Friday, technology based education company K12 Inc. (LRN), recorded an increase in profit for the second quarter, boosted by a 20% rise in revenues, as well as better margins. Earnings for the quarter came in ahead of analysts expectations, while revenues fell short. Going forward, the company also reaffirmed its outlook for fiscal year 2010.
The Herndon, Virginia-based company's net income for the second quarter was $9.6 million or $0.32 per share, up from $3.5 million or $0.12 per share in the year-ago period.
On average, eight analysts polled by Thomson Reuters expected the company to earn $0.15 per share for the quarter. Analysts' estimates typically exclude one-time items.
Quarterly revenue rose 20.1% to $93.2 million from $77.6 million in the comparable quarter last year. Six-analysts expected the company to generate revenue of $95.11 million for the second quarter.
Average enrollments for the second quarter was 67,354, an increase of 22.3% from 55,076 in the prior year quarter.
Operating margins increased to 15.3% of revenue, representing a gross increase of 7.6% points, as compared to 7.7% in the same quarter last year.
In the current second quarter, operating income soared 137.7% to $14.3 million from $6.0 million in the corresponding quarter last year.
Income tax expense increased to $4.4 million, including an effective tax rate of 31.4%, from $2.4 million in the year-ago period.
For the six months ended December 31, 2009 , the company reported net income of $16.7 million or $0.56 per share compared to $9.4 million or $0.32 per share a year-ago. Year-to-date revenue was $199.5 million, up from $166.2 million in the prior year period.
Looking forward, the company reaffirmed fiscal 2010, net income in the range of $14.6 million to $17.1 million and revenue in the range of $380 million to $390 million. Operating income is expected to be between $27 million and $31 million for the full year 2010.
Analysts currently expects the company to earn $0.56 per share on revenue of $384.55 million for the full year.
LRN is currently trading at $19.25, up $0.14 or 0.73% on a volume of 0.32 million shares on the NYSE.
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