a6810922.htm
 


UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
(Mark One)
þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934
 
For the quarterly period ended June 30, 2011
 
or
 
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from            to
 
Commission File Number:   -   001-33810
 
AMERICAN PUBLIC EDUCATION, INC.
(Exact name of registrant as specified in its charter)
 
Delaware
 
01-0724376
(State or other jurisdiction of
 
(I.R.S. Employer
Incorporation or organization)
 
Identification No.)
 
111 West Congress Street
Charles Town, West Virginia 25414
(Address, including zip code, of principal executive offices)
 
(304) 724-3700
(Registrant’s telephone number, including area code)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes þ No o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes o    No  o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. See the definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 
Large accelerated filer þ
Accelerated filer o
 
Non-accelerated filer o
Smaller reporting company o
 
(Do not check if a smaller reporting company)
 
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes o No þ
 
The total number of shares of common stock outstanding as of August 8, 2011 was 17,832,022.
 
 
 

 
 
AMERICAN PUBLIC EDUCATION, INC.
FORM 10-Q
INDEX
 
 
 
Page
PART I – FINANCIAL INFORMATION
   
   
3
10
15
15
   
   
PART II – OTHER INFORMATION
   
   
16
16
17
17
17
17
18
   
19
 
 
2

 
 
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
AMERICAN PUBLIC EDUCATION, INC.
Consolidated Balance Sheets
(In thousands)
 
    As of June 30,     As of December 31,  
    2011     2010  
    (Unaudited)        
ASSETS  
Current assets:
           
Cash and cash equivalents
  $ 94,503     $ 81,352  
Accounts receivable, net of allowance of $1,224 in 2011 and                
$1,050 in 2010
    10,077       10,269  
Prepaid expenses
    4,581       4,233  
Income tax receivable
    528       780  
Deferred income taxes
    1,965       1,369  
                 
Total current assets
    111,654       98,003  
Property and equipment, net
    45,197       42,415  
Other assets, net
    1,695       1,421  
Total assets
  $ 158,546     $ 141,839  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
               
Accounts payable
  $ 8,831     $ 9,422  
Accrued liabilities
    9,561       9,349  
Deferred revenue and student deposits
    22,635       18,815  
                 
Total current liabilities
    41,027       37,586  
Deferred income taxes
    7,324       6,953  
Total liabilities
    48,351       44,539  
                 
Commitments and contingencies (Note 2)                
                 
Stockholders’ equity:
               
Preferred stock, $.01 par value;                
Authorized shares - 10,000; no shares issued or outstanding     -       -  
Common stock, $.01 par value;
               
Authorized shares - 100,000; 18,691 issued and 17,851
               
outstanding in 2011; 18,593 issued and 17,911                
outstanding in 2010
    187       186  
Additional paid-in capital
    144,497       141,757  
Less cost of 840 shares of repurchased stock in 2011 and
               
682 shares of repurchased stock in 2010
    (26,645 )     (19,966 )
Accumulated deficit
    (7,844 )     (24,677 )
                 
Total stockholders’ equity
    110,195       97,300  
                 
Total liabilities and stockholders' equity
  $ 158,546     $ 141,839  
 
The accompanying notes are an integral part of these consolidated financial statements.
 
 
3

 
 
AMERICAN PUBLIC EDUCATION, INC.
Consolidated Statements of Income
(In thousands, except share and per share amounts)
 
    Three Months Ended    
Six Months Ended
 
   
June 30,
   
June 30,
 
    2011     2010     2011     2010  
   
(Unaudited)
   
(Unaudited)
 
                         
Revenues
  $ 60,795     $ 46,254     $ 119,459     $ 93,565  
Costs and expenses:
                               
Instructional costs and services
    23,011       17,376       45,116       35,401  
Selling and promotional
    9,721       8,120       20,605       15,229  
General and administrative
    10,910       7,451       21,421       15,083  
Depreciation and amortization
    2,242       1,568       4,335       2,976  
                                 
Total costs and expenses
    45,884       34,515       91,477       68,689  
                                 
Income from operations before
                               
interest income and income taxes
    14,911       11,739       27,982       24,876  
Interest income, net
    25       35       52       57  
                                 
Income before income taxes
    14,936       11,774       28,034       24,933  
Income tax expense
    5,960       4,749       11,201       10,260  
                                 
Net income
  $ 8,976     $ 7,025     $ 16,833     $ 14,673  
                                 
 
                               
Net Income per common share:
                               
Basic
  $ 0.50     $ 0.38     $ 0.94     $ 0.80  
 
                               
Diluted
  $ 0.49     $ 0.37     $ 0.92     $ 0.77  
                             
Weighted average number of
                               
common shares:                                
Basic
    17,890,298       18,407,149       17,912,423       18,364,843  
 
                               
Diluted
    18,345,775       19,032,440       18,359,223       19,001,369  

The accompanying notes are an integral part of these consolidated financial statements.
 
 
4

 
 
AMERICAN PUBLIC EDUCATION, INC.
Consolidated Statements of Cash Flows
(In thousands)
 
    Six Months Ended June 30,  
    2011     2010  
    (Unaudited)  
             
Operating activities
 
 
       
Net income
  $ 16,833     $ 14,673  
Adjustments to reconcile net income to net cash provided by
               
operating activities                
Provision for bad debt
    174       833  
Depreciation and amortization
    4,335       2,976  
Stock-based compensation
    1,608       1,477  
Stock issued for director compensation
    69       102  
Deferred income taxes
    (225 )     2  
Changes in operating assets and liabilities:
               
Accounts receivable
    18       (1,180 )
Prepaid expenses and other assets
    (831 )     178  
Income tax receivable
    252       (856 )
Accounts payable
    (591 )     (1,307 )
Accrued liabilities
    212       (485 )
Deferred revenue and student deposits
    3,820       1,741  
                 
Net cash provided by operating activities
    25,674       18,154  
                 
Investing activities
               
Capital expenditures
    (6,796 )     (8,477 )
Capitalized program development costs and other assets
    (112 )     (258 )
                 
Net cash used in investing activities
    (6,908 )     (8,735 )
                 
Financing activities
               
Cash paid for repurchase of common stock
    (6,903 )     (66 )
Cash received from issuance of common stock
    688       833  
Excess tax benefit from stock based compensation     600       1,111  
                 
Net cash (used in) provided by financing activities
    (5,615 )     1,878  
                 
Net increase in cash and cash equivalents
    13,151       11,297  
Cash and cash equivalents at beginning of period
    81,352       74,866  
                 
Cash and cash equivalents at end of period
  $ 94,503     $ 86,163  
                 
Supplemental disclosure of cash flow information
               
Income taxes paid
  $ 10,575     $ 10,003  

The accompanying notes are an integral part of these consolidated financial statements.
 
