[September 07, 2017] |
|
Wiley Reports First Quarter 2018 Results
John Wiley & Sons, Inc. (NYSE:JWA)(NYSE:JWB), a global research and
learning company, today announced results for the first quarter ending
July 31, 2017.
HIGHLIGHTS
-
Revenue increased 2% to $411 million; +1% at constant currency
-
Adjusted EPS increased 9% to $0.59 per share; -5% at constant currency
-
Operational excellence initiatives resulted in $29 million of
restructuring and related charges, expected to yield $45 million in
gross run-rate savings beginning in fiscal 2019
-
Free Cash Flow less Product Development spending improved by $48
million
-
Quarterly dividend increased for 24th consecutive year to
$0.32 per share
FINANCIAL SUMMARY
Unaudited ($millions except for EPS)
|
GAAP Measures
|
|
|
|
Q1 2018
|
|
|
|
Q1 2017
|
|
|
|
Change
|
|
|
|
Change
Constant Currency
|
Revenue
|
|
|
|
$411.4
|
|
|
|
$404.3
|
|
|
|
2%
|
|
|
|
1%
|
Operating Income
|
|
|
|
$14.5
|
|
|
|
$43.8
|
|
|
|
-67%
|
|
|
|
|
Diluted EPS
|
|
|
|
$0.16
|
|
|
|
$0.53
|
|
|
|
-70%
|
|
|
|
|
Cash from Operations
|
|
|
|
($81.8)
|
|
|
|
($136.7)
|
|
|
|
40%
|
|
|
|
|
Non-GAAP Measures
|
|
|
|
Q1 2018
|
|
|
|
Q1 2017
|
|
|
|
Change
|
|
|
|
Change
Constant Currency
|
Adjusted Operating Income
|
|
|
|
$43.8
|
|
|
|
$42.9
|
|
|
|
2%
|
|
|
|
-13%
|
Adjusted EPS
|
|
|
|
$0.59
|
|
|
|
$0.54
|
|
|
|
9%
|
|
|
|
-5%
|
Free Cash Flow less Product Development Spending
|
|
|
|
($117.8)
|
|
|
|
($165.5)
|
|
|
|
29%
|
|
|
|
|
-
Revenue increase was largely driven by the contribution from
the Atypon acquisition, as print book declines in Publishing were
offset by increases in Research and Solutions.
-
Adjusted Operating Income decline at constant currency was
mainly due to $6 million in one-time credits in the prior year related
to employee benefit plans. Cost of Sales and Operating and
Administrative Costs were up 1% and 3% at constant currency,
respectively. GAAP Operating Income additionally reflected
$29.3 million in restructuring and related charges.
-
Adjusted EPS decline at constant currency was due to lower
adjusted operating income. GAAP EPS also reflected
restructuring and related charges as well as foreign exchange losses
on intercompany transactions.
-
Free Cash Flow less Product Development Spending improvement
was mainly due to the timing of cash collections and payments as
anticipated in the fourth quarter 2017 report. Free cash flow is
seasonally negative in the first half of Wiley's fiscal year
principally due to the timing of collections for journal subscriptions.
-
Return to Shareholders: During the quarter, Wiley repurchased
265,158 shares for $14 million at an average cost of $52.86.
Approximately 3.5 million shares remain in the repurchase program. In
June, Wiley increased its quarterly dividend by 3% to $0.32 per share,
marking the 24th consecutive annual increase and raising the
annualized dividend payout to $1.28 per share.
MANAGEMENT COMMENTARY
"We continue to make important progress in shifting our strategic focus
to the delivery of enhanced digital products and services for
researchers, educators, professionals, and higher education students
around the globe," said Matthew Kissner, Interim CEO and Chairman. "We
are realigning our cost base, reallocating resources, reinvesting in
specific growth areas, and focusing on culture, productivity, and
customer engagement - all of which should benefit us in fiscal 2019 and
beyond."
