We are a Delaware corporation incorporated in 1946. Our principal executive offices are located at 13000 North Meridian Street, Carmel, Indiana 46032-1404, and our telephone number is (317) 706-9200. From 1966 until our initial public offering on December 27, 1994, we were wholly owned by ITT Corporation, an Indiana corporation, formerly a Delaware corporation and formerly known as ITT Industries, Inc. (“Old ITT”). On September 29, 1995, ITT Corporation, a Nevada corporation (“ITT”), succeeded to the interests of Old ITT in the beneficial ownership of 83.3% of our common stock. Public offerings of our common stock by ITT in June 1998 and February 1999 and our repurchase of 1,500,000 shares of our common stock from ITT in February 1999 completely eliminated ITT’s beneficial ownership of any of our common stock.
We are a leading for-profit provider of postsecondary degree programs in the United States based on revenue and student enrollment. As of December 31, 2009, we were offering master, bachelor and associate degree programs to approximately 80,000 students. As of December 31, 2009, we had 125 locations (including 121 campuses and four learning sites) in 38 states. All of our institutions are authorized by the applicable education authorities of the states in which they operate, and are accredited by an accrediting commission recognized by the U.S. Department of Education (“ED”). We design our education programs, after consultation with employers and other constituents, to help graduates prepare for careers in various fields involving their areas of study. We have provided career-oriented education programs since 1969 under the “ITT Technical Institute” name and since June 2009 under the “Daniel Webster College” name.
In 2009, we began operations at ten new ITT Technical Institute campuses and converted five learning sites into five ITT Technical Institute campuses. In 2010, we plan to begin operations at eight to ten new ITT Technical Institute and/or Daniel Webster College (“DWC”) locations. In 2009, we continued our efforts to diversify our program offerings by developing programs at different levels in technology and non-technology fields of study that we intend to offer at our campuses and deliver entirely in residence, entirely online over the Internet or partially in residence and partially online.
On June 10, 2009, we acquired substantially all of the assets and assumed certain liabilities of DWC for approximately $20.8 million in cash, net of cash acquired. DWC’s campus is located in Nashua, New Hampshire. DWC currently offers programs of study at the master, bachelor and associate degree levels both in residence and through distance education.
Our strategy is to pursue multiple opportunities for growth. We are implementing a growth strategy designed to increase revenue and operating efficiencies by:
increasing the number and types of program offerings that are delivered in residence and/or online;
increasing student enrollment at existing campuses;
operating new campuses across the United States; and
adding learning sites to existing campuses.
The principal elements of this strategy include the following:
Enhance Results at the Campus Level.
Increase Enrollments at Existing Campuses. We intend to increase recruiting efforts that are primarily aimed at enrolling more working adults at our existing campuses, and make our programs more convenient for students. In addition, we believe that current demographic and employment trends will allow us to enroll a greater number of recent high school graduates.
Increase the Number of Programs Offered at Existing Campuses. We intend to continue increasing the number of programs that we offer at our existing campuses. Our objective is to offer multiple programs at each campus. Our existing campuses provide significant potential for the introduction of our current programs at a broader number of campuses. We believe that introducing our current programs at additional existing campuses will attract more students. In 2009, we added a total of 377 programs among 106 campuses, and in 2010 we intend to add more of our current programs among approximately 95 locations. We currently offer one or more of our online programs to students who are located in 48 states and the District of Columbia. We intend to expand the number of our online programs offered in 2010.
Develop Additional Programs. In 2009, we continued our efforts to diversify our program offerings by developing new programs in both technology and non-technology fields of study that are delivered entirely in residence, entirely online or partially in residence and partially online. In 2010, we plan to continue developing additional programs in technology and non-technology fields of study that are delivered entirely in residence, entirely online or partially in residence and partially online. The new programs are expected to involve a variety of disciplines and be at the associate, bachelor and master degree levels. We believe that offering new programs can attract a broader base of students, motivate current students to extend their studies and help us improve the utilization of our facilities.
Extend Total Program Duration. In 2009, we increased the number of our campuses that offer bachelor degree programs from 87 to 102. In 2010, we intend to increase the number of our campuses that offer bachelor degree programs. The average combined total program time that students are enrolled in one or more of our programs has increased over time as a result of:
a portion of the graduates of our associate degree programs enrolling in bachelor degree programs at our campuses; and
a portion of our new students beginning their studies in bachelor degree programs, instead of first completing associate degree programs.
We believe that the average combined total program time of our students may increase further as we:
increase the number of our campuses offering bachelor degree programs;
add additional bachelor degree programs at our campuses; and expand our online curricula offerings to include additional master degree programs.
