LAUREATE EDUCATION, INC. 10-Q

Item 1. Financial Statements (Unaudited) LAUREATE EDUCATION, INC. AND SUBSIDIARIES Consolidated Statements of Operations IN THOUSANDS, except per share amounts For the three months ended March 31, 2024 2023 (Unaudited) (Unaudited) Revenues $ 275,372 $ 251,255 Costs and expenses: Direct costs 253,978 225,312 General and administrative expenses 10,265 10,314 Operating income 11,129 15,629 Interest income 1,911 2,158 Interest expense ( 4,661 ) ( 5,952 ) Other (expense) income, net ( 548 ) 261 Foreign currency exchange loss, net ( 5,607 ) ( 28,952 ) (Loss) gain on disposal of subsidiaries, net ( 3,086 ) 306 Loss from continuing operations before income taxes and equity in net loss of affiliates ( 862 ) ( 16,550 ) Income tax expense ( 9,922 ) ( 10,195 ) Equity in net loss of affiliates, net of tax ( 7 ) ( 3 ) Loss from continuing operations ( 10,791 ) ( 26,748 ) Loss from discontinued operations, net of tax of $ 0 for both periods ( 57 ) ( 14 ) Net loss ( 10,848 ) ( 26,762 ) Net loss attributable to noncontrolling interests 97 155 Net loss attributable to Laureate Education, Inc. $ ( 10,751 ) $ ( 26,607 ) Basic and diluted earnings (loss) per share: Loss from continuing operations $ ( 0.07 ) $ ( 0.17 ) Loss from discontinued operations — — Basic and diluted loss per share $ ( 0.07 ) $ ( 0.17 ) The accompanying notes are an integral part of these consolidated financial statements. 2 LAUREATE EDUCATION, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income IN THOUSANDS For the three months ended March 31, 2024 2023 (Unaudited) (Unaudited) Net loss $ ( 10,848 ) $ ( 26,762 ) Other comprehensive income: Foreign currency translation adjustment, net of tax of $ 0 for both periods 26,883 72,797 Total other comprehensive income 26,883 72,797 Comprehensive income 16,035 46,035 Net comprehensive loss attributable to noncontrolling interests 97 149 Comprehensive income attributable to Laureate Education, Inc. $ 16,132 $ 46,184 The accompanying notes are an integral part of these consolidated financial statements. 3 LAUREATE EDUCATION, INC. AND SUBSIDIARIES Consolidated Balance Sheets IN THOUSANDS, except per share amounts March 31, 2024 December 31, 2023 Assets (Unaudited) Current assets: Cash and cash equivalents $ 126,226 $ 89,392 Restricted cash 7,616 7,505 Receivables: Accounts and notes receivable 159,145 173,571 Other receivables 8,417 3,509 Allowance for doubtful accounts ( 85,418 ) ( 84,967 ) Receivables, net 82,144 92,113 Income tax receivable 12,278 15,224 Prepaid expenses and other current assets 33,427 19,284 Current assets held for sale 756 889 Total current assets 262,447 224,407 Property and equipment: Land 139,289 129,229 Buildings 377,868 377,954 Furniture, equipment and software 559,968 556,134 Leasehold improvements 143,978 137,171 Construction in-progress 18,900 22,673 Accumulated depreciation and amortization ( 672,538 ) ( 660,935 ) Property and equipment, net 567,465 562,226 Operating lease right-of-use assets, net 364,114 371,611 Goodwill 672,502 661,482 Tradenames, net 171,305 169,183 Deferred costs, net 4,781 4,981 Deferred income taxes 71,321 71,426 Other assets 46,430 44,896 Long-term assets held for sale 16,022 15,404 Total assets $ 2,176,387 $ 2,125,616 The accompanying notes are an integral part of these consolidated financial statements. 4 LAUREATE EDUCATION, INC. AND SUBSIDIARIES Consolidated Balance Sheets (continued) IN THOUSANDS, except per share amounts March 31, 2024 December 31, 2023 Liabilities and stockholders' equity (Unaudited) Current liabilities: Accounts payable $ 35,824 $ 43,239 Accrued expenses 72,696 69,464 Accrued compensation and benefits 79,263 96,652 Deferred revenue and student deposits 121,305 69,351 Current portion of operating leases 59,086 57,514 Current portion of long-term debt and finance leases 49,411 52,828 Income taxes payable 29,027 40,204 Other current liabilities 26,352 22,714 Current liabilities held for sale 1,177 1,248 Total current liabilities 474,141 453,214 Long-term operating leases, less current portion 342,983 360,120 Long-term debt and finance leases, less current portion 176,551 112,241 Deferred compensation 9,636 9,511 Income taxes payable 137,505 140,492 Deferred income taxes 57,219 56,490 Other long-term liabilities 35,326 34,151 Long-term liabilities held for sale 10,418 10,259 Total liabilities 