EDC(US:EDUC)2022-01-05 16:00Revenue Performance - The Company did not experience a decrease in net revenues during fiscal year 2021, and year-to-date results for fiscal 2022 are more normalized[17]. - Total net revenues for the three months ended November 30, 2021, were $45,112,300, a decline of 32.5% from $66,750,300 in the same period of 2020[56]. - The UBAM segment reported net revenues of $41,397,800 for the three months ended November 30, 2021, down 35.4% from $64,169,700 in the prior year[56]. - Net revenues for the three months ended November 30, 2021, decreased by $22.8 million, or 35.5%, to $41.4 million compared to $64.2 million in the same period last year[81]. - Net revenues for the nine months ended November 30, 2021, decreased by $49.5 million, or 31.3%, to $108.5 million compared to $158.0 million in the same period last year[85]. - The Publishing segment reported net revenues of $3,714,500 for the three months ended November 30, 2021, an increase of 43.9% from $2,580,600 in the prior year[56]. - Publishing division's net revenues increased by $4.1 million, or 65.1%, to $10.4 million during the nine-month period ended November 30, 2021, from $6.3 million reported in the same period last year[96]. Earnings and Expenses - Net earnings applicable to common shareholders for the three months ended November 30, 2021, were $2,646,600, a decrease of 38.3% compared to $4,269,600 for the same period in 2020[42]. - Basic earnings per share (EPS) for the three months ended November 30, 2021, was $0.33, down 35.3% from $0.51 in the prior year[42]. - Total operating expenses for the three months ended November 30, 2021, decreased by $13.2 million, or 37.6%, to $21.9 million compared to $35.1 million in the same quarter last year[83]. - Total operating expenses decreased by $29.9 million, or 34.5%, to $56.7 million for the nine-month period ended November 30, 2021, compared to $86.6 million for the same period last year[88]. - Operating income for the UBAM segment decreased by $3.3 million, or 30.6%, to $7.5 million during the three months ended November 30, 2021[84]. - Operating income of the UBAM segment decreased by $5.3 million, or 20.2%, to $21.0 million during the nine months ended November 30, 2021, compared to $26.3 million reported in the same period last year[89]. - Income taxes for the three months ended November 30, 2021, decreased by $0.5 million, or 33.3%, to $1.0 million from $1.5 million in the same quarter last year[74]. Inventory and Debt - Current net inventories as of November 30, 2021, totaled $69,236,200, an increase from $51,762,400 as of February 28, 2021, representing a growth of approximately 34%[23]. - Total long-term debt as of November 30, 2021, was $25,527,900, up from $10,984,700 as of February 28, 2021[32]. - The Company executed an Amended and Restated Loan Agreement on February 15, 2021, which included a reduction in the fixed interest rate on Term Loan 1 from 4.23% to 3.12%[32]. - The Company has a $20.0 million revolving loan with an effective interest rate of 3.00% as of November 30, 2021[33]. - Future minimum payments receivable under operating leases are estimated to total $14,704,600[31]. - The Advancing Term Loan 2 was established in the principal amount of $10.0 million on November 19, 2021, maturing November 19, 2031[36]. Share-Based Compensation - Share-based compensation expense for the three months ended November 30, 2021, was $261,600, a decrease of 10.3% compared to $291,800 for the same period in 2020[52]. - The Company expects to recognize total unrecognized share-based compensation expense of $2,093,500 over a weighted-average period of 29.6 months as of November 30, 2021[52]. - The total compensation expense for restricted share awards recognized for the nine months ended November 30, 2021, was $784,900, an increase of 15.9% from $677,000 for the same period in 2020[52]. - During the first nine months of fiscal year 2022, the company recognized $0.8 million of compensation expense associated with shares granted[126]. Cash Flow and Investments - Cash outflows from operations were $7,377,100 during the first nine months of fiscal year 2022, despite net earnings of $7,982,900[101]. - Cash used in investing activities was $3,387,100 for capital expenditures, including $2,901,600 for equipment to increase daily shipping capacity[103]. Consultant and Sales Performance - Average number of active consultants for the three months ended November 30, 2021, was 41,500, a decrease of 15,700, or 27.4%, from 57,200 in the same period last year[81]. - Sales commissions for the three months ended November 30, 2021, decreased by $8.5 million, or 37.1%, to $14.4 million compared to $22.9 million in the same quarter last year[83]. Other Financial Metrics - Gross margin for the three months ended November 30, 2021, decreased by $16.5 million, or 35.9%, to $29.4 million, with a gross margin percentage of 71.1%[82]. - Gross margin for the nine months ended November 30, 2021, decreased by $35.3 million, or 31.2%, to $77.7 million, with a gross margin percentage of 71.6%[86]. - Gross margin as a percentage of net revenues decreased to 46.3% during the nine-month period ended November 30, 2021, from 48.2% reported in the same period last year[97]. - Total operating expenses of the Publishing segment increased by $0.6 million, or 50.0%, to $1.8 million during the nine-month period ended November 30, 2021, from $1.2 million reported in the same period last year[98].