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Share Name | Share Symbol | Market | Type |
---|---|---|---|
John Wiley & Sons, Inc.(CL A) | NYSE:JWA | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0 | - |
John Wiley & Sons, Inc. (NYSE:JWA) (NYSE:JWB), a global leader in research and education, today announced results for the first quarter ended July 31, 2021.
SUMMARY
MANAGEMENT COMMENTARY “Wiley’s steady execution of growth strategies in open research, online education, and talent development drove another quarter of strong revenue and profit gains,” said Brian Napack, President and CEO. “Our strategies continue to be tightly aligned with accelerating long-term trends across academic and corporate markets, and we are well-positioned to drive social impact by enabling discovery, powering education and shaping workforces.”
FIRST QUARTER PERFORMANCE
GAAP Measures
Unaudited ($millions except for EPS)
Q1 2022
Q1 2021
Change
Revenue
$488.4
$431.3
+13%
Operating Income
$41.0
$30.0
+36%
Diluted EPS
$0.24
$0.29
(17%)
Non-GAAP Measures
Q1 2022
Q1 2021
Change Constant Currency
Revenue
$488.4
$431.3
+9%
Adjusted EBITDA
$95.3
$81.8
+12%
Adjusted EPS
$0.54
$0.42
+17%
Excluding acquisitions and currency impact, revenue rose 7% for the quarter. Wiley recorded a favorable FX variance of $16.7 million in Revenue, $3.7 million in Adjusted EBITDA, and $0.05 in Adjusted EPS.
Revenue
Adjusted EBITDA
EPS
Adjusted EPS Change Going forward, Wiley’s Adjusted EPS metric will exclude the impact of certain non-cash items directly related to acquisitions, most notably the amortization of acquired intangible assets. The Company does not consider these non-cash items to be indicative of its ongoing operating performance. For the first quarter, under the new measurement, Adjusted EPS (excluding the impact of amortization of intangibles) was $0.85 compared to $0.67 in the prior year period. See the Adjusted EPS reconciliation table toward the end of this release for more information.
Balance Sheet, Cash Flow, and Capital Allocation
FISCAL YEAR 2022 OUTLOOK The Company is reaffirming its full year outlook and adding the newly defined Adjusted EPS metric. Going forward, Wiley will discontinue reporting on the former Adjusted EPS metric.
Metric ($millions, except EPS)
Fiscal 2021
Fiscal 2022 Outlook
Revenue
$1,942
$2,070 to $2,100
Adjusted EBITDA
$419
$415 to $435
Adjusted EPS - former
$2.92
$2.80 to $3.05
Adjusted EPS - newly defined
$4.00
$4.00 to $4.25
Free Cash Flow
$257
$200 to $220
EARNINGS CONFERENCE CALL Scheduled for today, September 2 at 10:00 am (ET). Access webcast at investors.wiley.com. or directly at https://event.on24.com/wcc/r/3384264/798549EF00EC73C2803C99A64C083AD2. US callers, please dial (844) 418-0103 and enter the participant code 9996020#. International callers, please dial (236) 714-3019 and enter the participant code 9996020#.
ABOUT WILEY Wiley (NYSE:JWA) (NYSE:JWB) is a global leader in research and education, unlocking human potential by enabling discovery, powering education, and shaping workforces. For over 200 years, Wiley has fueled the world’s knowledge ecosystem. Today, our high-impact content, platforms, and services help researchers, learners, institutions, and corporations achieve their goals in an ever-changing world. Visit us at Wiley.com, Like us on Facebook and Follow us on Twitter and LinkedIn.
NON-GAAP FINANCIAL MEASURES Wiley provides non-GAAP financial measures and performance results such as “Adjusted EPS,” “EBITDA”, “Adjusted EBITDA,” “Adjusted Contribution to Profit,” “Adjusted Income before Taxes,” “Adjusted Income Tax Provision,” “Adjusted Effective Tax Rate,” “Free Cash Flow less Product Development Spending,” “organic revenue,” and results on a Constant Currency basis to assess underlying business performance and trends. Management believes non-GAAP financial measures, which exclude the impact of restructuring charges and credits and certain other items, and the impact of acquisitions provide a useful comparable basis to analyze operating results and earnings. See the reconciliations of non-GAAP financial measures and explanations of the uses of non- GAAP measures in the supplementary information. We have not provided our 2022 outlook for the most directly comparable US GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend on various factors, and could be material to our consolidated results computed in accordance with US GAAP.
