Covista Inc 8-K, filed Feb 2, 2021
Covista Inc. (CVSA)
8-K
2021-02-02
For: 2021-02-02
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About this 8-K
Covista Inc filed this 8-K on February 2, 2021.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 2, 2021
(Exact name of registrant as specified in its charter)
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(Address of principal executive offices)
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(866 ) 374-2678
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N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or
Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 7.01 | Regulation FD Disclosure |
In connection with the announcement of its fiscal 2021
second quarter financial results, Adtalem Global Education Inc. (“Adtalem”) has furnished a supplemental disclosure related to its pending acquisition of Walden University. The Acquisition of Walden University Supplemental Materials are
available on Adtalem’s Investor Relations website (www.adtalem.com) and are
attached hereto as Exhibit 99.1 to this Form 8-K and are incorporated herein by reference.
The information furnished pursuant to this Item 7.01, including Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of Adtalem under the Securities Act of 1933,
as amended, or the Exchange Act.
Forward-Looking Statements
Certain statements contained in this Form 8-K and related Supplemental Materials are forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact,
which includes statements regarding the Company’s future growth and the future impacts of the COVID-19 pandemic and the pending acquisition of Walden University. Forward-looking statements can also be identified by words such as “future,”
“believe,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “may,” “will,” “would,” “could,” “can,” “continue,” “preliminary,” “range,” and similar terms. These forward-looking statements are subject to risk and uncertainties that could
cause actual results to differ materially from those described in the statements. These risks and uncertainties include the risk factors described in Item 1A. “Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities
and Exchange Commission (SEC) and our other filings with the SEC.
These forward-looking statements are based on information as of February 2, 2021, and Adtalem assumes no obligation to publicly update or revise its
forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized, except as required by law.
| Item 9.01 | Financial Statements and Exhibits |
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| 99.1 | Acquisition of Walden University Supplemental Materials dated February 2, 2021. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
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ADTALEM GLOBAL EDUCATION INC.
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By:
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/s/ Michael O. Randolfi
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Michael O. Randolfi
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Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
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Date: February 2, 2021
Exhibit 99.1
Acquisition of Walden UniversitySupplemental Materials February 2, 2021
Safe Harbor 2 ©2021 Adtalem Global Education Inc. All rights reserved. Certain statements
contained in this presentation concerning Adtalem Global Education’s future performance, including those statements concerning expectations or plans, constitute “forward-looking statements” within the meaning of the Safe Harbor Provision of
the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as Adtalem Global Education or its management "believes," "expects," "anticipates," "foresees," "forecasts,"
"estimates,” “plans,” “intends” or other words or phrases of similar import. Actual results may differ materially from those projected or implied by these forward-looking statements. Potential risks, uncertainties and other factors that could
cause results to differ are described more fully in Item 1A, "Risk Factors," of our most recent Annual Report on Form 10-K for the fiscal year ended June 30, 2020 filed with the Securities and Exchange Commission (SEC) on August 18, 2020 and
our other filings with the SEC. These forward-looking statements are based on information available to us as of the date any such statements are made, and we do not undertake any obligation to update any forward-looking statement, except as
required by law. Non-GAAP Financial MeasuresThis presentation includes references to certain financial measures that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”). Management
believes that the non-GAAP disclosures provide investors with useful supplemental information regarding the underlying business trends and performance of Adtalem’s ongoing operations and are useful for period-over-period comparisons of such
operations. Adtalem uses these supplemental non-GAAP financial measures internally in our assessment of performance and budgeting process and in our assessment of the potential impact of our proposed acquisition of Walden University. These
non-GAAP financial measures have important limitations and should not be considered as a substitute for measures of Adtalem’s financial performance prepared in accordance with GAAP. For how we define the non-GAAP financial measures, and a
reconciliation of each non-GAAP financial measure to the most directly comparable GAAP measure, please refer to the reconciliations at the end of this presentation.
