Results were slightly weaker than expected in the first quarter of fiscal 2013 at John Wiley, but company executives still expect to meet full year forecasts, company CEO Steve Smith said. For the quarter ended July 31, revenue fell 4%, to $411 million and net income fell 29%, to $36.1 million. Results were hurt by foreign exchange (excluding foreign exchange sales were off 2%), timing in Wiley’s journal business and softness in the higher education market. Earnings reflect a $4.8 million charge tied to severance costs associated with Wiley’s plan to discontinue, outsource, or relocate certain functions due to the ongoing transformation of Wiley to a more digitally oriented company.
The Professional/Trade group was the only one of Wiley’s three segments to post a sales increase in the quarter and that was attributed primarily to the purchase of the Inscape assessment and training business in the fourth quarter of fiscal year 2012 and the success of the Certified Financial Analyst Institute (CFA) product launch. Sales rose 3%, to $102 million. Higher sales in the U.S. were offset by softness overseas. And while e-book sales of $10 million were flat over prior year due to timing, Wiley said total digital revenues accounted for 21% of all sales in the quarter compared to 14% in last year’s first quarter because of the Inscape purchase.
The company noted that following the sale of Frommer’s, Unofficial Guides and WhastonWhen brands it continues to explore the sale of other consumer print and digital publishing assets including culinary, general interest, nautical, pets, crafts, Webster’s New World, and CliffsNotes. Following the close of the quarter, Wiley bought the assets of Trader’s Library, assuming sales for 154 products, mostly videos. Traders' Library is a book publishing and distribution company targeting the investment arena from individual investors and financial advisors to professional traders. Anticipated annual revenue is approximately $1 million.
In its other groups, sales in the Scientific, Technical, Medical and Scholarly division declined 7%, to $235.9 million, and Global Education sales also fell 7%, to $72.8 million.