Q3 2025 Universal Technical Institute Inc Earnings Call
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I'd like to turn the call over to your host today, Matt Camden. Please go ahead.
Hello, and welcome to Universal Technical Institute's fiscal third quarter 2025 earnings call.
Joining me today are our CEO, Jerome Grant and CFO Bruce unit.
Following our prepared remarks, we will open the call for your questions. A replay of this call its transcript and our investor presentation will be archived on the Investor Relations section of our website at Investor <unk>, along with our earnings release issued earlier today and furnished to the SEC.
Speaker #1: Good day and welcome to UNIVERSAL TECHNICAL INSTITUTE's third quarter 2025 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please ignore conference specialists by pressing the star key followed by zero.
During this call we may make comments that contain forward looking statements as defined in the private Securities Litigation Reform Act of 1095, which by their nature address matters that are in the future and are uncertain.
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These statements reflect management's current beliefs and expectations and are subject to a number of factors that may cause actual results to differ materially from those statements.
Speaker #1: To withdraw your question, please press star, then two. Please note, this event is being recorded. I will now turn the call over to our host today, Matt Kempton.
Speaker #1: Please go ahead.
These factors include but are not limited to those discussed in our earnings release and SEC filings. These.
These statements do not guarantee future performance and therefore undue reliance should not be placed upon them.
Speaker #2: Hello, and welcome to UNIVERSAL ECHNICAL INSTITUTE's fiscal third quarter 2025 earnings call. Joining me today are our EO, Jerome Grant, and CFO, Bruce Schuman.
We do not intend to update these forward looking statements as a result of new information or future developments, except as required by law.
Speaker #2: Following our prepared remarks, will open the call for your questions. A replay of call is transcript and our investor presentation will be archived on the Investor Relations section of our website at investor.uti.edu.
Please note unless otherwise stated all comparisons in this call will be against our results for the comparable period of fiscal 2024.
The information presented today also includes non-GAAP financial measures. These should be viewed in addition to and not as a substitute for the company's reported results in accordance with U S. GAAP.
Speaker #2: Along with our earnings release issued earlier today and furnished to the SEC. During this call, we may make comments that contain forward-looking statements as defined in the private securities litigation reform act from 1995, which, by their nature, address matters that are in the future and are uncertain.
All non-GAAP financial measures referenced in today's call are reconciled in our earnings press release to the most directly comparable GAAP measure for more information regarding definitions of our non-GAAP measures. Please see our earnings release financial supplement and Investor presentation.
Speaker #2: These statements reflect management's current beliefs and expectations and are subject to a number of factors that may cause actual results to differ materially from those statements.
With that I will turn the call over to Jerome Grant CEO of Universal Technical Institute for his prepared remarks Jerome.
Speaker #2: These factors include, but are not limited to, those discussed in our earnings release and SEC filings. These statements do not guarantee future performance and therefore undo reliance should not be placed upon them.
Thank you Matt Good afternoon, everyone and thank you for joining us to discuss our results for the third quarter of 2025 rigs.
We're excited to be with you today and to share another quarter of strong performance driven by a keen focus on strategic execution.
Speaker #2: We do not intend to update these forward-looking statements as a result of new information or future developments, except as required by law. Please note, unless otherwise stated, all comparisons in this call will be against our results for the comparable period of fiscal 2024.
Before delving into our results for Q3, I want to touch on some of the legislative and regulatory factors. We've all been keeping a close eye on that may be impacting certain segments of the broader education space and the landscape. We are currently navigating.
Speaker #2: The information presented today also includes non-GAAP financial measures. These should be viewed in addition to and not as a substitute for the company's reported results in accordance with US GAAP.
Let's start with the general operating environment we.
We see the current federal regulatory environment is conducive to our mission and model.
Speaker #2: All non-GAAP financial measures referenced in today's call are reconciled in our earnings press release to the most directly comparable GAAP measure. For more information regarding definitions of our non-GAAP measures, please see our earnings release, financial supplement, and investor presentation.
Were executing in a macro landscape that is increasingly supportive of skilled trades were having more meaningful conversations with policymakers and employers than ever before a clear sign of growing momentum.
Speaker #2: With that, I will turn the call over to Jerome Grant, CEO of UNIVERSAL TECHNICAL NSTITUTE, for his prepared remarks. Jerome?
Notably we are successfully engaging with the department of education, and other Trump administration offices to explore new avenues for advancing skilled trade growth as they are focused on bringing more jobs to America.
Speaker #3: Thank you, Matt. Good afternoon, everyone. And thank you for joining us to discuss our results for the third quarter of 2025. We're excited to be with you today and to are another quarter of strong performance driven by a keen focus on strategic execution.
Yeah.
With our North Star strategy closely aligned with the operating landscape our confidence in the next four years is strong.
Speaker #3: Before delving into our results for Q3, I want to touch on some of the legislative and regulatory factors we have all been keeping a close eye on that may be impacting certain segments of the broader education space and the landscape we are currently navigating.
Turning now to developments on the legislative side, most notably I'd like to provide some clarity around how we're looking at the passing of one big beautiful Bill App.
While this legislation introduces significant changes for higher education broadly many of the limitations mainly focus on more costly for year and graduate programs that we do not offer.
Speaker #3: Let's start with a general operating environment. We see the current federal regulatory environment as conducive to our mission and model. We're executing in a macro landscape that's increasingly supportive of skilled trades.
Recent discussions that I had in D. C show that there is strong support for accelerating our efforts to address the skilled labor shortage in the U S. For example, the Bill has created some opportunities for some of our students, particularly our short course programs, which may now become Pell eligible <unk>.
Speaker #3: We're having more meaningful conversations with policymakers and employers than ever before, a clear sign of growing momentum. Notably, we are successfully engaging with the Department of Education and other Trump administration offices to explore new avenues for advancing skilled trade growth as they are focused on bringing more jobs to America.
These courses while currently not significant driver of our revenue serve as a jumping off points for students to dive deeper into UTI in Congress full time programs. This new legislation provides us with the opportunity to move more aggressively into the short term credential space.
Speaker #3: With our North Star strategy closely aligned with the operating landscape, our confidence in the next four years is strong. Turning now to developments on the legislative side, most notably, I'd like to provide some clarity around how we're oking at the passing of one big, beautiful bill act.
Holistically the regulatory environment in this administration priorities reinforce the appreciation for technical education and further validates the foundation, we have built to deliver value to our students and employers alike.
Speaker #3: While this legislation introduces significant changes for higher education broadly, many of the limitations mainly focus on more costly four-year and graduate programs that we do not offer.
Now turning to the results for the third quarter.
We delivered another strong quarter in Q3, reflecting.
The consistency of our execution and the resilience of our model.
Speaker #3: Recent discussions that I had in DC show that there's strong support for accelerating our efforts to address the skilled labor shortage in the US.
Our results were driven by continued demand for skilled collar jobs and strategic investment to grow our reach.
