing population is over the age of 55 and it is expected that all of those eligible to retire within the next three years more than 50% we will do so.
These staffing shortages are not sustainable as costs continue to soar for the healthcare providers due to their need to use temporary labor and overtime to fill these shortages.
<unk> healthcare system margins to decline substantially.
And ultimately it is the patient who suffers.
At Rasmussen and Honduras, we are partnering with over 300 clinical partners to help these healthcare systems alleviate this chronic nursing shortage.
Across our three education units of Rasmussen Apus in Honduras, we expanded our nursing curriculum ladder with raster since launch of a nurse practitioner program at the end of 2021.
Notably what remains attractive about our pre licensure education as we enable LPN to begin working in approximately 12 months.
Direct entry RN students complete within 15 months and our RN students begin working in just over two years.
The vast majority of our nursing students are currently pre licensure, yet we continue to believe the nursing sector needs post licensure education and in particular to educate new nursing faculty.
Overall, we believe strongly that the accreditation standards requirements of state boards of nursing approvals, the significant amount of clinical and other partner relationships needed and the general process of standing up a nursing school provides a substantial barrier to entry for new competition and is a significant reason.
We remain enthusiastic about nursing education.
Turning to slide six nursing enrollment reached record levels at both <unk> and <unk> 21 in.
In total API has total nursing enrollment of over 11200 students that are predominantly pre licensure rash.
<unk> since nursing enrollments continue to grow up 8% in <unk> 'twenty, one as compared to the prior year period.
Nursing enrollment now represents over 50% of the total enrollment at Rasmussen compared with less than 30% just a few years ago and we expect this trend to continue.
At <unk>, we now have over 2500 nursing students, which represents 17% growth in <unk> 'twenty, one versus the prior year period.
We have positive news from Honduras, Indianapolis campus, which originally opened in 2020, just a few weeks ago based on favorable and <unk> results and overall student outcome.
Deanna State Board of nursing granted Handros, an increase to 200 enrolled students for 2022 up from 60. This significant increase was made possible by the <unk> team's commitment to high quality education and focus on maintaining top tier regulatory and state Board standards.
Where we currently have 100% and <unk> pass rates.
Additionally, in fall of 'twenty, two we anticipate welcoming our first nursing student cohort and Honduras, New Detroit, Michigan campus.
Even though nursing growth remains positive and we continue to see heightened interest in our nursing program the.
The recent impacts of Covid and the omicron variance have dampened some students ability to begin or continue their nursing education.
For example, in Ohio in Q1 of 'twenty to over 120 of our new predominantly female and single parents students had to defer education from the impact of Covid, including public School bus system shutdowns, forcing our students to remain home to educate their children.
We anticipate this impact will be temporary as COVID-19 restrictions subside and the high interest levels in the programs should translate to strong enrollments.
In Q1, 'twenty, two we anticipate total nursing enrollment to increase by roughly 4% compared to the same period of 2021.
Notably positive growth is against deep comparable periods in 2021, when the programs are exhibiting very strong growth, 22% at Rasmussen and 45% at <unk>.
The two year CAGR for Rasmussen nursing is 12% generating 8400 current student enrollment and the two year CAGR for Honduras nursing is 25% leading to 'twenty 460 enrollments.
Moving to slide seven at <unk>, while total net registrations were down 2% to 86600 in <unk> 'twenty. One this does not reflect the positive two year enrollment momentum up 4% and in particular in <unk> 'twenty, one where <unk>.
<unk> faced a very difficult prior year comp of 11%.
Positive in <unk> of 'twenty.
This is also a marked improvement versus the previous two quarters.
There are several green shoots at Aps.
We are experiencing a return of army enrollment momentum.
Army registrations were up approximately 4% during <unk> 21, compared to a tough comp of 29% positive in the same period of 2020 and represents a 16% two year CAGR.
Due to our improved focus on student persistence and completion that started in Q3 of 'twenty one.
We are experiencing returning military student acceleration across every degree type and notably year over year quarterly growth in our three largest branches.
Army Navy and marine.
We are encouraged that the army ignite Ed portal impact on soldier registrations has subsided.
And our soldiers ability to register through the system has improved with over 70% utilization of the new ignite AD tools and processes by Army soldiers in the most recent start.
We believe apus is increasing its market share as other universities have suspended the use of exception to protocol or ETP due primarily to delays in army reimbursement, while <unk> had been willing to accommodate those students.