 
5

 
 

AMERICAN PUBLIC EDUCATION, INC.
Notes to Consolidated Financial Statements
 
 
 
1. Nature of the Business
 
American Public Education, Inc. (“APEI”) together with its subsidiary (the “Company”) is a provider of exclusively online postsecondary education directed primarily at the needs of the military and public service communities that operates in one reportable segment. APEI’s one subsidiary is American Public University System, Inc. (the “University System”), a West Virginia corporation, which is a regionally accredited post-secondary online university that includes American Military University and American Public University.
 
The University System achieved regional accreditation in May 2006 with The Higher Learning Commission of the North Central Association of Colleges and Schools and became eligible for participation in federal student aid programs under Title IV of the Higher Education Act of 1965, which we refer to as Title IV Programs, for classes beginning in November 2006.
 
2. Basis of Presentation
 
The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).  All intercompany transactions have been eliminated in consolidation.   The financial statements do not include all of the information and footnotes required by GAAP for complete financial statement presentations. In the opinion of management, these statements include all adjustments (consisting of normal recurring adjustments) considered necessary to present a fair statement of our consolidated results of operations, financial position and cash flows. Operating results for any interim period are not necessarily indicative of the results that may be expected for the year ending December 31, 2011. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and footnotes in its audited financial statements included in its Annual Report, on Form 10-K, for the year ended December 31, 2010.
 
    Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

    Recent Accounting Pronouncements

There have been no applicable pronouncements since our last filing.
 
    Commitments and Contingencies
 
The Company accrues for costs associated with contingencies including, but not limited to, regulatory compliance and legal matters when such costs are probable and can be reasonably estimated. Liabilities established to provide for contingencies are adjusted as further information develops, circumstances change, or contingencies are resolved. The Company bases these accruals on management’s estimate of such costs, which may vary from the ultimate cost and expenses associated with any such contingency.
 
From time to time the Company may be involved in litigation in the normal course of its business.  The Company is not aware of any pending or threatened litigation matters that, in the opinion of management, will have a material adverse effect on the Company’s business, operations, financial condition or cash flows.
 
On February 28, 2011 the U.S. Department of Education began an on-site program review of the University System’s administration of the Title IV programs.  In general, after the Department of Education conducts its site visit and reviews data supplied by the institution, the Department of Education sends the institution a program review report.  The institution has the opportunity to respond to the findings in the program review report.  The Department of Education then issues a final program review determination letter, which identifies any liabilities.  The institution may appeal any monetary liabilities specified in the final program review determination letter.  The site visit for the University System’s program review, which covered the 2009-2010 and 2010-2011 award years, took place from February 28, 2011 through March 4, 2011.

 
 
 
6

 
 
The Company received the program review report in April 2011.  The report includes three findings, two of which involve individual student-specific errors.  The third finding is that the University System’s policies failed to treat certain students as having unofficially withdrawn from the institution and that the University consequently failed to calculate and return federal student financial aid that the University System was required to return to the Department of Education as the result of these unofficial withdrawals. The Department has taken the position that students who did not “earn an F grade” in a payment period should be treated as having unofficially withdrawn from the school, even if they had future course registrations in the next payment period. The Company disagrees with this interpretation of Department of Education regulations and filed a response to the Department of Education in June 2011.  The Department of Education has not specified a potential penalty, and the Company has not accrued any amounts in connection with the program review.  The Company believes that if it is liable for refunds to the Department of Education for these students, the amount could be up to approximately $837,000 and would be offset in the Company’s financial results by any amounts that the Company may eventually collect from the students to whom the funds were disbursed or amounts these students may have already repaid the Department.  As part of the process of responding to this finding, the Company continues to provide the Department with requested information and documents.
 
   Concentration
 
Approximately 44%  and 45% of the Company’s revenues for the three and six month periods ended June 30, 2011 were derived from students who received tuition assistance from tuition assistance programs sponsored by the United States Department of Defense compared to approximately 51% and 52% of the Company’s revenues for the three and six months ended June 30, 2010, respectively. Approximately 34% and 32% of the Company’s revenues for the three and six months ended June 30, 2011, respectively, were from students using financial aid under the Title IV programs compared to 22% and 21% for the three and six months ended June 30, 2010, respectively. A reduction in either of these programs could have a significant impact on the Company’s operations.
 
3. Net Income Per Common Share
 
Basic net income per common share is based on the weighted average number of shares of common stock outstanding during the period. Diluted net income per common share increases the shares used in the per share calculation by the dilutive effects of options and restricted stock.  Stock options and restricted stock are not included in the computation of diluted earnings per share when their effect is anti-dilutive.  There were no anti-dilutive stock options or restricted stock excluded from the calculation for the three months and six months ended June 30, 2011 and the three and six months ended June 30, 2010.
 
4. Income Taxes  
 
The Company is subject to U.S. Federal income taxes as well as income taxes of multiple state jurisdictions.  For Federal and state tax purposes, tax years 2007-2010 remain open to examination.
 