Improve Student Outcomes. We strive to improve the graduation and graduate employment rates of our undergraduate students by providing academic and career services and dedicating administrative resources to these services.
Geographically Expand Our Campuses and Learning Sites. We plan to add new campuses and learning sites of existing campuses at locations throughout the United States. Using our proprietary methodology, we determine locations for new campuses and learning sites based on a number of factors, including demographics and population and employment growth.
Programs of Study
As of December 31, 2009, the ITT Technical Institutes were offering 35 degree programs in various fields of study across the following schools of study.
At the vast majority of our campuses, we generally organize the academic schedule for programs of study on the basis of four 12-week academic quarters in a calendar year, with new students beginning at the start of each academic quarter. At these campuses, students taking a full-time course load can complete our associate degree programs in eight academic quarters, bachelor degree programs in 15 academic quarters and a master degree program in seven academic quarters. We typically offer classes in most residence programs in:
3.5- to 5.5-hour sessions three days a week, Monday through Saturday, with all program courses taught entirely or partially in residence; or sessions that are scheduled two to three days a week, Monday through Saturday, with certain program courses taught entirely or partially online over the Internet most academic quarters.
Depending on student enrollment, class sessions at the vast majority of our campuses are generally available in the morning, afternoon and evening. The courses that are taught online over the Internet are delivered through an asynchronous learning network and have a prescribed schedule for completion of the coursework. At the vast majority of our campuses, the class schedule for our residence courses and the coursework completion schedule for our online courses generally provide students with the flexibility to maintain employment concurrently with their studies. Based on student surveys, we believe that a substantial majority of our students work at least part-time during their programs of study.
Most of our programs of study blend traditional academic content with applied learning concepts and have the objective of helping graduates prepare for a changing economic and/or technological environment. A significant portion of most programs offered at our campuses involves practical study in a lab environment.
The learning objectives of most courses in each program of study are substantially the same among the vast majority of our campuses to provide greater uniformity and to better enable students to transfer, if necessary, to other campuses offering the same programs with less disruption to their education. We regularly review each curriculum to respond to changes in technology and industry needs. Each of the ITT Technical Institutes establishes an advisory committee for each field of study taught at that campus, which is comprised of representatives of local employers and other constituents. These advisory committees assist the ITT Technical Institutes in assessing curricula, equipment and laboratory design, and updating the curricula. In addition to courses directly related to a student's program of study, our programs also include general education courses in the humanities, composition, mathematics, the sciences and the social sciences.
Tuition for a student entering an undergraduate residence program at an ITT Technical Institute in December 2009 for 36 quarter credit hours (the minimum course load for a full-time student for an academic year at traditional two- and four-year colleges) is $17,400 for all ITT Technical Institute undergraduate residence programs, except as adjusted in some states to reflect applicable taxes and fees. Tuition for a student entering an undergraduate residence program at DWC in September 2009 for 24 semester credit hours (the minimum course load for a full-time student for an academic year at traditional two- and four-year colleges) is $27,940 for all DWC undergraduate residence programs. The tuition amounts discussed above do not reflect institutional scholarships and grants which reduce the amount of tuition that students pay to attend our institutions. We typically adjust the tuition for our programs of study at least annually. The majority of students attending residence programs at our campuses lived in that campus’ metropolitan area prior to enrollment. The only student housing that we provide is at the Nashua, New Hampshire campus of Daniel Webster College.
We strive to attract students with the motivation and ability to complete the career-oriented educational programs offered by our campuses. To generate interest among potential students, we engage in a broad range of activities to inform potential students and their parents about our campuses and the programs they offer. These activities include television, Internet and other media advertising, direct mailings and high school presentations. We employ approximately 1,700 full- and part-time recruiting representatives to assist in local recruiting efforts.
Local recruiting representatives of a campus pursue expressions of interest from potential students for our residence programs of study by contacting prospective students and arranging for interviews at the campus or any learning site of that campus. Occasionally, we also pursue expressions of interest from students for our residence programs of study by contacting them and arranging for their attendance at a seminar providing information about the campus and its programs. We pursue expressions of interest from potential students for our online programs of study by providing program and resource information on our websites and through telephone calls, electronic mail and postal delivery.
Student recruitment activities are subject to substantial regulation at both the state and federal level and by our accrediting commissions. Most states have bonding and licensing requirements that apply to many of our representatives and other employees involved in student recruitment. Our National Director of Recruitment and Regional Directors of Recruitment oversee the implementation of recruitment policies and procedures. In addition, our compliance department reviews student recruiting practices at each of our campuses on at least an annual basis.