Lincoln Educational Services (LINC) investor relations material

Market environment and industry trends

• Significant skills gap in trades due to decades-long focus on college education, creating high demand for skilled tradespeople.

• Trades education is increasingly attractive as a faster, more affordable path to employment compared to traditional college.

• Baby boomer retirements and technological advances in construction, healthcare, and transportation are fueling demand.

• Company holds less than 2% market share in a highly fragmented industry, indicating substantial growth potential.

• Industry partnerships with major employers enhance job placement and program relevance.

Business model and operational strategy

• Operates a blended learning model (Lincoln 10.0) with 30% online and 70% in-person, increasing efficiency and scalability.

• Strong operating leverage: about 30% of incremental revenue drops to the bottom line.

• Focused on replicating high-performing programs and opening two new campuses per year for the next five years.

• Expansion targets high-growth regions, especially in the South and West, with new campuses in Texas and New York.

• Preference for organic growth over acquisitions, but open to strategic buys in new trades or markets.

Financial performance and outlook

• Q3 revenues up 25%, with 6% growth in student starts; guidance raised to $500M revenue and $66M EBITDA for the year.

• Updated 2027 guidance: over $600M in revenue and $90M in adjusted EBITDA, driven by new campuses and organic growth.

• Debt reduced to $5M as of Q3, expected to be zero by year-end; strong cash flow and $65M in liquidity.

• EBITDA margins expected to rise by 150 basis points annually, reaching high teens within 3–4 years.

• Capital allocation focused on growth, with 80% of CapEx for expansion and maintenance CapEx at 2–4% of revenue.