Sparked by a strong performance in its trade group, total revenue at Scholastic rose 22% in the third fiscal quarter ended February 29, jumping to $467.0 million. Net loss in the quarter was cut to $3.2 million from $25.1 million in the comparable period in fiscal 2011.
In the children's book publishing and distribution segment, revenue rose 38%, to $266.0 million, as sales in the trade unit soared to $112 million from $43.5 million in last year’s third quarter. The higher sales were driven by strong orders of The Hunger Games trilogy in both print and e-book formats, spurred by anticipation of the March 23 movie release. Last quarter's sales of The Invention of Hugo Cabret by Brian Selznick also benefited from a successful movie adaptation, Hugo, Scholastic reported. Also doing well was Selznick’s Wonderstruck plus new and backlist titles in The 39 Clues® series and War Horse. In book clubs, sales fell 6%, but profits improved primarily as a result of reduced promotional spending. Book fair sales rose 12%, to $84.5 million.
In its other segments, sales in the educational technology and services group rose slightly, from $38.2 million to $40.0 million. In the classroom and supplemental materials publishing unit revenue fell to $38.2 million, compared to $43.1 million in the prior year period, reflecting the earlier timing of classroom library sales in the current year, partially offset by strong classroom magazine revenue, Scholastic said.
Scholastic’s international segment had a good quarter with revenue rising to $105.6 million, compared to $95.1 million in the prior year period, on strong sales in Canada, the U.K. and Australia, benefiting in particular from The Hunger Games trilogy. Sales also rose in Asia, partly due to strength in Singapore and India. Foreign exchange had minimal impact on revenue in the. Media, licensing and advertising segment sales rose to $17.2 million, compared to $14.9 million in the prior year period, as a result of higher sales of interactive products, as well as increased production revenue.
Scholastic noted that corporate overhead in the third quarter was $17.9 million, up from $13.1 million, due in part to one-time expenses of $2.5 million related to staff reductions and voluntary retirement program.
For the first nine months of fiscal 2012, revenue was up 10% to $1,470.3 million, and earnings rose to $52.5 million from $14.6 million. With the strong performance in the trade group last quarter, and a better than expected performance in general, Scholastic upped its outlook for the full fiscal year with the company forecasting revenue of approximately $2.0 billion and earnings per diluted share from continuing operations between $2.60 and $2.90. This guidance excludes the impact of one-time items associated with cost reduction programs and non-cash, non-operating items, which through the third quarter were $0.29 per diluted share.
