Career Education Corporation Reports Results for 2004 Fourth Quarter and Year-End

HOFFMAN ESTATES, Ill.--()--Feb. 15, 2005--Career Education Corporation (Nasdaq:CECO) today reported financial results for the fourth quarter and year ended December 31, 2004. The company noted that its results include an adjustment related to an increase in the estimate for its allowance for doubtful accounts and a restatement for a change in revenue recognition method for its Culinary and Healthcare externships. Additionally, the company provided updated information concerning the ongoing independent investigation being conducted by the special committee of its Board of Directors.

Significant Items

In connection with reporting its results for the fourth quarter of 2004, the company increased its estimate for its allowance for doubtful accounts. The company periodically evaluates its receivables and establishes the allowance for doubtful accounts based on methodologies and assumptions, which the company reviews and modifies based on emerging information. The company recently analyzed its receivables collection rates together with changes in financial aid funding sources and improved analytical tools, and determined it should increase its estimate for its allowance for doubtful accounts.

As a result, the company recorded a non-cash, pre-tax charge for the change in accounting estimate of its allowance for doubtful accounts of approximately $18.9 million in the fourth quarter of 2004. This change in estimate does not affect prior period financial statements. This additional charge, included in General and Administrative expense, less the related tax benefit of $7.6 million, represented $0.11 per diluted share in the quarter. The bad debt expense, excluding the charge related to the change in accounting estimate, was 4.5% of total revenue for the quarter ended December 31, 2004.

In addition, the company changed its method of revenue recognition related to its Culinary and Health Education externships. These student externships are required to be taken at the end of certain academic programs, following the conclusion of in-school instruction, in order to satisfy graduation requirements. The new revenue recognition method recognizes tuition revenue through the end of the student's externship period, while the prior practice recognized revenue only over the period of in-school academic instruction. This change, as shown in the attached financial tables, results in a restatement of the company's financial statements for 2000 through 2004. The full-year and fourth quarter 2004 restatement resulted in a non-cash reduction of $11.5 million and $3.4 million in revenue and $0.06 and $0.02 per diluted share after taxes, respectively. This revenue will be earned and recognized in subsequent periods net of student refunds. The company noted that the restatement does not materially affect year-over-year growth percentages or trends for revenue and earnings per share as prior-period results have been restated to reflect this change.

Three Months Ended December 31

-- Fourth quarter 2004 total revenue increased 33% to $485.9 million from a restated $366.7 million for the same period last year. The increase in revenue is primarily attributable to a 30% increase in same-school revenue driven by an increase in same-school population (21.5% increase at October 31st) and an approximate 8% increase in average revenue per student during the fourth quarter.

-- Net income was $59.8 million, or $0.57 per diluted share, up 18% from last year's fourth quarter restated net income of $50.7 million, or $0.49 per diluted share. Fourth quarter 2004 net income includes the following items:

(In millions, except per      Quarterly Quarterly Quarterly Quarterly 
 share data)                   Earnings  Income    Net       Diluted
                               Before    Taxes     Income    Earnings
                               Income                        Per Share
                               Taxes
----------------------------------------------------------------------
Allowance for Doubtful
 Accounts Change in Estimate     ($18.9)     $7.6    ($11.3)   ($0.11)
----------------------------------------------------------------------
Externship Revenue Recognition
 Restatement                      ($3.4)     $1.4     ($2.0)   ($0.02)
----------------------------------------------------------------------
Certain Legal Fees                ($4.9)     $2.0     ($2.9)   ($0.03)
----------------------------------------------------------------------
Self-funded Employee Benefits
 Plan Charge                      ($2.2)     $0.9     ($1.3)   ($0.01)
----------------------------------------------------------------------
Lower Effective Tax  Rate           n/a      $3.0      $3.0     $0.03
----------------------------------------------------------------------
                         Total   ($29.4)    $14.9    ($14.5)   ($0.14)
----------------------------------------------------------------------

-- Approximately $18.9 million of pre-tax General and Administrative expense is related to the aforementioned increase in the allowance for doubtful accounts.

-- Approximately $3.4 million of pre-tax revenue reduction is related to the aforementioned restatement for the externship revenue.