Speaker #3: For example, the bills created new opportunities for some of our students, particularly our short course programs which may now become Pell eligible. These courses, while currently not significant drivers of our revenue, serve as a jumping-off point for students to dive deeper into UTI and Concord's full-time programs.
We remain focused on scaling our new programs optimizing student outcomes and investing in our long term growth strategy delivering results that continue to meet and exceed expectations.
Revenue for the third quarter exceeded expectations, increasing 15% year over year to $204 3 million.
Speaker #3: This new legislation provides us with the opportunity to move more aggressively into the short-term credential space. Holistically, the regulatory environment and this administration's priorities reinforce the appreciation for technical education and further validates the foundation we have built to deliver value to our students and employers alike.
Net income increased roughly 114% year over year to $10 7 million with diluted earnings per share of <unk> 19 SaaS.
Adjusted EBITDA grew over 37% year over year to $25 $3 million.
Average fulltime active students grew nearly 13% year over year to 23757 students with total new student starts increasing approximately 3% year over year in the quarter.
Speaker #3: Now, turning to the results for third quarter. We delivered another strong quarter in Q3. Reflecting the consistency of our execution and the resilience of our model, our results were driven by continued demand for skilled college jobs and strategic investment to grow our reach.
Throughout this quarter, we continue to see validation around the importance of and our impact and skilled trades education.
This year, we marked a major milestone by celebrating UTI 60, <unk> anniversary and six decades of training Americas workforce.
Speaker #3: We remained focused on scaling our new programs, optimizing student outcomes, and investing in our long-term growth strategy delivering results that continue to meet and exceed expectations.
As part of that celebration, we have the honor of ringing the opening bell at the New York Stock Exchange This past may.
Speaker #3: Revenue for the third quarter exceeded expectations, increasing 15% year over year to $204.3 million. Net income increased roughly 114% year over year to $10.7 million, with diluted earnings per share of $0.19.
UTI also continues to be featured in prominent media outlets like Forbes USA today, and Cnbc's Mad money.
Each of these pieces reflects a shared team people are reevaluating the ROI of traditional college degrees and increasingly recognizing the value of skilled trades and other health care education.
Speaker #3: Adjusted EBITDA grew over 37% year over year to $25.3 million. Average full-time active students grew nearly 13% year over year to $23,757 students with total new student starts increasing approximately 3% year over year.
These stories highlight the lives, we're changing and reinforced the broader societal shift towards kinds of careers. We trained four.
On our last call, we announced that our executive leadership team was now fully built out to lead the company through this exciting growth phase.
Speaker #3: In the quarter, throughout this quarter, we continue to see validation around the importance of and our impact in skilled trades education. This year, we marked a milestone by celebrating UTI's 60th anniversary and six decades of training America's workforce.
With that we shifted our focus to opportunistic talent investments and our commercial engine.
As a result of this we bolstered our ranks by hiring seasoned divisional leadership to oversee marketing admissions and business development across both UTI and conquer divisions. These revenue driving positions further prepare us to reach our fullest potential as we execute on this next phase of our North Star strategy.
Speaker #3: As part of that celebration, we had the honor of ringing the opening bell at the New York Stock Exchange this past May. UTI also continues to be featured in prominent media outlets like Forbes, USA Today, and CNBC's Mad Money.
Now, let's take a closer look at the division specific highlights for the quarter.
Speaker #3: Each of these pieces reflects a shared theme: people are reevaluating the ROI of traditional college degrees and increasingly recognizing the value of skilled trades and other healthcare education.
Our Concord career Colleges Division maintained its strong topline and student performance in Q3 benefiting from sustained demand for careers in Allied health and nursing and continued operational excellence across our marketing investments.
Speaker #3: These stories highlight the lives we're changing and reinforce the broader societal shift towards kinds careers we train for. On our last call, we announced that our executive leadership team was now fully built out to lead the company through this exciting growth phase.
<unk> continues to outpace our expectations and as performance only serves to bolster our anticipation of meeting or exceeding expectations when they move into the post growth restrictions era.
The program initiatives, we previously announced are progressing as plan and remain on track for 2025 to reiterate these initiatives include increasing the Dallas nursing program capacity by an additional 60 students.
Speaker #3: With that, we shifted our focus to opportunistic talent investments in our commercial engine. As a result of this, we bolstered our ranks by hiring seasoned divisional leadership to oversee marketing, admissions, and business development across both UTI and Concord divisions.
Launching a new nursing program in Jacksonville, Florida, and Rolling our 10 non title for short course programs across the concrete campuses.
Speaker #3: These revenue-driving positions further prepare us to reach our fullest potential as we execute on this next phase of our North Star strategy. Now, let's take a closer look at the division-specific highlights for the quarter.
The Heartland co branded campus also remains on track to open in early fiscal 2026.
As you will recall these campuses are projected to reach an annual revenue run rate of over $4 million, one scale and will serve as a model for future strategic partnerships.
Speaker #3: Our Concord Career Colleges division maintained its strong top line and student performance in Q3. Benefiting from sustained demand for careers in allied health and nursing and continued operational excellence across our marketing investments, Concord continues to outpace our expectations and is performance-only serves to bolster our anticipation of meeting or exceeding expectations when they move into the post-growth restrictions era.
Regarding our optimization efforts construction's underway for our new 60000 square foot Denver location, where are the Aurora campus will be relocated.
This re imagine campus is scheduled to open in early 2026 and will feature larger simulation facilities expand our dental hygiene capacity and even space for future program expansions at.
Speaker #3: The program initiatives we previously announced are progressing as planned and remain on track for 2025. To reiterate, these initiatives include increasing the Dallas Nursing Program capacity by an additional 60 students, launching a new nursing program in Jacksonville, Florida, and rolling out 10 non-Title IV short course programs across the Concord campuses.
Now shifting to the UTI Division the UTI Division continued to experience strong year over year growth in average full time students driven by program expansions and the robust market demand.
While new student growth softened this quarter as previously expected, we anticipate a strong fourth quarter as our high school population prepares to begin their studies now remember nearly half of Uti's Division starts come in the fourth quarter and they remain on track for their overall target.
Speaker #3: The Heartland co-branded campus also remains on track to open in early fiscal 2026. As you will recall, these campuses are projected to reach an annual revenue run rate of over $4 million once scaled and will serve as a model, for future strategic partnerships.
Our efforts to optimize existing UTI campuses and expand Uti's campus footprint are underway and on track for fiscal 2025, 2026 and 2027.
Speaker #3: Regarding our optimization efforts, construction's underway for our new 60,000 square foot Denver location, where the Aurora campus will be relocated. This reimagined campus is scheduled to open in early 2026 and will feature larger simulation facilities, expanded dental hygiene capacity, and even space for future program expansions.
Our <unk> program expansion is launching in 2025 are on track and performing to plan.
Most notably this quarter, we added HV ACR programs to both Rancho Cucamonga and the Miramar campuses.
