bridge point - ppt
TRANSCRIPT
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2011 J.P. MorganUltimate ServicesInvestor Conference
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This presentation may include forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward-looking statements are subject to risks and uncertainties and
actual results may differ materially from those reflected in the forward-looking
statements. Important factors that could cause actual results to differ materially include,
but are not limited to, those risk factors discussed in Bridgepoints filings with the
Securities and Exchange Commission, including the Annual Report on Form 10-K for
the year ended December 31, 2010 (f iled on March 2, 2011) and the Quarterly Report
on Form 10Q for the quarter ended September 30, 2011 (filed on November 1, 2011).
Forward-looking statements speak only as of the date the statements are made.
Bridgepoint assumes no obligation to update forward-looking statements to reflect
actual results, changes in assumptions or changes in other factors affecting forward-
looking information, except to the extent required by applicable securities laws.
FORWARD-LOOKING STATEMENTS
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
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LARGE MARKET OPPORTUNITY
BA orHigher43 MM
AA13 MMNoCollegeDegree98 MM
US Workforce > 25 Years OldEmployed Population: 154 MM2Private SectorEnrollment:1.4 MM
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
1 Source: BMO Capital Markets, Education and Training, Equity Research, September 20112 Source: Labor Force Statistics, Current Population Survey, Employment status by educational attainment, 2010 annual averages
Private Sector Market Share1
5.8%
6.9% 7.3%
8.2%
10.0%
11.9%
0%
2%
4%
6%
8%
10%
12%
0
250
500
750
1,000
1,250
2004 2005 2006 2007 2008 2009
%oTaEome
Eome0
Private-for-profit Market share
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
11.5m13.7m 15.4m
17.8m21.6m
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
1980 1984 1986 1988 1990 1992 1994 1996 1998 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Fall Enrollment: Up 10 MM in 30 years
Source: The College Boards Annual Survey of Colleges, IPEDS, and Eduventures analysis
GROWTH IN HIGHER EDUCATION
TUITION VASTLY OUTPACED ENROLLMENT GROWTH:THREATENS STUDENTACCESS AND A CHIEVEMENT
+258% between 1980& 2010 at 4Y Publics
+177% at Private4Y Nonprofits
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
6,91678,332
229,363
1,260,605
1,537,151
1,783,095
2,139,714
2,482,068
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000Est. Online Headcount
Source: IPEDS/NCES, SEC filings, school data, Sloan-C and Eduventures analysis
PRIVATE SECTOR:~40% of the wholly online market;~10% of U.S. Higher Ed
ONLINE IS MAINSTREAM:Online is ~12% of total headcountin U.S. Higher Ed~30% of adult and graduateheadcount (Fall 2010)
ONLINE PROGRAMS EMBRACED BY ADULTSSEEKING ACCESS
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1.0 1.11.2
1.6
2.0
2.4
0.0
1.0
2.0
3.0
High
SchoolGrads
Some
College
AA BA MA Dr.
2009 Median Earnings Relativeto H.S. Grads1 9.7%8.6%
6.8%
5.2%3.9%
2.5%
0.0%
3.0%
6.0%
9.0%
12.0%
High
SchoolGrads
Some
College
AA BA MA Dr.
2009 Unemployment Rate2
$300,000
$1,100,000
$1,500,000
$2,600,000
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
AA BA MA Dr.
Lifetime Earnings AdvantageOver High School Grads3
COLLEGE BENEFITS:HIGHER PAY +LOWER UNEMPLOYMENT
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
1Source: Bureau of Labor Statistics, Current Population Survey (posted 5/27/2010)2Source: 2009 annual averages for persons age 25 and over, earnings are for full-time wage and salary works3Source: U.S. Census Bureau, Current Populations Survey, 2009 Annual Social and Economic Supplement
TimesH.S.
Earnings
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* 43 States Cut Assistance1
* Reductions in Faculty
* Tuition Increases
* More to Come?
