Wiley’s fourth quarter sales rose 2 percent to $445 million, with adjusted net income flat at $28.5 million. But those earnings were down a penny on a per share basis, at 46 cents a share, and declined 5 percent on a currency-neutral basis. Analysts were expecting 3 cents more per share in earnings, and $7 million more in sales than reported. A strong performance in higher education was offset by softness in Professional/Trade (P/T), which fell 3 percent to $110 million, due to “foregone sales” related to Borders’ bankruptcy. They say Borders “represented about 5 percent of projected P/T sales” for the fiscal year.
For the full year, sales rose 4 percent to $1.743 billion with adjusted earnings of $2.90 per share increasing by 15 percent (excluding the previously reported 10 cents a share restructuring charge due to Borders’ bankruptcy.) Adjusted net income for the year was $178 million, and professional/trade sales rose by 1.6 percent to $437 million.
President and ceo Stephen Smith said in a statement, “The shift to digital continues to enhance all of our businesses, resulting in new revenue models, new opportunities in emerging markets, and margin and working capital improvements.”
Professional/trade ebooks were up 127% for the year to $23 million, or 5 percent of that segment’s sales revenue. In the fourth quarter alone, ebooks comprised $9 million, or 8 percent of sales. Notably, Wiley’s consumer division garners almost as much money from other digital revenue streams, including online advertising and content licensing, as they do from ebooks. Total digital revenue for the year comprised 10 percent of sales, or roughly $44 million–meaning digital sales in addition to ebooks were roughly $21 million. (Digital revenues accounted for 7 percent of sales in the prior year, or roughly $30 million.)
Looking ahead, Wiley expects “mid-single digit revenue growth and EPS in a range from $3.15 to $3.20,” before accounting for currency exchange.