-- Approximately $4.9 million of pre-tax legal and other expenses related to the SEC investigation, investigation being conducted by the special committee of the Board of Directors, and shareholder class action and derivative lawsuits.

-- Approximately $2.2 million of pre-tax expense is related to CEC's self-funded medical and dental plan. The company adjusted its year-end accrual as actual costs were higher than previously anticipated for 2004, the first year these plans were self-funded.

-- Approximately $3.0 million of income is related to a reduction on our effective tax rate from 40.25% to 39.25%. The lower tax rate was driven by a reduction in the company's state income taxes and tax free investment earnings. The effective state income tax rate was reduced by the mix of earnings and various state tax credits generated.

Twelve Months Ended December 31

-- Full year 2004 revenues increased 47% to $1.73 billion from $1.18 billion for the same period last year, after reflecting the externship revenue recognition restatement. The increase in revenue is primarily attributable to a 33% increase in same-school revenue driven by an approximate average 25% increase in same-school population for the period and an approximate 4% increase in average revenue per student during the year.

-- Net income was $179.6 million, or $1.71 per diluted share, up 61% from $111.9 million, or $1.11 per diluted share, after adjusting for the 2-for-1 stock split effected in August 2003 and the externship revenue recognition restatement. Full year 2004 net income includes the following items:

(In millions, except per        Annual     Annual    Annual    Annual
  share data)                   Earnings   Income     Net     Diluted
                                Before     Taxes     Income   Earnings
                                Income                       Per Share
                                Taxes
----------------------------------------------------------------------
Allowance for Doubtful
 Accounts Change in Estimate     ($18.9)     $7.6    ($11.3)   ($0.11)
----------------------------------------------------------------------
Externship Revenue Recognition
 Restatement                     ($11.2)     $4.5     ($6.7)   ($0.06)
----------------------------------------------------------------------
Certain Legal Fees               ($11.4)     $4.6     ($6.8)   ($0.07)
----------------------------------------------------------------------
Lower Effective Tax  Rate           n/a      $3.0      $3.0     $0.03
----------------------------------------------------------------------
                         Total   ($41.5)    $19.7    ($21.8)   ($0.21)
----------------------------------------------------------------------

Balance Sheet and Cash Flow

-- At December 31, 2004, we had cash and cash equivalents of $348.1 million, compared with $161.2 million on September 30, 2004. Short-term and long-term debt as of December 31, 2004 was $23.9 million.

-- Net cash provided by operating activities for the fourth quarter of 2004 was $114.5 million compared to $113.3 million for the same period of 2003.

-- Purchases of property and equipment for the quarter were $48.8 million and for the year were $142.8 million. Purchases of property and equipment for 2004 represented approximately 8.3% of total revenues.

-- Quarterly days sales outstanding (DSOs) for total net receivables were 17 days at December 31, 2004. This represents a 9-day decrease from the quarterly DSOs at December 31, 2003 of 26 days, reflecting the revenue recognition restatement. Before the increase in the allowance of doubtful accounts, quarterly days sales outstanding (DSOs) for total net receivables were 20 days at December 31, 2004. We calculate DSOs by dividing the sum of net student receivables and net other receivables by average daily revenue. Average daily revenue is computed by dividing quarterly "total revenue" by the total number of days in the quarter.

Population Data

-- Total CEC student population on January 31, 2005 was approximately 101,500, up 21% compared with approximately 84,100 on January 31, 2004. On a same school basis, total CEC student population was up approximately 19.5%.

-- The aforementioned student population data excludes previously disclosed teach-outs related to the Academy division, but includes the effect of the restatement of the Culinary and Healthcare externship revenue recognition. Students participating in externship programs are now included in our student population as we are recognizing revenue through the end of the externship period. These externships were previously excluded from the company's population statistics as the company was not earning revenue over the student externship period.

-- Total student population of CEC's Online Education Group on January 31, 2005 was approximately 24,900, up from approximately 12,200 students on January 31, 2004.

-- Fourth quarter 2004 new student starts were approximately 28,600.