While enrollment challenges have abated the receivable from army has not meaningfully decreased due to army significant backlog of payments to process.
However, as a result of productive conversations we've had with army leadership and recent system enhancements. We have seen reimbursement is beginning to flow and steps outlined to resolve the payment backlog.
We have been pleased to have the opportunity to proactively collaborate on data reconciliation with the army and are satisfied that the data is consistent between the two systems.
Therefore, we strongly believe the remaining receivable balances and payments are now primarily a timing issue.
Also as we previously mentioned military students continue to provide a strong recurring foundation of registration that is more insulated from the broader higher education enrollment trends for adult learners and a tight labor market.
Moving on to our other apus students segments, while returning veteran registrations declined bright spots with veterans include new student growth at associates degrees and master's degrees.
The softness in non military registrations are offset by green shoots of student growth and associates degrees and certificates yet.
Yet reflect the overall weak market enrollment trends, which drove the roughly 2% decline in total non military registration.
The implementation of our modernized CRM platform has simplified enrollment and is increasing lead to conversion rates in Q1 of 2022.
At Rasmussen, approximately 50% of enrollments and 60% of revenue come from nursing.
So as we turn to non nursing for several years <unk> has invested behind the acceleration of nursing and has directed the corresponding prioritization of marketing investments towards that segment, resulting in a <unk> 21 decline of 13% and non nursing enrollments.
Rasmussen legacy Northern region, which includes Minnesota, and Wisconsin are experiencing historically low unemployment rates at two 7% and two 8% respectively and the labor participation rate in those states is also declining.
The severe labor shortage generally has driven wages higher and resulted in an overall tight labor market, which has dampened the urgency for prospective students to consider career changes or additional education to qualify for work advancement.
Despite non nursing softness rasmuson does have some green shoots starting with strong improvements in retention with the winter term increasing to 85, 6% overall and graduate education programs offered below $10000 has seen significant acceleration.
We don't expect the labor market tightened to change in the near term and it will continue to weigh on our non nursing non military registrations. Nonetheless.
Still expect registrations in the first quarter at Aps to increase zero to 3% to between 92990 5700, reflecting continued military improvement.
At <unk>, we anticipate non nursing enrollment to decrease roughly 14% in the first quarter of 2022 compared to the prior year period due to the general student behavioral trends in the U S.
At Aps non military students only represent about 15% of our student population, while at <unk>, the non nursing and non health care population represents 30% of enrollments, but roughly only 24% of revenue.
I would now like to turn the call over to Rick to review, our fourth quarter and full year results improve the detail.
Thank you Angie on slide nine we present, our financial highlights for the quarter and full year periods.
Revenue for the fourth quarter was $154 million up approximately $68 million from the comparable prior year period due to the addition of Roswell some results in the 'twenty to 'twenty one period.
The fourth quarter with preferred which included a full three months of rasmuson results.
<unk> fourth quarter revenue was $73 million.
Decrease of 3% from fourth quarter 2020, as a result of the decrease in overall net course registrations Andrew discussed earlier.
As a reminder, army specific registrations were up for the fourth quarter of 2021 versus the prior year period as we're total active duty military registrations.
<unk> revenue increased by 18% to $12 million in the fourth quarter of 2021 versus the comparable prior year period, driven by strong year over year enrollment growth due to the ongoing demand for nursing education successful marketing efforts and the execution of enrollment strategies at <unk> for the year.
In 2021 total revenue increased 30% compared to 2020 due primarily to the addition of Rasmussen and the 2021 period and the revenue growth at <unk>.
Total costs and expenses for the quarter were $138 million, an increase of $61 million from the prior year period due primarily to the inclusion of <unk> results in the current year quarter expenses for the quarter include approximately $1 7 million of noncash stock compensation expense.
$1 8 million of professional fees and integration costs, primarily related to the integration of Rasmussen and the acquisition of graduate school and $8 3 million of depreciation and amortization on a pretax basis.
As part of the integration of Rasmussen and our efforts to continuously evaluate and review our cost structure more broadly there were two head count reductions completed over the past several months first and as previously discussed we completed a reduction in force in April .
Hi.
In August 2021 that resulted in a benefit of approximately $1 4 million and pretax labor.
Labor and benefit savings in 2021, and more importantly is expected to result in savings in the range of approximately two six to $3 6 million in 2022.