1,243,779 1,176,478 Redeemable equity 1,398 1,398 Stockholders' equity: Common stock, par value $ 0.004 per share – 700,000 shares authorized, 155,160 shares issued and outstanding as of March 31, 2024 and 157,586 shares issued and outstanding as of December 31, 2023 621 630 Additional paid-in capital 1,160,865 1,179,721 Retained earnings 17,411 41,862 Accumulated other comprehensive loss ( 245,261 ) ( 272,144 ) Total Laureate Education, Inc. stockholders' equity 933,636 950,069 Noncontrolling interests ( 2,426 ) ( 2,329 ) Total stockholders' equity 931,210 947,740 Total liabilities and stockholders' equity $ 2,176,387 $ 2,125,616 The accompanying notes are an integral part of these consolidated financial statements. 5 LAUREATE EDUCATION, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows IN THOUSANDS For the three months ended March 31, 2024 2023 Cash flows from operating activities (Unaudited) (Unaudited) Net loss $ ( 10,848 ) $ ( 26,762 ) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 18,050 16,721 Amortization of operating lease right-of-use assets 9,765 7,189 Loss on sales and disposal of subsidiaries and property and equipment, net 3,251 1,524 Non-cash interest expense 324 245 Non-cash share-based compensation expense 1,409 1,124 Bad debt expense 6,307 2,788 Deferred income taxes 1,267 ( 607 ) Unrealized foreign currency exchange loss 4,964 28,949 Non-cash loss from non-income tax contingencies — 61 Other, net 3,221 3,724 Changes in operating assets and liabilities: Receivables 2,301 4,224 Prepaid expenses and other assets ( 14,475 ) ( 12,152 ) Accounts payable and accrued expenses ( 26,597 ) ( 26,159 ) Income tax receivable/payable, net ( 11,986 ) ( 32,663 ) Deferred revenue and other liabilities 46,200 58,263 Net cash provided by operating activities 33,153 26,469 Cash flows from investing activities Purchase of property and equipment ( 15,884 ) ( 5,833 ) Receipts from sales of property and equipment 48 4 Net (payments) receipts from sales of discontinued operations ( 154 ) 250 Net cash used in investing activities ( 15,990 ) ( 5,579 ) Cash flows from financing activities Proceeds from issuance of long-term debt, net of original issue discount 81,091 38,000 Payments on long-term debt ( 26,545 ) ( 15,227 ) Payment of dividend equivalent rights for vested share-based awards ( 1,598 ) ( 2,318 ) Payments to purchase noncontrolling interests — ( 123 ) Proceeds from exercise of stock options 29 1,423 Withholding of shares to satisfy tax withholding for vested stock awards and exercised stock options ( 1,693 ) ( 611 ) Payments to repurchase common stock ( 32,894 ) — Payments of debt issuance costs ( 9 ) — Net cash provided by financing activities 18,381 21,144 Effects of exchange rate changes on Cash and cash equivalents and Restricted cash 1,123 3,462 Change in cash included in current assets held for sale 278 — Net change in Cash and cash equivalents and Restricted cash 36,945 45,496 Cash and cash equivalents and Restricted cash at beginning of period 96,897 93,784 Cash and cash equivalents and Restricted cash at end of period $ 133,842 $ 139,280 The accompanying notes are an integral part of these consolidated financial statements. 6 Laureate Education, Inc. and Subsidiaries Notes to Consolidated Financial Statements (Dollars and shares in thousands) Note 1. Description of Business Laureate Education, Inc. and subsidiaries (hereinafter Laureate, we, us, our, or the Company) provide higher education programs and services to students through licensed universities and higher education institutions (institutions). Laureate's programs are provided through institutions that are campus-based and through electronically distributed educational programs (online). We are domiciled in Delaware as a public benefit corporation, a demonstration of our long-term commitment to our mission to benefit our students and society. The Company completed its initial public offering (IPO) on February 6, 2017, and its shares are listed on the Nasdaq Global Select Market under the symbol “LAUR.” The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, these financial statements include all adjustments considered necessary to present a fair statement of our consolidated results of operations, financial position and cash flows. Operating results for any interim period are not necessarily indicative