Information Concerning Special Committee Investigation

-- As previously reported, our Board of Directors formed a special committee to conduct an independent investigation of allegations of securities laws violations against the company, including allegations relating to the company's accounting practices and reported statistics relating to starts, student population and placement. At that time, we announced that the special committee had retained the law firm of McDermott, Will & Emery LLP to represent and assist it in its review. Additionally, it was previously reported that by the special committee's direction, McDermott, Will & Emery retained Navigant Consulting, Inc. to assist in the investigation. Navigant Consulting is providing independent forensic accounting services in connection with the special committee's review of allegations relating to previously reported financial information and related matters. At the request of the special committee, Navigant reviewed the company's new methodology for estimating its allowance for doubtful accounts and found it to be reasonable. The special committee investigation has not yet been completed.

Business Outlook

While we may make further acquisitions, none are contemplated by these forward-looking statements.

-- We expect full year 2005 revenues to be approximately $2.1 billion and full year 2005 earnings per share to be approximately $2.27. Our full year earnings expectations include an approximate $0.05 per share impact for the effect of the externship revenue recognition change. Additionally, the earnings expectations include higher costs for legal and regulatory matters.

-- We expect the Online Education Group's full year 2005 revenues, included in the preceding amounts, to be approximately $600 million.

-- We expect full year 2005 operating profit margin improvement to be approximately 150 basis points.

-- We expect first quarter 2005 revenues to be approximately $500 million and first quarter 2005 earnings per share to be approximately $0.51. We expect diluted weighted average shares outstanding to be approximately 105 million for first quarter 2005.

-- We expect bad debt levels to be approximately 5% of total revenue for 2005.

-- We expect our 2005 effective income tax rate will be approximately 39.25%.

-- We expect that 2005 capital expenditures will be approximately 7.5% of total revenue.

Conference Call Information

-- Career Education Corporation will host a conference call today at 5:30 PM (Eastern Time). Interested parties can access the live webcast of the conference call at www.careered.com. Participants can also listen to the conference call by dialing (617) 614-3673 (international) or (800) 261-3417 (domestic) and citing code 84473011. Please log-in or dial-in at least 10 minutes prior to the start time to ensure a connection. After 7:30 PM (Eastern Time) the same day, an archived version of the webcast will be accessible for 90 days at www.careered.com. A replay of the call will also be available for seven days by calling (617) 801-6888 and citing code 75236285.

Career Education Corporation (www.careered.com) is the world's largest on-campus provider of private, for-profit, postsecondary education and has a rapidly-growing presence in online education. CEC's Colleges, Schools and Universities Group operates 82 campuses in the U.S., Canada, France, the United Kingdom and the United Arab Emirates and offers doctoral degree, master's degree, bachelor's degree, associate degree and diploma programs in the career-oriented disciplines of visual communication and design technologies, information technology, business studies, culinary arts and health education. The Online Education Group operates American InterContinental University Online and Colorado Technical University Online and offers a variety of degrees in information technology, business, visual communication and education. CEC's total student population on January 31, 2005 was approximately 101,500 students.

Except for the historical and present factual information contained herein, the matters set forth in this release, including statements under "Business Outlook" and statements identified by words such as "anticipates," "expects," "projects," "plans," "will," and similar expressions, are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on information currently available to us and involve risks and uncertainties that could cause our actual growth, results, performance and business prospects and opportunities to differ materially from those expressed in, or implied by these statements. These risks and uncertainties, the outcome of which could materially and adversely affect our financial condition and operations, include, but are not limited to: risks related to our ability to comply with, and the impact of changes in, legislation and regulations that affect our ability to participate in student financial aid programs; costs, risks and effects of legal and administrative proceedings and investigations and governmental regulations, including the pending Securities and Exchange Commission and Justice Department investigations and, class action, derivative, Qui Tam, and other lawsuits; cost and potential impact of findings by the special committee of our Board of Directors that is investigating allegations of securities laws violations against CEC; risks related to our ability to comply with accrediting agency requirements or obtain accrediting agency approvals; costs and difficulties related to the integration of acquired businesses; future financial and operational results; competition; general economic conditions; ability to manage and continue growth; and other risk factors relating to our industry and business, as detailed in our Annual Report on Form 10-K for the year ended December 31, 2003, and from time to time in our other reports filed with the SEC. We disclaim any responsibility to update these forward-looking statements.