5. Stock Based Compensation

On March 15, 2011, the Board of Directors adopted the American Public Education, Inc. 2011 Omnibus Incentive Plan (the “2011 Incentive Plan”), and APEI’s stockholders approved the 2011 Incentive Plan on May 6, 2011, at which time the 2011 Incentive Plan became effective. Upon effectiveness of the 2011 Incentive Plan, APEI ceased making awards under the 2007 Omnibus Incentive Plan. The 2011 Incentive Plan allows APEI to grant up to 2,000,000 shares plus any shares of common stock that are subject to outstanding awards under the 2002 Stock Plan or the 2007 Incentive Plan that terminate due to expiration, forfeiture, cancelation or otherwise without the issuance of such shares.  As of June 30, 2011, there were 1,195,375 shares subject to outstanding awards under the 2002 Stock Plan and the 2007 Incentive Plan.  Awards under the 2011 Incentive Plan may include the following award types: stock options, which may be either incentive stock options or nonqualified stock options; stock appreciation rights; restricted stock; restricted stock units; dividend equivalent rights; performance shares; performance units; cash-based awards; other stock-based awards, including unrestricted shares; or any combination of the foregoing.

 
7

 

Stock-based compensation expense related to restricted stock grants is expensed over the vesting period using the straight-line method for Company employees and the graded-vesting method for members of the Board of
Directors and is measured using APEI’s stock price on the date of grant. The fair value of each option award is estimated at the date of grant using a Black-Scholes option-pricing model that uses the assumptions noted in the
following table. We calculate the expected term of stock option awards using the “simplified method” in accordance with Staff Accounting Bulletins (SAB) No. 107 and 110 because we lack sufficient historical data and are unable to make reasonable expectations regarding the future. We also estimate forfeitures of share-based awards at the time of grant and revise such estimates in subsequent periods if actual forfeitures differ from original projections. We make assumptions with respect to expected stock price volatility based on the average historical volatility of peers with similar attributes. In addition, we determine the risk free interest rate by selecting the U.S. Treasury five-year constant maturity, quoted on an investment basis in effect at the time of grant for that business day.
 
   
June 30, 2011
   
June 30, 2010
 
Expected volatility
    39.04 %     26.46 %
Expected dividends
    0.00 %     0.00 %
Expected term, in years
    4.5       4.5  
Risk-free interest rate
    2.01 %     2.65 %
Weighted-average fair value of options                
granted during the year
  $ 13.22     $ 9.37  
 
Options granted through June 30, 2011 vest ratably over periods of three to five years and expire in seven to ten years from the date of grant.  Option activity is summarized as follows (unaudited):
 
                     
Aggregate
 
         
Weighted
   
Weighted-Average
   
Intrinsic
 
   
Number
   
Average
   
Contractual
   
Value
 
   
of Options
   
Exercise Price
   
Life (Yrs)
   
(In thousands)
 
Outstanding, December 31, 2010
    1,022,726     $ 16.63              
Options granted
    177,950     $ 37.52              
Awards exercised
    (77,007 )   $ 8.93              
Awards forfeited
    (2,733 )   $ 25.19              
                             
Outstanding, June 30, 2011
    1,120,936     $ 20.46       5.11     $ 26,962  
                                 
Exercisable, June 30, 2011
    774,704     $ 13.68       4.71     $ 23,883  

 
8

 
 
The following table summarizes information regarding stock option exercises (unaudited):
 
   
June 30, 2011
   
June 30, 2010
 
   
(In thousands)
 
Proceeds from stock options exercised
  $ 688     $ 833  
Intrinsic value of stock options exercised
  $ 2,620     $ 6,523  
Tax benefit from exercises
  $ 1,012     $ 1,393  
 
The table below summarizes the restricted stock activity for the six months ended June 30, 2011 (unaudited):
 
         
Weighted-Average
 
   
Number
   
Grant Price
 
   
of Shares
   
and Fair Value
 
Non vested, December 31, 2010
    59,119     $ 37.03  
Shares granted
    40,375     $ 37.52  
Vested shares
    (24,872 )   $ 37.98  
Shares forfeited
    (183 )   $ 35.62  
Non vested, June 30, 2011
    74,439     $ 36.98  
 
Stock based compensation cost charged against income during the three and six month period ended June 30, 2011 and June 30, 2010 is as follows:
 
     
Three Months Ended
     
Six Months Ended
 
     
June 30,
     
June 30,
 
     
2011
     
2010
     
2011
     
2010
 
     
(Unaudited)
     
(Unaudited)
 
     
(In thousands)
     
(In thousands)
 
Instructional costs and services
  $ 214     $ 189     $ 468     $ 365  
Marketing and promotional
    78       56       165       115  
General and administrative
    454       477       975       997  
Stock-based compensation expense in operating income
   
746
      722       1,608       1,477  
Tax benefit
    (294 )     (275 )     (628 )     (554 )
Stock-based compensation expense, net of tax
  $ 452     $ 447     $ 980     $ 923  
 
As of  June 30, 2011, there was $5.3 million of total unrecognized compensation cost, representing $3.1 million of unrecognized compensation cost associated with share-based compensation arrangements, and $2.2 million of unrecognized compensation cost associated with non-vested restricted stock.  The total remaining cost is expected to be recognized over a weighted average period of 1.1 years.
 
 
9

 
 
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
 
                The following discussion of our historical results of operations and our liquidity and capital resources should be read in conjunction with the consolidated financial statements and related notes that appear elsewhere in this report.
 