of the results that may be expected for the full year. These unaudited Consolidated Financial Statements should be read in conjunction with Laureate's audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the 2023 Form 10-K). Note 2. Revenue Revenue Recognition Laureate's revenues primarily consist of tuition and educational service revenues. We also generate other revenues from student fees and other education-related activities. These other revenues are less material to our overall financial results and have a tendency to trend with tuition revenues. Revenues are recognized when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. These revenues are recognized net of scholarships and other discounts, refunds and waivers. Laureate's institutions have various billing and academic cycles. We determine revenue recognition through the five-step model prescribed by ASC Topic 606, Revenue from Contracts with Customers , as follows: • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, we satisfy a performance obligation. We assess collectability on a portfolio basis prior to recording revenue. Generally, students cannot re-enroll for the next academic session without satisfactory resolution of any past-due amounts. If a student withdraws from an institution, Laureate's obligation to issue a refund depends on the refund policy at that institution and the timing of the student's withdrawal. Generally, our refund obligations are reduced over the course of the academic term. We record refunds as a reduction of deferred revenue as applicable. 7 The following table shows the components of Revenues by reportable segment and as a percentage of total revenue for the three months ended March 31, 2024 and 2023: Mexico Peru Corporate (1) Total 2024 Tuition and educational services $ 267,315 $ 54,296 $ — $ 321,611 117 % Other 47,168 11,974 47 59,189 21 % Gross revenue 314,483 66,270 47 380,800 138 % Less: Discounts / waivers / scholarships ( 100,403 ) ( 5,025 ) — ( 105,428 ) ( 38 ) % Total $ 214,080 $ 61,245 $ 47 $ 275,372 100 % 2023 Tuition and educational services $ 223,008 $ 63,027 $ — $ 286,035 114 % Other 34,694 11,073 59 45,826 18 % Gross revenue 257,702 74,100 59 331,861 132 % Less: Discounts / waivers / scholarships ( 75,739 ) ( 4,867 ) — ( 80,606 ) ( 32 ) % Total $ 181,963 $ 69,233 $ 59 $ 251,255 100 % (1) Includes the elimination of inter-segment revenues. Contract Balances The timing of billings, cash collections and revenue recognition results in accounts receivable (contract assets) and Deferred revenue and student deposits (contract liabilities) on the Consolidated Balance Sheets. We have various billing and academic cycles and recognize student receivables when an academic session begins, although students generally enroll in courses prior to the start of the academic session. Receivables are recognized only to the extent that it is probable that we will collect substantially all of the consideration to which we are entitled in exchange for the goods and services that will be transferred to the student. We receive advance payments or deposits from our students before revenue is recognized, which are recorded as contract liabilities in deferred revenue and student deposits. Payment terms vary by university with some universities requiring payment in advance of the academic session and other universities allowing students to pay in installments over the term of the academic session. All of our contract assets are considered accounts receivable and are included within the Accounts and notes receivable balance in the accompanying Consolidated Balance Sheets. Total accounts receivable from our contracts with students were $ 159,145 and $ 173,571 as of March 31, 2024 and December 31, 2023, respectively. The decrease in the contract assets balance at March 31, 2024 compared to December 31, 2023 was primarily driven by collections, in particular the repayment of outstanding amounts by students re-enrolling for the next academic session. The first and third calendar quarters generally coincide with the primary and secondary intakes for our larger institutions. All contract asset amounts are classified as current. Contract liabilities in the amount of $ 121,305 and $ 69,351 were included within the Deferred revenue and student deposits balance in the current liabilities section of the accompanying Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023, respectively. The increase in the contract liability balance during the period ended March 31, 2024 was the result of semester billings and cash payments received in advance of satisfying performance obligations, partially offset by revenue recognized during that period. Revenue recognized during the three months ended March 31, 2024 that was included in the contract liability balance at the beginning of the year was approximately $ 51,701 . 