             Career Education Corporation and Subsidiaries
              UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
        For the Twelve Months Ended December 31, 2004 and 2003
     (Amounts in thousands, except per share data and percentages)


                                                               % of
                                                       2004   Revenue
                                                 ----------- ---------
Revenue:
  Tuition and registration fees                  $1,608,433      93.0%
  Other                                             120,082       7.0%
                                                 -----------
    Total revenue                                 1,728,515     100.0%
                                                 -----------

Operating expenses:
  Educational services and facilities               557,134      32.1%
  General and administration                        822,358      47.6%
  Depreciation and amortization                      57,469       3.4%
                                                 -----------
    Total operating expenses                      1,436,961      83.1%
                                                 -----------

Income from operations                              291,554      16.9%

Other income (expense):
  Interest income                                     2,952       0.2%
  Interest expense                                   (2,802)     -0.2%
  Share of affiliate earnings                         4,248       0.2%
  Miscellaneous                                        (290)      0.0%
                                                 -----------
    Total other income                                4,108       0.2%
                                                 -----------

Income before provision for income taxes            295,662      17.1%

Provision for income taxes                          116,047       6.7%
                                                 -----------

Net income                                         $179,615      10.4%
                                                 ===========



======================================================================

Diluted net income per share                          $1.71

Diluted weighted average shares outstanding         105,004




                                         2003
                ------------------------------------------------------
                     As        % of                  As        % of
                  Reported    Revenue  Adjustment Restated    Revenue
                ------------ -------- ----------- ---------- ---------
Revenue:
 Tuition and
  registration
  fees           $1,089,192      91.6% $(12,364) $1,076,828      91.5%
 Other               99,417       8.4%        -      99,417       8.5%
                ------------           --------- -----------
  Total revenue   1,188,609     100.0%  (12,364)  1,176,245     100.0%
                ------------           --------- -----------

Operating
 expenses:
 Educational
  services and
  facilities        413,806      34.8%     (291)    413,515      35.2%
 General and
  administration    533,964      44.9%        -     533,964      45.4%
 Depreciation
  and
  amortization       43,908       3.7%        -      43,908       3.7%
                ------------           --------- -----------
  Total
   operating
   expenses         991,678      83.4%     (291)    991,387      84.3%
                ------------           --------- -----------

Income from
 operations         196,931      16.6%  (12,073)    184,858      15.7%

Other income
 (expense):
 Interest income      1,004       0.1%        -       1,004       0.1%
 Interest
  expense            (1,845)     -0.2%        -      (1,845)     -0.2%
 Share of
  affiliate
  earnings            3,354       0.3%        -       3,354       0.3%
 Miscellaneous            -       0.0%        -           -       0.0%
                ------------           --------- -----------
  Total other
   income             2,513       0.2%        -       2,513       0.2%
                ------------           --------- -----------

Income before
 provision for
 income taxes       199,444      16.8%  (12,073)    187,371      15.9%

Provision for
 income taxes        80,276       6.8%   (4,771)     75,505       6.4%
                ------------           --------- -----------

Net income         $119,168      10.0%  $(7,302)   $111,866       9.5%
                ============           ========= ===========



======================================================================

Diluted net
 income per
 share                $1.19              $(0.07)      $1.11

Diluted weighted
 average shares
 outstanding        100,522             100,522     100,522



             Career Education Corporation and Subsidiaries
              UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
         For the Three Months Ended December 31, 2004 and 2003
     (Amounts in thousands, except per share data and percentages)


                                                               % of
                                                       2004   Revenue
                                                  ---------- ---------
Revenue:
  Tuition and registration fees                    $456,670      93.9%
  Other                                              29,234       6.0%
                                                  ----------
    Total revenue                                   485,904     100.0%
                                                  ----------

