John Wiley & Sons announced the results for the fourth quarter and fiscal year 2015, ending April 30, 2015. Q4 revenue on a constant currency basis rose 2% to $442 million.
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Growth in Professional Development (+10%), aided by the CrossKnowledge and Profiles International acquisitions, and Education (+2%) offset a decline in Research (-1%). Organic revenue decreased 1% at constant currency, while revenue on a US GAAP basis declined 3% due to the adverse impact of foreign exchange.
Adjusted earnings per share (EPS) on a constant currency basis grew 17% to $0.81 due to restructuring savings, higher gross margins from the shift to digital, and a lower effective income tax rate.
Adjusted EPS excludes certain one-time or unusual items in both years as further described in the attached reconciliation of US GAAP to Adjusted EPS. US GAAP EPS for the fourth quarter grew 32%.
Wiley recorded a restructuring charge of $4.9 million this quarter for severance and other costs related to reorganization and consolidation across the business.
Fiscal Year Summary
Revenue on a constant currency basis grew 4% over prior year to $1,822 million, with organic growth in Research (+2%) and Education (+3%), as well as contributions from acquisitions in Professional Development (+13%), driving results. Total organic revenue, which excludes CrossKnowledge and Profiles International, increased modestly (+1%) over prior year at constant currency. Revenue grew 3% on a US GAAP basis.
Adjusted EPS on a constant currency basis grew 10% to $3.26 with revenue growth, higher gross margins from the shift to digital, restructuring savings, and a lower effective income tax rate. The adverse impact of foreign exchange compared to the prior year was -$0.11 per share. Adjusted EPS excludes certain one-time or unusual items in both years, as described in the attached reconciliation of US GAAP to Adjusted EPS. US GAAP EPS for fiscal year 2015 was $2.97 vs. $2.70 in the prior year.
Adjusted shared services and administrative costs were essentially flatfor the year at $494 million due to restructuring, procurement, and outsourcing savings offset by additional investment in new business growth. Lower Distribution and Operation Services (-10%) and Finance (-1%) expense offset higher Technology and Content Management (+2%) and Other Administration (+6%) expense.
Restructuring Charges: Wiley recorded $29 million in restructuring charges principally related to facility consolidations and dispositions in connection with prior restructuring actions, as well as severance costs related to reorganization and consolidation.
Free Cash Flow of $247 million was $4 million behind prior year due to increased investment in technology and restructuring payments related to severance.
Net Debt and Cash Position: Net debt (long-term debt less cash and cash equivalents) at the end of April was $293 million, up from $214 million at the end of the prior year due to the acquisition of CrossKnowledge. Net debt to EBITDA was at 0.7 on a trailing twelve month basis. Cash and cash equivalents as of April 30, 2015 were $457 million.
Share repurchases: In fiscal year 2015, Wiley repurchased 1.1 million shares for $62 million, an average cost of $57.26. As of April 30, the Company had nearly 2.2 million shares remaining in the repurchase program announced in June 2013. Wiley did not repurchase shares in the fourth quarter.
Dividend: In June 2014, Wiley increased its quarterly dividend by 16% to $0.29, or $1.16 annualized. It was the 21st consecutive annual increase. ■