FISCAL YEAR 2018 OUTLOOK
|
The Company reaffirms its fiscal 2018 guidance.
|
|
Metric ($M)
|
|
|
|
FY17 Actual
|
|
|
|
FY18 Expectation
(at constant currency)
|
Revenue
|
|
|
|
$1,718.5
|
|
|
|
Approximately even
|
Adjusted Operating Income
|
|
|
|
$228.4
|
|
|
|
Approximately even
|
Adjusted EPS
|
|
|
|
$3.01
|
|
|
|
Low-single digit % decline
|
Cash from Operations
|
|
|
|
$314.5
|
|
|
|
$350 million or higher
|
Capex
|
|
|
|
$148.3
|
|
|
|
Slightly lower
|
Financial Tables: Please see accompanying tables for additional
details on financial performance. Please note that certain labels in the
tables have changed, including Author-Funded Access (now Open Access),
Platform Services (now Publishing Technology Services), Online Program
Management (now Education Services), and Unallocated Shared Services
Costs (now Corporate Expenses).
Adjusted Results: The Company provides financial measures
referred to as "adjusted," which exclude unusual charges and
credits as more fully described in the attached financial schedules. For
the first quarter ended July 31, the Company excluded foreign exchange
gains and losses on intercompany transactions in deriving adjusted
earnings in the current and prior year periods. This change will also be
reflected in subsequent periods. The Company believes these gains and
losses, which result from transactions associated with tax planning
efforts, do not reflect its underlying performance.
Foreign Exchange: Foreign exchange was beneficial to first
quarter revenue and EPS by $2.8 million and $0.07, respectively. If
current rates hold, Wiley expects to record a positive FY18 FX variance
due to functional currency gains related to calendar year 2017 journal
subscriptions in the UK. Variances are on a constant currency basis
unless otherwise noted.
RESEARCH SEGMENT (SCIENTIFIC, TECHNICAL, MEDICAL, SCHOLARLY
JOURNALS AND SERVICES)
-
Revenue: $223.6 million (+8% GAAP; +6% constant currency).
Growth was driven primarily by the contribution from the Atypon
acquisition (+$8 million, acquired October 2016) and higher Open
Access revenues (+20%).
-
Adjusted Contribution to Profit: $66.3 million (0% constant
currency). Performance reflected higher revenues offset primarily by
Atypon expenses and higher royalty costs. GAAP Contribution to
Profit: $61.5 million (2%) included restructuring charges of $4.8
million in the current year.
-
Calendar Year 2017 Journal Subscriptions: As of the end of
July, calendar year 2017 Journal Subscriptions were up 0.3% on a
constant currency basis with 98% of expected business contracted.
-
Society Publishing Partnerships: Nine new society contracts
were signed in the quarter with combined annual revenue of $6.6
million; nineteen were renewed with combined annual revenue of $11.6
million; four were not renewed totaling $0.9M.
PUBLISHING SEGMENT (BOOKS, COURSEWARE, TEST PREPARATION)
-
Revenue: $131.3 million (-9% GAAP; -8% constant currency).
Strong growth in Test Preparation and Certification (+20%) and Course
Workflow (+40%) were not enough to offset market-driven declines and
erosion of demand for print products in Education Publishing (-16%
overall) and STM and Professional Publishing (-8% overall).
-
Adjusted Contribution to Profit: $15.9 million (-18% constant
currency). Performance reflects lower revenues and the timing of
development and licensing costs. GAAP Contribution to Profit of
$5.0 million (-74%) included restructuring charges of $10.9 million in
the current year.
SOLUTIONS SEGMENT (EDUCATION SERVICES, CORPORATE LEARNING,
PROFESSIONAL ASSESSMENT)
-
Revenue: $56.5 million (+9% GAAP and constant currency). Growth
in Education Services (+14%) and Assessment (+10%) offset a 1% decline
in Corporate Learning.
-
Adjusted Contribution to Profit: Increased to $0.8 million from
$0.1 million in the prior year. Improvement driven by revenue growth
and increased operating efficiency. GAAP Contribution to Profit:
-$2.0 million including restructuring charges of $2.8 million.
-
Education Services (formerly Online Program Management): In the
quarter, Wiley signed one new partner (Winthrop University) and six
new programs. One partner and five programs were retired. As of July
31, Wiley had 39 university partners and 251 programs under contract.
EARNINGS CONFERENCE CALL
Scheduled for today, September 7 at 10:00 a.m. (ET). Access the webcast
at www.wiley.com>
Investor Relations> Events and Presentations, or http://www.wiley.com/WileyCDA/Section/id-370238.html.