Operating expenses:
  Educational services and facilities               146,537      30.1%
  General and administration                        229,577      47.3%
  Depreciation and amortization                      16,627       3.4%
                                                  ----------
    Total operating expenses                        392,741      80.8%
                                                  ----------

Income from operations                               93,163      19.2%

Other income (expense):
  Interest income                                     1,412       0.3%
  Interest expense                                     (734)     -0.2%
  Share of affiliate earnings                         1,448       0.3%
  Miscellaneous                                         (94)      0.0%
                                                  ----------
    Total other income                                2,032       0.4%
                                                  ----------

Income before provision for income taxes             95,195      19.6%

Provision for income taxes                           35,359       7.3%
                                                  ----------

Net income                                          $59,836      12.3%
                                                  ==========



======================================================================

Diluted net income per share                          $0.57

Diluted weighted average shares outstanding         104,946



                                          2003
                  ----------------------------------------------------
                      As        % of                  As       % of
                   Reported    Revenue  Adjustment Restated   Revenue
                  ----------- --------- ---------- --------- ---------
Revenue:
  Tuition and
   registration
   fees             $343,000      92.4%   $(4,557) $338,443      92.3%
  Other               28,296       7.6%         -    28,296       7.7%
                  -----------           ---------- ---------
    Total revenue    371,296     100.0%    (4,557)  366,739     100.0%
                  -----------           ---------- ---------

Operating
 expenses:
  Educational
   services and
   facilities        117,031      31.5%      (124)  116,907      31.9%
  General and
   administration    153,030      41.2%         -   153,030      41.7%
  Depreciation
   and
   amortization       13,144       3.6%         -    13,144       3.6%
                  -----------           ---------- ---------
    Total
     operating
     expenses        283,205      76.3%      (124)  283,081      77.2%
                  -----------           ---------- ---------

Income from
 operations           88,091      23.7%    (4,433)   83,658      22.8%

Other income
 (expense):
  Interest income        130       0.1%         -       130       0.0%
  Interest
   expense              (471)     -0.1%         -      (471)     -0.1%
  Share of
   affiliate
   earnings            1,187       0.3%         -     1,187       0.3%
  Miscellaneous            -       0.0%         -         -       0.0%
                  -----------           ---------- ---------
    Total other
     income              846       0.3%         -       846       0.2%
                  -----------           ---------- ---------

Income before
 provision for
 income taxes         88,937      24.0%    (4,433)   84,504      23.0%

Provision for
 income taxes         35,521       9.6%    (1,693)   33,828       9.2%
                  -----------           ---------- ---------

Net income           $53,416      14.4%   $(2,740)  $50,676      13.8%
                  ===========           ========== =========



======================================================================

Diluted net
 income per share      $0.51               $(0.03)    $0.49

Diluted weighted
 average shares
 outstanding         104,288              104,288   104,288



             CAREER EDUCATION CORPORATION AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED BALANCE SHEETS
                            (In thousands)




                                            December 31, 2003
                                    ----------------------------------
                        December 31,     As                     As
                           2004       Reported   Adjustment  Restated
                        ----------- ----------- ---------- -----------

          ASSETS

CURRENT ASSETS:
    Cash and cash
     equivalents          $348,099    $161,235         $-    $161,235
    Receivables:
        Students, net
         of allowance
         for doubtful
         accounts of
         $63,903 and 
         $47,467 as of
         December 31,
         2004 and 2003      87,503     110,445     (6,485)    103,960
        Other, net           5,378       6,915          -       6,915
    Inventories             17,522      11,652          -      11,652
    Prepaid expenses        44,702      35,441          -      35,441
    Other current
     assets                  5,980       5,464          -       5,464
    Deferred income tax
     assets                 18,341       4,639          -       4,639
                        ----------- ----------- ---------- -----------
         Total current
          assets           527,525     335,791     (6,485)    329,306
                        ----------- ----------- ---------- -----------
    Property and
     equipment, net        351,146     263,925          -     263,925
    Goodwill, net          449,136     440,709      1,525     442,234
    Intangible assets,
     net                    35,881      36,326          -      36,326
    Other assets            38,495      42,399          -      42,399
                        ----------- ----------- ---------- -----------
TOTAL ASSETS            $1,402,183  $1,119,150    $(4,960) $1,114,190
                        ----------- ----------- ---------- -----------

