Another for profit takes a dip…
The shares Apollo Education Group declined after disclosing it received a “civil investigative demand” from the Federal Trade Commission (FTC) on Wednesday.
The stock price of Apollo Education Group dropped more than 2$ to $13.06 per share at the time of this writing around 1:36 in the afternoon in New York.
Apollo Education Group is the parent company of the University of Phoenix.
FTC civil investigative demand
Apollo Education Group said the FTC’s demand is related to an investigation to find out if certain unnamed persons, partnerships, or others are engaged or engaging in deceptive or unfair practices in advertising, marketing or selling secondary or post-secondary, educational accreditation products and services .
The FTC required Apollo Education Group to submit documents and information a broad spectrum of the business and practices of the University of Phoenix from January 1, 2011 to present.
According to the company, some of the required information about the university include its practices related to its academic programs, accreditation, billing & debt collection, enrollment, financial aid, marketing, recruiting, tuition & fees, student retention, training, and other compliance matters.
Apollo Education Group said it is evaluation the civil investigative demand and intends to cooperate fully with the FTC.
Apollo Education Group 3Q financial results
Separately, Apollo Education Group released its third-quarter financial results on Wednesday. Its net revenue was $681.5 million, lower than its $793.6 million revenue last year.
The company reported an income of $57.5 million from continuing operations of $0.53 per share, down from $86.9 million or $0.78 per share in the same period last year. Its operating income was $101.6 million excluding special items.
“In a time of transformation, University of Phoenix, our largest subsidiary, is working to become a more focused, higher retaining and less complex institution,” said Greg Cappelli, CEO of Apollo Education Group.
Capelli also said, “Our commitment across all of our institutions is to deliver world-class experiences and outcomes, connecting students’ education with their career aspirations, and helping employers recruit, retain, and develop a highly engaged and productive workforce.”
Apollo Group Education expects to deliver operating income of around $190 million to $200 million excluding special items and net revenue in the range of $2.60 billion to $2.61 billion for fiscal 2015.