John Wiley & Sons, Inc. · NYSE:WLY
John Wiley & Sons — Q3 2017 Earnings Presentation
13 slides from John Wiley & Sons's earnings presentation, Mar 7, 2017
Slide 1: Third Quarter 2017 Earnings Report
Third Quarter 2017 Earnings Report March 7, 2017
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains certain forward‐looking statements concerning the Company's operations, performance, and financial condition. Reliance should not be placed on forward‐looking statements, as actual results may differ materially from those in any forward‐looking statem
Slide 3: Third Quarter Summary
Third Quarter Summary • Revenue growth of 3% at constant currency (0% GAAP) due to favorable impact of shift to time‐based journal subscriptions (+$29M) and contribution from Atypon (+$8M). Excluding those items, revenue declined 5% due to: – Market‐driven weakness in Books (‐18%) and $10M backfile
Slide 4: Financial Performance
Financial Performance (millions) Q3 2017 Q3 2016 Change (ex‐FX) Revenue $436.5 $436.4 3% Adjusted Operating Income $60.3 $53.3 14% Adjusted Operating Margin 13.8% 12.2% Adjusted EPS $0.92 $0.67 37% Note, revenue and adjusted numbers include favorable impact of shift to time‐based journal subscriptio
Slide 5: Research
Research (millions) Q3 2017 Q3 2016 % of Revenue Change (ex‐FX) Journal Subscriptions $149.9 $125.7 73% 23% Author‐Funded Access $6.9 $6.4 3% 15% Licensing, Reprints, Backfiles, Other $41.0 $51.5 20% (14%) Total Journal Revenue $197.8 $183.6 96% 12% Platform Services (Atypon) $8.0 4% TOTAL REVENUE $
Slide 6: Publishing
Publishing (millions) Q3 2017 Q3 2016 % Revenue Change (ex‐FX) STM and Professional Books $76.9 $90.8 45% (12%) Education Books $50.3 $69.5 29% (27%) Total Books and References $127.2 $160.3 74% (18%) Course Workflow (WileyPLUS) $23.5 $21.9 14% 7% Online Test Preparation and Certification $8.5 $6.6
Slide 7: Solutions
Solutions (millions) Q3 2017 Q3 2016 % of Revenue Change (ex‐FX) Online Program Management $30.0 $26.1 51% 15% Professional Assessment $13.8 $13.2 23% 5% Corporate Learning $15.4 $13.0 26% 20% TOTAL REVENUE $59.2 $52.2 100% 14% ADJ. CONTRIBUTION TO PROFIT (CTP)* $4.7 $2.0 137% • Online Program Manag
Slide 8: Adjusted Shared Services Costs
Adjusted Shared Services Costs (millions spent) Q3 2017* Q3 2016* Change (ex‐FX) Distribution and Operation Services $18.2 $20.1 (5%) Technology and Content Management $62.5 $67.0 (5%) Finance $11.1 $11.5 (1%) Other Administration $30.5 $32.5 (4%) Total $122.4 $131.0 (4%) • Distribution and Operatio
Slide 9: Balance Sheet
Balance Sheet Balance Sheet (millions) As of 1/31/17 As of 1/31/16 Cash and Cash Equivalents $482.3 $535.9 Short Term Debt $0 $150.0 Long Term Debt $865.7 $814.7 Net Debt $383.4 $428.9 Net Debt to adjusted EBITDA (ttm) 1.1 1.1 • Strong balance sheet continues to provide flexibility for investment an
Slide 10: Cash Flow
Cash Flow Cash Flow (millions) YTD 2017 YTD 2016 • Free Cash Flow improvement due to accelerated journal cash Net Income $67.0 $111.6 collections, lower tax Cash From Operations $229.2 $116.6 payments ($9M), and lower restructuring payments ($9M) Tech, Prop, Equip ($82.3) ($69.0) Composition Spend (
Slide 11: FY17 Outlook
FY17 Outlook Operational Metric Current Expectation YTD Results Revenue Low‐single digit decline (previously flat) (3%) EPS Mid‐single digit decline (no change) (6%) • Adjustment to revenue outlook driven by accelerated decline in Books market • EPS outlook unchanged, partly enabled by one‐time tax
Slide 12: Nine Month Summary
Nine Month Summary • Research and Solutions performing well, as expected – Journal subscriptions showing consistent underlying growth – Atypon acquisition proceeding well; Wiley Online Library migration on track; opportunities for expanded service offerings – Strong revenue growth in Solutions and m
Slide 13: Third Quarter 2017 Earnings Report
Third Quarter 2017 Earnings Report March 7, 2017