U.S. callers, please dial 866-564-2842 and enter the participant
code 2784819#. International callers, please dial (323) 794-2130
and enter the participant code 2784819#.
ABOUT WILEY
Wiley is a global research and learning company. Through the Research
segment, the Company provides scientific, technical, medical, and
scholarly journals, as well as related content and services, for
academic, corporate, and government libraries, learned societies, and
individual researchers and other professionals. The Publishing
segment provides scientific (STM), professional development, and
education books and related content, as well as test preparation
services and course workflow tools, to libraries, corporations,
students, professionals, and researchers. In Solutions, Wiley
provides online program management services for higher education
institutions, and learning, development, and assessment services for
businesses and professionals.
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements concerning the
Company's operations, performance, and financial condition. Reliance
should not be placed on forward-looking statements, as actual results
may differ materially from those in any forward-looking statements. Any
such forward-looking statements are based upon a number of assumptions
and estimates that are inherently subject to uncertainties and
contingencies, many of which are beyond the control of the Company, and
are subject to change based on many important factors. Such factors
include, but are not limited to (i) the level of investment in new
technologies and products; (ii) subscriber renewal rates for the
Company's journals; (iii) the financial stability and liquidity of
journal subscription agents; (iv) the consolidation of book wholesalers
and retail accounts; (v) the market position and financial stability of
key online retailers; (vi) the seasonal nature of the Company's
educational business and the impact of the used book market; (vii)
worldwide economic and political conditions; (viii) the Company's
ability to protect its copyrights and other intellectual property
worldwide (ix) the ability of the Company to successfully integrate
acquired operations and realize expected opportunities and (x) other
factors detailed from time to time in the Company's filings with the
Securities and Exchange Commission. The Company undertakes no obligation
to update or revise any such forward-looking statements to reflect
subsequent events or circumstances.
JOHN WILEY & SONS, INC.
|
UNAUDITED SUMMARY OF OPERATIONS
|
FOR THE FIRST QUARTER ENDED
|
JULY 31, 2017 AND 2016
|
(in thousands, except per share amounts)
|
|
FIRST QUARTER ENDED JULY 31,
|
|
|
|
|
|
2017
|
|
|
2016
|
|
|
% Change
|
|
|
|
|
US GAAP
|
|
Adjustments
|
|
Adjusted
|
|
|
US GAAP
|
|
Adjustments
|
|
Adjusted
|
|
|
US GAAP
|
|
Adjusted excl. FX
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
$
|
411,444
|
|
|
-
|
|
|
411,444
|
|
|
|
404,285
|
|
|
-
|
|
|
404,285
|
|
|
|
2
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Sales
|
|
|
|
114,788
|
|
|
-
|
|
|
114,788
|
|
|
|
113,478
|
|
|
-
|
|
|
113,478
|
|
|
|
1
|
%
|
|
1
|
%
|
Operating and Administrative (A)
|
|
|
|
243,808
|
|
|
(3,600
|
)
|
|
240,208
|
|
|
|
235,340
|
|
|
|
|
235,340
|
|
|
|
4
|
%
|
|
3
|
%
|
Restructuring (Credits) Charges (A)
|
|
|
|
25,729
|
|
|
(25,729
|
)
|
|
-
|
|
|
|
(920
|
)
|
|
920
|
|
|
-
|
|
|
|
|
|
|
Amortization of Intangibles
|
|
|
|
12,619
|
|
|
-
|
|
|
12,619
|
|
|
|
12,573
|
|
|
-
|
|
|
12,573
|
|
|
|
0
|
%
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Costs and Expenses
|
|
|
|
396,944
|
|
|
(29,329
|
)
|
|
367,615
|
|
|
|
360,471
|
|
|
920
|
|
|