Forward-Looking Statements

Some of the statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”).  We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (“SEC”).  We may, in some cases, use words such as “project,” “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “should,” “would,” “could,” “potentially,” “will,” or “may,” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account information currently available to us.  These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us or are within our control.  If a change occurs, our business, financial condition and results of operations may vary materially from those expressed in our forward-looking statements.  There are a number of important factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements.  These important factors include those that we discuss in this section of this Form 10-Q, in the “Risk Factors” section of this Form 10-Q,  in the “Risk Factors” section of our annual report on Form 10-K for the fiscal year ended December 31, 2010 (the “Annual Report”) and in our various filings with the SEC.  You should read these factors and the other cautionary statements made in this Form 10-Q in combination with the more detailed description of our business in our Annual Report as being applicable to all related forward-looking statements wherever they appear in this quarterly report.  If one or more of these factors materialize, or if any underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from any future results, performance or achievements expressed or implied by these forward-looking statements.  We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
 
Overview
 
   Background
 
             American Public Education, Inc. is a provider of online postsecondary education directed primarily at the needs of the military and public service communities. We operate through the American Public University System, a regionally accredited online university that includes American Military University, or AMU, and American Public University, or APU.

We were founded as American Military University, Inc. in 1991 and began offering graduate courses in January 1993. Following initial national accreditation by the Accrediting Commission of the Distance Education and Training Council, or DETC, in 1995, American Military University began offering undergraduate programs primarily directed to members of the armed forces. Over time, American Military University diversified its educational offerings in response to demand by military students for post-military career preparation. With its expanded program offerings, American Military University extended its outreach to the greater public service community, primarily police, fire, emergency management personnel and national security professionals. In 2002, we reorganized into a holding company structure, with American Public Education, Inc. serving as the holding company of American Public University System, Inc., which operates the American Public University System, which includes AMU and APU. Our university system achieved regional accreditation in May 2006 with The Higher Learning Commission of the North Central Association of Colleges and Schools and became eligible for participation in federal student financial aid programs under Title IV of the Higher Education Act of 1965, which we refer to as Title IV programs, for classes beginning in November 2006.

The university system offers terms beginning on the first Monday of each month in either eight or sixteen-week formats.  Semesters and academic years are established to manage requirements for participation in Title IV programs and to assist students who are utilizing Title IV programs in meeting eligibility requirements.

   Summary

Adjusted net course registrations increased 28% and 29% for the three and six month period ended June 30, 2011 over the three and six month period ended June 30, 2010. Adjusted net course registrations are net course registrations that are adjusted to reflect that beginning January 3, 2011, the Company combined one-credit lab courses with their related three-credit classes. As a result, adjusted net course registration growth rates exclude other non-credit registrations and are presented as if labs and classes were combined in the prior year period. Our revenue increased from $46.3 million to $60.8 million, or by 31%, and $93.6 million to $119.5 million, or by 28%, for the three and six month period ended June 30, 2011 over the three month and six month period ended June 30, 2010, respectively.   Operating margins decreased to 24.5% from 25.3% and 23.5% from 26.6% for the three month and six month period ended June 30, 2011 over the three and six month period ended June 30, 2010, respectively.
 
 
10

 
 
Our results of operations normally fluctuate as a result of variations in our business, principally due to the level of our selling and promotional expenses and changes in enrollment, and we expect that going forward we will see a more pronounced seasonal fluctuation in new enrollments due to our increasing civilian population. In the second quarter of 2010, we experienced slower growth in active duty military registrations. As a result, beginning with the third quarter of 2010 we increased, and in subsequent quarters we continued to increase, our marketing spend to attempt to increase civilian registrations.  In what we believe is a challenging time for the industry, we believe that the long term health of our business is best served by continuing to focus on marketing and promotional activities intended to expand awareness of our brand and increase net registrations from the civilian market.
 
Critical Accounting Policies
 
Critical accounting policies are disclosed in our consolidated financial statements and footnotes in the audited financial statements for the year ended December 31, 2010 included in our Annual Report for the year ended December 31, 2010.  There have been no significant changes in our critical accounting policies from those disclosed in the Annual Report.
 
Results of Operations
 
The following table sets forth statements of income data as a percentage of revenues for each of the periods indicated:
 
   
Three Months
   
Six Months
 
   
Ended June 30,
   
Ended June 30,
 
   
2011
   
2010
   
2011
   
2010
 
                         
Revenues
    100.0 %     100.0 %     100.0 %     100.0 %
Costs and expenses:
                               
Instructional costs and services
    37.9       37.6       37.8       37.8  
Selling and promotional
    16.0       17.6       17.2       16.3  
General and administrative
    17.9       16.1       17.9       16.1  
Depreciation and amortization
    3.7       3.4       3.6       3.2  
                                 
Total costs and expenses
    75.5       74.7       76.5       73.4  
                                 
Income from operations before
                               
interest income and income taxes
    24.5       25.3       23.5       26.6  
Interest income, net
    -       0.1       -       0.1  
 
                               
Income from operations
                               
before income taxes
    24.5       25.4       23.5       26.7  
Income tax expense
    9.8       10.3       9.4       11.0  
                                 
Net Income
    14.7 %     15.1 %     14.1 %     15.7 %
 
 
11

 
 
Three Months Ended June 30, 2011 Compared to Three Months Ended June 30, 2010
 
     Revenues. Our revenues for the three months ended June 30, 2011 were $60.8 million, an increase of $14.5 million, or 31%, compared to $46.3 million for the three months ended June 30, 2010. The increase was primarily a result of an increase in the number of net course registrations from new civilian students.
 
     Costs and Expenses.  Costs and expenses for the three months ended June 30, 2011 were $45.9 million, an increase of $11.4 million, or 33%, compared to $34.5 million for the three months ended June 30, 2010.  Costs and expenses as a percentage of revenues increased to 75.5% for the three months ended June 30, 2011 from 74.7% for the three months ended June 30, 2010.
 
     Instructional costs and services expenses. Our instructional costs and services expenses for the three months ended June 30, 2011 were $23.0 million, representing an increase of 32% from $17.4 million for the three months ended June 30, 2010.  This increase was directly related to an increase in the number of classes offered due to the increase in net course registrations.  Instructional costs and services expenses as a percentage of revenues were 37.9% for the three months ended June 30, 2011, compared to 37.6% for the three months ended June 30, 2010. 
 
