SOURCE: EVCI Career Colleges Holding Corp.

March 23, 2005 17:20 ET

EVCI Career Colleges Files 10-KSB

Audited Financials Confirm Previously Announced Operating Results

YONKERS, NY -- (MARKET WIRE) -- March 23, 2005 -- EVCI Career Colleges Holding Corp. (NASDAQ: EVCI) filed its 10-KSB today and confirmed its previously announced operating results for 2004. The highlights include revenues of $33.1 million, up 64% from $20.2 million for 2003; income from operations of $4.6 million for 2004 as compared to $1.6 million for 2003, a 188% increase; and net income available to common stockholders of $6.3 million as compared to $2.6 million last year, a 142% increase. Net income included a benefit from income taxes of $2.8 million as compared to $1.9 million in 2003.

Diluted EPS was $0.50 versus $0.31 for 2003. Operating income per share was $0.37 as compared to $0.20 for 2003, an 85% increase. Operating income per share is determined by dividing operating income by the diluted weighted average number of shares for the period.

As previously announced, EVCI will host a conference call tomorrow, at 11:00 AM. Details on how to access the conference call can be found in our press release dated March 21, 2005.

          EVCI Career Colleges Holding Corp. and Subsidiaries
                      Consolidated Balance Sheet


December 31,                                      2004          2003
                                              -----------   -----------

ASSETS

Current Assets:
  Cash and cash equivalents                   $10,504,308   $ 2,522,107
  Student accounts receivable,
   less allowance for doubtful
   accounts of $105,000 and $50,000,
   respectively                                 6,015,719     2,715,418
  Note receivable                                       -        90,000
  Prepaid expenses and other current
   assets                                         137,410       103,367
                                              -----------   -----------

    Total current assets                       16,657,437     5,430,892

Property and Equipment - net                    4,733,185     1,714,606

Restricted Certificates of Deposit                 32,142       291,352

Goodwill                                        3,914,624     3,600,522

Deferred Income Tax Asset, net of valuation
 allowance of $1,827,500 and $6,259,000,
 respectively                                   5,557,500     2,000,000

Other Assets                                      443,084       271,956
                                              -----------   -----------

    Total Assets                              $31,337,972   $13,309,328
                                              ===========   ===========


LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Accounts payable and accrued expenses       $ 3,046,707   $   775,727
  Income taxes payable                            329,729        72,450
  Accrued purchase price payable for
   Interboro Institute, Inc.                            -       973,337
  Deferred tuition revenue                      1,834,510     1,007,621
  Current portion of capital
   lease obligation                               275,329       161,805
  Current portion of notes payable                318,907       480,235
                                              -----------   -----------

    Total current liabilities                   5,805,182     3,471,175

Capital lease obligation, net of
 current portion                                  585,337       236,194

Accrued purchase price payable for
 Interboro Institute, Inc., net of
 current portion                                        -     1,622,227

Notes Payable, net of current portion             286,518       964,968

Deferred rent                                     766,710             -
                                              -----------   -----------

    Total liabilities                           7,443,747     6,294,564
                                              -----------   -----------

Commitments and Contingencies

Stockholders' Equity:
  Preferred stock - $.0001 par value;
   authorized 1,000,000 shares;
   none issued and outstanding                          -             -
  Common stock - $.0001 par value;
   authorized 20,000,000 shares; issued
   and outstanding 12,329,603 and
   10,862,452 shares, respectively                  1,254         1,090
  Additional paid-in capital                   49,922,445    39,296,760
  Accumulated deficit                         (26,029,474)  (32,283,086)
                                              -----------   -----------

    Stockholders' equity                       23,894,225     7,014,764
                                              -----------   -----------
    Total Liabilities and
     Stockholders' Equity                     $31,337,972   $13,309,328
                                              ===========   ===========


          EVCI CAREER COLLEGES HOLDING CORP. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENT OF INCOME

Year ended  December 31,                          2004          2003
                                              -----------   -----------

Net revenue                                   $32,718,087   $19,912,423
Other income                                      351,886       325,305
                                              -----------   -----------

Total revenue                                  33,069,973    20,237,728
                                              -----------   -----------

Operating expenses:
  Cost of revenue                               7,313,643     4,928,275
  Selling, general and administrative          21,134,039    13,674,927
                                                        -             -
                                              -----------   -----------

Total operating expenses                       28,447,682    18,603,202
                                              -----------   -----------

Income from operations                          4,622,291     1,634,526

Other income (expense):
  Loss on settlement of tuition  disallowance    (978,200)            -
  Interest and financing costs                   (225,992)     (138,038)
  Interest income                                  73,513        23,412
                                              -----------   -----------