FORWARD-LOOKING STATEMENTS This release contains certain forward-looking statements concerning the Company's operations, performance, and financial condition. Reliance should not be placed on forward-looking statements, as actual results may differ materially from those in any forward-looking statements. Any such forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to uncertainties and contingencies, many of which are beyond the control of the Company and are subject to change based on many important factors. Such factors include, but are not limited to: (i) the level of investment by Wiley in new technologies and products; (ii) subscriber renewal rates for the Company's journals; (iii) the financial stability and liquidity of journal subscription agents; (iv) the consolidation of book wholesalers and retail accounts; (v) the market position and financial stability of key retailers; (vi) the seasonal nature of the Company's educational business and the impact of the used book market; (vii) worldwide economic and political conditions; (viii) the Company's ability to protect its copyrights and other intellectual property worldwide (ix) the ability of the Company to successfully integrate acquired operations and realize expected opportunities; (x) the Company’s ability to realize operating savings over time and in fiscal year 2022 in connection with our multi-year Business Optimization Program; (xi) the impact of COVID-19 on our operations, performance, and financial condition; and (xii) other factors detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any such forward-looking statements to reflect subsequent events or circumstances.
Category: All Corporate News
Category: Earnings Releases
JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1)(2) CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME (Dollars in thousands, except per share information) (unaudited)Three Months Ended
July 31,
2021
2020
Revenue, net$
488,388
$
431,326
Costs and expenses: Cost of sales
165,956
144,809
Operating and administrative expenses
260,589
237,369
Restructuring and related (credits) charges
(276
)
2,218
Amortization of intangible assets
21,151
16,891
Total costs and expenses
447,420
401,287
Operating income
40,968
30,039
As a % of revenue
8.4
%
7.0
%
Interest expense
(4,639
)
(4,614
)
Foreign exchange transaction gains (losses)
370
(82
)
Gain on sale of certain assets
3,750
-
Other income, net
3,553
4,391
Income before taxes
44,002
29,734
Provision for income taxes
30,172
13,400
Effective tax rate
68.6
%
45.1
%
Net income$
13,830
$
16,334
As a % of revenue
2.8
%
3.8
%
Earnings per share Basic$
0.25
$
0.29
Diluted
$
0.24
$
0.29
Weighted average number of common shares outstanding Basic
55,869
55,912
Diluted
56,599
56,193
Notes: (1) The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) All amounts are approximate due to rounding. JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) (2) RECONCILIATION OF US GAAP MEASURES to NON-GAAP MEASURES (unaudited) Reconciliation of US GAAP EPS to Non-GAAP Adjusted EPS
Three Months Ended
July 31,
2021
2020
US GAAP Earnings Per Share - Diluted$
0.24
$
0.29
Adjustments: Restructuring and related (credits) charges
(0.01
)
0.03
Foreign exchange gains on intercompany transactions
(0.01
)
(0.02
)
Gain on sale of certain assets (A)
(0.05
)
-
Income tax adjustments (B)
0.37
0.12
Non-GAAP Adjusted Earnings Per Share - Diluted
$
0.54
$
0.42
Reconciliation of US GAAP Income Before Taxes to Non-GAAP Adjusted Income Before Taxes
Three Months Ended
(amounts in thousands)July 31,
2021
2020
US GAAP Income Before Taxes$
44,002
$
29,734
Pretax Impact of Adjustments: Restructuring and related (credits) charges
(276
)
2,218
Foreign exchange gains on intercompany transactions
(795
)
(1,569
)
Gain on sale of certain assets (A)
(3,750
)
-
Non-GAAP Adjusted Income Before Taxes
$
39,181
$
30,383
Reconciliation of US GAAP Income Tax Provision to Non-GAAP Adjusted Income Tax Provision,including our US GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate US GAAP Income Tax Provision
$
30,172
$
13,400
Income Tax Impact of Adjustments (C): Restructuring and related (credits) charges
45
743
Foreign exchange gains on intercompany transactions
(101
)
(612
)
Gain on sale of certain assets (A)
(936
)
-