     Selling and promotional expenses. Our selling and promotional expenses for the three months ended June 30, 2011 were $9.7 million, representing an increase of 20% from $8.1 million for the three months ended June 30, 2010.  This increase was primarily due to an increase in civilian outreach, online advertising and media advertising expenses.  Selling and promotional expenses as a percentage of revenues decreased to 16.0% for the three months ended June 30, 2011 from 17.6% for the three months ended June 30, 2010.  This decrease as a percent of revenue is a result of increased civilian registrations from greater awareness of the APU brand.
 
     General and administrative expenses. Our general and administrative expenses for the three months ended June 30, 2011 were $10.9 million representing an increase of 45% from $7.5 million for the three months ended June 30, 2010.  The increase in expense was a result of an increase in expenditures for financial aid processing fees, bad debt expense and expenditures for technology required to support the increase in civilian students and regulatory changes.  General and administrative expenses as a percentage of revenues increased to 17.9% for the three months ended June 30, 2011 from 16.1% for the three months ended June 30, 2010.  The percentage increase was primarily due to financial aid processing, bad debt expense and technology spending increases to manage the increase in civilian students and regulatory changes.
 
     Depreciation and amortization. Depreciation and amortization expenses were $2.2 million for the three months ended June 30, 2011, compared with $1.6 million for the three months ended June 30, 2010.  This represents an increase of 38%.  This increase resulted from greater capital expenditures and higher depreciation and amortization on a larger fixed asset base.
 
     Stock-based and other compensation expenses. Stock-based compensation expenses included in instructional costs and services, selling and promotional, and general and administrative expense for the three months ended June 30, 2011 were $746,000 in the aggregate, representing an increase of 3% from $722,000 for the three months ended June 30, 2010.  The increase in stock-based compensation for the three months ended June 30, 2011 is primarily attributable to new grants issued in the first quarter of 2011.
 
     Income tax expense. We recognized income tax expense for the three months ended June 30, 2011 and June 30, 2010 of $6.0 million and $4.7 million, respectively, or effective tax rates of 39.9% and 40.3%, respectively.
 
   Net income. Our net income was $9.0 million for the three months ended June 30, 2011, compared to net income of $7.0 million for the three months ended June 30, 2010, an increase of $2.0 million, or 29%.  This increase was related to the factors discussed above.
 
 
12

 
 
Six Months Ended June 30, 2011 Compared to Six Months Ended June 30, 2010
 
     Revenues. Our revenues for the six months ended June 30, 2011 were $119.5 million, an increase of $25.9 million, or 28%, compared to $93.6 million for the six months ended June 30, 2010. The increase was primarily a result of an increase in the number of net course registrations from new civilian students.
 
     Costs and Expenses.  Costs and expenses for the six months ended June 30, 2011 were $91.5 million, an increase of $22.8 million, or 33%, compared to $68.7 million for the six months ended June 30, 2010.  Costs and expenses as a percentage of revenues increased to 76.5% for the six months ended June 30, 2011 from 73.4% for the six months ended June 30, 2010.
 
     Instructional costs and services expenses. Our instructional costs and services expenses for the six months ended June 30, 2011 were $45.1 million, representing an increase of 27% from $35.4 million for the six months ended June 30, 2010.  This increase was directly related to an increase in the number of classes offered due to the increase in net course registrations.  Instructional costs and services expenses as a percentage of revenues were 37.7% for the six months ended June 30, 2011, compared to 37.8% for the six months ended June 30, 2010.    
 
     Selling and promotional expenses. Our selling and promotional expenses for the six months ended June 30, 2011 were $20.6 million, representing an increase of 36% from $15.2 million for the six months ended June 30, 2010.  This increase was primarily due to an increase in civilian outreach, online advertising and media advertising expenses.  Selling and promotional expenses as a percentage of revenues increased to 17.2% for the six months ended June 30, 2011 from 16.3% for the six months ended June 30, 2010.  This increase reflects additional marketing expense to attempt to increase civilian registrations and to expand awareness of the APU brand to the civilian market.
 
     General and administrative expenses. Our general and administrative expenses for the six months ended June 30, 2011 were $21.4 million representing an increase of 42% from $15.1 million for the six months ended June 30, 2010.  The increase in expense was a result of an increase in expenditures for recruiting, financial aid processing fees, bad debt expense and expenditures for technology required to support a larger civilian student population and regulatory changes.  General and administrative expenses as a percentage of revenues increased to 17.9% for the six months ended June 30, 2011 from 16.1% for the six months ended June 30, 2010.  The percentage increase was primarily due to recruiting, financial aid processing, bad debt expense and technology spending increases to manage the increase in civilian students and regulatory changes.
 
     Depreciation and amortization. Depreciation and amortization expenses were $4.3 million for the six months ended June 30, 2011, compared with $3.0 million for the six months ended June 30, 2010.  This represents an increase of 43%.  This increase resulted from greater capital expenditures and higher depreciation and amortization on a larger fixed asset base.

     Stock-based and other compensation expenses. Stock-based compensation expenses included in instructional costs and services, selling and promotional, and general and administrative expense for the six months ended June 30, 2011 were $1.6 million in the aggregate, representing an increase of 7% from $1.5 million for the six months ended June 30, 2010.  The increase in stock-based compensation for the six months ended June 30, 2011 is primarily attributable to new grants issued in the first quarter of 2011.
 
 
13

 
 
     Income tax expense. We recognized income tax expense for the six months ended June 30, 2011 and June 30, 2010 of $11.2 million and $10.3 million, respectively, or effective tax rates of 40.0% and 41.2%, respectively.     
 
Net income. Our net income was $16.8 million for the six months ended June 30, 2011, compared to net income of $14.7 million for the six months ended June 30, 2010, an increase of $2.1 million, or 14%.  This increase was related to the factors discussed above.
 
