Jerome Grant: Yes. It was about half and half versus our expectations. About half of the benefit was revenue and the other half was expense. Mostly timing, we didn’t ramp expenses quite as fast as we thought would. We had some initiatives that were going to start later in the year than we were thinking when we came into the year. So there’s a little bit of push associated with the expense side and some of that was just timing on ramp, which is why we were able to increase our guidance because we’ll flow through some of that net benefit for the year. The top line, keep in mind, again, there’s a tail. We had a start this quarter with that students in school for a year. And so the strong growth we exited last year with and the strong growth that we have in the first half of this year.
We’ll continue to benefit the top line over the next few quarters, whereas once we start seeing growth, let’s say, starts are in the 3% to 5% range, just in a low to mid single digit general type of guide. Then all things being equal that revenue would normalize to that plus any rate differential that we have based on tuition rate escalations that occur.
Raj Sharma: Just it seemed like the overall increase in the EBITDA guidance for the year seemed conservative given the big beat in Q1?
Jerome Grant: Yes. And again, some of that is just moving some of the expenses around in the timing of the year. We have a little bit of shuffling of revenue around just based on as we re-project the year, some of the start cadence and being able to flow through in a portion of the Q1 to be. So look, we’re it’s early in the year. We would normally update our guidance frankly in the first quarter. Normally, it would be second or third quarter. But given the strong beat and just given our outlook the year, we’re comfortable doing that and we’ll continue to monitor through the year and make other adjustments as we see appropriate.
Raj Sharma: And then just my last question is on the regulatory front end composite score. Where does the composite score stand now? And is there a target that you’d like to achieve? And does that kind of the number? And I guess the attempts are always to try to improve that number. And does that play into how you would think about capital allocation in financing of any of a specific acquisition in the future? Just trying to get a sense of that?
Jerome Grant: Sure. Yes. We focus heavily on regulatory metrics. We are very purposeful about staying above any thresholds that cause issues in terms of any of our reporting with the Department of Education, any of our creditors. So student outcomes are also very important. As far as composite score, what’s interesting about that is, as and maybe just for general education for those listening, it’s a scale of 0 to 3, but 1.5 and above, it’s basically pass sale. There’s you get no benefit out of a 1.51 relative to a 3. You’re above 15, period. End of story. So we’re not managing to get to a 3. I mean, if we get a 3, that’s great. There’s a lot of math, and elements to the equation, that drives the composite score. We’re above 1.5. We’re comfortably above 1.5, and we’ll continue to manage, above 1.5. We did dip relative to the prior year, because of the acquisition of Concorde.
Again, there’s a lot of variables that go into the math around that. So, we were above a 2. We were a 1.6, this last year. We would most likely be above a 2 again this year as a kind of a temporary blip. But, again, no impact because above 1.5 is there’s you’re clear of any potential implications with the Department of Ed. So that’s really the primary metric we look at, but we take it very seriously, and we manage our business to ensure that we’re delivering that.
Operator: The next question comes from Eric Martinuzzi with Lake Street.
Eric Martinuzzi: I wanted to make sure I understood the upward revision to the fiscal ’24. Obviously, with the no change in the new student starts, this is coming down to sort of the installed base of students outperforming. So I was just curious, is this a little bit better revenue per student maybe than you’re originally thinking or better retention in the student population. What’s the driver on the revenue without the change in new student starts?
Troy Anderson: Yes. I think it’s a little bit more of the population, better performance on the population. Starts were pretty much in line with our expectations. As you said, we’re comfortable with the full year guidance range we’ve given previously. Again, early in the year, 4,300 starts out of 25,000 midpoint. So we have a lot of lot of work to do to land the other 21,000 starts for the year, but we feel very confident in that. And so just a bit better monetization out of the coming out of Q4 into Q1, a little bit better persistence and lower attrition on the installed base as you said, and we continue to feel good about the performance for the remainder of the year on that.
Eric Martinuzzi: And then on the use of cash priorities, you guys have a lot of different directions you can go in. Obviously, M&A has been a key driver of the business. But where do you stack rank? I don’t know if you even have the ability post the convertible preferred conversion of share repurchases, but you’ve got new programs, new campuses, M&A, buyback, help me understand the stack rank there.
