• Fourth Quarter Revenue: $423 million, up 10% year over year on an organic constant currency basis.
• Fourth Quarter Adjusted EBITDA: $141 million, up 14% year over year on an organic constant currency basis.
• Full-Year 2024 Revenue: $1.567 billion, up 7% on an organic constant currency basis.
• Full-Year 2024 Adjusted EBITDA: $450 million, with a margin of 28.7%.
• Full-Year 2024 Net Income: $296 million, earnings per share of $1.92.
• Full-Year 2024 Adjusted Net Income: $209 million, adjusted earnings per share of $1.35.
• Mexico Revenue Growth (Q4): 15% increase year over year.
• Mexico Adjusted EBITDA Growth (Q4): 29% increase year over year.
• Peru Revenue Growth (Q4): 5% increase year over year.
• Peru Adjusted EBITDA Decline (Q4): 9% decrease year over year.
• Net Debt Position (End of 2024): $11 million.
• Capital Returned to Shareholders (2024): $102 million.
• 2025 Revenue Guidance: $1.545 billion to $1.570 billion, flat to down 1% on an as-reported basis.
• 2025 Adjusted EBITDA Guidance: $467 million to $477 million, reflecting 4% to 6% growth on an as-reported basis.
• 2025 Total Enrollments Guidance: 489,000 to 495,000 students, reflecting 4% to 5% growth.

• Warning! GuruFocus has detected 5 Warning Signs with AHH.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Laureate Education Inc (NASDAQ:LAUR) achieved a historic high in margin profile for 2024, demonstrating strong operational performance.
• The company returned over $100 million of capital to shareholders in 2024, highlighting its commitment to shareholder value.
• Laureate Education Inc (NASDAQ:LAUR) expanded its academic offerings by opening new medical, dental, and veterinary schools in Mexico and Peru.
• All universities in Mexico and Peru received a five-star rating from QSR for employability, online learning, inclusiveness, and social impact.
• The company reported a 10% year-over-year increase in fourth-quarter revenue on an organic constant currency basis, driven by enrollment growth and favorable price mix.

Negative Points

• Laureate Education Inc (NASDAQ:LAUR) anticipates significant foreign currency translation headwinds in 2025 due to volatility in the Mexican peso.
• The company expects a one-time revenue loss of $13 million in 2025 due to campus consolidations in Mexico.
• Adjusted EBITDA for Peru declined 9% year over year in the fourth quarter, impacted by cost deferrals and higher bad debt.
• The geopolitical uncertainties in Mexico, including tariff threats, could impact the economic environment and potentially affect enrollment.
• Laureate Education Inc (NASDAQ:LAUR) expects flat to slightly down reported revenues for 2025, despite local currency growth, due to currency translation impacts.

Q & A Highlights

Q: How is the economic environment in Mexico affecting Laureate Education, and what are the expectations for GDP growth? A: Eilif Serck-Hanssen, President and CEO, explained that while Laureate is not directly impacted by geopolitical discussions around tariffs and trade, economic conditions do influence their business. The GDP growth slowed from 3% to 1% in the latter half of the year due to reduced foreign direct investment. The guidance for 2025 is based on a 1% GDP growth, with expectations of volatility due to ongoing trade discussions. The company is more optimistic about 2026 and beyond.

Q: Can you provide more details on Laureate's capital allocation policy and plans for returning excess capital to shareholders? A: Eilif Serck-Hanssen stated that Laureate aims for a 50% free cash flow conversion on an unleveraged basis. After supporting business growth with around 5% of revenues in CapEx, 50% of the unleveraged free cash flow will be returned to shareholders. This reflects a commitment to returning capital while supporting growth.

Q: What is the expected tax rate for Laureate Education moving forward? A: Rick Buskirk, CFO, noted that the effective tax rate was around 29% on a reported basis. After adjusting for non-cash FX gains and a discrete tax item, the run rate is expected to be below 40%.

Q: How is the enrollment outlook in Peru, and what are the expectations for the primary intake? A: Eilif Serck-Hanssen mentioned that the main intake in Peru is progressing well, with GDP growth expectations of over 3% for 2025. However, there are lingering effects of the recession, particularly in the price-sensitive value segment.

Q: What are the financial expectations for 2025 in terms of revenue and adjusted EBITDA? A: Rick Buskirk provided guidance for 2025, expecting total enrollments to grow by 4% to 5%, with revenues ranging from $1.545 billion to $1.570 billion. Adjusted EBITDA is projected to grow by 4% to 6% on a reported basis, with margins expected to increase by approximately 150 basis points.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.