Income Tax Adjustments: Impact of increase in UK statutory rate on deferred tax balances (B)
(20,726
)
(6,689
)
Non-GAAP Adjusted Income Tax Provision$
8,454
$
6,842
US GAAP Effective Tax Rate
68.6
%
45.1
%
Non-GAAP Adjusted Effective Tax Rate
21.6
%
22.5
%
Notes: (A) The gain on sale of certain assets is due to the sale of our world languages product portfolio which was included in our Academic & Professional Learning segment and resulted in a pretax gain of approximately $3.8 million during the three months ended July 31, 2021. (B) On June 10, 2021, the UK officially increased its corporate tax rate from 19% to 25% effective April 1, 2023. This resulted in a $20.7 million non-cash deferred tax expense from the re-measurement of the Company’s applicable UK net deferred tax liabilities during the three months ended July 31, 2021. During the first quarter of fiscal 2021, the UK officially enacted legislation that increased its statutory rate from 17% to 19%. This resulted in a $6.7 million non-cash deferred tax expense from the re-measurement of the Company’s applicable UK net deferred tax liabilities during the three months ended July 31, 2020. (C) For the three months ended July 31, 2021, substantially all of the tax impact was from deferred taxes. For the three months ended July 31, 2020, the tax impact was $0.2 million from current taxes offset by $0.1 million from deferred taxes. (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) All amounts are approximate due to rounding. JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) (2) RECONCILIATION OF NON-GAAP ADJUSTED EPS - FROM PREVIOUSLY REPORTED TO NEWLY DEFINED (Dollars in thousands, except per share information) (unaudited)Fiscal Year 2022
Fiscal Year 2021
Fiscal Year
Q1
Q1
Q2
Q3
Q4
Fiscal Year
2020
Non-GAAP Adjusted Income Before Taxes (Previously Reported)$
39,181
$
30,383
$
70,664
$
48,334
$
58,385
$
207,765
$
173,119
Plus: Amortization of acquired intangible assets (A)
22,284
18,149
18,381
20,163
22,728
79,421
68,269
Non-GAAP Adjusted Income Before Taxes (Newly Defined)
61,465
48,532
89,045
68,497
81,113
287,186
241,388
Less: Non-GAAP Adjusted Income Tax Provision (Newly Defined)
13,297
11,140
19,107
14,974
15,909
61,131
53,995
Non-GAAP Adjusted Net Income (Newly Defined)
$
48,168
$
37,392
$
69,938
$
53,523
$
65,204
$
226,055
$
187,393
Non-GAAP Adjusted Earnings Per Share - Diluted (Newly Defined)
$
0.85
$
0.67
$
1.25
$
0.95
$
1.15
$
4.00
$
3.30
Non-GAAP Adjusted Earnings Per Share - Diluted (Previously Reported)
$
0.54
$
0.42
$
1.00
$
0.68
$
0.84
$
2.92
$
2.40
Weighted average number of common shares outstanding (shares in 000's) Diluted (B)
56,599
56,193
56,165
56,332
56,616
56,461
56,729
Reconciliation of US GAAP EPS to Non-GAAP Adjusted EPS
Fiscal Year 2022
Fiscal Year 2021
Fiscal Year
Q1
Q1
Q2
Q3
Q4
Fiscal Year
2020
US GAAP Earnings (Loss) Per Share - Diluted$
0.24
$
0.29
$
1.22
$
0.39
$
0.73
$
2.63
$
(1.32
)
Adjustments: Restructuring and related (credits) charges
(0.01
)
0.03
0.02
0.28
0.12
0.44
0.43
Foreign exchange (gains) losses on intercompany transactions
(0.01
)
(0.02
)
0.01
0.01
(0.01
)
(0.02
)
0.02
Gain on sale of certain assets
(0.05
)
-
-
-
-
-
-
Impairment of goodwill
-
-
-
-
-
-
1.94
Impairment of Blackwell trade name
-
-
-
-
-
-
1.31
Impairment of developed technology intangible
-
-
-
-
-
-
0.04
Income tax adjustments
0.37
0.12
(0.25
)
-
-
(0.13
)
(0.03
)
EPS impact of using weighted-average dilutive shares for adjusted EPS calculation (B)
-
-
-
-
-
-
0.01
Non-GAAP Adjusted Earnings Per Share - Diluted (Previously Reported)
$
0.54
$
0.42
$
1.00
$
0.68
$
0.84
$
2.92
$
2.40
Amortization of acquired intangible assets
0.31
0.25
0.25
0.27
0.31
1.08
0.90
Non-GAAP Adjusted Earnings Per Share - Diluted (Newly Defined)
$
0.85
$
0.67
$
1.25
$
0.95
$
1.15
$
4.00
$
3.30
Reconciliation of US GAAP Income (Loss) Before Taxes to Non-GAAP Adjusted Income Before Taxes US GAAP Income (Loss) Before Taxes
$
44,002
$
29,734
$
68,513
$
27,392
$
50,273
$
175,912
$
(63,092
)
Pretax Impact of Adjustments: Restructuring and related (credits) charges
(276
)
2,218
1,920
20,675
8,497
33,310
32,607
Foreign exchange (gains) losses on intercompany transactions
(795
)
(1,569
)
231
267
(385
)
(1,457
)
1,256
Gain on sale of certain assets
(3,750
)
-
-
-
-
-
-
Impairment of goodwill
