John Wiley & Sons, Inc. · NYSE:WLY
John Wiley & Sons — Q3 2016 Earnings Presentation
14 slides from John Wiley & Sons's earnings presentation, Mar 8, 2016
Slide 1: Third Quarter Fiscal 2016 Earnings Report
Third Quarter Fiscal 2016 Earnings Report March 8, 2016
Slide 2: About Wiley / Safe Harbor Statement
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: Third Quarter Highlights
Third Quarter Highlights • Revenue growth (+3%) at constant currency and excluding transitional (non-cash) impact of shift to time-based journal subscriptions (-$29M) – Growth driven by solid operational performance from Journals (+5%), Research Books and References (+13%), Online Test Preparation (
Slide 4: Performance Summary
Performance Summary (millions) Q3 2016 Q3 2015 Change Change (ex-FX) Revenue $436.4 $465.9 (6%) (3%) Adjusted Operating Income* $53.3 $78.1 (32%) (27%) Adjusted Operating Margin 12.2% 16.8% Adjusted EPS* $0.67 $0.99 (32%) (26%) • Transitional impact of shift to time-based subscriptions adverse to re
Slide 5: Research
Research % of (millions) Q3 2016 Q3 2015 Change (ex-FX) Revenue Journal Subscriptions $122.9 $155.7 55% (19%) Author-Funded Access $6.4 $6.1 3% 11% Licensing, Reprints, Backfiles, and Other $51.3 $44.1 23% 22% Total Journal Revenue $180.7 $205.8 80% (9%) Print Books $24.8 $27.4 11% (6%) Digital Book
Slide 6: Professional Development
Professional Development (millions) Q3 2016 Q3 2015 % of Revenue Change (ex-FX) Print Books $52.3 $56.1 51% (5%) Digital Books $10.3 $11.2 10% (6%) Online Test Preparation and Certification $6.8 $4.0 7% 69% Other Knowledge Service Revenue $7.8 $8.2 8% (1%) Total Knowledge Services $77.3 $79.5 75% (1
Slide 7: Education
Education (millions) Q3 2016 Q3 2015 % of Revenue Change (ex-FX) Print Textbooks $31.1 $40.5 29% (16%) Digital Books $11.0 $11.0 10% 2% Total Books $42.1 $51.5 39% (12%) Custom Material $16.3 $13.6 15% 20% Course Workflow (WileyPLUS) $21.9 $20.8 20% 6% Online Program Management (Deltak) $26.1 $23.0
Slide 8: Adjusted Shared Services Costs
Adjusted Shared Services Costs (millions spent) Q3 2016* Q3 2015* Change (ex-FX) Distribution and Operation Services $20.9 $21.4 1% Technology and Content Management $66.8 $60.8 12% Finance $12.6 $13.0 0% Other Administration $30.9 $27.9 14% Total $131.1 $123.0 9% • Technology spending (excluding Co
Slide 9: Balance Sheet
Balance Sheet Balance Sheet (millions) As of 1/31/16 As of 1/31/15 Cash and Cash Equivalents $535.9 $260.2 Short Term Debt $150.0 $100.0 Long Term Debt $814.7 $588.1 Net Debt $428.8 $427.9 Net Debt to adjusted EBITDA (ttm) 1:1 1:0 • Existing revolving credit agreement amended; capacity increased to
Slide 10: Cash Flow
Cash Flow • Cash from Operations decline Cash Flow (millions) YTD 2016 YTD 2015 due to lower cash earnings Net Income $111.6 $130.0 and less favorable timing of cash collections Cash From Operations $116.6 $154.2 • Free Cash Flow impacted by Composition Spending ($28.6) ($26.9) investment in ERP and
Slide 11: Effectiveness and Efficiency Update
Effectiveness and Efficiency Update • Q3 restructuring charge of $13.7M related to previously announced cost savings initiatives: – Restructuring of books businesses – Outsourcing of US distribution operations to Cengage – Implementation of other shared services efficiency initiatives • Approximate
Slide 12: FY16 Outlook Reaffirmed
FY16 Outlook Reaffirmed Metric Expectation Operational Revenue Growth Flat Operational EPS Growth Flat Excludes non-performance items such as the time-based journal revenue shift and the impact of foreign exchange, as well as certain charges and credits • Guidance excludes FX and shift to time-based
Slide 13: Summary
Summary • Solid quarter with revenue (+3%) and adjusted EPS (+6%) growth excluding currency and time-based journal shift; positive operational results across key areas, including Journals, Research Books, Corporate Learning, Online Program Management, Custom Education Material, and Course Workflow •
Slide 14: Third Quarter Fiscal 2016 Earnings Report
Third Quarter Fiscal 2016 Earnings Report March 8, 2016