8 Note 3. Assets Held for Sale During the second quarter of 2023, two of the Company’s subsidiaries that operate K-12 educational programs in Mexico met the criteria for classification as held for sale under ASC 360-10-45-9, “Long-Lived Assets Classified as Held for Sale.” The sale of the K-12 campuses is intended to allow the Mexico segment to focus on its core business. The planned sale of this disposal group does not represent a strategic shift and therefore does not qualify for presentation as a discontinued operation in the Consolidated Financial Statements. In addition, during 2023, two parcels of land at campuses in Mexico and a parcel of land in the United States met the criteria for classification as held for sale under ASC 360-10-45-9. The assets and liabilities are recorded at the lower of their carrying values or their estimated fair values less costs to sell. The carrying amounts of the major classes of assets and liabilities that were classified as held for sale are presented in the following table: March 31, 2024 December 31, 2023 Assets Held for Sale Cash and cash equivalents $ 228 $ 502 Receivables, net 481 376 Property and equipment, net 6,787 6,310 Operating lease right-of-use assets, net 9,235 9,094 Other assets 47 11 Total assets held for sale $ 16,778 $ 16,293 Liabilities Held for Sale Deferred revenue and student deposits $ 771 $ 731 Operating leases, including current portion 9,355 9,214 Long-term debt, including current portion 867 859 Other liabilities 602 703 Total liabilities held for sale $ 11,595 $ 11,507 The long-term debt balance represents a finance lease for property. Note 4. Business and Geographic Segment Information Laureate’s educational services are offered through two reportable segments: Mexico and Peru. Laureate determines its segments based on information utilized by the chief operating decision maker to allocate resources and assess performance. Our segments generate revenues by providing an education that emphasizes profession-oriented fields of study with undergraduate and graduate degrees in a wide range of disciplines. Our educational offerings utilize campus-based, online and hybrid (a combination of online and in-classroom) courses and programs to deliver their curriculum. The Mexico and Peru markets are characterized by what we believe is a significant imbalance between supply and demand. The demand for higher education is large and growing and is fueled by several demographic and economic factors, including a growing middle class, global growth in services and technology-related industries and recognition of the significant personal and economic benefits gained by graduates of higher education institutions. The target demographics are primarily 18- to 24-year-olds in the countries in which we compete. We compete with other private higher education institutions on the basis of price, educational quality, reputation and location. We believe that we compare favorably with competitors because of our focus on quality, professional-oriented curriculum and the competitive advantages provided by our network. There are a number of private and public institutions in both countries in which we operate, and it is difficult to predict how the markets will evolve and how many competitors there will be in the future. We expect competition to increase as the Mexican and Peruvian markets mature. Essentially all of our revenues were generated from private pay sources as there are no material government-sponsored loan programs in Mexico or Peru. Specifics related to both of our reportable segments are discussed below. In Mexico, the private sector plays a meaningful role in higher education, bridging supply and demand imbalances created by a lack of capacity at public universities. Laureate owns two nationally licensed institutions and is present throughout the country with a footprint of over 30 campuses. Students in our Mexican institutions typically finance their own education. 