361,391
|
|
|
|
10
|
%
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
|
14,500
|
|
|
29,329
|
|
|
43,829
|
|
|
|
43,814
|
|
|
(920
|
)
|
|
42,894
|
|
|
|
-67
|
%
|
|
-13
|
%
|
Operating Margin
|
|
|
|
3.5
|
%
|
|
|
|
10.7
|
%
|
|
|
10.8
|
%
|
|
|
|
10.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
|
|
(3,273
|
)
|
|
-
|
|
|
(3,273
|
)
|
|
|
(4,071
|
)
|
|
-
|
|
|
(4,071
|
)
|
|
|
-20
|
%
|
|
-20
|
%
|
Foreign Exchange (Loss) Gain (B)
|
|
|
|
(5,136
|
)
|
|
6,017
|
|
|
881
|
|
|
|
221
|
|
|
1,329
|
|
|
1,550
|
|
|
|
|
|
|
Interest Income and Other
|
|
|
|
5
|
|
|
-
|
|
|
5
|
|
|
|
377
|
|
|
-
|
|
|
377
|
|
|
|
-99
|
%
|
|
-99
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Taxes
|
|
|
|
6,096
|
|
|
35,346
|
|
|
41,442
|
|
|
|
40,341
|
|
|
409
|
|
|
40,750
|
|
|
|
-85
|
%
|
|
-12
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Benefit) Provision for Income Taxes (A,B)
|
|
|
|
(3,140
|
)
|
|
10,627
|
|
|
7,487
|
|
|
|
9,327
|
|
|
(65
|
)
|
|
9,262
|
|
|
|
-134
|
%
|
|
-33
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
$
|
9,236
|
|
|
24,719
|
|
|
33,955
|
|
|
|
31,014
|
|
|
474
|
|
|
31,488
|
|
|
|
-70
|
%
|
|
-6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share- Diluted (A)
|
|
|
$
|
0.16
|
|
|
0.43
|
|
|
0.59
|
|
|
|
0.53
|
|
|
0.01
|
|
|
0.54
|
|
|
|
-70
|
%
|
|
-5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Shares - Diluted
|
|
|
|
57,709
|
|
|
57,709
|
|
|
57,709
|
|
|
|
58,176
|
|
|
58,176
|
|
|
58,176
|
|
|
|
|
|
|
(A,B) See the accompanying Notes to Unaudited Financial
Statements for a description of each adjustment.
|
|
|
JOHN WILEY & SONS, INC.
|
FOR THE FIRST QUARTER ENDED
|
JULY 31, 2017 AND 2016
|
|
RECONCILIATION OF US GAAP TO ADJUSTED EPS
- DILUTED (UNAUDITED)
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
US GAAP Earnings Per Share - Diluted
|
|
|
|
$
|
0.16
|
|
|
$
|
0.53
|
Adjusted to exclude the following:
|
|
|
|
|
|
|
|
|
|
Restructuring and Related Charges (Credits) (A)
|
|
|
|
|
0.35
|
|
|
|
(0.01)
|
FX Losses on Intercompany Transactions (B)
|
|
|
|
|
0.08
|
|
|
|
0.02
|
Adjusted Earnings Per Share - Diluted
|
|
|
|
$
|
0.59
|
|
|
$
|
0.54
|
|
NOTES TO UNAUDITED FINANCIAL STATEMENTS
|
Adjustments:
|
A
|
|
|
Adjusted results for the three months ended July 31, 2017 and
2016 exclude restructuring and related charges (credits) associated
with the Company's Restructuring and Reinvestment Program of $29.3
million, or $0.35 per share, and $(0.9) million, or $(0.01) per
share, respectively. The first quarter of fiscal year 2017 credit
reflects the true-up of facility lease reserves.
|
B
|
|
|
Adjusted results exclude foreign exchange gains and losses
associated with intercompany transactions. For the three months
ended July 31, 2017 and 2016, there were losses of $6.0 million, or
$0.08 per share, and $1.3 million, or $0.02 per share, respectively.
|
|
Non-GAAP Financial Measures:
|
In addition to providing financial results in accordance with
GAAP, the Company has provided adjusted financial results that
exclude the impact of other nonrecurring items described in more
detail throughout this press release. These non-GAAP financial
measures are labeled as "Adjusted" and are used for evaluating the
results of operations for internal purposes. These non-GAAP measures
are not intended to replace the presentation of financial results in
accordance with GAAP. Rather, the Company believes the exclusion of
such items provides additional information to investors to
facilitate the comparison of past and present operations. Unless
otherwise noted, adjusted amounts in the attached schedules include
foreign exchange.
|
|
|
JOHN WILEY & SONS, INC.
