Capella Plans Job Cuts as New Enrollments Sink

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“While Capella (NASDAQ: CPLA) produced strong full year 2010 results, we are now operating in an uncertain environment,” said Kevin Gilligan, chairman and chief executive officer of Capella Education Company. “The current uncertainty is driven by weaker demand for higher-education, regulatory uncertainty and increased competition for the high-quality learners that have historically been attracted to Capella’s academic rigor and graduate focus.”

…The company expects to adjust spending levels and reduce excess support capacity by eliminating approximately 125 positions representing about 8 percent of our non-faculty workforce, resulting in a charge of about $2 million in the quarter ending March 31, 2011 and an annualized cost savings of approximately $12 to $12.5 million..”

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