PublicSector
Independent PrivateSector
Net TaxpayerCost Per Student2
$15,500
$2,400
Dollars
$7,100
1 Source: Center on Budget and Policy Priorities, February 9, 2011
2 Source: Robert J. Shapiro and Nam D. Phan, Sonecon September 2010
TRADITIONAL COLLEGES: FEWER SEATS,HIGHER COSTS
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
1) Barclays Capital Equity Research 2011
53%
46%43%
38% 36%33%
15%12%
-100%
-75%
-50%
-25%
0%
25%
50%
$0
$100
$200
$300
$400
$500
$600
Devry -DV
UoP -APOL
Kaplan- WPO
Argosy- EDMC
Strayer- STRA
Capella- CPLA
GrandCanyon -
LOPE
AIU -CECO
Ashford -BPI
AshfordMilitary -
BPI
AMU -APEI
Cost Per Credit % Difference
ASHFORD TUITION ADVANTAGE
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
1.4%
2.9%
4.0%
5.3%
0.0%
2.0%
4.0%
6.0%
2007 2008 2009 2010
BridgepointEducations MarketShare Based onEnrollmentPercentage1
STEADY GROWTH IN MARKET SHARE
1) BMO Equity Research 2011
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More Affordable
Apple/ Android
Better Student Benchmarking Data
Rich Data on Outcomes
Used By 40 Institutions
Assessment of Learning Data
MOBILE ACCESS
Proprietary Learning Platform
80% of Students by 2012
Constellation
Students
Grade Book
Admin
Classroom
Faculty
INNOVATION DIFFERENTIATES US
}
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
Patent Pending
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
Recognized- 2011 Horizon Report
technology to watch
- Finalist for theSIIAs 2011 CODIE Award
Impactful- 89% of AU students say
Constellation is reliable andhassle-free
- 78% say it improves their learning
Feature-rich- Quizzing for self assessment,
interactive timelines, simulationsand animations
- Create & review highlights,annotations, and more
CONSTELLATION PLATFORM
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
Versatile:- Downloadable to many
devices:
iPads
MP3 players
iPods
Professionally Vetted:- Professional Authors
- Expert Peer-Review- Professional Editors
CONSTELLATION PLATFORM
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2011 OUR APPROACH TOQUALITY EDUCATION
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MA, PsyD, PhD
Social & Behavioral Sciences
Colorado Springs Campus
HLC Accredited
BA 74%
AA14%
MA11%Dr1%
Degrees
99% Online71% Female50% Minority35 Years Old
University of The RockiesAshford University
AA, BA, MA, MBA
17 NAIA Teams
Clinton, IA Campus
HLC Accredited; WASC Applied
Edu 17%
Hcare21%
Lib Arts24%
Bus 39%
Programs
RECOGNIZED BRANDS
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
QUALITY AT EVERY STEP
Admissions
Lead Analytics Pre-App. Quality Control / I.D. Management
Walk to Class / Orientation
Collaboration: Admission / Academics
Courses
QA Checkpoints: Course, Program, Institutional levels
Quality Matters Leader: > 380 certified
Technology: Performance & Feedback Assessment Team Gauges Student Achievement
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
Ashford Universitys learning model
- A rigorous course/program development process- Encapsulates instructional design advances of the past 40 years
- Student-centered
- Course and program learning outcomes with aligned assessments
University of the Rockies: a similar learning model- Plus a specific disciplinary perspective and Practitioner-Scholar Model
Faculty
- Extensive training in technology and teaching methodology- Rubrics
- Faculty mentoring
EXEMPLARY LEARNING MODELS
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
Ashford and Rockies: Robust data disclosure
On student characteristics, satisfaction and performance,and alumni data
Committed to transparency: Informed prospective student decision-making
Institutional continuous improvement
Accountability for public and private funds
Exceeds federal requirements
TRANSPARENCY & ACCOUNTABILITY
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
- Student and faculty characteristics
- Student retention and course completion- Intended learning outcomes:
Institution overall
General education
By program
- Student performance on 3rd party General Edassessments
- Benchmarked against national student engagementand satisfaction data
- Alumni satisfaction and career progression- Outlines of curricula and instructional reform in
response to student feedback
ASSESSMENT SITE ASHFORD
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
VALIDATION Ashford outperforming national benchmarks:
- SAILS test of information literacy (Kent State University) Exceeded 7of 8 benchmarks set by other baccalaureate institutions
- NSSE 2010 survey of student engagement AU student responses surpassed national average in numerous categories
- Ashford alumni 97% reported overall satisfaction with their experience
95% would recommend Ashford- UniLOA survey of critical skills development (Indiana St. University)
Outperformed national average on 6 of 7 benchmarks
Source: Ashford University 2010 Assessment Data for 2009 cohort
Source: Ashford University Internal Data
ENHANCED ASHFORD PERFORMANCE
BA students attempting more than 12 courses exhibited annualretention of 83.9%
BA students who transfer in 60+ credits have a 78% retention rate
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2011 FINANCIALREVIEW
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INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
FINANCIAL MODEL HIGHLIGHTS
Highly visible revenue stream
Operating leverage drives margin expansion and earningsgrowth
Capital efficient business
Consistent financial, operating record
Strong growing and cash position, no debt
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12,623
31,558
53,688
77,892
90,597
5,000
25,000
45,000
65,000
85,000
2007 2008 2009 *2010 Q3 '11
Enrollments
$85.7
$218.3
$454.3
$713.2 $712.1
$50.0
$250.0
$450.0
$650.0
$850.0
2007 2008 2009 *2010 Q3'11YTD
RevenueCAGR*83.4%
CAGR*102.6%
($MM)
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
HISTORY OF CONSISTENT PERFORMANCE
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34.8%
28.8%26.4% 26.3% 26.3%
10.0%
25.0%
40.0%
2007 2008 2009 2010 Q3 YTD
Instructional Costs and Services
42.0%
37.1%
32.1% 29.7%26.7%
10.0%
25.0%
40.0%
55.0%
2007 2008 2009 2010 Q3 YTD
Marketing and Promotional
18.5% 18.8%
23.5%
13.7% 13.5%
5.0%
15.0%
25.0%
2007 2008 2009 2010 Q3 YTD
General and Administ rative
4.6%
15.3%18.0%
30.3%33.5%
3.0%
15.0%
27.0%
39.0%
2007 2008 2009 2010 Q3 YTD
Operating Margin
-- % of Revenue --
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
CONSISTENT IMPROVEMENT IN OPERATINGLEVERAGE
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$10.4
$70.7
$131.7
$189.9
$148.7
$0
$100
$200
2007 2008 2009 2010 Q3YTD
Net Cash Provided ByOperating Activities($ MM)
$0.01$0.16
$0.74
$2.14
$2.60
$0.00
$1.00
$2.00
$3.00
2007 2008 2009 2010 Q3YTD
Fully-Diluted EarningPer Common Share
INNOVATIVE SOLUTIONS THAT ADVANCE LEARNING
STRONG CASHFLOW AND EPS
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