National American University Holdngs : September 29, 2016 - National American University Holdings, Inc. Reports Fiscal 2017 First Quarter Results

Company to host conference call on September 29, 2016, at 11:00 a.m. ET

Financial and Operational Highlights

• During the FY 2017 first quarter, combined enrollment in continuing education/workforce development, graduate, and doctoral programs increased 48.5% from the FY 2016 first quarter. Enrollment by total headcount for the FY 2017 first quarter (summer 2017 term) decreased 16.1% from the prior-year period, to 6,832 students as of August 31, 2016.

• Balance sheet at August 31, 2016, included cash and cash equivalents and investments of $20.8 million; taxes receivable of $3.8 million, working capital of $19.1 million; no outstanding lending debt; and stockholders' equity of 37.4 million, or approximately $1.55 per diluted share.

• FY 2017 first quarter total revenue was $21.1 million, compared to $24.6 million in the prior-year period. The Company's academic segment's revenue was $19.4 million in the FY 2017 first quarter, compared to $22.7 million in the prior-year period.

• FY 2017 first quarter net loss attributable to the Company was $2.0 million, compared to net loss attributable to the Company of $1.3 million in the prior-year period, primarily as a result of decreased revenue on lower enrollment and fixed educational services expenditures.

• The Board of Directors declared a cash dividend in the amount of $0.045 per share on all shares of the Company's common stock outstanding and of record as of the close of business on September 30, 2016, which will be paid on or about October 7, 2016.

Rapid City, South Dakota, September 28, 2016 - National American University Holdings, Inc. (the "Company") (NASDAQ: NAUH), which through its wholly owned subsidiary operates National American University ("NAU" or the "University"), a regionally accredited, proprietary, multi-campus institution of higher learning, today reported unaudited financial results for its fiscal 2017 first quarter ended August 31, 2016.

Ronald L. Shape, Ed.D., President and Chief Executive Officer of the Company, stated, "We continue to remain focused on our various strategic initiatives for long-term growth and remain confident that our University is well positioned in a challenging environment. We are very pleased with the enrollment growth in our continuing education and workforce development programs, the growth in our graduate program, and the growth in our doctoral program. However, the enrollment pressures in our undergraduate programs continued to be a factor for the summer term even though we have continued to adapt our operations appropriately while also placing greater emphasis on student engagement. We are leveraging our operational flexibility and balance sheet to take advantage of opportunities within our market. We continue to assist students impacted by schools that have closed or have announced that they are discontinuing enrollments. Over the past year, NAU has worked to accept transfers from other institutions where students have been unable to complete their education. We have worked closely with these individuals and new enrollees to highlight our academic programs and the commitment we have to our students' success. We have grown our continuing education enrollment, and are also expanding outside of the United States through accepting enrollments from students at Canadian institutions with which NAU partners. We believe that the infrastructure we have built over the past year has begun to gain traction. Overall, we are excited about the initiatives we continue to work on in FY 2017 and believe these opportunities will serve to strengthen the long-term foundation upon which NAU was built nearly 75 years ago."

Enrollment Update

Total NAU student enrollment for the summer 2017 term decreased 16.1% to 6,832 students from 8,139 during the prior summer term. Students enrolled in 57,800 credit hours compared to 70,621 credit hours during the prior summer term. The current average age of NAU's students continues to be in the mid-30s, with those seeking undergraduate degrees remaining the highest portion of NAU's student population.

The following is a summary of student enrollment at August 31, 2016, and August 31, 2015, by degree level and by instructional delivery method:

August 31, 2016

August 31, 2015

No. of

% of

No. of

% of

Continuing Ed 254 3.7% 116 1.4%

Doctoral 80 1.2% 77 0.9%

Graduate 312 4.6% 242 3.0% Undergraduate & Diploma 6,186 90.5% 7,704 94.7%

Total 6,832 100.0% 8,139 100.0%

No. of

% of

No. of

% of

Online 4,580 67.0% 5,608 68.9%

On-Campus 1,260 18.4% 1.326 16.3%

Hybrid 992 14.5% 1,205 14.8%

Total 6,832 100.0% 8,139 100.0%

The Company, through its wholly owned subsidiary, operates in two business segments: the academic segment, which consists of NAU's undergraduate, graduate, and doctoral education programs and contributes the primary portion of the Company's revenue; and ownership in and development of multiple apartments and condominium complexes from which it derives sales and rental income. The real estate operations generated approximately 1.0% of the Company's revenue for the quarter ended August 31, 2016.