Income before benefit for income taxes          3,491,612     1,519,900
                                              -----------   -----------


Benefit for income taxes                       (2,762,000)   (1,860,000)
                                              -----------   -----------

Net income                                      6,253,612     3,379,900

Accreted value of warrants and transaction
 costs - Series B                                       -      (179,382)
Dividends on preferred stock - Series B                 -      (630,333)
                                              -----------   -----------
Net income  available to common stockholders  $ 6,253,612   $ 2,570,185
                                              ===========   ===========
Income  per common share:
  Basic:                                      $      0.53   $      0.35
                                              ===========   ===========
  Diluted:                                    $      0.50   $      0.31
                                              ===========   ===========
Weighted-average number of common
 shares outstanding:
  Basic:                                       11,883,695     7,360,649
                                              ===========   ===========
  Diluted:                                     12,518,450     8,265,176
                                              ===========   ===========


          EVCI CAREER COLLEGES HOLDING CORP AND SUBSIDIARIES
                CONSOLIDATED STATEMENT OF CASH FLOWS

Year ended December 31,                           2004          2003
                                              -----------   -----------

Cash flows from operating activities:
 Net income                                   $ 6,253,612   $ 3,379,900
  Adjustments to reconcile net income
   to net cash provided by
   (used in) operating activities:
   Depreciation and amortization                1,011,866       877,349
     Allowance for doubtful accounts               55,000
     Non cash compensation expense                406,368             -
   Deferred income taxes                       (3,557,500)   (2,000,000)
   Changes in operating assets
    and liabilities:
     Increase in student accounts receivable   (3,355,301)   (1,071,054)
     Increase in prepaid expenses and
      other current assets                        (34,043)      (21,363)
     Decrease (increase) in other assets         (171,128)       25,333
     (Decrease) increase in accounts payable
      and accrued expenses                      2,270,980      (346,627)
   Increase in income taxes payable               257,279             -
     (Decrease) increase in deferred
      tuition revenue                             826,889      (867,886)
     Increase in deferred rent                    766,710             -
     Decrease in assets and liabilities from
      discontinued operations                           -       (64,956)
                                              -----------   -----------

       Net cash provided by (used in)
        operating activities                    4,730,732       (89,304)
                                              -----------   -----------

Cash flows from investing activities:
  Purchases of property and equipment          (2,492,059)     (649,410)
  Release of restricted funds                      259,210            -
  Investment in restricted certificates
   of deposit                                           -        (3,177)
  Repayment of notes receivable                    90,000        10,000
  Payments on accrued purchase price payable   (2,909,666)     (345,000)
                                              -----------   -----------

       Net cash used in investing activities   (5,052,515)     (987,587)
                                              -----------   -----------

Cash flows from financing activities:
  Principal payments on capital
   lease obligation                            (1,075,719)     (121,591)
  Principal payment on notes payable             (839,778)            -
  Repayment of promissory note payable                  -       (28,261)
  Net proceeds from note payable - bank                 -       923,464
  Repayment of note payable -
   Series B holders                                     -      (910,000)
  Proceeds from issuance of common
   stock and warrants                           9,349,585     2,000,000
  Proceeds from exercise of options
   and warrants                                   869,896       874,771
  Dividends paid on Series B preferred
   stock                                                -    (1,752,122)
  Expense incurred upon conversion of
   series B preferred stock                             -        (9,748)
                                              -----------   -----------

       Net cash provided by
        financing activities                    8,303,984       976,513
                                              -----------   -----------

Net increase (decrease) in cash and
 cash equivalents                               7,982,201      (100,378)

Cash and cash equivalents at beginning
 of year                                        2,522,107     2,622,485
                                              -----------   -----------

Cash and cash equivalents at end of year      $10,504,308   $ 2,522,107
                                              ===========   ===========

Supplemental disclosures of cash
 flow information:

  Cash paid during the year for:
    Interest                                  $   225,992   $   143,239
                                              ===========   ===========
    Income taxes                              $   604,546   $   146,445
                                              ===========   ===========

Supplemental schedule of noncash
 investing and financing activities:


  Capital lease obligations incurred
   in the acquisition of equipment            $ 1,538,387   $   299,843
                                              ===========   ===========

  Increase in goodwill                        $   314,102   $ 1,343,233
                                              ===========   ===========

  Increase in accrued purchase price payable  $   314,102   $ 1,343,233
                                              ===========   ===========

Contact Information

  • Contact:
    EVCI Career Colleges Holding Corp.
    Dr. John J. McGrath
    Chief Executive Officer & President
    914-623-0700