Thread regarding DeVry Inc. layoffs

The Layoffs From a Financial Analysis Perspective

I am a financial adviser and I was investigating DV for a client when I stumbled upon this site. It was interesting that this site about DeVry layoffs came up in the same search results with articles talking about the strategy to turn around and transform DeVry University. I applaud everyone's efforts to get to the bottom of the corporate scheme, but I have always believed that the way to see what a company is up to is look at their financial records. Money talks in more ways than one and employees have a right to know what their company's money is saying. Some of you probably know all of this already so forgive me if it is repetition, but here is my speculation from the point of view of someone who has seen similar things in similar organizations.

After reading the 2015 prospectus, I speculate, they are not going to “turn anything around”. They are changing course/transforming and phasing out programs, not associated with Health Care, CPA’s and global expansion. You should begin seeing requests to reduce student enrollment, in programs selected for the chopping block if you haven't already. There is an attempt to redirect and re-invest company funds to support other more viable programs and projects. When UIS phased out a few two year programs, they made the announcement two years out from the expected end date. In this case, I would expect to see such an announcement at the start of the next fiscal/academic year (July/Sept 2016). If you do not, then that could indicate an alternative exit strategy, that could be communicated when/if it requires your participation.

What would this mean to faculty and staff, cuts of course. They should make an attempt to see that all current and recently accepted students have access to all of the basic degree requirements, for the next couple years. A few staff may hang on beyond the 2017-2018 academic year to ensure any remaining students finish. This would likely be a cheaper option than giving students refunds. This option also helps with their grad and retention stats too.

In the end, they have other priorities and need to redirect funds to support this new direction (health care, CPA’s and global markets). It looks like a few of these new programs are set to begin within the next two years. So, DeVry Group will want to have additional money available by then. This is mostly just speculation of course, but it is supported by data and experience.

I can tell you for sure that the layoffs have little to do with saving money because it was not saved, it was all re-invested in other places. DeVry definitely has money, so the threat of bankruptcy, is not on the table at the moment. What I do not know, is why these things have not been communicated to you by this point. The numbers show a common phaseout pattern, that should have been announced, at least internally by now. If it is not announced soon, that may be cause for concern. I really do not mean to stir the pot, but if you are not in DeVry's health care, CPA or international departments, it may be time to start looking out for yourself and asking some questions.

Hope this helps.

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| 2741 views | | 11 replies (last July 4, 2016) | Reply
Post ID: @OP+I5x3ZU8

11 replies (most recent on top)

@I5x3ZU8-7sqw, I think you're right. See, this is why I love this board. There are contributions from around the country, in different roles and departments, and even some from outside of DeVry. And by each of us sharing what we know and observe, we can piece together the clues to this maddening puzzle that the company has surrounded us with, and deduce the real truths that management will not tell us. I believe that we have collaboratively explained almost the entire situation now, beyond a reasonable doubt.

So I just have two questions remaining at the moment:

  1. When will the end finally arrive? If recent actions are any indication, I expect that there won't be much warning in advance, but it is obviously coming soon.

  2. How can we communicate and present these conclusions to the employees and students who need this information? Contrary to DeVry's policies, we all deserve the right to make responsible, informed decisions about our future. Many of my coworkers read this board and discuss it regularly, but I don't think that is the case everywhere.

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Post ID: @8cxl+I5x3ZU8

The connection is that the eight or so individual schools are being managed as a menu of operating units under one corporate holding company, DeVry Education Group. Operating units that are not profitable or become too difficult to manage will be starved of resources and then shut down. It is the survival of the corporate holding company that matters as this is where the stock is registered. The wild card is still the FTC lawsuit and subsequent shareholder lawsuits and student loan refunds, as happened with Corinthian.

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Post ID: @3mqy+I5x3ZU8

@I5x3ZU8-2zdf Good point. Then again, We did just change the portal address from my.devry.edu to my.devrygroup.com. Connection there maybe?

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Post ID: @2tct+I5x3ZU8

Actually, some of this has been announced. The week before the last major layoff, it was announced that the electronics, computer engineering, and biomedical engineering programs were being eliminated at some locations. But that's just three programs, and only at some locations. Do you think it's a stretch to assume that the entire DeVry University is shutting down just because we're cutting our engineering programs?

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Post ID: @2zdf+I5x3ZU8

I worked for DeVry in North Brunswick from 2000-2008. When I worked there I thought the campus had the strongest General Education department in the DeVry system. There were as many PhDs in North Brunswick as in the rest of the system combined. There was always the pendellum that swung back and forth between being a good academic institution and a for profit university. However academics in North Brunswick was very strong. However the corporate effect won out. As of now there is only one full-time faculty member left from what was the General Education Department. They even just laid off the faculty member who had both a PhD in Engineering and a PhD in Mathematics. There is no one at the location serving as President of the campus. There are no deans left and not even any department heads. The Registar department has been fired and everything is being run by a corporate office. Shane on the NJ Department of Higher Education for letting this happen in NJ and keeping the same state approvals.

Perhaps the State of NJ will have the backbone to say that this is not a situation that will be allowed to continue. I doubt that will happen.

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Post ID: @2hch+I5x3ZU8

Business insurance does not cover intentional fraud perpetrated by executive management; it covers unintentional acts only. Once the FTC lawsuit roved intentional deception, all financial liabilities fall to the corporation and its individual officers..

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Post ID: @1eox+I5x3ZU8

I am always amazed at the "ivory tower" thinking on these sites. Devry (and other public companies) have insurance to cover lawsuits. To not have it would invite shareholder lawsuits.

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Post ID: @1xcm+I5x3ZU8

I bet they are saving 8-9 million just by hiring the new female inexperienced ceo

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Post ID: @1nyz+I5x3ZU8

@I5x3ZU8-yig Taylor and Keller are long gone, and DeVry's falling fortunes roughly correspond to their exit. I fully agree that DeVry is NOT looking to turn anything around. You can't possibly grow your business by cutting services. In answer to the original post, they have been dropping oblique hints that they are going to be doing exactly what you say they are but have said nothing direct thus far.

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Post ID: @1wrj+I5x3ZU8

DeVry has lost touch with what made it a special place to work.

It is very sad to see what this place has turned into.

Where is Ron Taylor and Dennis Keller? How did they let this happen?

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Post ID: @yig+I5x3ZU8

This analysis basically defines a corporate restructuring of priorities and resources to business units that are for the moment the most profitable. The wild card is the FTC and shareholder lawsuits, and the possible involvement of the Dept. of Education in terms of refunds for student loans obtained under fraudulent circumstances. These actions will certainly have financial impacts, and it remains to be seen if the DEG has deep enough pockets to handle them and still remain viable.

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Post ID: @ooa+I5x3ZU8

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