Transaction Rationale Walden University is the flagship online university of Laureate Education
offering more than 80 programs and is the #1 conferrer of Master of Science in Nursing (“MSN”) degrees, Master of Science in Healthcare Administration (“MHA”) degrees and doctoral degrees in public health in the USRanked #1 among 380
accredited US institutions for conferring doctorates to African AmericansThe acquisition of Walden by Adtalem presents a powerful opportunity to further enhance the Company’s healthcare focus, expand the online platform, generate more scale
and offer substantial synergy potentialThe transaction also positions Adtalem to generate significant long-term value for shareholdersExpected to be accretive to the pro forma Company’s margins and drive top-line growth with renewed focus on
organic investment in WaldenExpected to provide an incremental ~$120M in unlevered free cash flow and be accretive to adjusted EPS by $1.15 in year one Run rate cost synergies of $60M to be fully phased in within 24 months of closing, with
half expected to be realized during the first 12 monthsPro forma company would be the largest healthcare educator in the country with unmatched capabilities to serve its student base through best-in-class processes, support and resources of
both Adtalem and Walden 3 Notes: Adjusted EPS represents earnings from continuing operations excluding special items (e.g., one-time integration costs) and the impact of purchase accounting adjustments. ©2021 Adtalem Global Education
Inc. All rights reserved. For additional information, please see the non-GAAP reconciliations in the Appendix.
Financial Walden Transaction at a Glance 4 ©2021 Adtalem Global Education Inc. All rights
reserved. For additional information, please see the non-GAAP reconciliations in the Appendix. $591MTTM Jun20 Revenue1 29%TTM Jun20 Adjusted EBITDA Margin2 ~5%Historical Revenue CAGR for Healthcare-focused colleges1 #1Enrollment
ranking in Undergrad & Graduate Nursing expected 5.3xPurchase Price Multiple After Tax Step-Up & Cost Synergies4 $456MPro Forma TTM Jun20 EBITDA, including $60M expected synergy2 < 2.0xCommitment to Net Debt ratio
within 24 months post-close 84% Graduate-level enrollment, complementary to Adtalem mix3 Strategic Transaction Attributes Notes:Refer to page 6 for additional detail.Refer to page 11 for additional detail.Refer to page 5 for
additional detail.Refer to page 15 for additional detail.All Walden figures are as reported by Walden. 88%TTM Jun20 EBITDA attributable to Healthcare-focused colleges1
Walden Overview 5 College of Health Sciences College of NursingCollege of Health
Professions 77% of Enrollment in Healthcare-focused colleges College of Management and Technology College of Social and Behavioral Sciences The Richard W. Riley College of Education & Leadership Degree-Level Student
Age Student Ethnicity College Mix 100% Online; 50k+ Enrollment Schools: (i) Psychology (38%), (ii) Counseling (17%), (iii) Social Work (16%), (iv) Human Services (16%), (v) Public Policy & Administration (8%) and (vi) Criminal Justice
(5%) ©2021 Adtalem Global Education Inc. All rights reserved. Notes: College of Social and Behavioral Sciences school mix is based on 2019 degree completions. Walden enrollment data for college mix and degree-level is as of 9/30/2020.
Walden student ethnicity and student age data is as of Fall 2019. Walden figures are as reported by Walden. Enrollment Mix
Walden: Healthcare-Focused College Mix & Growth Rates 6 Healthcare-focused colleges contribute
77% of revenue and 88% of adjusted EBITDA and have realized modest growth in recent yearsSteady historical growth in healthcare-focused colleges has recently accelerated. Calendar 2020 third quarter new enrollments increased 20% for Health
Sciences and 23% for Social & Behavioral Sciences versus prior year Revenue Mix($ millions) Adjusted EBITDA Mix($ millions) Healthcare-focused colleges Non-healthcare-focused colleges Notes: 77% revenue and 88% adjusted EBITDA
metrics noted above based on TTM Jun20 results. Revenue CAGRs calculated using TTM Sep20 as baseline and comparing vs. TTM Sep19 (1 Year), calendar year 2018 (2 Year) and calendar year 2016 (4 Year). Healthcare-focused colleges include Health
Sciences (Nursing & Health Professions) and Social & Behavioral Sciences. Walden figures are as reported by Walden. ©2021 Adtalem Global Education Inc. All rights reserved. Walden Historical Revenue Growth Rates by
Healthcare-Focused College TTM Jun20 TTM Jun20 77%Healthcare-focused 88%Healthcare-focused 1 Year CAGR 2 Year CAGR 4 Year CAGR Health Sciences 4% 5% 6% Social & Behavioral Sciences 5% 4% 5% Walden Total Enrollment by
Healthcare-Focused College (000s) Health Sciences Social & Behavioral Sciences Sep17-Sep20 CAGR: HS = 5%; SBS = 4% For additional information, please see the non-GAAP reconciliations in the Appendix.
