With revenue in the school group down 21.4%, to $420.4 million, total sales at McGraw-Hill Education fell 11.1% in the third quarter ended August 31, to $937.3 million. Adjusted operating profit fell 11.0%, to $314.7 million. Sales in the higher education/professional/international group fell less than 1%, to $516.9 million.
Parent company McGraw-Hill Cos. attributed the drop in school group sales to a much reduced adoption market plus softness in open territories and reduced ordering from Texas.
In the higher ed/professional/international group sales were affected by slowing growth in college enrollments at two- and four-year schools and step drops at for-profit post secondary schools. Still, sales increased for McGraw-Hill Higher Education’s Career Education imprint in the third quarter, but could not offset a decline in its Humanities, Social Studies and Language product line.
Strong double-digit growth of digital products and services somewhat offset softness in traditional products in the third quarter in the U.S. higher education and professional markets. Revenue increased in international markets, primarily due to the favorable impact of foreign exchange rates and the introduction of the 18th edition of Harrison’s Principles of Internal Medicine.
For the first nine months of the year, earnings fell 19%, to $281.4 million, at MHE, on an 8.3% decline in revenue, to $1.78 billion. In prepared remarks, MHC chairman Terry McGraw said division of MHC into two companies was on track with MHE expected to become a standalone company by the end of 2012
