Sales Rise At Scholastic, But Earnings Fall On Two Charges

Sales inched up at Scholastic in their fiscal second quarter, ending November 30, rising $9.7 million to $623 million. But operating income of $94.7 million was down 7 percent as the company wrote down $13.4 million on "legacy acquisitions" in the children's publishing and distribution segment and took a $5.5 million one-time charge for "cost reduction and restructuring programs" as well.

At the same time, Scholastic said it will exercise an option to purchase their headquarters building in Soho for $255 million before the end of the year. They say it "should provide a number of benefits, including enhanced free cash flow and the ability to monetize portions of its headquarters space."

The company says the release of the Catching Fire movie "sparked an increase" in Hunger Games book sales. In the children's book publishing and distribution division, sales rose $4.7 million to $352 million. Trade sales of $52.5 million were up $1.3 million from a year ago.

Results for the quarter were below analysts' expectations. In the year to date, Scholastic's shares are down about 2.5 percent.
Release