Liquidity and Capital Resources
 
     Liquidity
 
The Company financed operating activities and capital expenditures during the six months ended June 30, 2011 and 2010 primarily through cash provided by operating income and proceeds received from the exercise of stock options.  Cash and cash equivalents were $94.5 million and $86.2 million at June 30, 2011 and June 30, 2010, respectively, representing an increase of $8.3 million, or 9.6%.
 
We derive a significant portion of our revenues from tuition assistance programs from the Department of Defense, or DoD.  Generally, these funds are received within 60 days of the start of the classes to which they relate.  A growing source of revenue is derived from our participation in Title IV programs, for which disbursements are governed by federal regulations.  We have typically received disbursements under Title IV programs within 30 days of the start of the applicable class. These factors, together with the number of classes starting each month, affect our operational cash flow.
 
Our costs and expenses have increased with the increase in student enrollment, as well as our increased selling and promotional expenses, and we expect to fund these expenses through cash generated from operations. Based on our current level of operations and anticipated growth, we believe that our cash flow from operations and other sources of liquidity, including cash and cash equivalents, will provide adequate funds for ongoing operations and planned capital expenditures for the foreseeable future.

    Operating Activities

                Net cash provided by operating activities was $25.7 million and $18.2 million for the six months ended June 30, 2011 and 2010, respectively.  As revenue and profits have grown, cash has increased.
 
    Investing Activities
 
                Net cash used in investing activities was $6.9 million and $8.7 million for the six months ended June 30, 2011 and 2010, respectively.  Capital expenditures were related to the acquisition of existing structures, new construction projects due to our ongoing evaluation of space needs and our continued investment in systems. We expect these factors, and potentially others, to cause capital expenditures to increase in future periods, including in the near term.
 
    Financing Activities
 
                Net cash used in financing activities for the six months ended June 30, 2011 was $5.6 million from the repurchase of our common stock, net of cash received from the issuance of common stock as a result of stock option exercises, and the excess tax benefit from stock based compensation. Net cash provided by financing activities for the six months ended June 30, 2010 was $1.9 million from cash received from the issuance of common stock as a result of stock option exercises and the excess tax benefit from stock based compensation offset by the repurchase of common stock.
 
        The Board of Directors has authorized a repurchase program to repurchase up to the cumulative number of shares issued or deemed issued under the Company’s equity incentive and stock purchase plans after January 1, 2011, which for 2011 management currently estimates to be approximately 219,208 shares of the Company’s common stock.  As of June 30, 2011 the Company had repurchased 158,000 shares under the repurchase program for an aggregate amount of $6.7 million.
 
Regulatory Update
 
    In July 2011, The Higher Learning Commission reaffirmed accreditation of American Public University Systems (APUS) without any stipulations on its affiliation status. APUS’s next comprehensive evaluation is scheduled for the 2020-21 academic year, and it has an interim progress report regarding development of University-wide coordination and improvement of graduate studies due in July 2015.

On February 28, 2011 the U.S. Department of Education began an on-site program review of the University’s administration of the Title IV programs.  In general, after the Department of Education conducts its site visit and reviews data supplied by the institution, the Department of Education sends the institution a program review report.  The institution has the opportunity to respond to the findings in the program review report.  The Department of Education then issues a final program review determination letter, which identifies any liabilities.  The institution may appeal any monetary liabilities specified in the final program review determination letter.
 
 
14

 
 
The site visit for our program review, which covered the 2009-2010 and 2010-2011 award years, took place from February 28, 2011 through March 4, 2011.  In April 2010, we received the program review report.  The report includes three findings, two of which involve individual student-specific errors.  The third finding is that our policies improperly failed to treat certain students as having unofficially withdrawn from the institution and that we consequently failed to calculate and return federal student financial aid that we were required to return to the Department of Education as the result of these unofficial withdrawals.  The Department has taken the position that students who did not “earn an F grade” in a payment period should be treated as having unofficially withdrawn from the school, even if they had future course registrations in the next payment period.  We disagree with this interpretation of Department of Education regulations, and we timely responded to the program review indicating our disagreement.  As part of the process of responding to this finding, we continue to provide the Department with requested information and documents.  While the Department of Education has not specified a potential penalty, we believe that if we are liable for refunds to the Department of Education for these students, the amount could be up to approximately $1.2 million and would be offset in our financial results by any amounts that we may eventually collect from the students to whom the funds were disbursed or amounts these students may have already repaid the Department.
 
More information on the Title IV programs is contained in Part I, Item 1 of our Annual Report on Form 10-K under the heading “Regulation of our Business – Regulation of Title IV Financial Aid Programs” and in Part I, Item 1A of our Annual Report on Form 10-K under the heading “Risks Related to the Regulation of our Industry.”

Service members of the United States Armed Forces are eligible to receive tuition assistance from their branch of the armed forces that they may use to pursue postsecondary degrees. Service members of the United States Armed Forces can use tuition assistance at postsecondary schools that are accredited by accrediting agencies recognized by the U.S. Secretary of Education. Our tuition is currently structured so that tuition assistance payments for service members fully cover the service member’s per semester credit hour tuition cost of our undergraduate courses and cover more than 75% of the per course tuition cost of our graduate courses.  The current debate on the federal deficit has led to proposals to decrease the overall appropriations to the Department of Defense, which could lead to reductions in the size of the tuition assistance program or the amount that individual service members can use for particular courses.

Based on public statements made by Department of Defense, it appears the Department of Defense is considering possible changes to the tuition assistance program.  While the DoD has not made any public statements with specific information on this matter, we believe modifications may include a reduction of the per course tuition benefit (currently $750), a decrease in the annual cap (currently $4,500), and/or require that service members pay out-of-pocket for a portion of their tuition, among other possible changes.

At this time, the company is not able to estimate the potential impact of a reduction or change to military tuition assistance, and if we are no longer able to receive tuition assistance payments or the tuition assistance program is reduced or eliminated, our enrollments and revenues would be significantly reduced resulting in a material adverse effect on our results of operations and financial condition.  We estimate, however, that most service members will be eligible for Title IV and “Top-Up” to finance their out-of-pocket tuition costs. “Top-Up” is a program that allows service members to use a portion of their Veterans education benefits while still on active duty.  Some enlisted soldiers may also be able to cover out-of-pocket tuition costs by using Pell grants, although Pell grants may also be under pressure in the future.