Additionally, in mid January Ross Wilson completed a similar cost reduction effort that we estimate will result in pre tax labor and benefit savings in the range of two five to $3 5 million during 2022.
These figures do not include the severance costs associated with these actions.
On a full year basis total costs and expenses were $388 million for 2021, an increase of $91 million as compared to 2020, which is attributable to the inclusion of restaurants in the current year period.
These results include full year stock based compensation of $7 7 million.
$7 6 million of professional fees and integration costs, primarily related to the Rasmussen and graduate school acquisitions, and $17 8 million of depreciation and amortization on a pretax basis or.
Overall <unk> achieved adjusted EBITDA of $29 3 million in the current year quarter and $64 7 million for the full 2021 year.
Net income per diluted per diluted share for the quarter was 50.
At <unk> 97 for.
For the full 2021 year.
Net cash provided by operating activities was $16 3 million for the full year 2021, compared to $44 8 million in 2020.
The decrease was primarily due to the timing of the restaurants and acquisition as Russ Rasmussen received the majority of its cash receipts at the start of our quarterly term during the first month of each fiscal quarter. While this first one.
<unk> throughout the quarter.
Excuse me.
The seller retain substantially all of the cash.
Hosing majority of restaurants as operations were therefore funded by API from September one through the Middle of October when Russell received its temporary provisional program participation agreement or PPA.
P. P. A format that allowed Rasmussen to continue drawing title for funds.
Cash provided by operating activities was also impacted by changes in working capital due to the timing of receipts and payments, particularly as it relates to the army's transition to army ignite.
Which is adversely impacted <unk> ability to invoice the army and.
And higher estimated tax payments in 2021 compared to the prior year.
At December 31 accounts receivable from the Army was approximately 27 million of which $18 2 million is older than 60 days from the course start date.
Cash at December 31, 2021 was $150 million of which approximately 27 million is restricted.
As previously mentioned on the third quarter 2021 earnings call restricted cash is almost entirely comprised of a restricted certificate of deposit securing a letter of credit rasmuson universities required to post as a result of its 2020 composite score is.
Additionally, our $20 million revolving credit facility remains undrawn at this time.
Turning to slide 10 first quarter 2022 outlook.
<unk> outlook for the first quarter of 2022 is as follows.
Net course registrations are expected to be flat to up 3% year over year. This reflects the rebound from army registrations offset by the impact on near term demand of COVID-19, and broader enrollment factors impacting the higher education industry and <unk>.
We continue to work on reestablishing registration momentum.
Honduras and Rasmussen first quarter student enrollment our actuals because of the quarterly starts at these schools.
<unk> first quarter total student enrollment increased by 8% year over year to approximately 2500 students at.
Rasmussen nursing student enrollment increased 2% year over year offset by non nursing enrollment declines of 14% for an aggregate Ross was an enrollment decline of approximately 7% year over year.
In the first quarter of 2022 consolidated revenue is expected to increase between 275% to 80% year over year. Given the addition of Rasmussen the company expects net income to be between $2 3 million and $3 3 million and earnings per diluted share to be.
Queen 12.
17.
Adjusted EBITDA is expected to be between $17 7 million and $19 8 million for the first quarter of 2022.
Included in the EPS guidance is approximately a $1 million loss or approximately <unk> <unk> per diluted share at graduate school related to integration costs.
One additional point to note is the impact on cash taxes of the deductibility of goodwill associated with both the Honduras and Rasmussen acquisitions as well as the impact of accelerated depreciation for tax purposes.
As of December 31, API had net operating loss carryforwards, and capital loss carryforwards of approximately $16 million and $2 million, respectively, which are available to offset future taxable income.
The company's utilization of net operating loss carry forwards may be subject to annual limitations.
Due to ownership change provisions of section 382 of the internal revenue code.
With that.
I would like to turn the call back to Andrew for final remarks.
Thank you Rick.
As I stated at the beginning of our call. We believe API is the only company at the intersection of America's greatest strength.
That of Postsecondary education military healthcare and capital markets.
From our education of service minded military and veteran students to our national nursing platform to our over 350 programs and certificates at Apu S Rasmussen, Honduras and graduate School USA.
There is no better time to invest in the future of America by investing in American public education.
With that I'd like to open up the line for questions.
As a reminder, if you'd like to ask a question. Please press Star then one on your telephone keypad.