|
UNAUDITED SEGMENT RESULTS
|
FOR THE FIRST QUARTER ENDED
|
JULY 31, 2017 AND 2016
|
(in thousands)
|
|
FIRST QUARTER ENDED JULY 31,
|
|
|
|
|
|
2017
|
|
|
|
2016
|
|
|
|
% Change
|
|
|
|
|
|
US GAAP
|
|
Adjustments (A)
|
|
Adjusted
|
|
|
US GAAP
|
|
Adjustments (A)
|
|
Adjusted
|
|
|
US GAAP
|
|
Adjusted excl. FX
|
Research
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Journal Subscriptions
|
|
|
$
|
168,325
|
|
|
-
|
|
168,325
|
|
|
|
162,684
|
|
|
-
|
|
|
162,684
|
|
|
|
3
|
%
|
|
0
|
%
|
Open Access
|
|
|
|
8,803
|
|
|
-
|
|
8,803
|
|
|
|
7,513
|
|
|
-
|
|
|
7,513
|
|
|
|
17
|
%
|
|
20
|
%
|
Licensing, Reprints, Backfiles and Other
|
|
|
|
38,230
|
|
|
-
|
|
38,230
|
|
|
|
37,026
|
|
|
-
|
|
|
37,026
|
|
|
|
3
|
%
|
|
6
|
%
|
Total Journal Revenue
|
|
|
|
215,358
|
|
|
-
|
|
215,358
|
|
|
|
207,223
|
|
|
-
|
|
|
207,223
|
|
|
|
4
|
%
|
|
2
|
%
|
Publishing Technology Services (Atypon)
|
|
|
|
8,269
|
|
|
-
|
|
8,269
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
Total Research Revenue
|
|
|
|
223,627
|
|
|
-
|
|
223,627
|
|
|
|
207,223
|
|
|
-
|
|
|
207,223
|
|
|
|
8
|
%
|
|
6
|
%
|
Contribution to Profit
|
|
|
|
61,461
|
|
|
4,836
|
|
66,297
|
|
|
|
60,435
|
|
|
(69
|
)
|
|
60,366
|
|
|
|
2
|
%
|
|
0
|
%
|
|
Publishing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STM and Professional Publishing
|
|
|
$
|
63,600
|
|
|
-
|
|
63,600
|
|
|
|
70,697
|
|
|
-
|
|
|
70,697
|
|
|
|
-10
|
%
|
|
-8
|
%
|
Education Publishing
|
|
|
|
45,736
|
|
|
-
|
|
45,736
|
|
|
|
54,861
|
|
|
-
|
|
|
54,861
|
|
|
|
-17
|
%
|
|
-16
|
%
|
Course Workflow (WileyPLUS)
|
|
|
|
1,210
|
|
|
-
|
|
1,210
|
|
|
|
866
|
|
|
-
|
|
|
866
|
|
|
|
40
|
%
|
|
40
|
%
|
Test Preparation and Certification
|
|
|
|
11,490
|
|
|
-
|
|
11,490
|
|
|
|
9,558
|
|
|
-
|
|
|
9,558
|
|
|
|
20
|
%
|
|
20
|
%
|
Licensing, Distribution, Advertising and Other
|
|
|
|
9,242
|
|
|
-
|
|
9,242
|
|
|
|
8,980
|
|
|
-
|
|
|
8,980
|
|
|
|
3
|
%
|
|
4
|
%
|
Total Publishing Revenue
|
|
|
|
131,278
|
|
|
-
|
|
131,278
|
|
|
|
144,962
|
|
|
-
|
|
|
144,962
|
|
|
|
-9
|
%
|
|
-8
|
%
|
Contribution to Profit
|
|
|
|
5,009
|
|
|
10,854
|
|
15,863
|
|
|
|
19,320
|
|
|
353
|
|
|
19,673
|
|
|
|
-74
|
%
|
|
-18
|
%
|
|
Solutions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education Services (Online Program Management)
|
|
|
$
|
26,337
|
|
|
-
|
|
26,337
|
|
|
|
23,172
|
|
|
-
|
|
|
23,172
|
|
|
|
14
|
%
|
|
14
|
%
|
Professional Assessment
|
|
|
|
14,887
|
|
|
-
|
|
14,887
|
|
|
|
13,522
|
|
|
-
|
|
|
13,522
|
|
|
|
10
|
%
|
|
10
|
%
|
Corporate Learning
|
|
|
|
15,315
|
|
|
|
|
15,315
|
|
|
|
15,406
|
|
|
-
|
|
|
15,406
|
|
|
|
-1
|
%
|
|
-1
|
%
|
Total Solutions Revenue
|
|
|
|
56,539
|
|
|
-
|
|
56,539
|
|
|
|
52,100
|
|
|
-
|
|
|
52,100
|
|
|
|
9
|
%
|
|
9
|
%
|
Contribution to Profit
|
|
|
|
(1,968
|
)
|
|
2,795
|
|
827
|
|
|
|
146
|
|
|
-
|
|
|
146
|
|
|
|
N/M
|
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Expenses
|
|
|
|
(50,002
|
)
|
|
10,844
|
|
(39,158
|
)
|
|
|
(36,087
|
)
|
|
(1,204
|
)
|
|
(37,291
|
)
|
|
|
39
|
%
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
$
|
14,500
|
|
|
29,329
|
|
43,829
|
|
|
|
43,814
|
|
|
(920
|
)
|
|
42,894
|
|
|
|
-67
|
%
|
|
-13
|
%
|
(A) See the accompanying Notes to Unaudited Financial Statements
for a description of the adjustment.
