Jerome Grant: That’s a great question. We have not brought them together. I think one of the things you’ve heard from us over the last few quarters is that our collaboration or operational integration strategies that are being explored for Concorde and UTI were not something we engaged on last year. Last year, we engaged on regulatory issues, controls, back-end, HR, benefits, things along those lines that would not disrupt the trajectory of the business in 2023. As we’ve turned the page into 2024, we’re spending significantly more time talking about collaboration ideas. There’s a large population of the admissions enrollments that are — enrollment counselors that we wouldn’t look at that collaboration because that many of them are very local on the campus taking people who are touring specific campuses for specific reasons.
And of course, that would keep them separate. But as you take a look at how we may want to represent healthcare in the high schools or in the military, that’s something we’re taking a very serious look at right now, specifically the military, which has got a, I think, a great opportunity for us to be significantly more aggressive in the way we represent healthcare professions as people rotate out of the military.
Alex Paris: That makes sense. It’s helpful. I appreciate that color. And then, a question on inflation and its impact on fiscal 2023. Looks like inflation has peaked and it is receding. What’s your experience within UTI and Concorde with inflationary pressures, salaries, the ability to find instructors, et cetera?
Jerome Grant: Well, two things. One, I think one of the things we’ve commented on and continue to comment on is I think the sort of peaking and beginning to subside of the inflationary pressures has created sort of a posture of the new normal out here. I was watching the news this morning and they were talking about how gas had gone down to $3.39 a gallon here in Phoenix and they were high-fiving each other about it, where just a few years ago, that would have been something you didn’t do. So, the new normal, I think, is really out there. And we’re really seeing that in our prospects, where people are like, “Listen, being an Amazon driver isn’t a career, and I really want to look at something that’s durable, good pay, great demand.
And so, I understand that I’m paying more for all of these things, but this is something I want to get on within my life.” And so, what we’ve really seen is more people who in the past, meaning ’22 and ’23, were saying to us, “I’d love to do this, but I just can’t afford it,” now saying, it’s time to get on, right? And so, have we seen a huge rush? No, we haven’t. But the conversations certainly have changed with the prospects.
Troy Anderson: Yeah. And Alex, I don’t know if I think maybe you were also asking about our cost structure, but just quick comment there. I mean, again, we commented on it in prior calls. On the healthcare side, it’s more dynamic of just the supply and demand of healthcare workers. And many of the Concorde instructors, in particular, are active healthcare workers and they’re adjuncts from a teaching perspective. So that does put a little bit of extra pressure on the Concorde side that’s different than the UTI side. But generally speaking, we are not having trouble staffing. We have actually seen a little bit less pressure this past year as well as in some more of the enterprise-type functions, IT, finance, et cetera. Definitely seeing some pullback, in fact, we’re seeing a lot of resumes for some of the positions we’re posting here recently. So, moving in the right direction there.
Alex Paris: Great to hear. And then, the last question is related to your Series A preferred stock. As I recall, you are able to force conversion if the VWAP equals or exceeds $8.33 a share for 20 consecutive days. Seems like we almost get there repeatedly and we don’t just quite get there. Where do we stand now? When would you expect that that would be? This was a great earnings report, so I don’t think you’re going to backtrack. And then, once converted, what’s the dilution thought? There’ll be 20 million more shares, but of course you don’t have the preferred dividend any longer.
Troy Anderson: Sure. And this is Troy. Certainly given the trading we saw exiting the last window throughout the — in-between period and hopefully momentum we’re carrying here out of this earnings release and into the next window which opens on Monday, we’re optimistic that we will achieve the company trigger. It is 20 consecutive trading days within an open window, volume weighted average share price above, $8.33 or above. And we’re — knock on the wood, we’ll get there in this window. The overall dynamic, so on an EPS perspective, we don’t because of the way we calculate our EPS, we’re doing it on the two Class method. The converted shares are already — we’re basically apportioning net income between converted shares and unconverted — or the common shares and the unconverted shares already.
So there’s really no meaningful impact on EPS other than the preferred dividend. It will be a little over 20 million shares that would converse. We go up to 54-million-and-change in total outstanding shares, but it doesn’t really — you get to the same number in a different formula from an EPS perspective.
