John Wiley & Sons, Inc. · NYSE:WLY
John Wiley & Sons — Q4 2023 Earnings Presentation
27 slides from John Wiley & Sons's earnings presentation, Jun 15, 2023
Slide 1: Fourth Quarter and Fiscal 2023 Earnings Review
Fourth Quarter and Fiscal 2023 Earnings Review June 15, 2023
Slide 2: Safe Harbor Statement and Non-GAAP Measures
SAFE HARBOR STATEMENT NON-GAAP MEASURES This presentation contains certain forward-looking statements concerning the In this presentation, management provides the following non-GAAP Company's operations, performance, and financial condition. Reliance should performance measures: not be placed on for
Slide 3: Unlocking human potential by powering discovery and learning
Unlocking human potential by powering discovery and learning
Slide 4: Overview
Overview Overview Full year performance weighed down by cyclical market headwinds in Academic, lower article volume in Research mainly due to macroeconomic pressures and the Hindawi publishing disruption Now focusing Wiley on our greatest strengths, best opportunities, and most profitable business l
Slide 5: Fiscal 2023 Performance
Fiscal 2023 Performance Revenue* GAAP EPS** Adj. EPS Adj. EBITDA Free Cash Flow 0% ▼$2.31 ▼8% ▼2% ▼$50M $2,020M $0.31 $3.84 $422M $173M All variances at constant currency except GAAP EPS *FY organic revenue at CC -1% **GAAP EPS mainly due to Q3 impairment charges totaling $1.77/share and restructuri
Slide 6: Research: Publishing Volume Outlook
Research: Publishing Volume Outlook ▪ Short-term dynamics affected volume in calendar ’22, which included 8 months of Fiscal 2023 ▪ Article submissions and output lagged through the year ▪ Industry-wide, article volumes declined in 2022 in 18 of the top 20 geographic markets ▪ Non-recurring causes:
Slide 7: Research: Hindawi Revitalization in Fiscal 2024
Research: Hindawi Revitalization in Fiscal 2024 FY2023 Q3-Q4 Fiscal 2024 Outlook ▪ Suspended special issues publishing program in Q3 ▪ Hindawi Fiscal ‘24 revenue expected to be $30-$35M lower due to continued effects ▪ Proactively closed four Hindawi journals that represented 50% of our 1,700 articl
Slide 8: The Knowledge Company
The Knowledge Company Wiley enables the creation of new knowledge and its application in science, learning, and innovation
Slide 9: Focusing on our Core Strengths in Research and Publishing
Focusing on our Core Strengths in Research and Publishing Research Journals Professional Learning Content Distribution Knowledge Workflow Data, Insights & & Content Libraries Content & Courseware & Discovery Platforms Solutions Audience Access ▪ Must-have brands and content based on “new knowledge”
Slide 10: Becoming a Simpler, Stronger, and More Profitable Wiley
Becoming a Simpler, Stronger, and More Profitable Wiley Divesting Non-Core Assets Numbers based on Fiscal 2023 results Assets held for sale or sold Go-Forward University Services Wiley Edge Research Businesses CrossKnowledge Test Prep Learning Advancement Courses Total Adj. Revenue $393M $1,627M % o
Slide 11: Actions Underway to Deliver Performance and Margin Gains
Actions Underway to Deliver Performance and Margin Gains Focus on research, Focusing on must-have content, platforms, and solutions in vertical markets where we have publishing, and strong competitive advantage, scale, and opportunity solutions Divest non-core Divesting University Services, Wiley Ed
Slide 12: Performance, Outlook, Financial Position
Performance Outlook Financial Position Learning
Slide 13: Fourth Quarter Performance
Fourth Quarter Performance Revenue* GAAP EPS** Adj. EPS Adj. EBITDA ▼2% ▲$0.46 ▲32% ▲23% $526M $1.22 $1.45 $137M All variances at constant currency except GAAP EPS ▪ Revenue performance primarily due to the Hindawi publishing disruption in Research and modest declines in Academic offsetting growth i
Slide 14: Research
Research (millions) Q4 2023 Change Change CC FY 2023 Change Change CC Research Publishing $241 (6%) (5%) $927 (4%) (1%) Research Solutions $39 (4%) (2%) $153 4% 7% Total Revenue $280 (6%) (5%) $1,080 (3%) 0% Adjusted EBITDA $106 4% $377 (2%) Adjusted EBITDA Margin 37.8% 34.9% ▪ Research Publishing d
Slide 15: Academic