Labor Shortage in US Healthcare Expected to Grow 7 Demand for healthcare practice and healthcare
support professionals currently exceeds supply by 44% and 9%, respectively Shifting US demographics expected to increase healthcare professional supply/demand imbalance Increasing older population creates additional demand for healthcare
servicesAging healthcare workforce decreases supply of healthcare professionals Aging US Healthcare Professionals Aging US Population Occupations in Which Demand Exceeds Supply US Population Aged 65+(Millions) 50% of RNs and
physicians are age 50+38% of active physicians are age 56 & older Source: Burning Glass Technologies Age impact on hospital days:Over 65: 3x more hospital daysOver 75: 4x more hospital days Source: US Department of Health and
Human Services Source: US Department of Health and Human Services +3%CAGR ©2021 Adtalem Global Education Inc. All rights reserved.
High Growth Expected in US Nursing Education Market 8 US nursing education market currently $28B
and expected to grow at a 21% CAGR to $60B by 2024Combined business is expected to be #1 in US nursing enrollment, but still less than 10% of total market share which provides continued opportunity to grow +21%CAGR Source: Technavio ($
billions) US Nursing Education Market Top US Nursing Schools by 2019 Enrollment Chamberlain + Walden(Pro Forma) Pro forma largest enrollment; less than 10% of total market share Source: AACN as of Fall 2019; total US nursing enrollment
560k. (000s) ©2021 Adtalem Global Education Inc. All rights reserved.
US Behavioral Health Trends: Growing Demand & Supply Shortages 9 Rapidly growing demand for
behavioral health services driven by greater access, increased awareness and impacts of COVID-19US behavioral health spending has increased 63% over the last decade147 million of the 65 million US adults with behavioral health conditions are
not accessing treatment2Occupations in Counseling and Social Work are expected to grow by 16% and 13%, respectively, in the US over the next 10 years3Growth in YoY online inquiries for public health (+83%) and behavioral science (+64%)
programs each ranked in the top five in the US4Walden’s College of Social & Behavioral Sciences (“SBS”) is well-positioned to benefit from increasing demand Walden SBS YoY new enrollment up in calendar Q3 2020 (+23%) and TTM Sep20 (+8%)
periods US Behavioral Health Services2025 Expected Supply & Demand by Select Occupations5 (000s) Walden College of Social & Behavioral SciencesMix by 2019 Degree Completions SAMHSA Projections of National Expenditures for
Treatment of Mental and Substance Use Disorders, 2009-2020 External research from McKinsey PEPI Practice and clinical literature 2019-2029 US growth rates per US Bureau of Labor StatisticsPer January 2021 BMO report citing Gray Associates
analysis of the top 75 US programs based on inquiry volume. Growth rates represent YoY change in inquiry volume from December 2019 to December 2020Per US Department of Health and Human Services National Projections of Supply and Demand for
selected Behavioral Health Practitioners 2013 - 2025
Transaction Creates Premier National Healthcare Educator 10 ©2021 Adtalem Global Education Inc. All
rights reserved. >80,000Enrollment $1.35BRevenue 10%YoY New Enrollment Growth #1Undergraduate and Graduate Nursing Enrollment in the US #1Provider of US Licensed Physicians #1Provider of MDs, PhDs and Nursing degrees to African
Americans Healthcare-Focused Institutions Notes: Healthcare-focused institutions include Chamberlain, AUC, Ross Vet, Ross Med and Walden’s Health Sciences and Social & Behavioral Sciences colleges. Enrollment figures are as of
9/30/2020. $1.35B revenue represents sum of TTM 9/30/2020 period for Adtalem and Walden healthcare-focused institutions. YoY new enrollment growth represents growth from TTM 9/30/2019 to TTM 9/30/2020 for the combined Adtalem and Walden