This brings the H VCR programs footprint to 11 campuses across seven states.
Speaker #3: Now, shifting to the UTI division, the UTI division continued to experience strong year over year growth in average full-time students, driven by program expansions and the robust market demand.
This quarter, we also reached a meaningful milestone in our aviation program with.
We proudly graduated our first class from our aviation maintenance programs in Avondale and long beach campuses.
Speaker #3: While new student growth softened this quarter as previously expected, we anticipate a strong fourth quarter as our high school population prepares to begin their studies.
Just as exciting our Houston based aviation students took home first place at the 2025 aerospace maintenance competition, which is a national event that test both technical skill and teamwork against top training institutions in the country. These achievements reflect not just the excellence of our aviation programs, but the caliber of the students we continue to attract.
Speaker #3: Now, ember, nearly half of UTI's division starts come in the fourth quarter, and they remain on track for their overall target. Our efforts to optimize existing UTI campuses and expand UTI's campus footprint are underway, and on track for fiscal's 2025, 2026, and 2027.
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As far as campus launches, we previously announced we have two new UTI campuses set to open in 2026 pending regulatory approvals.
Speaker #3: Our eight program expansions launching in 2025 are on track and performing to plan. Most notably, this quarter we added HVACR programs to both Rancho Cucamonga and the Miramar campuses.
<unk> being a fully optimized Atlanta campus, which will offer a comprehensive set of programs and second our inaugural skilled trades focused campus in San Antonio both are on schedule and on budget.
Speaker #3: This brings the HVACR programs' footprint to 11 campuses across seven states. This quarter, we also reached a meaningful milestone in our aviation program. We proudly graduated our first class from our aviation maintenance programs in Avondale and Long Beach campuses.
Once fully ramp these campuses should contribute significantly to margins as well as generate upwards of $45 million and $23 million in revenue respectively.
Finally, I'm pleased to say that we have identified the fiscal 2027 UTI campus locations and fiscal 2026 UTI program types for our next tranche of expansions, while we won't be providing specifics on this call. These plans are in place and I look forward to updating everyone very soon.
Speaker #3: Just as exciting, our Houston-based aviation students took home first place at the 2025 Aerospace Maintenance Competition, which is a national event that tests both technical skill and teamwork against top training institutions in the country.
Speaker #3: These achievements reflect not just the excellence of our aviation programs, but the caliber of the students we continue to attract. As far as campus launches, we previously announced that we have two new UTI campuses set to open in 2026, pending regulatory approvals.
With another quarter of strong execution, and a favorable operating environment I am pleased to share that we are raising the low end of our fiscal 2025 guidance ranges for both revenue and new students starts.
We now anticipate consolidated revenue between 830 $835 million.
Speaker #3: The first, being a fully optimized Atlanta campus, which will offer a comprehensive SEP of programs and second, our inaugural skilled trades focus campus in San Antonio.
Reflecting approximately 14% year over year growth at the midpoint.
And new students starts should range between 29000, 530000, and with that I'll turn the call over to Bruce Our CFO to review, our third quarter financial results and talk through our guidance in more depth.
Speaker #3: Both are on schedule and on budget. Once fully ramped, these campuses should contribute significantly to margins as well as generate upwards of $45 million and $23 million in revenue, respectively.
Thank you Jerome.
Our financial performance in Q3 reflects continued solid execution on our strategy as a company for.
Speaker #3: Finally, I'm pleased to say that we've identified the fiscal 2027 UTI campus locations and fiscal 2026 UTI program types for our next tranche of expansions.
For the third quarter average fulltime active students increased 12, 7% year over year to 23757 students.
Speaker #3: While we won't be providing the specifics on this call, these plans are in place and I look forward to updating everyone very soon. With another quarter of strong execution and a favorable operating environment, I'm pleased to share that we are raising the low end of our fiscal 2025 guidance ranges for both revenue and new student starts.
New student starts increased two 8% year over year to 5721 starts.
The Concord Division delivered an 18, 8% increase in average full time active students compared to Q3 'twenty four while new student starts for the third quarter grew nine 1% year over year.
Speaker #3: We now anticipate consolidated revenue between $830 and $835 million dollars, reflecting approximately 14% year over year growth at the midpoint. And new student starts should range between $29,500 and $30,000.
The strong year over year growth was primarily a result of sustained investments in marketing and admissions as well as the team's strong lead conversions.
Speaker #3: With that, I'll turn the call over to Bruce, our CFO, to review our third quarter financial results and talk through our guidance in more depth.
The UCI division drove an eight 9% year over year increase in average fulltime active students for Q3.
Speaker #4: Thank ou, Jerome. Our financial performance in Q3 reflects continued solid execution on our strategy as a company. For the third quarter, average full-time active students increased 12.7% year over year to $23,757 students.
New student starts declined slightly in the third quarter, reflecting a 3% year over year decrease.
The year over year growth in average fulltime active students reflects the strong demand for skilled collar graduates in our team's ability to convert leads.
New students starts were softer in Q3 as expected due to having one less start an instance in the quarter compared to the prior year period, and we continue to remain confident in our ability to achieve our full year starts guidance as outlined.
Speaker #4: New student starts increased 2.8% year over year to $5,721 starts. The Concord division delivered an 18.8% increase in average full-time active students compared to Q3 24, while new student starts for the third quarter grew 9.1% year over year.
Shifting to our financial performance third quarter revenue on a consolidated basis grew 15, 1% year over year to $204 3 million.
Speaker #4: The strong year over year growth was primarily a result of sustained investments in marketing and admissions as well as the team's strong lead conversions.
Concord contributed $72 8 million, an increase of 27% over the prior year quarter.
Speaker #4: The UTI division drove an 8.9% year-over-year increase in average full-time active students for Q3. New student starts declined slightly in the third quarter, reflecting a 3% year-over-year decrease.
While the UTI Division contributed $131 5 million.
An increase of 12, 2% over the prior year quarter.
Looking at profitability consolidated net income for the third quarter was $10 $7 million or <unk> 19 per diluted share.
Speaker #4: The year over year growth in average full-time active students reflects the strong demand for skilled college graduates and our 's ability to convert leads.
Adjusted EBITDA for the third quarter increased 37, 3% year over year to $25 3 million.
Speaker #4: New student starts were softer in Q3 as expected due to having one less start instance in the quarter compared to the prior year period, and we continue to remain confident in our ability to achieve our full year starts guidance as outlined.
These results included $1 $7 million in growth investment spend related to new program launches and new campus build outs.
Growth investment spend for the year to date is $2 $2 million.
Speaker #4: Shifting to our financial performance, third quarter revenue on a consolidated basis grew 15.1% year over year to $204.3 million. Concord million, an increase of 20.7% over the prior year quarter.
At the end of the quarter, we had $54 4 million shares outstanding.
Total available liquidity at the end of the third quarter was $236 $9 million, including $47 $2 million of short term investments and $119 million of remaining capacity on our revolving credit facility.