Item 3. Quantitative and Qualitative Disclosures about Market Risk
 
           We are subject to risk from adverse changes in interest rates, primarily relating to our investing of excess funds in cash equivalents bearing variable interest rates, which are tied to various market indices.  Our future investment income will vary due to changes in interest rates.  At June 30, 2011, a 10% increase or decrease in interest rates would not have a material impact on our future earnings or cash flows related to investments in cash equivalents. We have no derivative financial instruments as of June 30, 2011.
 
Item 4. Controls and Procedures
 
   Evaluation of Disclosure Controls and Procedures
 
           Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2011 as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based upon the evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of June 30, 2011.
 
           Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
 
   Changes in Internal Control over Financial Reporting
 
                There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(f) and 15d-15(f) of the Exchange Act that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
 
 
15

 
 
PART II – OTHER INFORMATION
 
Item 1.  Legal Proceedings

On August 12, 2010, a putative class action lawsuit was commenced against the Company, Wallace E. Boston, Jr. ("Boston"), Frank B. McCluskey and Harry T. Wilkins ("Wilkins"), in the United States Court for the Northern District of West Virginia (Martinsburg Division), encaptioned Douglas N. Gaer v. American Public Education, Inc. et al, C.A. No. 3:10 CV-81. The plaintiff alleges that the Company and the individual defendants violated Section 10(b) of the Exchange Act, Rule 10b-5 promulgated thereunder and Section 20(a) of the Exchange Act. The plaintiff purports to be acting on behalf of a class consisting of purchasers or acquirers of the Company’s stock between February 22, 2010 to August 5, 2010 (the “Class Period”).  The plaintiff alleges that, as a result of the defendants' allegedly false misleading statements or omissions concerning the Company’s prospects, the Company’s common stock traded at artificially inflated prices throughout the Class Period. The plaintiff seeks compensatory damages and fees and costs, among other relief, but has not, at this time, specified the amount of damages being sought in this action.  In an order dated November 10, 2010, Douglas Gaer and the City of Miami Firefighters' and Police Officers' Retirement Trust were appointed co-lead plaintiffs and lead plaintiffs' counsel was approved.  On January 25, 2011, plaintiffs filed an Amended Complaint asserting the same statutory claims against the Company, Boston and Wilkins.  On or about March 10, 2011, defendants moved to dismiss the complaint in its entirety.  On or about April 25, 2011, plaintiffs filed an opposition to the motion to dismiss.   On May 16, 2011, the defendants filed a reply memorandum in support of their motion to dismiss.  The parties are now awaiting a decision from the Court.

On February 14, 2011, a complaint for declaratory judgment was commenced by American University System, Inc. against the Company’s wholly-owned subsidiary American Public University System, Inc. (“APUS”) and American University, in the United States District Court for the Northern District of Texas (Dallas Division), encaptioned American University System, Inc. v. American University and American Public University System, Inc. C.A. No. 3:11 CV-00282-L.  The plaintiff is seeking a judicial declaration that plaintiff has not infringed the trademarks of the defendants and that the trademarks of the defendants, including American Public University System and American Public University of the American Public University System are not valid trademarks.  APUS was served with the complaint on June 13, 2011.  On July 5, 2011, the defendants filed a motion seeking the dismissal of the complaint or, in the alternative, for the Court to transfer venue to the U.S. District Court for the District of Columbia.  On July 27, 2011, the plaintiff filed a brief in opposition to the defendant’s motion.  The defendants will file a response to the brief in opposition in August.  The Company believes that the complaint is without merit.

Item 1A. Risk Factors

An investment in our stock involves a high degree of risk. You should carefully consider the risks set forth in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2010, the risks set forth in the Risk Factors section of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2011 and all of the other information set forth in this Form 10-Q and our Form 10-K and the additional information in the other reports we file with the Securities and Exchange Commission. In addition, you should also consider the risk factors set forth below, which amend and supplement the risk factors referred to above, before deciding to invest in our common stock. If any of the risks contained in those reports, or described below, actually occur, our business, results of operation, financial condition and liquidity could be harmed, the value of our securities could decline and you could lose all or part of your investment.

Tuition assistance programs offered to United States Armed Forces personnel constituted 50% of our net course registrations for 2010 and over 45% of our net course registrations for the first six months of 2011, and our revenues and number of students would decrease if we are no longer able to receive funds under these tuition assistance programs or tuition assistance is reduced or eliminated.
 
Service members of the United States Armed Forces are eligible to receive tuition assistance from their branch of the armed forces that they may use to pursue postsecondary degrees. Service members of the United States Armed Forces can use tuition assistance at postsecondary schools that are accredited by accrediting agencies recognized by the U.S. Secretary of Education. Our tuition is currently structured so that tuition assistance payments for service members fully cover the service member’s per semester credit hour tuition cost of our undergraduate courses and cover more than 75% of the per course tuition cost of our graduate courses.  The current debate on the federal deficit has led to proposals to decrease the overall appropriations to the Department of Defense, which could lead to reductions in the size of the tuition assistance program or the amount that individual service members can use for particular courses.

Based on public statements made by Department of Defense, it appears the Department of Defense is considering possible changes to the tuition assistance program. While the DoD has not made any public statements with specific information on this matter, we believe modifications may include a reduction of the per course tuition benefit (currently $750), a decrease in the annual cap (currently $4,500), and/or require that service members pay out-of-pocket for a portion of their tuition, among other possible changes.  If we are no longer able to receive tuition assistance payments or the tuition assistance program is reduced or eliminated, our enrollments and revenues would be significantly reduced resulting in a material adverse effect on our results of operations and financial condition.
 