healthcare-focused institutions. Combined degree mix excludes Adtalem’s Medical Education Readiness Program (“MERP”). Walden figures utilized in metrics above are as reported by Walden. Combined Healthcare-Focused Degree
Mix Rankings Bachelor’s Master’s Doctoral
Combined Financial Profile 11 Walden acquisition expected to add scale and enhance margin
profile Revenue FY20 Basis (TTM Jun20) Adjusted EBITDA FY20 Basis (TTM Jun20) Adjusted EBITDA Margin FY20 Basis (TTM Jun20) $60M cost synergies $60M cost synergies ©2021 Adtalem Global Education Inc. All rights reserved. ($
millions) ($ millions) For additional information, please see the non-GAAP reconciliations in the Appendix. Notes: Walden figures are as reported by Walden.
Complementary Platforms with Significant Growth Opportunities 12 Combined educational offerings are
complementary Modality (% Online): Adtalem = 56%, Walden = 100%, Combined = 81%Ability to leverage Chamberlain’s 22 physical campuses to offer hybrid programs and expand offeringsDegree-Level (% Graduate): Adtalem = 46%, Walden = 84%,
Combined = 68% Programs & Degrees: legacy Walden degree programs greatly expand and diversify Adtalem’s healthcare-focused offerings High-Potential Revenue Synergies To Explore Student Acquisition and Retention Leverage ‘best of’
student acquisition capabilities Optimize best-in-class student experiencesExpand tech-enabled student services Program Development Design leading hybrid learning modelsDevelop high-demand programs through existing offeringsAdditional
micro-degree and certificate offerings Scale and Coverage Continue expanding national footprint and presenceSeamless undergrad to graduate degree journeyLeverage expanded alumni network B2B Partnerships Leverage new scale to engage
mid- and large-size employer partnersBuild innovative partnerships with inclusive employers ©2021 Adtalem Global Education Inc. All rights reserved. Notes: Modality and degree-Level data based on enrollment as of 9/30/2020.
Graduate Walden Bolsters Critical Online Capabilities 13 Increasing Mix of Online & Hybrid
LearningUS Trends in Mix by Modality (2014-2018)2 The combined company is expected to rank in the top 5 of US online educators1 and bring to bear industry-leading capabilities across the entire online education services value chain,
positioning it to capitalize on growth in online and hybrid learning While increased adoption of online learning will result in new entrants, the combined company’s legacy in delivering a highly differentiated online experience with superior
student outcomes is expected to continue to distinguish its institutions Undergraduate 28% 31% 35% 33% 37% 40% Online Learning (Only) Hybrid Learning Online Education Services Value Chain Notes:Based on 2018 total enrollment
and per IPEDSPer November 2020 McKinsey Higher Education Enrollment report Online Education Services Value Chain Lead
Generation Marketing/Enrollment Content Creation Delivery Student Support Licensure Prep Degree Conferral
Cost Synergy Opportunities 14 Cost synergies expected to deliver $60M annual savings driven by
increased back-office operational efficiencies and thoughtful integration of business unitsAll synergies are designed to align with core integration guiding principle of delivering superior student outcomes Improvements in operational areas
such as streamlined recruitment teams and application of automated solutions Back-office product development redesign (e.g., lowered platform costs, curriculum design process review) Centralized functional support teams and optimized spend
(e.g., indirect procurement, professional services) Optimized marketing spend to reflect ‘best of’ capabilities (e.g., rationalized media & digital channel spend) Enrollment & Admissions Product Development G&A (excl.