The first question is from Tobey Sommer with <unk> Securities. Your line is open.
Hey, good afternoon. This is actually Jasper bibb on for Tobey I wanted to ask about the expense guidance for the first quarter. It looks like EBITDA margins down maybe 600 basis points from last year can you just comment on what's driving the higher expense base to start the year.
Sure. This is Rick really two things number one labor costs.
Weighted to the nursing programs and I'll say productive productivity at the campuses.
We went through Covid, we were able to move.
Several or many of the nursing programs to a blended online model and now lets say returned back to campus.
It results in a higher cost structure, you combine that with the demand for nursing faculty and really the shortage, which is driving up labor costs.
It's really those two elements that are driving a lower margin than our campus based operations.
I would also point out that there is some seasonality in the business. If you look back over the trailing eight or 12 quarters. The first quarter does tend to be lower than other quarters during the year.
Okay, and I know youre, not giving full year guidance at this point.
The labor costs in the back to school cough, I imagine would be we'd be fairly sticky.
So do you think you could still expand EBITDA margin.
Year over year basis, this year or how should we think about the cadence of margins over the next couple of quarters.
<unk> four as an example, we talked about the reduction in force that took place at Rasmussen, which was.
Right in the beginning of the first quarter and then the benefit we would expect to receive of that over the course of the year. So we do have levers that we can pull that wood.
Manage the margins and we would expect to improve those margins over time.
Also given the fixed cost model in the campus based operations and looking at the seasonality of the revenue, which you can look back and see you would expect margin expansion on top of revenue improvement.
During those those subsequent periods.
Okay.
Makes sense and then just wanted to follow up on your comment in the prepared remarks about more marketing dollars being allocated to the to the nursing segment of Robinson versus non nursing.
Was just hoping you could comment on what does the marketing yields look like for each side of the business that might be informing that choice.
Okay.
Hi, Jeff This is Andrew it's nice to speak with you as certainly the unit economics of a nursing students and a very specific.
Curriculum that they follow does yield in a.
In a shorter time period.
<unk> revenue per.
Per investment or what we would call LTV over CAC and so the attractive unit economics of a nursing student drove and continues to drive the prioritization of marketing dollars for new leads towards finding that next nursing students.
Okay.
So then.
As you look at your plan for this year.
Can you just speak to if you have any new campus openings in the pipeline and if that is the case what would be the approximate timing of that.
Sure you bet. So as I mentioned in my remarks, we're very pleased that Congress will be opening a new campus in Detroit, Michigan.
I'll turn it to Rick for how we want to think about the unit economics.
Sure.
So the campuses ramp fairly quickly.
<unk> in markets, where there is a.
A good demand.
For those.
Those campuses. So we would expect a campus to breakeven kind of in the second to third year, we were challenged in the Indianapolis market because the initial enrollment cap and so I was going to add to Andy's comments about the opening of the Michigan campus, Michigan campus by pointing out that the Indiana Board of nursing reach.
Singly increase the enrollment cap at the Indianapolis campus to two other students from I think the remark said 60 in that 60 was just a recent increased from the original 30.
So absent an enrollment cap, which I don't think we're anticipating in the Michigan market those those campuses ramp fairly fairly rapidly.
We also are contemplating relocations of campuses as well. One example is another hundreds campus in the Dayton market, where we have found a more attractive space with a larger footprint and we believe that that relocation, which will happen in 2022 will also yield.
Enrollment momentum and the Dayton market.
Okay.
Last one for me.
Can you just remind us how overseas troop movements or NATO exercises have impacted us in the past.
And as that dynamic given some of the headlines we're seeing.
Something that <unk> seen at all in the first quarter or not.
So true troop deployments do impact enrollment at Apus.
But.
Given our view of what's going on in Eastern Europe , which is obviously a horrible situation our thoughts are with our soldiers and our students soldiers there.
We're not seeing a very large impact at this time, we have had.
Some soldiers.
Inquire about.
Delaying their education, but at this point, it's not large.
Alright, thanks for taking my questions.
Slide.
The next question is from Stephen Sheldon with William Blair. Your line is open.
Hey, Thanks first I guess, what are you, including if you thought about the first quarter guidance I guess, what are you including for graduate School USA.
For revenue and adjusted EBITDA and is there any notable seasonality at that institution as we.
Kind of layer that into our models for the full year.
Hey, David It's Steve.
For graduate school.
There's a high degree of seasonality with.
