K12 isn't a missing element from the periodic table, but it could help kids learn the periodic table. The company offers online educational programs to students in kindergarten through 12th grade through "virtual schools." It also offers online curriculum to public and private schools. It provides course material and product sales directly to parents and individualized supplemental programs offered through schools. K12 also manages and sells its products and services to blended schools (public schools that combine online and face-to-face instruction), and provides services to US school districts and to international partners.
K12 serves students from 85 countries around the world. K12 operates overseas through the K12 International Academy, a private school that enables K12 to deliver its learning system to students in other countries. In 2010 the company opened offices in Singapore and Switzerland. In 2012 it was distributing its products and services to more than 1,000 school partners.
The company operates in three segments: Managed Public Schools (virtual and blended); Institutional Business (school district partnerships focused on curriculum development and teacher training); and International and Private Pay Business (three online and one brick and mortar private school, and international distribution partnerships).
K12's Managed Public School segment (its largest revenue generator) develops online programs that adhere to the policies of public entities such as public school districts, independent, non-profit charter school boards, and state education agencies. It offers the same coursework and curriculum as most school districts' "brick and mortar" campuses. However, since virtual schools don't have the requirement of a physical classroom, they can accommodate a large dispersed student population. They also allow for more capital resources to be directed toward teaching, curriculum, and technology rather than keeping up a physical infrastructure. Students who attend virtual public schools receive assignments, complete lessons, and obtain instruction from certified teachers with whom they interact online, telephonically, in virtual classroom environments, and, at times, face-to-face.
K12 also has a contract with the Delaware Department of Education to manage the Moyer Charter School. The agreement (reached in2010) representes K12's first foray into bricks-and-mortar school management. Through the agreement K12 is authorized to serve up to 460 students in grades 6-12. K12 intends to expand its work with school districts and has established a dedicated sales team to further that effort. The services it provides to districts include teacher training programs, administrator support, and a student account management system.
In FY 2012 the company saw an increase in revenues due to sales growth in its Managed Public Schools, Institutional Business, and International and Private Pay Business segments. Managed Public Schools revenues saw organic growth of $116.7 million and acquired growth of $25.4 million; Institutional Business revenues grew as the result of the full year effect of acquired businesses, such asAmerican Education Corporation (AEC); and International and Private Pay revenues grew through the IS Berne acquisition. Revenues for the Managed Public Schools grew 31% year-over-year, while total average enrollment growth for Managed Public Schools students grew by 41%.
Net income increased in FY 2012 due to a drop in interest expenses -- $1 million, as compared to net interest expense of $1.2 million for the prior fiscal year, primarily due to lower interest rates on capital leases and equipment financing arrangements.
K12's growth strategy consists of leveraging the investments it has made in curriculum, online learning, and school management, to serve adjacent markets and to diversify its risk profile. It plans to increase enrollment in its public school programs and expand into additional US states and cities while increasing its institutional and international footprint.
In 2011 the company acquired IS Berne, a traditional private school located in Berne, Switzerland serving students in grades Pre-K through 12. That year K12 agreed to acquire the online high school business of Kaplan. The unit targets adults without high school diplomas and high school students who are looking to augment their brick-and-mortar education.
K12 started out offering programs for children in kindergarten through second grade. It gradually expanded and now instruction all the way up to a self-paced high school program. The company made a greater investment in its middle and high school products with its 2010 acquisition of KC Distance Learning (KCDL). The purchase brought in three brands targeting both public and private schools: Aventa Learning, The Keystone School, and iQ Academies. Also that year K12 formed a 60-40 joint venture with Middlebury College to create online foreign language classes.
In late 2010, K12 acquired AEC, a provider of research-based core curriculum instructional software for kindergarten through adult learners. The acquisition added to K12's portfolio of instructional and curriculum offerings and assessment tools.
In 2012 the Learning Group LLC held 19% of the company, Jon Q. Reynolds, 11%.
CEO Ron Packard founded K12 in 2000.
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