Total revenue at Reed Elsevier rose 11% in 2002, to £5.02 billion ($7.93 billion), and pretax profit increased 9%, to £927 million. Sales and earnings increased in Reed's science and medical, legal and education segments, but fell in its business group (home to PW).
In the education group, now known as Harcourt Education, total sales rose 71%, to £993 million, due mainly to the July 2001 acquisition of Harcourt's U.S. education and testing business. Excluding the purchase, sales were up 2%. Operating profits increased 38%, to £183 million. Revenue in the U.S. schools and testing segment jumped 92%, to £846 million, while international sales increased 6%, to £147 million. During the year, the elementary school business was led by sales of reading and math programs in Florida and California, respectively, and sales of science and social studies programs in several states. At the secondary school level, science and literature and language arts programs did well. Testing sales rose 8% on a comparable basis with 2001. Looking at 2003, Reed said it sees "some recovery" in the school market due to more adoption opportunities and more federal money from the No Child Left Behind Act.
In the science and medical business, which now operates under the Elsevier brand, revenue rose 26%, to £1.29 billion, and operating profit increased to 25%, to £429 million. Sales in the group's science and technology division rose 12%, to £746 million, while sales in the health sciences division increased 52%, to £549 million. In science and technology, sales were driven by strong subscription renewals for both print journals and ScienceDirect. In health sciences, the gain was led by its medical book publishing program. During 2003, Reed expects to complete the integration of the Harcourt professional business into Elsevier, which will save more than $40 million. The journal operations have already been integrated, and the two book production and distribution functions will be integrated this year.
Total sales in the legal group, LexisNexis, rose 1.5%, to £1.35 billion, with sales in North America up 1.5%, to £1.06 billion, and international sales up by just over 1%, to £293 million. Operating profit rose 7.5%, to £287 million. In the U.S., online revenue increased 8%, while print and CD-ROM sales were flat. LexisNexis also enjoyed higher penetration of the small law firm market. Reed said the outlook was "good" for LexisNexis in 2003.
Revenue in Reed Business Information fell 15%, to £1.38 billion, with operating profit down 5%, to £234 million.
Revenue for Reed's U.S. business segment fell 26%, to £438 million, while revenue in Reed Exhibitions, which includes BEA, was down 4.5% to £425 million. Reed said the outlook for the business group in 2003 "remains uncertain."
