Boosted by a strong fourth quarter, Scholastic reported that total revenue for the year ended May 31 rose 3%, to $1.91 billion, while operating income increased to $128.4 million from $70.4 million in fiscal 2009. The company reported net income of $56.1 million compared to a loss of $14.3 million last year. The revenue gain was led by the educational publishing group which had a 24% increase in sales to $476.5 million. Sales in Scholastic’s biggest group, children’s book publishing & distribution, fell 3%, to $910.6 million.
Scholastic attributed the decline in the children’s group to a 5% drop in trade sales which in the prior year benefitted from sales of The Tales of Beedle the Bard; excluding Bard, trade sales were about flat. Book club sales fell 11% hurt by lower orders in the fall and winter. Book fair sales rose 4%.
Sales in the educational group were led by Read 180 and other technology products. Sales in the international group rose 3%, to $412 million, led by gains in Asia offset by declines in Canada and the U.K. Media, licensing and advertising revenue dropped 9%, to $113.8 million, reflecting soft sales of interactive products and toys.
Having shown marked improvement over fiscal 2009, especially on the bottomline, Scholastic is expecting sales in fiscal 2011 to come in between $1.9 and $2.0 billion. Earnings per share from continuing operations are projected to be in the $1.95 to $2.20 range compared to $2.60 in fiscal 2010. Scholastic chairman Dick Robinson said the company will make some significant investments in the current fiscal year in its children’s group, planning to spend $20 million to fully rollout its online ordering platform and to launch a “differentiated” children’s e-book offering in the year.