IT) Marketing & Advertising IT Extension of shared services support across combined entity and rationalized software & licensing spend Description Synergy Category ©2021 Adtalem Global Education Inc. All rights reserved.
Walden Transaction: EBITDA Multiples 15 ©2021 Adtalem Global Education Inc. All rights
reserved. BASE & COST SYNERGIES 8.4x 7.2x 5.3x 1,432171 1,432 - 200171 1,432 - 200171 + 60 $1,480M purchase price reduced for expected net working capital and debt-like item adjustments assuming a 7/1/2021 transaction close
date.Net present value of cash tax savings resulting from Walden acquisition tax step-up is estimated to be $175M-$225M. The mid-point of this range is utilized for illustrative purposes above. EBITDA multiple inclusive of cost synergies but
excluding impact of tax step-up benefit is 6.2x, calculated as $1,432M divided by $231M (TTM Jun20 EBITDA = $171M plus Cost Synergies = $60M). Walden EBITDA is as reported by Walden. PURCHASE PRICE COMPONENTS:Purchase Price
1,480Estimated Closing Adj. (-) 48 Headline Purchase Price 1,4321Tax Step-Up Value (-) 2002Base Purchase Price 1,232EBITDA COMPONENTS:Walden TTM Jun20 EBITDA 171Expected Cost Synergies (+) 60Post-Synergies EBITDA 2313 BASE HEADLINE INPUTS
& ASSUMPTIONS ($ millions) For additional information, please see the non-GAAP reconciliations in the Appendix.
< 2.0x Cash Flow and Capital Implications 16 Significant incremental cash flow resulting from
the Walden acquisition expected to enable quick debt paydown and fuel investment in the combined businessAnticipated to be accretive to adjusted EPS year one and beyond. Walden transaction ROIC 10%-12%+Management is committed to drive net
leverage below 2.0x within 24 months post-close Incremental Unlevered Free Cash Flow1($ millions; years represent time past close date) Expected Adjusted EPS Accretion2(Excludes special items & purchase accounting effects) Illustrative
Pro Forma Leverage Ratios(Net Debt / Adjusted EBITDA3) ©2021 Adtalem Global Education Inc. All rights reserved. Notes:Unlevered free cash flow includes tax step-up benefit, cost synergies (run-rate $60M per annum), and one-time
integration/synergy costs and excludes incremental interest associated with new debt facility. Adjusted EPS represents earnings per share from continuing operations, excluding special items and expected impact of purchase accounting. Assumes
25.0% combined tax rate. Diluted share count as of 12/31/2020 = 50.6M.Adjusted EBITDA excludes one-time integration costs and includes $60M cost synergies. For additional information, please see the non-GAAP reconciliations in the Appendix.
First Time Residency Match Rates2 First Time Pass Rates1 Superior Student Outcomes Drive
Compelling Value Proposition 17 Adtalem is a high-quality Title IV institution and a good steward of Title IV funds, driving a compelling value proposition for our students and graduates Title IV Funding Mix3 Cohort Default Rates5
©2021 Adtalem Global Education Inc. All rights reserved. USMLE and NCLEX pass rates represent calendar 2020 results. NAVLE pass rate represents calendar 2019 results. Ross Med and AUC residency match rates represent calendar 2020 results.
