On September 5, 2024, John Wiley & Sons Inc (WLY, Financial) released its 8-K filing for the first quarter ended July 31, 2024. The company reported robust financial performance, driven by growth in its Research and Learning segments, and the successful execution of its Value Creation Plan.
Company Overview
John Wiley & Sons Inc is a provider of academic journals, books, pre- and post-hire assessments and training, test preparation materials, and online education program management solutions. The company's reportable segments are Research, Learning, and Held for Sale or Sold. The majority of the company's revenue is generated from the Research segment, which provides peer-reviewed scientific, technical, and medical (STM) publishing, content platforms, and related services to academic, corporate, and government customers, academic societies, and individual researchers. Geographically, it derives maximum revenue from the United States, with additional contributions from the United Kingdom, China, Japan, Canada, and other countries.
First Quarter Performance
John Wiley & Sons Inc reported GAAP revenue of $404 million, a 10% decline year-over-year. However, adjusted revenue at constant currency, excluding held-for-sale or sold businesses, restructuring costs, and other adjusted items, was $390 million, reflecting a 6% increase. The company reported a GAAP operating income of $29 million, a significant improvement from a loss of $16 million in the prior year period. GAAP EPS was a loss of ($0.03), compared to a loss of ($1.67) in the previous year.
Segment Performance
Research: Revenue for the Research segment was $265 million, up 3% year-over-year. Adjusted EBITDA for the segment was $78 million, a 1% increase, with an adjusted EBITDA margin of 29.3%.
Learning: The Learning segment reported revenue of $124 million, a 14% increase, driven by a $16 million contribution from a GenAI content rights project. Adjusted EBITDA for the segment was $34 million, up 60%, with an adjusted EBITDA margin of 27.2%.
Financial Achievements
John Wiley & Sons Inc achieved several financial milestones in the first quarter:
- Adjusted EBITDA of $73 million, a 22% increase year-over-year.
- Adjusted EPS of $0.47, a 74% increase at constant currency.
- Net debt-to-EBITDA ratio of 2.0, compared to 1.9 in the prior year period.
- Free cash flow less product development spending was a use of $107 million, compared to a use of $106 million in the prior year.
Management Commentary
"The Wiley leadership team and I are pleased with how we started the year, as measured by both our performance indicators and financial results," said Matthew Kissner, Wiley President and CEO. "Research delivered solid growth driven by robust demand to publish in our journals and execution of our publishing and go-to-market strategies. Learning delivered strong growth as it sees continued demand for its authoritative content in training GenAI models and core growth in Academic. Finally, we closed our third and final divestiture and actioned the remainder of our $130 million cost savings program, positioning us for further performance and profit improvement."
Income Statement Highlights
| Metric | Q1 2025 | Q1 2024 |
|---|---|---|
| Revenue | $404 million | $451 million |
| Operating Income | $29 million | ($16 million) |
| Net Loss | ($1.4 million) | ($92.3 million) |
| GAAP EPS | ($0.03) | ($1.67) |
| Adjusted EPS | $0.47 | $0.27 |
Balance Sheet and Cash Flow
John Wiley & Sons Inc reported net cash used in operating activities of $89 million, compared to $82 million in the prior year period. The company allocated $32 million toward dividends and share repurchases, up from $29 million in the prior year. Capital expenditures were $18 million, below the prior year's $24 million due to timing.
Fiscal Year 2025 Growth Outlook
John Wiley & Sons Inc reaffirmed its Fiscal 2025 growth outlook, driven by favorable demand trends and strong performance indicators. The company expects adjusted revenue of $1,650 to $1,690 million, adjusted EBITDA of $385 to $410 million, and adjusted EPS of $3.25 to $3.60. Free cash flow is expected to be approximately $125 million.
For more detailed information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from John Wiley & Sons Inc for further details.
