John Wiley & Sons, Inc. · NYSE:WLY
John Wiley & Sons — Q2 2016 Earnings Presentation
13 slides from John Wiley & Sons's earnings presentation, Dec 8, 2015
Slide 1: Second Quarter Fiscal 2016 Earnings Report
Second Quarter Fiscal 2016 Earnings Report December 8, 2015
Slide 2: About Wiley
About Wiley Wiley is a global provider of knowledge and knowledge-enabled services that improve outcomes in areas of research, professional practice and education. Through its Research segment, the Company provides digital and print scientific, technical, medical, and scholarly journals, reference w
Slide 3: Performance Summary
Performance Summary (millions) Q2 2016 Q2 2015 Change Change (ex-FX) Revenue $433.4 $477.0 (9%) (5%) Adjusted Operating Income* $64.0 $76.0 (21%) (13%) Adjusted Operating Margin* 14.8% 15.9% Adjusted EPS* $0.78 $0.90 (18%) (10%) • Q2 results (-5% revenue and -10% adjusted EPS, ex-FX) impacted by wea
Slide 4: Research
Research (millions) Q2 2016 Q2 2015 % of Revenue Change (ex-FX) Journal Subscriptions $162.8 $172.1 68% (1%) Author-Funded Access $6.2 $5.1 3% 30% Licensing, Reprints, Backfiles, and Other $36.5 $49.1 15% (20%) Total Journal Revenue $205.5 $226.3 86% (4%) Print Books $23.1 $26.2 10% (8%) Digital Boo
Slide 5: Professional Development
Professional Development (millions) Q2 2016 Q2 2015 % of Revenue Change (ex-FX) Print Books $49.2 $53.0 50% (4%) Digital Books $11.9 $14.1 12% (13%) Online Test Preparation and Certification $6.3 $5.5 6% 13% Other Knowledge Service Revenue $5.5 $6.5 6% (15%) Total Knowledge Services $72.9 $79.2 74%
Slide 6: Education
Education (millions) Q2 2016 Q2 2015 % of Revenue Change (ex-FX) Print Textbooks $31.1 $41.7 32% (22%) Digital Books $8.9 $8.5 9% 12% Total Books $39.9 $50.2 42% (16%) Custom Material $12.3 $16.4 13% (25%) Course Workflow (WileyPLUS) $18.5 $18.4 19% 2% Online Program Management (Deltak) $23.2 $19.7
Slide 7: Adjusted Shared Services Costs
Adjusted Shared Services Costs (millions) Q2 2016* Q2 2015* Change (ex-FX) Distribution and Operation Services $20.9 $22.7 (3%) Technology and Content Management $62.4 $60.2 8% Finance $11.8 $12.6 (2%) Other Administration $30.0 $29.5 6% Total $125.2 $125.1 4% • Technology costs (excluding Content M
Slide 8: Effectiveness and Efficiency Update
Effectiveness and Efficiency Update • Consolidation of books businesses to emphasize opportunities for profitable growth and efficiency gains • US print textbook distribution operations to be outsourced to Cengage Learning • Third party cost benchmarking review completed for Technology and Finance w
Slide 9: Balance Sheet
Balance Sheet Balance Sheet (millions) As of 10/31/15 As of 10/31/14 Cash and Cash Equivalents $308.2 $198.9 Short Term Debt $150.0 $50.0 Long Term Debt $739.1 $749.5 Net Debt $580.9 $600.6 Net Debt to adjusted EBITDA (ttm) 1.5x 1.4x • Strong balance sheet provides flexibility for investment and ret
Slide 10: Cash Flow
Cash Flow • Cash from Operations Cash Flow (millions) 1H 2016 1H 2015 impacted by working Net Income $76.1 $87.4 capital timing and lower net income Cash From Operations ($126.5) ($94.1) • Capex increase due to Composition Spending ($20.0) ($16.9) investment in ERP and Capex (Technology) ($46.2) ($2
Slide 11: FY16 Outlook
FY16 Outlook Metrics Expectation Primary Reasons Cited Operational Revenue Flat Challenges in Book businesses Growth Challenges in Book businesses plus Operational EPS Growth Flat investment in new businesses and ERP Excludes non-performance items such as the time-based journal revenue shift and the
Slide 12: Summary
Summary • 1H revenue and adjusted EPS performance of -2% and -1%, ex-FX — Adjusted EPS +6% excluding FX and prior year backfile sale; comparably-sized backfile agreement expected to be signed with another national consortium in Q3 — Steady performance from the combination of Journal Subscriptions an
Slide 13: Second Quarter Fiscal 2016 Earnings Report
Second Quarter Fiscal 2016 Earnings Report December 8, 2015