Title IV funding mix for Adtalem is for FYE 6/30/2020 and for Walden is FYE 12/31/2019. 58% Adtalem mix is based on enterprise revenue, inclusive of Financial Services. Cohort default rates represent three-year cohort default rates for 2017
cohort. Walden MSN represents Walden’s BSN to MSN program. NCLEX USMLEStep 1 NAVLE USMLEStep 1 4 For-ProfitAverage NationalAverage WaldenMSN6 WaldenBSN WaldenOverall AdtalemOverall Chamberlain RossMed AUC RossVet
Mission and Social Impact 18 Adtalem is mission driven and delivers real social value by broadening
access to training for skilled and in-demand careers in healthcareWalden shares our mission and focus on social impact ©2021 Adtalem Global Education Inc. All rights reserved. Notes:Student enrollment mix is based on 2019 for Adtalem and
for Walden. Minority group includes individuals who selected any category other than WhiteFSMB, “FSMB Census of Licensed Physicians in the United States, 2018” Adtalem has been named one of America’s Most Responsible Companies 2021 by
NewsweekSource: CSR Board; Adtalem joined the CSR board, a corporate social responsibility organizationSource: Sustainalytics, 2020; Adtalem earned a #1 rating in Adtalem’s sub-category by Sustainalytics #1Doctorates to African
Americans1 80%Female Students1 55%Minority Students1 #1BSN Degrees to Minority Students1 #1Producer of US Licensed Physicians2 #1ESG Sub-category Rating by Sustainalytics5 Addressing Critical Needs 58%of AUC & RUSM Grads go on to
be Primary Care Physicians #1Undergraduate and Graduate Nursing Enrollment in the US And Doing So Responsibly #1Conferrer of Public Health Doctoral Degrees Serving Diverse Students 1of CSR Board’s 92 Members4 1of America’s Most
Responsible Companies3
Adtalem’s Evolution 19 Adtalem has a long history of successfully executing moves that better align
the Company’s portfolio with evolving market demand – including both large scale divestitures and strategic investments in new growth platformsWalden acquisition complements a streamlined and focused portfolio and ties into a compelling
long-term growth strategy in healthcare Acquisition of & Acquisition of Acquisition of Acquisition of Divestiture of & Acquisition of Divestiture of Acquisition of Additional 40k+ enrollment in healthcare-focused colleges
Notes: Healthcare-focused colleges include Health Sciences (Nursing & Health Professions) and Social & Behavioral Sciences. ©2021 Adtalem Global Education Inc. All rights reserved. Acquisition of
Success with Previous Acquisitions 20 Extensive experience with M&A in service of consistent,
thoughtful, strategic portfolio optimization that drives both shareholder value and positions the Company for future growthPrevious acquisitions have yielded superior student outcomes and strong financial performance Key
Metric(current) RevenueCAGR(since acquisition) MEDICAL & HEALTHCARE FINANCIAL SERVICES 9% 9% 37% 4% 6% 23% 22% 80,000+Global Members 91%NCLEX Pass Rate 88%NAVLE Pass Rate 94%USMLE Step 1 Pass Rate 94%USMLE Step 1 Pass
Rate 99# of Top 100 US Accounting Firms Served 190,000+Mortgage Professionals Served Notes: USMLE and NCLEX pass rates noted above represent calendar 2020 results. NAVLE pass rate represents calendar 2019 results. CAGR rate for Ross
schools calculated on an aggregate basis. All pass rates represent first time pass rates. ©2021 Adtalem Global Education Inc. All rights reserved.
Appendix
Chart 1 – Incremental Unlevered Free Cash Flow 22 ©2021 Adtalem Global Education Inc. All rights
reserved. Preliminary Financial Information We report our financial results in accordance with U.S. generally accepted accounting principles. All projected financial data in this presentation is preliminary, as financial close procedures for
the periods presented are not yet complete. These estimates are not a comprehensive statement of our financial position and results of operations as of and for the periods presented. Actual results may differ materially from these estimates
as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of our internal control over financial reporting, the completion of the preparation and management’s review of our financial
statements for the relevant periods and the subsequent occurrence or identification of events prior to the filing of the first quarter financial results or for the relevant period with the Securities and Exchange Commission.
Chart 2 – Incremental Earnings per Share 23 ©2021 Adtalem Global Education Inc. All rights
reserved. Preliminary Financial Information We report our financial results in accordance with U.S. generally accepted accounting principles. All projected financial data in this presentation is preliminary, as financial close procedures for
the periods presented are not yet complete. These estimates are not a comprehensive statement of our financial position and results of operations as of and for the periods presented. Actual results may differ materially from these estimates
as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of our internal control over financial reporting, the completion of the preparation and management’s review of our financial
statements for the relevant periods and the subsequent occurrence or identification of events prior to the filing of the first quarter financial results or for the relevant period with the Securities and Exchange Commission.