And overall in the business two thirds of the revenues come in the second and third quarters. The first to the first quarter and the fourth quarter fall in that <unk>.
15% to 20% range generally speaking.
So we're looking at sort of low single digit million dollars of revenue in the first quarter.
Got it and is that I think you've talked about $1 million.
Pat from integration costs.
I guess anything.
Overall, adjusted EBITDA I guess, how should we think about the impact of graduate school USA.
In the first quarter guidance.
Yeah in terms of in terms of overall adjusted EBITDA. It has an impactive.
It's a negative between $5 million and $1 million.
Okay.
Okay, Great and then.
I saw that you made you announced the hire of a new chief experience officer early in this year and I'm just curious.
This represents any notable changes in how you plan to provide key support or your broader digital strategy to engage students I know you talked about some marketing shifts to focusing Nebraska has been all used to focus more on nursing, but I guess how.
Any context for that would be great.
Great question, Stephen Thank you very much for asking.
We.
Really believe is that we will elevate the student experience as a result of range up to NOLA in to lead that effort. We have in the past really focused our efforts with students in different practice areas of our organization and what we're trying to do is.
Really create.
Start with the students with the student at the center of everything that we do.
And from the first touch point from lead all the way through career placement.
And ongoing alumni relations, it's our intention to create a smooth seamless cohesive experience under Jeff's leadership.
So many of the.
Shared service functions that came over with the <unk> acquisition now are part of our experience office that that Jeff leads and that includes our career services Department.
It also includes those functions that existed at API prior which is our key marketing areas.
It's also where we have students technology innovation house so that.
That whole team can be focused day in and day out on.
The elevation of the way in which the students experience our brand and make sure that regardless of which education unit. They engage with they can expect to get a high quality student centric experience. So we couldnt be more excited about Jeff and the team that he is building to take off.
All of our education unit student experience to the next level.
Good to hear thank you.
The next question is from Raj Sharma with B Riley Your line is open.
Hello, Good afternoon.
Thank you for taking my questions.
Wanted to understand on the on the enrollment.
Because of the portal issue.
Well look to where are we today relative to pre ignite ed issues on the enrollment level.
<unk>.
<unk> surpassed that level or.
So apples to apples what are the enrollments for the army.
Hey, Raj of tricks unrolling, yes, we've actually we're up year over year.
And so we've surpassed the levels that we had under.
The prior system go Army Ed.
As Angie mentioned in her comments.
We actually think.
Perhaps picking up market share at this point as other.
Smaller education providers of have really been unable to work.
With them through the system.
The way, we've been able to do it.
We recently, we've had periodic meetings with the folks at army, it's been really helpful for us to understand this.
The system.
And for them to understand the challenges our recent example.
Had we have a communication strategy that we've used with our.
With our army soldiers student Tim.
In a very sort of.
Sort of spec.
Special situations in the army is actually leveraging our communication strategy more broadly to the soldiers because.
We'd like to think and we're very proud of exhibiting kind of best practices.
Broadly as it relates to military education for sure, but specifically as it relates to army ignite.
Got it great and then.
On <unk> I just wanted to understand.
I understand that the non nursing economics are worse than the nursing economics.
Allocation of marketing dollars.
And we active decision or a proactive decision just wanted to understand the business.
How it's trending.
Also relative to when you acquired it and what's your expectations more.
Hey, Ross, it's Steve I'll start on that.
The trend towards investing in nursing has been a multiyear trend for Rasmussen that started a few years before we acquired it and has continued right the mix shift in terms of and I'll speak out about enrollment basis, but it's comparable on the revenue side.
Is it just a few years ago 2017, right. The enrollments for the nursing business was less than 30% today. It's now just a touch over 50% and so we've continued to see that trend and we expect that will continue to be the case over time as Rasmussen as an institution focuses on nursing.
And to a lesser degree the health Sciences side, and so between nursing and health Sciences.
The overall.
Enrollment and revenue compensation is between 70 and 75% we think that mix will continue so we have been proactive.
On a longer term basis.
In allocating marketing dollars toward the nursing practice area.
Got it.
Yes.
That's it for me. Thank you I will take it offline.
We have no further questions at this time I'll turn the call over to Angie Selden for any closing remarks.
Yes.
Thank you all for joining us today and for your interest in American public education and have a great evening.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating and you may now disconnect.
Okay.
Sure.
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