Private equity firm Apollo Global’s long journey with McGraw Hill is coming to an end, with an agreement to sell the publisher to yet another private equity company, Platinum Equity. The deal is valued at $4.5 billion including debt. With debt at the end of 2020 of about $2.23 billion, it means the new owner is actually spending (or further borrowing) about $2.25 billion, and taking on about that much in existing debt. McGraw Hill’s planned merger with Cengage was abandoned in May 2020 after facing objections from regulators in the US and UK. Prior to that, the company had […]
Education
Wiley Reports a Strong Fourth Quarter, with a Favorable Outlook
Wiley reported fourth quarter and fiscal year results for the period ended April 30, with sales of $536 million, up from $474.6 million, a 13 percent increase, including $14.8 million in foreign exchange variance and acquisitions. Operating income was $51.2 million, improved from a loss of ($170.7) million a year ago, and adjusted EBITDA was $112.7 million, up from $92.8 million. Academic & Professional Learning (which includes trade books) grew 15 percent as reported, “driven by strong growth in Education Publishing and trade publishing, accompanied by further recovery in corporate training.” For the full year, sales were $1.94 billion, up […]
Corporate: McGraw Hill and Pearson Offer Highlights of Results to Come
McGraw Hill offered brief preliminary highlights of their fiscal fourth quarter (ending March 31) and full year 2021 results. For the quarter, overall billings grew 21 percent, with 12 percent growth in higher ed billings. Adjusted EBITDA grew in the fourth quarter, thanks to strong billings and savings from the completed “cost rationalization program.” The company says higher ed billings grew 5 percent for the year, and digital billings grew 17 percent, but did not provide data on overall billings for the year. “Despite challenging environment in FY2021, MH demonstrated resiliency and focused on supporting institutions, educators and learnings during […]
Barnes & Noble Education’s Struggle Continues; WH Smith Improves Its Burn Rate
Barnes & Noble Education reported earnings for the third fiscal quarter ended January 30, with sales of $412 million, compared to $503 million last year, a decline of 19 percent. While sales were better than analysts’ expectations, earnings were worse, with net loss of $(48) million, down from $(2) million last year. The loss included pre-tax impairment of $27.6 million, “on certain store-level long-lived assets in the retail segment.” Retail sales decreased by $70.3 million in the quarter, or 15.4 percent. Comparable store sales were down 20 percent overall, with the biggest decline in trade books, down 61 percent. Textbook […]
Pearson Sales and Profit Down in 2020 as Management Predicts a Return to Growth
Following on their January trading update, Pearson announced full earnings for 2020. Sales were £3.4 billion, a decrease of £472 million, or 10 percent, as reported in January. Of the decline, £55m was due to scope changes, and £31 million from negative currency impact. Operating profit was £411 million, up from £275 million, but for 2020 the adjusted numbers are more revealing, since the statutory numbers reflect the £531 million gain from selling the company’s final 25 percent stake in Penguin Random House, which generated a pre-tax profit of £180 million. The year also saw lower restructuring costs, as the […]
Wiley’s Sales Near Flat, Earnings Down in Q3
Wiley reported third quarter sales for the period ended January 31 of $483 million, up from $467 million, or 3 percent on the topline. But that includes $7.6 million in favorable foreign exchange and added sales from the big Hindawi acquisition. Net income for the quarter was $22.2 million, down from $35 million, while adjusted EBITDA was $104 million, up from $96 million. They took $20.7 million in restructuring expenses, mostly related to a previously announced reduction in their real estate footprint. The most positive sign in the report is that Wiley raised its full-year outlook, now anticipating higher earnings […]