Chart 3 – Leverage & EBITDA 24 ©2021 Adtalem Global Education Inc. All rights
reserved. Preliminary Financial Information We report our financial results in accordance with U.S. generally accepted accounting principles. All projected financial data in this presentation is preliminary, as financial close procedures for
the periods presented are not yet complete. These estimates are not a comprehensive statement of our financial position and results of operations as of and for the periods presented. Actual results may differ materially from these estimates
as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of our internal control over financial reporting, the completion of the preparation and management’s review of our financial
statements for the relevant periods and the subsequent occurrence or identification of events prior to the filing of the first quarter financial results or for the relevant period with the Securities and Exchange Commission. Notes:Adtalem 12
months ended 6/30/20 derived from the actual results as reported in the most recent Adtalem Form 10-K as filed on August 18, 2020, except for the estimated adjusted EBITDA from continuing operations, which is a calculated amount.Walden 12
months ended 6/30/20 represents the unaudited results as reported internally by Walden, except for the estimated adjusted EBITDA from continuing operations, which is a calculated amount based on such results. These results are presented for
illustrative purposes only, and are not a representation of results that may be expected for any future period.Projected Synergies represent estimated synergies related to the expected annualized savings to be realized after the first two
years after the close of the acquisition, upon expected full integration of the operations of Adtalem and Walden.Estimated Gross and Net Debt/Adjusted EBITDA Ratios are calculated as the ratio of estimated gross or net debt to estimated
adjusted EBITDA, a non-GAAP measure. Estimated net debt is defined as the estimated total debt on the balance sheet less estimated cash on balance sheet, at closing of the transaction.
Chart 4 – Leverage & EBITDA 2 Years Post-Close 25 ©2021 Adtalem Global Education Inc. All
rights reserved. Preliminary Financial Information We report our financial results in accordance with U.S. generally accepted accounting principles. All projected financial data in this presentation is preliminary, as financial close
procedures for the periods presented are not yet complete. These estimates are not a comprehensive statement of our financial position and results of operations as of and for the periods presented. Actual results may differ materially from
these estimates as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of our internal control over financial reporting, the completion of the preparation and management’s review of
our financial statements for the relevant periods and the subsequent occurrence or identification of events prior to the filing of the first quarter financial results or for the relevant period with the Securities and Exchange
Commission. Notes:Represents estimated pro forma results of the combined Adtalem and Walden entity 24 months after the close of the acquisition.Combined Adtalem and Walden entity.Projected Synergies represent estimated synergies related to
the expected annualized savings to be realized after the first two years after the close of the acquisition, upon expected full integration of the operations of Adtalem and Walden.Estimated Gross and Net Debt/Adjusted EBITDA Ratios are
calculated as the ratio of estimated gross or net debt to estimated adjusted EBITDA, a non-GAAP measure. Estimated net debt is defined as the estimated total debt on the balance sheet less estimated cash on balance sheet 24 months after the
close of the acquisition.
Chart 5 – Return on Invested Capital 26 ©2021 Adtalem Global Education Inc. All rights
reserved. Preliminary Financial Information We report our financial results in accordance with U.S. generally accepted accounting principles. All projected financial data in this presentation is preliminary, as financial close procedures for
the periods presented are not yet complete. These estimates are not a comprehensive statement of our financial position and results of operations as of and for the periods presented. Actual results may differ materially from these estimates
as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of our internal control over financial reporting, the completion of the preparation and management’s review of our financial
statements for the relevant periods and the subsequent occurrence or identification of events prior to the filing of the first quarter financial results or for the relevant period with the Securities and Exchange Commission. Notes:Adjusted
ROIC is calculated as the ratio of incremental net income from continuing operations, excluding special items, a non-GAAP measure, to invested capital. Invested capital is defined as the purchase price, plus the one-time transaction fees,
after tax, plus the one-time integration costs, after tax.