9 In Peru, private universities are increasingly providing the capacity to meet growing demand in the higher-education market. Laureate owns three institutions in Peru, with a footprint of 19 campuses. Inter-segment transactions are accounted for in a similar manner as third-party transactions and are eliminated in consolidation. The Corporate amounts presented in the following tables include corporate charges that were not allocated to our reportable segments and adjustments to eliminate inter-segment items. We evaluate segment performance based on Adjusted EBITDA, which is a non-GAAP performance measure defined as Loss from continuing operations before income taxes and equity in net loss of affiliates, adding back the following items: (Loss) gain on disposal of subsidiaries, net, Foreign currency exchange loss, net, Other (expense) income, net, Interest expense, Interest income, Depreciation and amortization expense, Loss on impairment of assets, and Share-based compensation expense. Adjusted EBITDA is a key measure used by our management and Board of Directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Additionally, Adjusted EBITDA is a key financial measure used by the compensation committee of our Board of Directors and our Chief Executive Officer in connection with the payment of incentive compensation to our executive officers and other members of our management team. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. We use total assets as the measure of assets for reportable segments. The following tables provide financial information for our reportable segments, including a reconciliation of Adjusted EBITDA to Loss from continuing operations before income taxes and equity in net loss of affiliates, as reported in the Consolidated Statements of Operations: For the three months ended March 31, 2024 2023 Revenues Mexico $ 214,080 $ 181,963 Peru 61,245 69,233 Corporate 47 59 Total Revenues $ 275,372 $ 251,255 Adjusted EBITDA of reportable segments Mexico $ 59,916 $ 48,946 Peru ( 20,710 ) ( 6,455 ) Total Adjusted EBITDA of reportable segments 39,206 42,491 Reconciling items: Corporate ( 8,618 ) ( 9,017 ) Depreciation and amortization expense ( 18,050 ) ( 16,721 ) Share-based compensation expense ( 1,409 ) ( 1,124 ) Operating income 11,129 15,629 Interest income 1,911 2,158 Interest expense ( 4,661 ) ( 5,952 ) Other (expense) income, net ( 548 ) 261 Foreign currency loss, net ( 5,607 ) ( 28,952 ) (Loss) gain on disposal of subsidiaries, net ( 3,086 ) 306 Loss from continuing operations before income taxes and equity in net loss of affiliates $ ( 862 ) $ ( 16,550 ) 10 March 31, 2024 December 31, 2023 Assets Mexico $ 1,453,237 $ 1,396,605 Peru 559,927 559,428 Corporate 163,223 169,583 Total assets $ 2,176,387 $ 2,125,616 Note 5. Goodwill The change in the net carrying amount of Goodwill from December 31, 2023 through March 31, 2024 was composed of the following items: Mexico Peru Total Balance at December 31, 2023 $ 588,431 $ 73,051 $ 661,482 Currency translation adjustments 11,792 ( 772 ) 11,020 Balance at March 31, 2024 $ 600,223 $ 72,279 $ 672,502 Note 6. Debt Outstanding long-term debt was as follows: March 31, 2024 December 31, 2023 Senior long-term debt: Senior Secured Credit Facility (stated maturity date September 18, 2028) $ 121,000 $ 59,000 Other debt: Lines of credit 10,078 10,864 Notes payable and other debt 35,094 40,009 Total senior and other debt 166,172 109,873 Finance lease obligations and sale-leaseback financings 62,024 57,568 Total long-term debt and finance leases 228,196 167,441 Less: total unamortized deferred financing costs 2,234 2,372 Less: current portion of long-term debt and finance leases 49,411 52,828 Long-term debt and finance leases, less current portion $ 176,551 $ 112,241 Senior Secured Credit Facility Under its credit agreement (the Amended Credit Agreement), the Company maintains a revolving credit facility that provides for $ 145,000 of revolving credit loans maturing October 2024 (the Series 2024 Tranche) and $ 155,000 of revolving credit loans maturing September 2028 (the Series 2028 Tranche) for a $ 300,000 aggregate revolving credit facility (the Revolving Credit Facility). The credit available to be borrowed under the