Academic (millions) Q4 2023 Change Change CC FY 2023 Change Change CC Academic Publishing $127 (3%) (1%) $482 (9%) (7%) University Services $56 (5%) (4%) $208 (8%) (8%) Total Revenue $183 (3%) (2%) $690 (9%) (7%) Adjusted EBITDA $55 30% $148 (13%) Adjusted EBITDA Margin 30.1% 21.4% ▪ Academic Publis
Slide 16: Talent
Talent (millions) Q4 2023 Change Change CC FY 2023 Change Change CC Talent $63 8% 12% $249 17% 24% Total Revenue $63 8% 12% $249 17% 24% Adjusted EBITDA $13 10% $52 18% Adjusted EBITDA Margin 20.5% 21.1% ▪ Signed 15 new multinational corporate placement clients across industry verticals, including e
Slide 17: Financial Position and Capital Allocation
Financial Position and Capital Allocation Free Cash Flow: $173M compared to $223M in prior year. Variance mainly due to restructuring payments (-$21M) and interest expense (-$18M) $112M $107M Low Leverage: Net Debt-to-EBITDA of 1.5x compared to 1.6x at prior year end Strong Liquidity: Syndicated cre
Slide 18: Fiscal 2024 Transition Year Outlook
Fiscal 2024 Transition Year Outlook Fiscal 2023 Fiscal 2023 Fiscal 2024 Outlook Metric (Millions, except EPS) All Company ex-divestitures^ ex-divestitures Total Adjusted Revenue* $2,020 $1,627 $1,580 to $1,630 Research $1,080 Flat (+3% ex-Hindawi) Learning $547 Down low single digits Total Adjusted
Slide 19: Material Margin Acceleration in Fiscal 2025 and Fiscal 2026
Material Margin Acceleration in Fiscal 2025 and Fiscal 2026 Executed well on our Fiscal 2023 cost savings and simplification plans ▪ Restructuring program resulted in reduced real estate footprint and headcount ▪ Actions yielded $35M of savings in Fiscal 2023 Actions taken in Fiscal 2024 will delive
Slide 20: Revenue Growth Drivers in Fiscal 2025 and Fiscal 2026
Revenue Growth Drivers in Fiscal 2025 and Fiscal 2026 ▪ Long-term trends are strong based on ever-increasing global R&D spend ▪ Article volume expected to resume normal mid-single digit growth ▪ Hindawi revitalization complete with strong OA growth resuming ▪ Research Solutions accelerating through
Slide 21: Generative AI Opportunity
Generative AI Opportunity Fresh, validated, high impact information and insights increase in value in a world awash in unreliable, derivative GAI-generated content Knowledge Creation Knowledge Application Opportunity: Faster, cheaper, better content creation Opportunity: Personalized, contextualized
Slide 22: Key Highlights: Creating a Stronger, More Profitable Wiley
Key Highlights: Creating a Stronger, More Profitable Wiley Focusing on our greatest strengths and opportunities in 1 knowledge creation and knowledge application Conducting a strategic review of non-core education 2 assets; businesses for sale identified 3 Streamlining and right-sizing our organizat
Slide 23: Upcoming Milestones
Timeline: Upcoming Milestones JUN JUL AUG SEP OCT 6/15: 4Q23 Earnings Pro forma segments 9/7: 1Q24 Earnings 10/12: Host Investor Day ▪ Strategic actions to focus Provide two years of pro ▪ Report on two segments – ▪ Present new Wiley vision Wiley and drive greater forma financials on Research and Le
Slide 24: Thank you for joining us
Thank you for joining us IR website at https://investors.wiley.com/ Contact us for follow-up at: brian.campbell@wiley.com Direct +1 (201) 748-6874 24 Q423 Earnings Presentation V2.pptx
Slide 25: Appendix – US GAAP to Non-GAAP EPS
Appendix – US GAAP to Non-GAAP EPS JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) (2) RECONCILIATION OF US GAAP MEASURES to NON-GAAP MEASURES (unaudited) Reconciliation of US GAAP EPS to Non-GAAP Adjusted EPS See accompanying notes on Three Months Ended Year Ended April 30, April 30, followin
Slide 26: Appendix – US GAAP to Non-GAAP EPS Notes
Appendix – US GAAP to Non-GAAP EPS Notes: (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors.
Slide 27: Appendix – Net Income to Adjusted EBITDA
Appendix – Net Income to Adjusted EBITDA JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) RECONCILIATION OF US GAAP NET INCOME TO NON-GAAP EBITDA AND ADJUSTED EBITDA (unaudited) Three Months Ended Year Ended April 30, April 30, 2023 2022 2023 2022 Net Income $ 68,344 $ 43,146 $ 17,233 $ 148,309