Speaker #4: While the UTI division contributed $131.5 million, an increase of 12.2% over the prior year quarter. Looking at profitability, consolidated net income for the third quarter was $10.7 million, or $0.19 per diluted share.
We also had a net pay down of $20 million on our revolving credit facility and we will continue to closely manage the use of our revolver going forward.
Year to date operating cash flow was $40 2 million and adjusted free cash flow was $15 million.
Speaker #4: Adjusted EBITDA for contributed 72.8 increased 37.3% year over year to $25.3 million. These results included $1.7 million in growth investment spend related to new program launches and new campus buildouts.
Year to date capital expenditures were $25 $5 million, reflecting investments in our program and campus expansion initiatives.
Driven by our strong third quarter topline performance and sustained operational execution, we are raising our fiscal 2025 guidance ranges for revenue and starts and reiterating our expectations for all other key metrics.
Speaker #4: Growth investment spend for the year to date is $2.2 million. At the end of the quarter, we had 54.4 million shares outstanding. Total available liquidity at the end of the third quarter was $236.9 million, including $47.2 million of short-term investments.
Beginning with revenue, we now expect to generate between 830 and $835 million of revenue for fiscal 2025% or approximately 14% year over year growth at the midpoint.
Speaker #4: And $119 million of remaining capacity on our revolving credit facility. We also had a net paydown of $20 million on our revolving credit facility and will continue to closely manage the use of our revolver going forward.
Total new student starts in fiscal 2025 are now anticipated to range between 29000 530000.
Speaker #4: Year to date operating cash flow was $40.2 million, and adjusted free cash flow was $15 million. Year to date capital expenditures were $25.5 million, reflecting investments in our program and campus expansion initiatives.
This updated outlook reflects the strong performance in both divisions. The continued scaling of new programs and sustained demand across the skilled trades and allied health sectors.
We are reaffirming the remainder of our fiscal 2025 guidance ranges.
To reiterate net income is anticipated to be between 56 and $60 million with diluted earnings per share of $1 to $1 eight for the year.
Speaker #4: Driven by our strong third quarter top line performance and sustained operational execution, we are raising our fiscal 2025 guidance ranges for revenue and starts and reiterating our expectations for all other key metrics.
Full year adjusted EBITDA is expected to be between 124 and $128 million or around a 23% year over year increase at the midpoint.
Speaker #4: Beginning with revenue, we now expect to generate between $830 and $835 million of revenue for fiscal 2025. Or approximately 14% year over year growth at the midpoint.
And lastly, full year 2025, adjusted free cash flow is anticipated to range between 62% and $68 million.
Speaker #4: Total new student starts in fiscal 2025 are now anticipated to range between $29,500 and $30,000. This updated outlook reflects the strong performance in both divisions, the continued scaling of new programs, and sustained demand across the skilled trades and allied health sectors.
In line with historical timing, we expect the majority of our cash generation and year over year increase to happen in Q4.
In addition to todays earnings call transcript, we encourage everyone to review our press release financial supplement investor presentation, and the upcoming 10-Q filing.
These materials provide the latest updates and our consolidated and segment results strategic initiatives and guidance.
Speaker #4: We are reaffirming the remainder of our fiscal 2025 guidance ranges. To reiterate, net income is anticipated to be between $56 and $60 million, with diluted earnings per share of $1 to $1.08 for the year.
As always thank you to our team members students partners and shareholders for your unwavering support.
I'll now turn the call back over to Jerome for his closing remarks.
Speaker #4: Full year adjusted EBITDA is expected to be between $124 and $128 million, or around a 23% year over year increase at midpoint. And lastly, full year 2025 adjusted free cash flow is anticipated to range between $62 and $68 million.
Thank you Bruce.
As we move into the remainder of fiscal 2025, our operational goals remain the same.
In addition to maintaining a keen focus on finishing the year strong organically, we're continuing our planning and execution on expanding our campus footprint into greenfield locations broadening the reach of our existing programs and adding new in demand offerings as well as deepening industry relationships and growing our partner network in <unk>.
Speaker #4: In line with historical timing, we expect the majority of our cash generation and year over year increase to happen in Q4. In addition to today's earnings call transcript, we encourage everyone to review our press release, financial supplement, investor presentation, and the upcoming 10-Q filing.
Organically, we continue to be open to considering acquisitions that both align with our second phase of our north star strategy and provide meaningful value to our shareholders.
Speaker #4: These materials provide the latest updates on our consolidated and segment results, strategic initiatives, and guidance. As always, thank you to our team members, students, partners, and shareholders for your unwavering support.
I want to finish today's call by both sharing some exciting news and reiterating the operational and financial aspects of phase two of our North Star strategy.
We are pleased to announce that following discussions with the department of education, we were able to satisfy the agencies requirements for lifting the core growth restrictions that have restricted our concord career colleges divisions growth since the acquisition.
Speaker #4: I'll now turn the call back over to Jerome for his closing remarks.
Speaker #3: Thank you, Bruce. As we move into the remainder of fiscal 2025, our operational goals remain the same. In addition to maintaining a keen focus on finishing the year strong organically, we're continuing our planning and execution on expanding our campus footprint into Greenfield locations, broadening the reach of our existing programs, and adding new in-demand offerings.
We are now in a position to seek the department's approval to proceed with our expansion efforts for Concord. This is a significant moment for us and enables the company to accelerate conference program and campus growth starting next fiscal year, which is one full year ahead of plan.
As we noted previously adjusted EBITDA margins in fiscal 2026, and 2027 will reflect the impact of deliberate investment to support our expanded campus footprint and program portfolio.
Speaker #3: As well as deepening industry relationships and growing our partner network. Inorganically, we continue be open to considering acquisitions that both align with our second phase of our North Star strategy and provide meaningful value to our shareholders.
Although these investments are expected to temporarily moderate margin growth for the next two years.
Speaker #3: I want to finish today's call by both sharing some exciting news and reiterating the operational and financial aspects of phase two of our North Star strategy.
They are foundational to our long term growth strategy.
While we won't be providing formal guidance on the call today beyond 2025, I think it's safe to say that with our ability to move forward early with conference growth initiatives, we expect to see even stronger ramp in revenue and margin expansion beginning in fiscal 2028, and accelerating through 2029 and beyond.
Speaker #3: We are pleased to announce that following discussions with the Department of Education, we were able to satisfy the agency's requirements for lifting the core growth restrictions that have restricted our Concord Career Colleges division's growth since the acquisition.
Speaker #3: We are now in a position to seek the department's approval to proceed with our expansion efforts for Concord. This is a significant moment for us and enables the company to accelerate Concord's program and campus growth starting next fiscal year, which is one full year ahead of plan.
North Star strategy Phase II currently outlines achieving over $1 billion and yearly revenue and approaching $200 million and adjusted EBITDA by fiscal 2029.