If we fail to maintain adequate systems and processes to detect and prevent fraudulent activity in student enrollment and financial aid, it will impact our ability to anticipate student retention and enrollment trends we may lose our ability to participate in Title IV programs or Department of Defense tuition assistance programs or have our participation in the Title IV programs conditioned or limited. 

We have been the target of fraudulent activity by outside parties with respect to student enrollment and student financial aid programs, and given our continued growth and status as an online education provider and our relatively low tuition we believe we will increasingly be subject to an increased level of such activities. We must maintain systems and processes to identify and prevent fraudulent applications for enrollment and financial aid.  We cannot be certain that our systems and processes will continue to be adequate in the face of increasing and increasingly sophisticated fraud schemes or that we will be able to expand such systems and processes at a pace consistent with our growth.
 
 
16

 
 
Increasing fraudulent activity may make it difficult for us to anticipate accurately underlying student growth and retention of students, which could impact our ability to forecast required resources and results.

The Department of Education requires institutions that participate in Title IV programs to refer to the Office of the Inspector General of the Department of Education any credible information indicating that any applicant, employee, third-party servicer, or agent of the institution that acts in a capacity that involves administration of the Title IV programs has been engaged in any fraud or other illegal conduct involving Title IV programs, and in the past we have referred to the Office of the Inspector General information with respect to potential fraud by applicants. If the systems and processes that we have established to detect and prevent fraud are inadequate, the Department of Education may find that we do not satisfy its “administrative capability” requirements. This could result in our being limited in our access to, or our losing, Title IV program funding, which would limit our potential for growth outside the military sector and adversely affect our enrollment, revenues and results of operations. See “Regulation of our Business” in this annual report for more information on the Department of Education’s regulations on administrative capability. In addition, our ability to participate in Title IV programs and the tuition assistance programs of the United States Armed Forces is conditioned on our maintaining accreditation by an accrediting agency that is recognized by the Secretary of Education. Any significant failure to detect adequately fraudulent activity related to student enrollment and financial aid could cause us to fail to meet our accrediting agencies’ standards. Furthermore, under HEOA, accrediting agencies that evaluate institutions that offer distance learning programs, as we do, must require such institutions to have processes through which the institution establishes that a student who registers for a distance education program is the same student who participates in and receives credit for the program. Failure to meet our accrediting agencies’ standards could result in the loss of accreditation at the discretion of our accrediting agencies, which could result in a loss of our eligibility to participate in Title IV programs and the tuition assistance programs of the United States Armed Forces.
 
 
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Repurchases
 
During the three month period ending June 30, 2011, the Company repurchased 158,000 shares of the Company's common stock, par value $0.01 per share. The chart below provides further detail as to the Company’s repurchases during the period.
 
   
Total Number of
Shares Purchased
 
Average Price Paid
per Share
 
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
 
Maximum Number
(or Approximate
Dollar Value) of
Shares  that May
Yet Be Purchased
Under the Plans or
Programs (1)(2)
January 1, 2011 – January 31, 2011
 
-
 
-
 
-
 
219,208
February 1, 2011 – February 28, 2011
 
-
 
-
 
-
 
219,208
March 1, 2011 – March 31, 2011
 
32,000
 
$41.21
 
32,000
 
187,208
April 1, 2011 - April 30, 2011
 
40,000
 
$41.56
 
40,000
 
147,208
May 1, 2011 to May 31, 2011
 
42,000
 
$43.51
 
42,000
 
105,208
June 1, 2011 to June 30, 2011
 
44,000
 
$42.53
 
44,000
 
61,208
Total
 
158,000
 
$42.28
 
158,000
 
61,208
 
 
(1)  
On March 5, 2011, the Company’s Board of Directors approved a stock repurchase program for its common stock, under which the Company may purchase up to the cumulative number of shares issued or deemed issued under the Company’s equity incentive and stock purchase plans, which the Board of Directors estimates to be up to 219, 208 shares of the Company’s common.  Repurchases may be made from time to time in the open market at prevailing market prices or in privately negotiated transactions from time to time based on business and market conditions.  The stock repurchase program may be suspended or discontinued at any time, and will be funded using the Company's available cash. 
 
(2)  
During the six months ended June 30, 2011, the Company was deemed to have repurchased 6,050 shares of common stock forfeited by employees to satisfy minimum tax-withholding requirements in connection with the vesting of restricted stock grants. These repurchases were not part of the Board authorized stock repurchase program.
 
 
Item 3. Defaults Upon Senior Securities
 
None.
 
 
Item 4. Removed and Reserved
 

 
 
Item 5. Other Information
 
None.
 
 
17

 
 
Item 6. Exhibits
 
Exhibit No.
Exhibit Description
 
10.01
American Public Education, Inc. 2011 Omnibus Incentive Plan. (Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on May 10, 2011 (File No. 001-33810).)
31.01
Certification of Chief Executive officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.02
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.01
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
EX-101.INS **
XBRL Instance Document
EX-101.SCH **
XBRL Taxonomy Extension Schema Document
EX-101.CAL **
XBRL Taxonomy Extension Calculation Linkbase Document
EX-101.DEF **
XBRL Taxonomy Extension Definition Linkbase Document
EX-101.LAB **
XBRL Taxonomy Extension Label Linkbase Document
EX-101.PRE **
XBRL Taxonomy Extension Presentation Linkbase Document
 
 
18

 
 
SIGNATURES
 
      Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
    AMERICAN PUBLIC 
   
 EDUCATION, INC.
     
 
/s/ Wallace E. Boston, Jr.
August 9, 2011
 
Dr. Wallace E. Boston, Jr.
 
 
President and Chief Executive Officer
 
 
(Principal Executive Officer)
 
     
     
     
 
/s/ Harry T.  Wilkins
August 9, 2011
 
Harry T. Wilkins
 
 
Executive Vice President and Chief Financial Officer
 
 
(Principal Financial and Principal Accounting Officer)
 
 
 
19