Laureate Education Inc. (NASDAQ:LAUR) Q2 2024 Earnings Conference Call August 1, 2024 8:30 AM ET

Company Participants

Eilif Serck-Hanssen - President and CEO
Rick Buskirk - SVP & CEO
Adam Morse - SVP, Corporate Finance & Global Treasurer

Conference Call Participants

Lucas Dai Nagano - Morgan Stanley

Operator

Good day, and thank you for standing by. Welcome to the 2024 Second Quarter Laureate Education Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I‘d now like to hand the conference over to your first speaker today, Adam Morse, Senior Vice President of Corporate Finance. Please go ahead.

Adam Morse

Good morning and thank you for joining us on today's call to discuss Laureate Education's second quarter 2024 results. Joining me on the call today are Eilif Serck-Hanssen, President and Chief Executive Officer, and Rick Buskirk, Chief Financial Officer. Our earnings press release is available on the Investor Relations section of our website at laureate.net. We've also posted a supplementary presentation to the website, which we will be referring to during today's call. The call is being webcast, and a complete recording will be available after the call.

I'd like to remind you that some of the information we are providing today, including, but not limited to, our financial and operational guidance, constitutes forward-looking statements within the meaning of applicable U.S. securities laws. Forward-looking statements are subject to risks and uncertainties that may change at any time, and therefore, our actual results may differ materially from those we expected. Important factors that could cause actual results to differ materially from our expectations are disclosed in our annual report on form 10-K filed with the U.S. Securities and Exchange Commission, our 10-Q filed earlier this morning, as well as other filings made with the SEC. In addition, all forward-looking statements are based on current expectations as of the date of this conference call, and we undertake no obligation to update any forward-looking statements. Additionally, non-GAAP measures that we discuss, including, among others, adjusted EBITDA and its related margin, adjusted EBITDA to unlevered free cash flow conversion, total debt, net of cash and cash equivalents, and free cash flow, are detailed and reconciled where applicable to their GAAP counterparts in our press release or supplementary presentation.

Let me now turn the call over to Eilif.

Eilif Serck-Hanssen

Thank you, Adam, and good morning, everyone. Today, I'm pleased to report solid operating performance for the second quarter. We remain on track to deliver on our 2024 commitments on a constant currency basis. In addition, our strong balance sheet and significant cashflow generation support our continued emphasis on returning capital to shareholders. For the first six months of this year, we have repurchased over $72 million worth of shares. Later in our prepared remarks, Rick will discuss the impact from the recent weakening of the Mexican peso, which is causing us to make a slight downward adjustment to our outlook on a spot FX basis. The market dynamics remain favorable for private higher education in both of our geographies. Mexico continues to present a compelling growth story, driven by robust manufacturing and construction sectors, higher minimum wages, record low unemployment, and increased consumer spending. In addition, nearshoring is further bolstering growth prospects. Presidential elections were held during June in Mexico, and early indicators from the new administration are encouraging. The incoming Sheinbaum administration is emphasizing fiscal prudence, industrial policy, public-private collaboration, increased digitalization, and enhanced security as key pillars to strengthen the Mexican economy. The new president will assume office on October 1st. The market anticipates some possible foreign exchange volatility during the transition period, which we will be monitoring closely.