With our growth platform now fully unlocked, we're confident in our ability to achieve and yes, even exceed those targets.
Speaker #3: As we noted previously, adjusted EBITDA margins in fiscal 2026 and 2027 will reflect the impact of deliberate investment to support our expanded campus footprint and program portfolio.
As we closed out Q3, I want to underscore how excited we are about what lies ahead.
The combination of a supportive regulatory environment renewed public enthusiasm for skilled trades and growing employer engagement positions. The company at the center of National workforce transformation with a robust portfolio of new programs and campuses and development and a leadership team built for growth diversification and <unk>.
Speaker #3: Although these investments are expected to temporarily moderate margin growth for the next two years, they are foundational to our long-term growth strategy. While we won't be providing formal guidance on the call today beyond 2025, I think it's safe to say that with our ability to move forward early with Concord's growth initiatives, we expect to see even stronger ramp in revenue and margin expansion beginning in fiscal 2028 and accelerating through 2029 and beyond.
Optimization, we believe we are just scratching the surface of what our company will achieve.
Thank you for your continued support we're excited about the momentum we're building and look forward to keeping you informed as we execute on our accelerated growth diversification and optimization strategy we.
Speaker #3: North Star strategy phase two currently outlines achieving over $1 billion in yearly revenue and approaching $200 million in justed EBITDA by fiscal 2029. With our growth platform now fully unlocked, we're confident in our ability to achieve and, yes, even exceed those targets.
We encourage everyone to visit one of our 32 campuses. So if you're interested please just let us know we will be happy to host you.
I'd now like to turn the call over to the operator for Q&A operator.
Yes. Thank you has mentioned we will now begin the question and answer session.
Speaker #3: As we closed out Q3, I want to underscore how excited we are about what lies ahead. The combination of a supportive regulatory environment, renewed public enthusiasm for skilled trades, and growing employer engagement positions the company at the center of national workforce transformation.
Just a question you May press Star then one on your telephone keypad.
Curious on your speakerphone, please pick up your handset before pressing the keys same timing of your question has been addressed and you would like to withdraw it. Please press Star then two.
This time, we will pause momentarily to assemble the roster.
Speaker #3: With a robust portfolio of new programs in campuses in development and a leadership team built for growth, diversification, and optimization, we believe we are just scratching the surface of what our company will achieve.
And the first question comes from Mike Grondahl with Northland Securities.
Hey, Thanks, guys Hey, Joe.
I wanted to start with Concorde.
Speaker #3: Thank you for your continued support. We're excited about the momentum we're building and look forward to keeping you informed as we execute on our accelerated growth, diversification, and optimization strategy.
Congrats on getting that approval.
There's been a lot of demand there a lot of growth.
What couldnt Concorde look like in three to five years and can you move quick enough to get a couple incremental campuses new campuses.
Speaker #3: We encourage everyone to visit one of our 32 campuses. So if you're interested, please just let us know. We'll be happy to host you. I'd now like to turn the call over to the operator for Q&A.
Speaker #3: Operator?
At Concord next year.
Speaker #5: Yes. Thank you. As mentioned, we will now be in the question and answer session. To ask a question, you may press star then one on our telephone keypad.
Yes, Yes, Mike can you hear me Mike.
Yes.
Okay. Good we're having some technical difficulties hearing the conference room, So I wanted to make sure you.
Speaker #5: If you're using a speakerphone, please pick up your adset before pressing the keys. If anytime you ed your question has been addressed and you would ike to withdraw it, please press star then two.
You could hear me, it's a great question I think.
Really what what the agreement we came to the department of Education does it accelerates our plans by year really we expected the growth restrictions to come off next summer. We've got them off this summer I think probably the best way to think about it is what it really means is we're going to be able to get say another half a dozen or so maybe.
Speaker #5: At this time, I will pause momentarily to assemble the roster. And the first question comes from Mike Groendahl with Northland Securities.
Speaker #6: Hey, thanks, guys. Hey, Jerome. I wanted to start with Concord. Congrats on, you know, getting that approval. There's been a lot of demand there, a lot of growth.
<unk> programs out into the market next year in 2026, when our plan had not.
And over the life of the plan the five year plan.
Speaker #6: What could Concord look like in three to five years? And can you move quick enough to get a couple of incremental campuses, new campuses, at Concord next year?
Means a couple of more campuses on the on the copper side can we get them all in 26, that's debatable right.
We're starting our approval process right now.
Speaker #5: Yeah, yeah. Mike, can you can you ar me, Mike?
We've been doing site selection for quite some time.
Speaker #7: Yes.
Speaker #5: Okay, good. We're having some technical difficulties here in the conference room, so I wanted to make sure you could hear me. It's a great question.
In anticipation of this happening and we're going to work as hard as we can but really the sum total of the upside to this to the five year plan that we put out was.
Speaker #5: I ink, you know, really what what the, agreement we came with the Department of Education does is accelerates our plans by a year, really.
<unk>.
A year's worth of property owners to list.
Speaker #5: You know, we expected the growth restrictions to come off next summer. We've got them off this summer. And I think probably the best way think about it is what it really means is we're going to be able to get, say, another half a dozen or so, maybe more, programs out into the market next year in 2026 when our plan had none.
Hello, Yes.
I'm still here I don't know who that was.
Okay.
That was.
Matt sorry.
And a couple of more campuses that we put into it.
We're we're working through the approval process right now and what that means is by the time, we get to guidance.
Speaker #5: And, over the life of the plan, the the five-year plan, this means a couple of more campuses on the on the Concord side. Can we get them all in in '26?
In November when we report at the end of the fourth quarter guidance for 'twenty six we'll revise that guidance and we'll we'll give you our targets at that time.
Speaker #5: That's debatable, right? The, you know, we're we're starting our approval process right now. we've been, doing site selection for quite some time. in anticipation of this happening, and we're ing to work as hard as we can.
That's good.
Okay.
As we're thinking about 2006 and 2007.
I think you are seeing.
EBITDA margin expansion.
Speaker #5: But really, the sum total of the upside to this to the five-year plan that we put out was, you know, a a a year's worth of program launches.
I'll be muted because of all the investment, but I don't think we're going backwards on those.
In gross dollars is that fair, how do you want to think about that.
Speaker #5: Hello?
Yes, I mean.
Speaker #8: Yeah, I'm I'm here. I don't know who that was.
We haven't given any numbers past 2025, so I want to make sure that you understand that our guidance has been out there now the analysts have taken it upon themselves to put some models out there that had.
Speaker #5: Okay. That that was that was, Matt. sorry. and and a couple of more campuses that we we put into it. You know, we're we're we're working through the approval process right now.
The EBITDA margins roughly flat to slight increase in 2026, and we think that the.
Speaker #5: And, what that means is, you ow, by the time we get to guidance, in, in November when we report at the end of the fourth quarter, guidance for '26, we'll revise that guidance and we'll we'll give ou our targets at that time.
The job they did does that admirable.