Amended Credit Agreement, whether as revolving loans or term loans, if any, are referred to herein collectively as the “Senior Secured Credit Facility.” As of March 31, 2024 and December 31, 2023, the Senior Secured Credit Facility had a total outstanding balance of $ 121,000 and $ 59,000 , respectively. Estimated Fair Value of Debt As of March 31, 2024 and December 31, 2023, the estimated fair value of our debt approximated its carrying value. Certain Covenants As of March 31, 2024, our Amended Credit Agreement contained certain negative covenants including, among others: (1) limitations on additional indebtedness; (2) limitations on dividends; (3) limitations on asset sales, including the sale of ownership interests in subsidiaries and sale-leaseback transactions; and (4) limitations on liens, guarantees, loans or 11 investments. The Amended Credit Agreement also provides, solely with respect to the revolving credit facility, that the Company shall not permit its Consolidated Senior Secured Debt to Consolidated EBITDA ratio, as defined in the Amended Credit Agreement, to exceed 3.00 x as of the last day of each quarter commencing with the quarter ending December 31, 2019 and thereafter. The agreement also provides that if less than 25 % of the revolving credit facility is utilized as of that date, then such financial covenant shall not apply. As of March 31, 2024, more than 25% of the revolving credit facility was utilized, and we were in compliance with the leverage ratio covenant. In addition, indebtedness at some of our locations contain financial maintenance covenants. We were in compliance with these covenants as of March 31, 2024. Note 7. Commitments and Contingencies Loss Contingencies Laureate is subject to legal actions arising in the ordinary course of its business. In management's opinion, we have adequate legal defenses, insurance coverage and/or accrued liabilities with respect to the eventuality of such actions. We do not believe that any settlement would have a material impact on our Consolidated Financial Statements. Income Tax Contingencies As of March 31, 2024 and December 31, 2023, Laureate had recorded cumulative liabilities for income tax contingencies of $ 137,505 and $ 140,492 , respectively. Non-Income Tax Loss Contingencies Laureate has accrued liabilities for certain civil actions against our institutions, a portion of which existed prior to our acquisition of these entities. Laureate intends to vigorously defend against these matters. As of March 31, 2024 and December 31, 2023, approximately $ 20,100 and $ 19,800 , respectively, of loss contingencies were included in Other long-term liabilities and Other current liabilities on the Consolidated Balance Sheets. We have also identified certain loss contingencies that we have assessed as being reasonably possible of loss, but not probable of loss, and could have an adverse effect on the Company’s results of operations if the outcomes are unfavorable. In the aggregate, we estimate that the reasonably possible loss for these unrecorded contingencies could be up to approximately $ 23,200 if the outcomes were unfavorable. Guarantees During the first quarter of 2021, one of our Peruvian institutions issued a bank guarantee in order to appeal a preliminary tax assessment received related to tax audits of 2014 and 2015. In addition, during the fourth quarter of 2023, the same institution issued a bank guarantee in order to appeal a tax assessment received related to the tax audit of 2009. As of March 31, 2024 and December 31, 2023, the total amount of the guarantees was approximately $ 12,600 and $ 12,700 , respectively. 12 Note 8. Stockholders’ Equity The components of net changes in stockholders’ equity for the three months ended March 31, 2024 are as follows: Laureate Education, Inc. Stockholders Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Non-controlling interests Total stockholders’ equity Shares Amount Balance at December 31, 2023 157,586 $ 630 $ 1,179,721 $ 41,862 $ ( 272,144 ) $ ( 2,329 ) $ 947,740 Non-cash share-based compensation — — 1,409 — — — 1,409 Purchase and retirement of common stock ( 2,607 ) ( 10 ) ( 19,512 ) ( 13,700 ) — — ( 33,222 ) Exercise of stock options and vesting of restricted stock units, net of shares withheld to satisfy tax withholding 181 1 ( 774 ) — — — ( 773 ) Equitable adjustments