|
N/M- Not Meaningful
|
|
|
JOHN WILEY & SONS, INC.
|
UNAUDITED CONDENSED STATEMENTS OF FINANCIAL POSITION
|
(in thousands)
|
|
|
|
|
|
|
July 31,
|
|
|
April 30,
|
|
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
84,113
|
|
|
185,894
|
|
|
58,516
|
Accounts receivable
|
|
|
|
|
198,576
|
|
|
213,968
|
|
|
188,679
|
Inventories
|
|
|
|
|
47,892
|
|
|
54,822
|
|
|
47,852
|
Prepaid and other
|
|
|
|
|
66,177
|
|
|
119,392
|
|
|
64,688
|
Total Current Assets
|
|
|
|
|
396,758
|
|
|
574,076
|
|
|
359,735
|
Product Development Assets
|
|
|
|
|
68,773
|
|
|
39,239
|
|
|
70,955
|
Royalty Advances
|
|
|
|
|
21,578
|
|
|
24,883
|
|
|
28,320
|
Technology, Property and Equipment
|
|
|
|
|
265,291
|
|
|
214,740
|
|
|
252,488
|
Intangible Assets
|
|
|
|
|
833,676
|
|
|
831,249
|
|
|
828,099
|
Goodwill
|
|
|
|
|
996,000
|
|
|
916,690
|
|
|
982,101
|
Income Tax Deposits
|
|
|
|
|
-
|
|
|
62,200
|
|
|
-
|
Other Assets
|
|
|
|
|
85,028
|
|
|
80,185
|
|
|
84,519
|
Total Assets
|
|
|
|
|
2,667,104
|
|
|
2,743,262
|
|
|
2,606,217
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Accounts and royalties payable
|
|
|
|
|
141,034
|
|
|
138,397
|
|
|
139,206
|
Deferred revenue
|
|
|
|
|
334,625
|
|
|
321,616
|
|
|
436,235
|
Accrued employment costs
|
|
|
|
|
81,245
|
|
|
55,241
|
|
|
98,185
|
Accrued income taxes
|
|
|
|
|
24,605
|
|
|
3,368
|
|
|
22,222
|
Accrued pension liability
|
|
|
|
|
5,820
|
|
|
5,467
|
|
|
5,776
|
Other accrued liabilities
|
|
|
|
|
83,509
|
|
|
69,042
|
|
|
86,232
|
Total Current Liabilities
|
|
|
|
|
670,838
|
|
|
593,131
|
|
|
787,856
|
Long-Term Debt
|
|
|
|
|
551,645
|
|
|
653,000
|
|
|
365,000
|
Accrued Pension Liability
|
|
|
|
|
212,843
|
|
|
206,814
|
|
|
214,597
|
Deferred Income Tax Liabilities
|
|
|
|
|
150,425
|
|
|
191,388
|
|
|
160,491
|
Other Long-Term Liabilities
|
|
|
|
|
72,135
|
|
|
82,521
|
|
|
75,136
|
Shareholders' Equity
|
|
|
|
|
1,009,218
|
|
|
1,016,408
|
|
|
1,003,137
|
Total Liabilities & Shareholders' Equity
|
|
|
|
$
|
2,667,104
|
|
|
2,743,262
|
|
|
2,606,217
|
|
|
JOHN WILEY & SONS, INC.