There is an opportunity in 2026 should we invest more aggressively in and launching campuses and programs that that we wouldn't achieve the same EBITDA in 2006, as we did in <unk> and in 'twenty, five and and really remember that that all has to do with the sort of change in accounting practice, where we no longer.
Speaker #8: Fair. That's good. And as we're thinking about '26 and '27, I think you're saying EBITDA margin expansion will be muted because of all the investment.
Take those onetime costs out of our adjusted EBITDA. So it will be clear on what our strategic investments are going to be in 2006, when we give guidance just as we were clear in 2005, when we said.
Speaker #8: But I don't think we're going backwards on those. In in in gross dollars. Is that fair? How how do you want people to think about that?
Speaker #5: Yeah, I an, we haven't given any numbers past 2025, so I want to make sure that you understand that that our guidance has been out there.
The second half of the year, we're going to spend about $6 million, which previously we would adjust it out of our of our adjusted EBITDA, but this year. We're not so next year, we'll be clear about that as well.
Speaker #5: Now, the analysts have taken it upon themselves to to put some models out there that had, the EBITDA margins, you know, roughly flat to slight increase in in 2026.
Okay sounds good and thanks.
Sure.
Thank you and the next question comes from Raj Sharma with Texas capital.
Speaker #5: And we think the the job they did is admirable. there is an opportunity in 2026 should we invest more aggressively in in launching campuses and programs that, that we wouldn't achieve the same EBITDA in '26 as we did in in in '25.
Thank you for taking my questions again solid continued execution.
Love It congratulations.
Yes sure.
Just on continuing on the Concorde.
Speaker #5: And and really remember it, that that all has to do with the the the sort of change in counting practice where we no longer, take those one-time costs out of our adjusted EBITDA.
Acceleration of growth and restrictions being lifted.
Can you kind of comment on the UTI.
Our readiness around faculty hiring so.
Speaker #5: So we'll be clear on what our strategic investments are going to be in '26 when we give guidance, just as we were clear in '25 when we said, you know, the second half of year, we're going to spend about $6 million dollars, which previously we would have justed out, of our of our adjusted EBITDA.
You've already talked about regulatory approvals in <unk> site development what what.
How is that going.
Yes, I mean, we've been working pretty closely since the administration changed with them on.
Building a model for progressing forward. So we've we've.
Speaker #5: But this year, we're not. So next year, we'll be lear about that as well.
Move pretty far forward in terms of site selection for the first campuses and our program portfolio was already built assuming we were going to be able to launch them in 2027, so the the.
Speaker #8: Perfect. Hey, sounds good. And thanks.
Speaker #5: Sure.
Speaker #7: Thank you. And the next question
Speaker #5: comes from Raj Sharma with Texas Capital.
Speaker #9: Yeah, thank you for taking my estions. Again, you ow, solid continued execution, love it. Congratulations.
The number of programs that will launch on the on the Concord campuses, which we'll announce as we secure approvals for the secure approvals for those was already in place. So we feel pretty good that we're hitting the ground running here.
Speaker #5: Thank you.
Speaker #9: Yeah.
Speaker #5: Sure.
Speaker #9: just on, continuing on the Concord, acceleration of growth and restrictions being lifted, can you kind of comment on the UTI's readiness around, you know, faculty hiring, sort of, you've already talked about regulatory approvals.
Fast as fast as we can because.
We've been indigo associations with them for quite some time.
Right. Thank you. Thank you for that and then on the starch is quickly I know that Q3 was softer but your overall yearly starts.
Speaker #9: And just sort of, you ow, site development, what what how's that going?
Fine in line. So you are saying Q4 is going to be.
Speaker #5: Yeah, I mean, we've been working pretty closely since the administration changed. With them on, you ow, building a model, for progressing forward. So we've we've, moved pretty far forward in terms of site selection for the first campuses.
As strong if not stronger than than you had expected.
Is that still is that.
Correct understanding thanks, thanks for asking and thanks for asking about I think the way to think about it number one in terms of looking at starts for Q3.
Speaker #5: And our program portfolio was already built assuming we were going to be able to launch them in 2027. So the the, the number of programs that we'll unch on the on the Concord campuses, which we'll announce as as we secure approvals for the secure for those, was already in place.
The hard part about looking at starts in any given quarter is that we don't have the same number of starts and every quarter every year and for instance at UTI. There was one large start that we didn't have this quarter. The opportunity was not there for upwards of 500 students than we had hoped to be able to fill that gap with more.
Speaker #5: So we feel pretty od that we're hitting the ground running here. as fast as as fast as we can because, you know, we've been in negotiations with them for quite some time.
High school students starting earlier, but our.
Our starting June was too early in June our large certain gene was too early in June to capture that many more high school students that being said, we've already got our visibility into what's going on in the fourth quarter and Thats why we felt good about clipping the bottom end of our range and saying that we're going to be closer to that 30000, then 29, where we had before.
Speaker #9: Right. Thank you. Thank you for that. And then on the starts, just quickly, I know the Q3 was softer, but your overall yearly starts, you know, are are fine.
Speaker #9: In line so you're saying Q4 is going to be, you ow, as strong or if not stronger than than than you had expected. Is that still so is that a correct understanding?
So we're feeling good about.
The strong double digit in almost mid teen growth rate for the group as a whole, which propels us really nicely into 'twenty six.
Speaker #5: Yeah, I mean, thanks thanks for asking it. Thanks for asking about it. think the way to think about it, number one, in terms of of of looking at starts for Q3, the hard part about looking at starts in any given quarter is that we don't have the same number of starts in every quarter every year.
Got it got it and then.
Youll have your capital allocation you are generating really good free cash flow you've got greater liquidity.
Speaker #5: And for instance, at UTI, there was one large start that we didn't have this quarter. The opportunity was not there for, you know, upwards of 500 students.
Like.
Then we're not we're never happy with what's going on what's next in terms of.
Speaker #5: And and, you ow, we had hoped to be able to fill that gap with more, high school students starting earlier. But our, our our start in June was too early in June.
Have you thought of or can you give us your thoughts on you know beyond campus expansion, how do you thinking about capital deployment any.
Speaker #5: Our large start in June was too early in June to capture that many more high school students. That being said, you know, we've already got our visibility into what's going on in the fourth quarter.
Any thoughts on sort of buybacks.
Okay.
M&A debt Paydown right.
Speaker #5: And that's why we felt good about clipping the bottom end our range and and saying that we're going to be, you know, closer to that 30,000.
Right now I mean, we're very very focused on generating value through through launching campuses and programs, we've already announced two new campuses on the UTI side.
Speaker #5: Then 29, where we had before. So we're eling good about, you know, the the strong double-digit, you ow, almost mid-teen, growth rate for the for the group as a whole, which propels us really nicely into '26.
In 2026 were working very diligently on the first set of campuses for for our Concord, now, which actually could increase that either in 'twenty six or early 'twenty seven so.