     LIABILITIES AND
       STOCKHOLDERS'
           EQUITY

CURRENT LIABILITIES:
    Current maturities
     of long-term debt      $2,274     $79,822         $-     $79,822
    Accounts payable        38,263      30,627          -      30,627
    Accrued expenses:
        Payroll and
         related
         benefits           38,193      25,671          -      25,671
        Income taxes             -      14,472    (13,278)      1,194
        Other               70,510      42,419       (568)     41,851
    Deferred tuition
     revenue               169,031     113,610     28,374     141,984
                        ----------- ----------- ---------- -----------
         Total current
          liabilities      318,271     306,621     14,528     321,149
                        ----------- ----------- ---------- -----------

LONG-TEM  LIABILITIES:
    Long-term debt, net
     of current
     maturities             21,591      25,453          -      25,453
    Long-term
     contractual
     obligations                 -       9,679          -       9,679
    Deferred income tax
     liabilities            39,374      18,366          -      18,366
    Other                   38,957      11,211          -      11,211
                        ----------- ----------- ---------- -----------
         Total long-tem
          liabilities       99,922      64,709          -      64,709
                        ----------- ----------- ---------- -----------

COMMITMENTS AND
 CONTINGENCIES
STOCKHOLDERS' EQUITY:
    Preferred stock              -           -          -           -
    Common stock             1,025       1,002          -       1,002
    Additional paid-in
     capital               571,192     496,582          -     496,582
    Accumulated other
     comprehensive
     income                  4,396       2,986          -       2,986
    Retained earnings      407,377     247,250    (19,488)    227,762
                        ----------- ----------- ---------- -----------
         Total
          stockholders'
          equity           983,990     747,820    (19,488)    728,332
                        ----------- ----------- ---------- -----------
TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY   $1,402,183  $1,119,150    $(4,960) $1,114,190
                        ----------- ----------- ---------- -----------



             CAREER EDUCATION CORPORATION AND SUBSIDIARIES
                UNAUDITED SELECTED SEGMENT INFORMATION
                        (Dollars in thousands)




                            For the Three Months Ended December 31,
                        ----------------------------------------------

                                                  2003
                                    ----------------------------------
                                        As                     As
                              2004   Reported   Adjustment  Restated
                        ----------- ----------- ---------- -----------
Revenue
  CSU (1)                 $367,698    $320,251    $(4,557)   $315,694
  OEG (2)                  118,206      51,045          -      51,045


Segment profit
  CSU                      $59,338     $70,429    $(4,433)    $65,996
  OEG                       41,622      23,354          -      23,354
  Corporate and other       (6,349)     (4,505)         -      (4,505)


Segment profit
 percentage
  CSU                         16.1%       22.0%                  20.9%
  OEG                         35.2%       45.8%                  45.8%





                           For the Twelve Months Ended December 31,
                        ----------------------------------------------

                                                 2003
                                    ----------------------------------
                                        As                     As
                              2004   Reported   Adjustment  Restated
                        ----------- ----------- ---------- -----------
Revenue
  CSU (1)               $1,337,051  $1,039,798   $(12,364) $1,027,434
  OEG (2)                  391,464     148,811          -     148,811


Segment profit
  CSU                     $176,055    $163,494   $(12,073)   $151,421
  OEG                      158,815      66,659          -      66,659
  Corporate and other      (39,068)    (29,868)         -     (29,868)


Segment profit
 percentage
  CSU                         13.2%       15.7%                  14.7%
  OEG                         40.6%       44.8%                  44.8%




(1) The Colleges, Schools, and Universities ("CSU") segment represents
an aggregation of our campus-based operating divisions.

(2) The Online Education Group ("OEG") segment represents an
aggregation of our online operating divisions.

(3) Segment profit equals the sume of income from operations and share
of affiliate earnings. 



