DeVry expects revenue shortfall, plans 570 job cuts

Facing falling enrollment and rising expenses, Downers Grove-based DeVry Inc. plans to cut about 570 jobs because it expects fourth-quarter earnings to be lower than expected, the for-profit educational firm said Monday in a filing with the U.S. Securities and Exchange Commission.

The cuts will be primarily at DeVry University and Carrington Colleges Group on the West Coast, and could include other institutions. The streamlining is expected to save about $50 million. The number of local job cuts was not yet available, a DeVry spokesman said.

The company anticipates revenue for its fiscal fourth quarter, ending June 30, of between $500 million and $510 million. Total operating costs and expenses in the quarter are anticipated to be between $465 million and $475 million, which is expected to produce earnings per share in the range of 43 cents to 46 cents.

The company said the shortfall in revenue is from the increased use of scholarships awarded to students in DeVry University’s May and July classes, and higher-than-anticipated operating costs in the fourth quarter.

“While we are disappointed with this quarter’s results, we are optimistic about mid- and long- term growth in higher education,” Daniel Hamburger, DeVry’s president and chief executive officer, said in a statement. “We are executing a plan to improve DeVry’s near-term performance. The most important elements of the plan are to align our cost structure with our enrollment levels, to regain enrollment growth, and to make targeted investments to drive future growth.”

New enrollments for the summer term at DeVry University are expected to decrease about 15 percent to 17 percent, compared to last year’s term, the company said.

Carrington Colleges Group also expects a slowing rate of decline in new enrollments for the three-month period ending June 30, with new students decreasing between 19 percent and 21 percent, compared to a decline of nearly 31 percent reported in the spring, the filing said.

DeVry will report its earnings for its fiscal 2012 fourth-quarter and full-year and summer enrollment on Aug. 9.