Right now most of our capital deployment is really focused on on.
Speaker #9: Got it. Got it. And then, you know, your your your capital allocation you're generating really good free cash flow. You've got greater liquidity. You know, it ems like a so you then, you know, we're we're never happy with what's going on.
Generating in and even accelerating in Europe, the organic growth to get to that 28 29 tail on on the.
Northstar plan.
Even larger than what we've put out in the market.
Speaker #9: What's next in terms of have you thought of or can you give us your thoughts on, you know, beyond campus expansion, how are you thinking about capital deployment?
Yes, Roger this is Bruce the only thing I would add to that you see that commitment to growth even in our <unk>.
Capex forecast to $455 million invested this year. The majority of that is really focused on that growth spend new campuses new programs to make sure we can execute in 'twenty six.
Speaker #9: Any any thoughts on sort of buybacks, you know? M&A, debt paydown?
Speaker #5: Right. Right. Right now, I mean, we're very, very focused on generating value through through launching campuses and and programs. I mean, we've ready announced two new campuses on the UTI side.
Correct.
Like.
Like I said, we're never happy with what's happening and then we go into the next level of problems.
What's next in your free cash flow, but thank you so much for taking my questions and again fantastic job Fantastic continued execution.
Speaker #5: In 2026, we're working very diligently on the first set of campuses for Concord now, which actually could increase that either in '26 or early '27.
I'll take you Raj Thanks look forward to talking to you.
Speaker #5: So, you know, right , most of our capital deployment is really focused on on, generating and and even accelerating the the organic growth to get the that 28, 29 tail on on the, North Star plan, even larger than what we put out in the market.
Sure.
Thank you and the next question comes from Jeff <unk> with <unk>.
Hey, good afternoon.
And everyone maybe following up on the new starts.
Hoping you can provide a bit more detail on what youre seeing as far as student interest levels in the fourth quarter to date.
And the high school students that are coming in now is that still fairly heavily skewed toward our auto diesel or you get more traction with HVAC and some of the other skilled trades there.
Speaker #9: Yeah, Raj, this is Bruce. The only thing I would add to that, you see that commitment to growth even in our CapEx. forecast, you know, a full $55 million is invested this year.
So I think the thing to remember, which I said in my comments is that truly 50% of UTI Division starts come in the fourth quarter, because about 40 mid 40% of the UTI population is high school students, who are coming right out right out of high school.
Speaker #9: The majority that is really focused on that growth spend, new campuses, new programs, to make sure we can execute in 2026. Right. You know, like I've said, we're never happy with what's happening.
Speaker #9: And then we go on to the next level of problems, what's what's next on your free cash flow. But thank you much for taking my, questions and, again, fantastic job, fantastic continued execution.
The high school students coming right out of high school predominantly go into auto diesel Frac.
<unk> and high school, they don't know that much about what skill trades means in terms of being an electrician or HVAC tack or et cetera. They tend to know I'd like to fix cars.
Speaker #9: I'll take it.
Speaker #5: Thank you, .
Speaker #9: Thanks. Yeah.
Speaker #5: Sure. Look forward to talking to you.
Speaker #9: Okay. Thank ou.
Speaker #5: Thank you. And the next question comes from Jasper Bibb with Truest.
Speaker #10: Hey, good afternoon, everyone. maybe following up on the new starts. Just hoping you could provide a a bit more detail on what you're seeing as far as student interest levels in the fourth quarter to date.
And so.
<unk>.
Still a large portion of the high school students are going into auto diesel and they're filling in quite nicely.
Seeing what we what we expected to see from them in the fourth quarter.
Speaker #10: and and the high school students that are coming in now, is that still pretty heavily skewed toward the auto diesel, or do you get more traction with HVAC and some of the other skilled trades there?
The timing of starts gave us that hiccup of why we thought we would moderate in the third quarter, but.
Speaker #5: So I think the thing to remember, which I said in my comments, is that, you know, truly 50% of the UTI division's starts come in the fourth quarter because, about 40 mid-40% of the UTI, population is high school students who are coming right out of right out of high school.
We feel strong enough that we're still in that mid teens range for the whole company for the for the rest of the year to to raise the low end of our guidance there as well.
Thanks, and then can you maybe talk about how large the exposure is there short term training programs that can benefit from some of the <unk> changes you talked about in the prepared remarks, I know, it's not probably.
Speaker #5: the the high school students coming right out of high school predominantly go into auto diesel. frankly, in high school, they don't know that much about what skilled trades means in terms of being an electrician or HVAC tech or etc.
Probably huge yes, if you just look like a percent of revenue I think would help contextualize that for us.
Yes.
It's very very small right right now and the reason it is very very small right now is because none of it was pell eligible and therefore, we didn't move aggressively into short term credential spaces different types of welding certificates or or.
Speaker #5: They tend to know I'd like to fix cars. and so, you know, still a large portion of the high school students are are are going they're they're filling in quite nicely.
Speaker #5: And
Speaker #5: You know, we're seeing what we what we expected to see from them in the in the fourth quarter. You know, the timing of starts gave us that hiccup of of why we thought we would moderate in the in the third quarter.
Smaller portions of the health care space is that not being eligible those sorts of certificates. We didn't move intuit, what I was really trying to underscore in my comments was it gives us an opportunity now beyond what's on our roadmap to start thinking about.
Speaker #5: But, you know, we feel strong enough that we're still in that that mid-teens range for the whole company for the for for the rest of the year to to raise the low end of our guidance there as well.
Shorter bespoke programs that people can get eight on and therefore, we would be able to move quickly into.
Speaker #10: Thanks. And then can you maybe talk , how large the exposure is to
Speaker #10: short-term training into auto diesel.
Delivering subsets of our curriculum in a full time setting, but just shorter shorter durations that would be palatable.
Speaker #10: programs that could benefit from some of the Pell changes you talked about and the prepared remarks? I ow it's not probably huge, but maybe just like a percent of revenue that something could help contextualize it for us.
Yes.
Makes sense.
One for me can you maybe update us on where you are as far as capacity Encore then.
Speaker #5: No, it's, you know, it's it's it's very, very small, right? right . And the reason it's very, very small right now is because none of it was Pell eligible.
Whether some of your programs may be done for comes to mind are being capacity limited at certain campuses now and whether the growth restrictions lifting can help there.
Speaker #5: And therefore, we didn't move aggressively into short-term credentials phases. Different types of welding certificates or or, smaller portions of the the healthcare space is is that not being Pell eligible, those sorts of certificates we didn't move into it.
Yes, what I said last quarter is is exactly what happened in this quarter, which is we've lapped ourselves a year, we had a project over the last year now year and a quarter of really looking at the clinical capacities and making sure that we were moving as far towards that 100% placement as we could.
Speaker #5: What I was really trying to underscore in my comments was it gives us an portunity now beyond what's on our roadmap to start thinking about, shorter bespoke programs that that people can get aid on.