to stock-based awards — — 21 — — — 21 Net loss — — — ( 10,751 ) — ( 97 ) ( 10,848 ) Foreign currency translation adjustment, net of tax of $ 0 — — — — 26,883 — 26,883 Balance at March 31, 2024 155,160 $ 621 $ 1,160,865 $ 17,411 $ ( 245,261 ) $ ( 2,426 ) $ 931,210 Stock Repurchase On March 5, 2024, the Company entered into a Stock Purchase Agreement with each of ILM Investments Limited Partnership, Torreal Sociedad de Capital Riesgo S.A., Pedro del Corro García-Lomas, a member of Laureate’s Board of Directors, Ana Gómez Cuesta and José Diaz-Rato Revuelta (together, the Sellers), pursuant to which the Company purchased an aggregate of 2,607 shares of our common stock from the Sellers at a purchase price of $ 12.62 per share for an aggregate purchase price of $ 32,894 . This repurchase, which was approved as a related party transaction by the Audit and Risk Committee of the Company’s Board of Directors, was pursuant to the Company’s existing $ 100,000 stock purchase program that was announced on February 22, 2024 . Under this stock repurchase program, all shares repurchased are immediately retired. Upon retirement of repurchased stock, the excess of the purchase price plus excise tax over par value is allocated to additional paid-in capital, subject to certain limitations. Any remainder is allocated to retained earnings. The components of net changes in stockholders’ equity for the three months ended March 31, 2023 are as follows: Laureate Education, Inc. Stockholders Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock at cost Non-controlling interests Total stockholders’ equity Shares Amount Balance at December 31, 2022 157,013 $ 923 $ 2,204,755 $ 39,244 $ ( 442,424 ) $ ( 1,026,272 ) $ ( 1,869 ) $ 774,357 Non-cash share-based compensation — — 1,124 — — — — 1,124 Exercise of stock options and vesting of restricted stock units, net of shares withheld to satisfy tax withholding 161 1 ( 448 ) — — — — ( 447 ) Equitable adjustments to stock-based awards — — ( 13 ) — — — — ( 13 ) Change in noncontrolling interests — — 16 — — — (140) (124) Net loss — — — ( 26,607 ) — — ( 155 ) ( 26,762 ) Foreign currency translation adjustment, net of tax of $ 0 — — — — 72,791 — 6 72,797 Balance at March 31, 2023 157,174 $ 924 $ 2,205,434 $ 12,637 $ ( 369,633 ) $ ( 1,026,272 ) $ ( 2,158 ) $ 820,932 13 Share-based Compensation Expense During the three months ended March 31, 2024 and 2023, the Company recorded share-based compensation expense for restricted stock unit awards of $ 1,409 and $ 1,124 , respectively. Accumulated Other Comprehen sive Income (Loss) Accumulated other comprehensive income (loss) (AOCI) in our Consolidated Balance Sheets includes the accumulated translation adjustments arising from translation of foreign subsidiaries’ financial statements, the unrealized gain on a derivative designated as an effective net investment hedge, and the accumulated net gains or losses that are not recognized as components of net periodic benefit cost for our minimum pension liability. The AOCI related to the net investment hedge will be deferred from earnings until the sale or liquidation of the hedged investee. The components of these balances were as follows: March 31, 2024 December 31, 2023 Laureate Education, Inc. Noncontrolling Interests Total Laureate Education, Inc. Noncontrolling Interests Total Foreign currency translation adjustment $ ( 255,171 ) $ 962 $ ( 254,209 ) $ ( 282,054 ) $ 962 $ ( 281,092 ) Unrealized gain on derivatives 10,416 — 10,416 10,416 — 10,416 Minimum pension liability adjustment ( 506 ) — ( 506 ) ( 506 ) — ( 506 ) Accumulated other comprehensive loss $ ( 245,261 ) $ 962 $ ( 244,299 ) $ ( 272,144 ) $ 962 $ ( 271,182 ) Note 9. Income Taxes Laureate's income tax provisions for all periods consist of federal, state and foreign income taxes. The tax provisions for the three months ended March 31, 2024 and 2023 are based on estimated full-year effective tax rates, adjusted for discrete income tax items related specifically to the interim periods. Laureate has operations in multiple countries at various statutory tax rates and other operations that are loss-making entities for which it is not more likely than not that a tax benefit will be realized on the loss. For the three months ended March 31, 2024, the Company recognized income t ax expense of $ 9,922 , as compared to $ 10,195 in the prior year period. Income tax expense for the three months ended March 31, 2024 and 2023 was attributable to pretax income, the jurisdictional mix of earnings, and pretax losses for which the Company cannot recognize a tax benefit. In addition, the Company benefited from changes in reserves for uncertain tax provisions in both periods. 