Learning Tree Announces Record Earnings for the Fourth Quarter and Fiscal Year - Learning Tree International - Company Financial Information

Edge: Work-Group Computing Report, Nov 22, 1999

Learning Tree International, Inc. announced Thursday that it had achieved record profits in its fourth quarter and fiscal year ended September 30, 1999.

Revenues for the quarter ended September 30, 1999 were $48.5 million compared to $49.0 million for the same quarter of the prior year. Income from operations for the fourth quarter increased to $7.3 million from $5.1 million for the same quarter of the prior year. Net income for the fourth quarter was $5.7 million compared with $3.9 million for the same quarter of the prior year. Net income per share for the fourth quarter grew to $0.26 compared with $0.18 for the same quarter of the prior year. These results are consistent with the preliminary ranges announced by the Company in October.

Revenues for the fiscal year ended September 30, 1999 were $189.3 million compared with $187.2 million for the fiscal year ended September 30, 1998. Income from operations for the fiscal year ended September 30, 1999 increased to $14.7 million compared with $13.3 million for the prior year. Net income for the fiscal year ended September 30, 1999 increased to $12.4 million compared to $10.5 million for the prior year. Net income per share for the fiscal year ended September 30, 1999 grew to $0.57 compared to $0.48 for the prior year.

Dr. David C. Collins, Chairman and CEO commented, "We are pleased with this quarter's record profits. For the full year, profits grew by 18% over last year, achieving a new record for the Company even after the impact of $6 million in non-recurring CBT write-offs and expenses in the third quarter."

Learning Tree International is a leading worldwide provider of education and training to information technology ("IT") professionals in business and government organizations. The Company develops, markets and delivers a broad, proprietary library of instructor-led courses focused on client/server systems, intranet/Internet technologies, computer networks, operating systems, programming languages, databases, object-oriented technology and IT management. The Company also tests and certifies IT professionals, and the American Council on Education recommends its courses for college credit. For more information about Learning Tree products and services, call 1-800-THE-TREE, or visit us on the World Wide Web at: http://www.learningtree.com.

Learning Tree is unable to determine whether the improvements in net income for the fourth quarter will continue in the future. The Company continues to believe that its decision in July to discontinue development of its CBT products will adversely impact future sales of these products. Except for historical information contained herein, the matters discussed in this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties include, without limitation, the Company's dependence on the timely development, introduction and customer acceptance of courses and products, the impact of competition and downward pricing pressures, the effect of changing economic conditions, the Company's ability to attract and retain key management and other personnel, risks in technology development and introduction, the risks involved in currency fluctuations, and other risks and uncertainties detailed from time to time in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K. In particular, the Company cannot predict at this time the exact impact of the "Y2K" issue on IT training, particularly in the early part of calendar 2000. The potential Y2K impacts on the Company's customers may adversely affect enrollments during at least the second quarter of the Company's 2000 fiscal year.

      LEARNING TREE INTERNATIONAL, INC. AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF OPERATIONS
     (all amounts in thousands, except per share amounts)

                        Three Months Ended      Fiscal Year Ended
                           September 30,           September 30,
                            (Unaudited)
                         1999        1998        1999        1998

Revenues             $  48,520   $  49,044   $ 189,321   $ 187,174
Costs of revenues       17,880      20,712      76,598      80,016
                     ---------   ---------   ---------   ---------
 Gross profit           30,640      28,332     112,723     107,158
                     ---------   ---------   ---------   ---------
Operating expenses:
 Course development      3,030       3,032      19,267      11,942
 Sales and marketing    14,179      14,294      54,996      59,422
 General and
  administrative     6,125       5,916      23,720      22,509
                     ---------   ---------   ---------    --------
                        23,334      23,242      97,983      93,873
                     ---------   ---------   ---------    --------

Income from operations   7,306       5,090      14,740      13,285

Other income (expense):  1,516         844       4,285       2,676
                     ---------   ---------   ---------    --------

Income before provision
 for income taxes        8,822       5,934      19,025      15,961
Provision for
 income taxes            3,142       2,018       6,611       5,427
                     ---------   ---------   ---------    --------

Net income           $   5,680   $   3,916   $  12,414    $ 10,534
                     =========   =========   =========    ========

Earnings per
 common share        $    0.26   $    0.18   $    0.57    $   0.48
                     =========   =========   =========    ========

Earnings per
 common share
 assuming dilution   $0.26   $    0.18   $    0.57    $   0.48
                     =========   =========   =========    ========

Weighted average
 number of shares
 outstanding        21,644      21,995      21,833      21,995
                  =========   =========   =========    ========

Diluted shares
 outstanding        21,822      21,995      21,898      22,015
                  =========   =========   =========    ========

  LEARNING TREE INTERNATIONAL, INC. AND SUBSIDIARIES
             CONDENSED CONSOLIDATED BALANCE SHEETS
                  (all amounts in thousands)

                            September 30,        September 30,
                                     1999                 1998

Cash, cash equivalents
 and short-term investments      $   91,416           $   67,191
Accounts receivable
 and prepaid expenses                22,922               23,110
                                 ----------           ----------
 Total current assets               114,338               90,301
Equipment, net and other             36,443               47,089
                                 ----------           ----------
 Total assets                    $  150,781           $  137,390
                                 ==========           ==========

Accounts payable and
 accrued liabilities             $   24,629           $   25,923
Deferred revenue                     37,618               33,357
                                 ----------           ----------
 Total current liabilities           62,247               59,280
Other                                 2,894                1,282
                                 ----------           ----------
 Total liabilities                   65,141               60,562
                                 ----------           ----------

Stockholders' equity                 85,640               76,828
                                 ----------           ----------
     Total liabilities and
  stockholders' equity           $  150,781           $  137,390
                                 ==========           ==========