In that year timeframe because in many of these cases, you need to fill to your capacities and then you can apply to get the caps lifted. These are soft caps that then can be lifted and thats. What we found ourselves as we hit the third quarter as I said in the second quarter, which was we are approaching the caps and many of them that doesn't necessarily mean.
Speaker #5: And therefore, we would be able to move quickly into, you ow, delivering subsets of our curriculum, in a full-time setting, but just shorter durations that would be Pell eligible.
Speaker #10: Yeah, that that makes sense. last one for me. Could you maybe date us on where you are as far as capacity at Concord and whether some of your programs may be dental comes to mind or or being capacity limited at certain campuses now and and whether the growth restrictions lifting could help there?
It's capacity it means that we were granted the right to have that many students and of course and now we are aggressively moving forward to get all those cap rates.
Alright, and so.
That's going to give us a new growth opportunity as we move forward for Concord as well there are very few markets in very few courses, where where we think there is any notion of capacity.
Speaker #5: Yeah. And you know what I said last quarter is exactly what happened in this quarter, which was we've pushed ourselves a year.
Speaker #5: We had a project over the last year now a year and a quarter of of really looking at the the clinical capacities and making sure that we were moving as far towards that 100% placement as we could, in in that year timeframe.
I think where the jobs are not there in that specific geography for that specific.
I still think Theres a lot of opportunity and now what we've proven is that we can fill to the opportunity thats been giving us. So now we're going to raise them.
Sounds good thank you for taking the questions.
Speaker #5: Because in many these cases, you need fill to your capacities. And then you can apply to get the the caps lifted. These soft caps that then can be lifted.
Thanks, Jennifer.
And as a reminder, please press star and then one if you would like to ask a question.
Speaker #5: And that's what we found ourselves as we hit the third quarter. As I said in the second quarter, which was, you know, we are approaching the caps.
And the next question comes from Bruce Goldfarb with Lake Street capital markets.
Speaker #5: And in many of them, that doesn't necessarily mean it's capacity. It means that, you know, we were granted the right to have that many students in a course.
Thanks for taking my call Jerome Bruce.
Congratulations on the great execution.
So my first question is.
Speaker #5: And now we are aggressively moving forward to get all those caps raised. Right? And so, that's going to give us a new growth opportunity as we move forward for for Concord as well.
Where are you on potentially consolidated UTI in Concord systems, ERP systems and learning systems.
Well, that's great I mean, one of the things I announced on our last call not this one was that we had brought in a new <unk>.
Speaker #5: There are very few markets in very few courses where, where we think there's any notion capacity. Where the jobs are not there in that specific geography for that specific, area.
<unk>.
And really focusing on those four big systems, our ERP system, our SaaS, our LMS and our CRM because thats a phase of the integration that we have not yet.
Speaker #5: I still think there's lot of opportunity. And now what 've proven is that we can fill to the opportunity that's been giving us. So now we're going raise them.
Undertaken.
Speaker #10: Sounds good. Thank you for taking the estions.
Work is happening in earnest this isn't something that happens over.
Speaker #5: Thanks, Jasper.
Speaker #10: Thank ou. And as a reminder, please press star and then one if you would like to ask a question. And the next question comes from Bruce Goldfar with Lake Street Capital Markets.
A year or or.
It's probably a multi year three four year process to get all four systems aligned but we will we'll begin to see those efficiencies as we align as we align those systems.
Speaker #11: thanks for taking my call. Jerome, Bruce, congratulations on the great execution. so my first question is, where where are you on potentially consolidating UTI and Concord systems ERP systems and learning systems?
That work's happening in earnest right now.
Great and then Tim.
In terms of the.
Big Beautiful Bill I mean, you talked a little bit of I think about the Pell grants.
But any other impacts are positive for.
Speaker #5: Oh, that's great. I mean, one of the things I I announced on our last call, not this one, was that we had brought in a new, CIO, and and really focusing on on those four big systems, our ERP system, our SIS, our LMS, and our CRM.
For UTI.
Sure.
How it is going to change the way you guys operate.
I actually think.
In my conversations in Washington.
Where we were asked for very first time, how do we get more interest in the skilled trades one of the things that we've made very clear was we need to get some more financial support to <unk>.
Speaker #5: Because that's a phase of the integration that we have not yet, undertaken. And and, you ow, work is happening in earnest. This isn't something that happens over a a year or or, you know, it's probably a multi-year, three, four-year process to get all four systems aligned.
Students for certificate programs non degree programs non traditional for your education and.
Sure.
The Palo eligibility on short courses get the conversation going even more.
Speaker #5: But we'll we'll begin to see those efficiencies as we align as we those systems. And and that that works happening in earnest right now.
And so we're real happy with what we've seen in that front.
Speaker #11: Great. And then, in terms of the the big, beautiful bill, I mean, you talked a little bit of, I think, the Pell grants. But any other impacts or positive for, for UTI or or how it's going to change the way you guys operate?
As far as any other any other programs. So it wasn't really part of the Big Beautiful Bill Act I think now as they move into the 2026 budget.
Votes in their next session I think.
What's the next opportunity to see more enhancements.
Or or.
Speaker #5: I I actually think, you know, you ow, in my conversations in Washington, where where the where we were asked for the very first time, how do we get more interest in the in the skilled trades?
Speak with there.
With their legislation to their urge to get more people into the trade. So our work continues.
Great.
Speaker #5: One of the things that that we've made very clear was we need to get more financial support to to to students for certificate programs, non-degree programs, non-traditional four-year education.
Thank you thanks for taking my questions.
Thank you.
Thank you and this concludes our question and answer session I would like to turn the Florida with Jerome Grant for any closing comments.
Speaker #5: And, you know, for for, the the Pell eligibility on short courses, gets the conversation going even more. and and so we're we're real happy with what we've seen in in in that front.
Thank you very much operator.
I'd like to thank everyone, who attended today as always Bruce Matt and I are available for follow up questions over the next few days and.
And we look forward to speaking with all of you our investors and analysts when we report our fourth quarter.
Speaker #5: you know, as far as any other any other programs it wasn't really part of the the big, beautiful bill act. I think now as they move into the 2026 budget, votes in their in their next session, I think, that's the next opportunity to see more enhancements, or or, speak with their, you know, with their legislation to their urge to get more people into the trades.
Fiscal 2025 results in mid November so back to you operator.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.
Speaker #5: So our continues.
Speaker #11: Great. Thank you. Thanks for, taking my questions.
Speaker #5: Thank ou.
Speaker #11: Thank you. And this concludes the question and answer session. I would like to return the floor to Jerome Grant for an enclosing comment.
Speaker #5: Thank you very much, operator. well, I'd like to thank everyone who attended today. As always, Bruce, Matt, and I are available for follow-up questions over the next few days.
Speaker #5: and we look forward to, speaking with all of you, our investors and analysts when we report our fourth quarter. fiscal 2025 results in mid-November.
Speaker #5: So back to you, operator.