14 Note 10. Earnings (Loss) Per Share Laureate computes basic earnings per share (EPS) by dividing income available to common shareholders by the weighted average number of common shares outstanding for the reporting period. Diluted EPS reflects the potential dilution that would occur if share-based compensation awards were exercised or converted into common stock. To calculate the diluted EPS, the basic weighted average number of shares is increased by the dilutive effect of stock options, restricted stock units, and any other share-based compensation arrangements determined using the treasury stock method. The following table summarizes the computations of basic and diluted earnings (loss) per share: For the three months ended March 31, 2024 2023 Numerator used in basic and diluted earnings (loss) per common share for continuing operations: Loss from continuing operations $ ( 10,791 ) $ ( 26,748 ) Loss attributable to noncontrolling interests 97 155 Net loss from continuing operations for basic and diluted loss per share $ ( 10,694 ) $ ( 26,593 ) Numerator used in basic and diluted earnings (loss) per common share for discontinued operations: Net loss from discontinued operations for basic and diluted loss per share $ ( 57 ) $ ( 14 ) Denominator used in basic and diluted earnings (loss) per common share: Basic and diluted weighted average shares outstanding 157,011 157,197 Basic and diluted earnings (loss) per share: Loss from continuing operations $ ( 0.07 ) $ ( 0.17 ) Loss from discontinued operations — — Basic and diluted loss per share $ ( 0.07 ) $ ( 0.17 ) The following table summarizes the number of stock options and restricted stock units that were excluded from the diluted EPS calculations because the effect would have been antidilutive: For the three months ended March 31, 2024 2023 Stock options 359 551 Restricted stock units 722 692 Note 11. Related Party Transactions Stock Repurchase As discussed in Note 8, Stockholders’ Equity, on March 5, 2024 , the Company entered into a Stock Purchase Agreement with the Sellers pursuant to which the Company purchased an aggregate of 2,607 shares of our common stock from the Sellers at a purchase price of $ 12.62 per share for an aggregate purchase price of $ 32,894 . This repurchase, which was approved as a related party transaction by the Audit and Risk Committee of the Company’s Board of Directors, was pursuant to the Company’s existing $ 100,000 share repurchase program that was announced on February 22, 2024 . 15 Note 12. Legal and Regulatory Matters Laureate is subject to legal proceedings arising in the ordinary course of business. In management’s opinion, we have adequate legal defenses, insurance coverage, and/or accrued liabilities with respect to the eventuality of these actions. Management believes that any settlement would not have a material impact on Laureate’s financial position, results of operations, or cash flows. Our institutions are subject to uncertain and varying laws and regulations, and any changes to these laws or regulations or their application to us may materially adversely affect our business, financial condition and results of operations. There have been no material changes to the laws and regulations affecting our higher education institutions that are described in our 2023 Form 10‑K. Note 13. Supplemental Cash Flow Information Reconciliation of Cash and cash equivalents and Restricted cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets, as well as the March 31, 2023 balance. The March 31, 2024 and March 31, 2023 balances sum to the amounts shown in the Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023: March 31, 2024 March 31, 2023 December 31, 2023 Cash and cash equivalents $ 126,226 $ 130,636 $ 89,392 Restricted cash 7,616 8,644 7,505 Total Cash and cash equivalents and Restricted cash shown in the Consolidated Statements of Cash Flows $ 133,842 $ 139,280 $ 96,897 Restricted cash represents cash that is not immediately available for use in current operations. 16