Fiscal 2017 First Quarter Financial Results

• Total revenue for the FY 2017 first quarter was $21.1 million, compared to $24.6 million in the same period last year. The academic segment's tuition revenue was $19.4 million, compared to $22.7 million in the prior-year period. The academic segment's auxiliary (bookstore) revenue was $1.4 million for the FY 2017 first quarter, compared to $1.7 million in the prior year period. This decrease in academic segment revenue was primarily a result of a decrease in enrollment, which was driven by weaker market demand among NAU's targeted student demographic, but was partially offset by a Board of Governors-approved tuition increase of approximately 2.5% that became effective in the fall term.

• For the FY 2017 first quarter, educational services expense was $6.5 million, or 31% of the academic segment's total revenue, compared to $6.3 million, or 25.8%, for the FY 2016 first quarter. This percentage increase was a result of fixed costs, such as facility expenses, being compared to a decreasing revenue base and the additional expense to launch new programs and transfer programs from closing institutions.

  Educational services expense specifically relates to the academic segment, and includes salaries and benefits of faculty and academic administrators, costs of educational supplies, facility costs, faculty reference and support material and related academic costs.

• During the FY 2017 first quarter, SG&A expenses decreased to $16.5 million, or 78.0% of total revenue, from

  $19.0 million, or 77.1%, in the prior-year period.

• Loss before income taxes and non-controlling interest for the FY 2017 first quarter was $3.0 million, compared to a loss before income taxes and non-controlling interest of $2.1 million in the same period last year, primarily as a result of decreased revenue on lower enrollment.

  • Net loss attributable to the Company for the FY 2017 first quarter was $2.1 million, or $0.09 per diluted share based on 24.1 million shares outstanding, compared to net loss attributable to the Company of $1.3 million, or

    $0.05 per diluted share based on 25.2 million shares outstanding, in the prior-year period.

  • Losses before interest, tax, and depreciation and amortization ("LBITDA") for the FY 2017 first quarter were $1.5 million, compared to LBITDA of $0.5 million in the prior-year period. A table reconciling EBITDA/LBITDA to net income/loss can be found at the end of this release.

The Board of Directors declared a cash dividend in the amount of $0.045 per share on all shares of the Company's common stock outstanding and of record as of the close of business on September 30, 2016, that will be paid on or about October 7, 2016.

Management will discuss these results in a conference call (with accompanying presentation) on Thursday, September 29, 2016, at 11:00 a.m. ET.

The dial-in numbers are: (877) 407-9078 (U.S.)

(201) 493-6745 (International)

Accompanying Slide Presentation and Webcast

The Company will also have an accompanying slide presentation available in PDF format at the "Investor Relations" section of the NAU website at http://investors.national.edu. The presentation will be made available 30 minutes prior to the conference call. In addition, the call will be simultaneously webcast over the Internet via the "Investor Relations" section of the NAU website or by clicking on the conference call link: http://national.equisolvewebcast.com/q1-2017.

National American University Holdings, Inc., through its wholly owned subsidiary, operates National American University ("NAU"), a regionally accredited, proprietary, multi-campus institution of higher learning offering associate, bachelor's, master's, and doctoral degree programs in technical and professional disciplines. Accredited by the Higher Learning Commission, NAU has been providing technical and professional career education since 1941. NAU opened its first campus in Rapid City, South Dakota, and has since grown to multiple locations throughout the United States. In 1998, NAU began offering online courses. Today, NAU offers degree programs in traditional, online, and hybrid formats, which provide students increased flexibility to take courses at times and places convenient to their busy lifestyles.

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the Company's business. Statements made in this release, other than those concerning historical financial information, may be considered forward-looking statements, which speak only as of the date of this release and are based on current beliefs and expectations and involve a number of assumptions. These forward-looking statements include outlooks or expectations for earnings, revenue, expenses or other future financial or business performance, strategies or expectations, or the impact of legal or regulatory matters on business, results of operations or financial condition. Specifically, forward-looking statements may include statements relating to the future financial performance of the Company; the ability to continue to receive Title IV funds; the growth of the market for the Company's services; expansion plans and opportunities; consolidation in the market for the Company's services generally; and other statements preceded by, followed by or that include the words "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "target" or similar expressions. These

forward-looking statements involve a number of known and unknown risks and uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by those forward-looking statements. Other factors that could cause the Company's results to differ materially from those contained in its forward-looking statements are included under, among others, the heading "Risk Factors" in the Company's Annual Report on Form 10-K, which the Company filed on August 5, 2016, and in its other filings with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this release.

Contact Information:

National American University Holdings, Inc.

Dr. Ronald Shape 605-721-5220

rshape@national.edu

Investor Relations Counsel

The Equity Group Inc.

Adam Prior 212-836-9606

aprior@equityny.com

Carolyne Y. Sohn 415-568-2255

csohn@equityny.com