Parsippany, NJ, February 23, 2024 – Lincoln Educational Services Corporation (Nasdaq: LINC) has announced a significant financial move by entering into a $40 million revolving credit facility with Fifth Third Bank. The agreement is set for a term of 36 months and will mature on February 16, 2027. It includes an aggregate principal amount of $40 million with a $10 million sublimit for letters of credit. Moreover, there’s an added benefit of an accordion option that could potentially upsize the credit facility by another $20 million, subject to the satisfaction of certain terms and conditions. This financial arrangement is designed to bolster Lincoln’s capital reserves, aiding in working capital, supporting general corporate purposes, and furthering the company’s strategic growth initiatives. These initiatives notably include the expansion of programs and campuses to accommodate growing student numbers and needs.
Scott Shaw, the President and CEO of Lincoln, remarked on the significance of this new financial partnership. Shaw highlighted the fortified financial standing that the credit facility brings to Lincoln, emphasizing its role in enhancing the company’s ability to implement both near-term and long-term growth strategies. “This new revolving credit facility, complemented with an already robust balance sheet, enhances additional financial resources to execute our near- and longer-term growth initiatives,” Shaw stated. He further noted the intention behind the financial maneuver, which aims to provide Lincoln with increased financial flexibility, ensuring the continuation of positive student experiences. The credit facility, combined with Lincoln’s reported $80 million in cash and no debt, positions the educational institution in a very strong financial situation. Shaw expressed optimism that this setup will enable the creation of lasting benefits not only for students and graduates but also for instructors, corporate partners, and shareholders alike.
Lincoln Educational Services Corporation, established in 1946, has made a name for itself as a premier provider of diversified career-oriented post-secondary education. With a focus on bridging America’s skills gap, Lincoln offers specialized programs in automotive technology, health sciences, skilled trades, business and information technology, as well as hospitality services. Its legacy of equipping the workforce with skilled technicians endures, with Lincoln operating 22 campuses across 13 states under four distinct brands: Lincoln College of Technology, Lincoln Technical Institute, Lincoln Culinary Institute, and Euphoria Institute of Beauty Arts and Sciences.
The announcement also carries forward-looking statements, including Lincoln’s anticipation for student growth and continuous improvement in service delivery amid the pandemic. These statements reflect the company’s current expectations concerning future events which involve certain risks, uncertainties, and assumptions. These risks include but are not limited to regulatory compliance, the impact of federal laws and regulations, competition within the industry, and broader economic conditions. Lincoln Educational Services has ensured a detailed outline of these and other factors in the “Risk Factors” sections of its periodic reports filed with the Securities and Exchange Commission, urging stakeholders to consider these in evaluating future prospects.
The terms and further details of this new credit facility can be found in a Form 8-K filed with the SEC, providing transparency and insight into Lincoln’s strategic financial planning and expected trajectory in the coming years.
Source