             Career Education Corporation and Subsidiaries
              Unaudited Consolidated Statements of Income
         For the Years Ended December 31, 2002, 2001 and 2000

                               For the Year Ended December 31, 2002
                             -----------------------------------------
                              As Reported   Adjustment    As Restated
                             ------------- ------------- -------------

Total revenue                    $780,059       $(9,112)     $770,947
Total operating expenses          666,761          (164)      666,597
Total other income                  1,062             -         1,062
Income before provision for
 income taxes                     114,360        (8,948)      105,412
Provision for income taxes         46,888        (3,170)       43,718
                             ------------- ------------- -------------
Net income                        $67,472       $(5,778)      $61,694
                             ============= ============= =============
Diluted net income per share        $0.71         $0.06         $0.65
                             ============= ============= =============


                               For the Year Ended December 31, 2001
                             -----------------------------------------
                              As Reported   Adjustment    As Restated
                             ------------- ------------- -------------

Total revenue                    $547,059       $(5,000)     $542,059
Total operating expenses          478,237           (45)      478,192
Total other income                    915             -           915
Income before provision for
 income taxes                      69,737        (4,955)       64,782
Provision for income taxes         31,382        (1,908)       29,474
                             ------------- ------------- -------------
Net income                        $38,355       $(3,047)      $35,308
                             ============= ============= =============
Diluted net income per share        $0.42         $0.03         $0.39
                             ============= ============= =============


                               For the Year Ended December 31, 2000
                             -----------------------------------------
                              As Reported   Adjustment    As Restated
                             ------------- ------------- -------------

Total revenue                    $334,528       $(3,649)     $330,879
Total operating expenses          295,148           (60)      295,088
Total other income (expense)          126             -           126
Income before provision for
 income taxes and cumulative
 change in accounting
 principle                         39,506        (3,589)       35,917
Provision for income taxes         17,322        (1,515)       15,807
Cumulative effect of change
 in accounting principle, net
 of income tax benefit               (778)            -          (778)
                             ------------- ------------- -------------
Net income                        $21,406       $(2,074)      $19,332
                             ============= ============= =============
Diluted net income per share        $0.28         $0.03         $0.25
                             ============= ============= =============


Note: The effect of the restatement on the previously reported full
year periods is set forth in the accompanying exhibits. The company
will file restated financial statements reflecting this change in
connection with filing its Form 10-K for 2004.


             Career Education Corporation and Subsidiaries
                SELECTED BALANCE SHEET & FINANCIAL DATA
                        As of December 31, 2004
                        (Dollars in thousands)

                                Purchases of            Net Cash
                                Property and          Provided by
                               Equipment, net     Operating Activities
                            --------------------  --------------------

For the three months ended
 December 31, 2004                      $48,779              $114,451

For the year ended 
 December 31, 2004                     $142,781              $374,594


             Career Education Corporation and Subsidiaries
                      Adjusted Student Population

                           Culinary &   Restated   Academy  Population
                           Healthcare     with     Division  without
 Population as       As    Externships Externships  Teach-  Teach-outs
       of:        Reported                           outs       (1)
---------------- --------- ----------- ----------- -------- ----------
January 31, 2003   51,100       1,050      52,150      n/a        n/a
 April 30, 2003    54,400       1,100      55,500      n/a        n/a
 July 31, 2003     62,000       2,000      64,000      n/a        n/a
October 31, 2003   79,500       2,400      81,900      n/a        n/a
January 31, 2004   83,200       1,800      85,000     (900)    84,100
 April 30, 2004    85,300       2,100      87,400     (750)    86,650
 July 31, 2004     81,000       2,150      83,150     (700)    82,450
October 31, 2004   97,300       3,050     100,350     (850)    99,500

(1) We are providing this information as we will be reporting
population for 2005 and 2004 net of our previously disclosed
teach-outs for our Academy division.

Contacts

Career Education Corporation
Karen King (Investor Relations), 847-585-3899
Tracy Lorenz (Investor Relations), 847-585-3899
Sallie Gaines (Media Relations), 312-485-0103
www.careered.com

Contacts

Career Education Corporation
Karen King (Investor Relations), 847-585-3899
Tracy Lorenz (Investor Relations), 847-585-3899
Sallie Gaines (Media Relations), 312-485-0103
www.careered.com