|
UNAUDITED CONDENSED STATEMENTS OF FREE CASH FLOW
|
(in thousands)
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2017
|
|
|
2016
|
Operating Activities:
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
9,236
|
|
|
|
31,014
|
|
Amortization of intangibles
|
|
|
|
12,619
|
|
|
|
12,573
|
|
Amortization of product development spending
|
|
|
|
9,644
|
|
|
|
9,731
|
|
Depreciation of technology, property and equipment
|
|
|
|
18,540
|
|
|
|
17,125
|
|
Non-cash charges and credits
|
|
|
|
32,045
|
|
|
|
20,231
|
|
Net change in operating assets and liabilities
|
|
|
|
(163,915
|
)
|
|
|
(227,386
|
)
|
Cash Used for Operating Activities
|
|
|
|
(81,831
|
)
|
|
|
(136,712
|
)
|
|
|
|
|
|
|
|
|
Investments in organic growth:
|
|
|
|
|
|
|
|
Additions to technology, property and equipment
|
|
|
|
(30,111
|
)
|
|
|
(20,778
|
)
|
Product development spending
|
|
|
|
(5,907
|
)
|
|
|
(7,989
|
)
|
Free Cash Flow less Product Development Spending
|
|
|
|
(117,849
|
)
|
|
|
(165,479
|
)
|
|
|
|
|
|
|
|
|
Other Investing and Financing Activities:
|
|
|
|
|
|
|
|
Acquisitions, net of cash
|
|
|
|
(4,413
|
)
|
|
|
(8,600
|
)
|
Net debt borrowings
|
|
|
|
185,964
|
|
|
|
47,993
|
|
Change in book overdrafts
|
|
|
|
(13,977
|
)
|
|
|
(12,261
|
)
|
Cash dividends
|
|
|
|
(18,382
|
)
|
|
|
(17,914
|
)
|
Purchase of treasury shares
|
|
|
|
(14,016
|
)
|
|
|
(11,289
|
)
|
Proceeds from exercise of stock options and other
|
|
|
|
5,599
|
|
|
|
13,689
|
|
Cash Provided by Investing and Financing Activities
|
|
|
|
140,775
|
|
|
|
11,618
|
|
|
|
|
|
|
|
|
|
Effects of Exchange Rate Changes on Cash
|
|
|
|
2,671
|
|
|
|
(24,051
|
)
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Cash and Cash Equivalents for Period
|
|
|
$
|
25,597
|
|
|
|
(177,912
|
)
|
|
|
RECONCILIATION TO GAAP PRESENTATION
|
|
Investing Activities:
|
|
|
|
|
|
|
|
Product development spending
|
|
|
$
|
(5,907
|
)
|
|
|
(7,989
|
)
|
Additions to technology, property and equipment
|
|
|
|
(30,111
|
)
|
|
|
(20,778
|
)
|
Acquisitions, net of cash
|
|
|
|
(4,413
|
)
|
|
|
(8,600
|
)
|
Cash Used for Investing Activities
|
|
|
$
|
(40,431
|
)
|
|
|
(37,367
|
)
|
|
|
|
|
|
|
|
|
Financing Activities:
|
|
|
|
|
|
|
|
Cash Provided by Investing and Financing Activities
|
|
|
$
|
140,775
|
|
|
|
11,618
|
|
Excluding:
|
|
|
|
|
|
|
|
Acquisitions, net of cash
|
|
|
|
(4,413
|
)
|
|
|
(8,600
|
)
|
Cash Provided by Financing Activities
|
|
|
$
|
145,188
|
|
|
|
20,218
|
|
|
Free Cash Flow less Product Development
Spending:
|
|
The Company provides financial measures referred to as "Free Cash
Flow less Product Development Spending." Free Cash Flow less Product
Development Spending is defined as "cash flow from operating
activities, less book composition and other product development and
capital spending." Management believes this metric provides
additional information to investors to facilitate the comparison of
past and present results. This metric is also used internally by
management in evaluating results. This non-GAAP measure is not
intended to replace the financial results reported in accordance
with US Generally Accepted Accounting Principles.
|
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