-
-
-
-
-
-
110,000
Impairment of Blackwell trade name
-
-
-
-
-
-
89,507
Impairment of developed technology intangible
-
-
-
-
-
-
2,841
Non-GAAP Adjusted Income Before Taxes (Previously Reported)
$
39,181
$
30,383
$
70,664
$
48,334
$
58,385
$
207,765
$
173,119
Amortization of acquired intangible assets (A)
22,284
18,149
18,381
20,163
22,728
79,421
68,269
Non-GAAP Adjusted Income Before Taxes (Newly Defined)
$
61,465
$
48,532
$
89,045
$
68,497
$
81,113
$
287,186
$
241,388
Reconciliation of US GAAP Income Tax Provision to Non-GAAP Adjusted Income Tax Provision, including our US GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate US GAAP Income Tax Provision
$
30,172
$
13,400
$
81
$
5,231
$
8,944
$
27,656
$
11,195
Income Tax Impact of Adjustments: (C) Restructuring and related (credits) charges
45
743
654
4,965
1,702
8,065
7,949
Foreign exchange (gains) losses on intercompany transactions
(101
)
(612
)
122
87
40
(363
)
242
Gain on sale of certain assets
(936
)
-
-
-
-
-
-
Impairment of goodwill
-
-
-
-
-
-
-
Impairment of Blackwell trade name
-
-
-
-
-
-
15,216
Impairment of developed technology intangible
-
-
-
-
-
-
686
Income Tax Adjustments: Impact of increase in UK statutory rate on deferred tax balances (D)
(20,726
)
(6,689
)
(83
)
-
3,261
(3,511
)
-
Impact of US CARES Act (E)
-
-
13,998
-
-
13,998
-
Impact of change in certain US state tax rates in 2021 and tax rates in France in 2020 (D)
-
-
-
-
(3,225
)
(3,225
)
1,887
Non-GAAP Adjusted Income Tax Provision (Previously Reported)
$
8,454
$
6,842
$
14,772
$
10,283
$
10,722
$
42,620
$
37,175
Amortization of acquired intangible assets (C)
4,843
4,298
4,335
4,691
5,187
18,511
16,820
Non-GAAP Adjusted Income Tax Provision (Newly Defined)
$
13,297
$
11,140
$
19,107
$
14,974
$
15,909
$
61,131
$
53,995
Non-GAAP Adjusted Net Income (Previously Reported)
$
30,727
$
23,541
$
55,892
$
38,051
$
47,663
$
165,145
$
135,944
Non-GAAP Adjusted Net Income (Newly Defined)
$
48,168
$
37,392
$
69,938
$
53,523
$
65,204
$
226,055
$
187,393
US GAAP Effective Tax Rate
68.6
%
45.1
%
0.1
%
19.1
%
17.8
%
15.7
%
-17.7
%
Non-GAAP Adjusted Effective Tax Rate (Previously Reported)
21.6
%
22.5
%
20.9
%
21.3
%
18.4
%
20.5
%
21.5
%
Non-GAAP Adjusted Effective Tax Rate (Newly Defined)
21.6
%
23.0
%
21.5
%
21.9
%
19.6
%
21.3
%
22.4
%
Notes: (A) Reflects the amortization of intangible assets established on the opening balance sheet for an acquired business. This includes the amortization of intangible assets such as developed technology, customer relationships, tradenames, etc., which is reflected in the "Amortization of intangible assets" line in the Condensed Consolidated Statements of Net Income. It also includes the amortization of acquired product development assets, which is reflected in "Cost of sales" in the Condensed Consolidated Statements of Net Income. (B) For Fiscal Year 2020, represents the impact of using diluted weighted-average number of common shares outstanding (56.7 million shares for the year ended April 30, 2020) included in the Non-US GAAP Adjusted EPS calculation in order to apply the dilutive impact on adjusted net income due to the effect of unvested restricted stock units and other stock awards. This impact occurs when a US GAAP net loss is reported and the effect of using dilutive shares is antidilutive. (C) These adjustments substantially impacted deferred taxes. (D) These adjustments impacted deferred taxes. (E) The tax impact was $8.4 million from current taxes and $5.6 million from deferred taxes in the three months ended October 31, 2020 and the year ended April 30, 2021. (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) All amounts are approximate due to rounding. JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) RECONCILIATION OF US GAAP NET INCOME TO NON-GAAP EBITDA AND ADJUSTED EBITDA (unaudited)Three Months Ended
July 31,
2021
2020
Net Income$
13,830
$
16,334
Interest expense
4,639
4,614
Provision for income taxes
30,172
13,400
Depreciation and amortization
54,566
49,507
Non-GAAP EBITDA
103,207
83,855
Restructuring and related (credits) charges
(276
)
2,218
Foreign exchange transaction (gains) losses
(370
)
82
Gain on sale of certain assets
(3,750
)
-
Other income, net
(3,553
)
(4,391
)
Non-GAAP Adjusted EBITDA$
95,258
$
81,764
Adjusted EBITDA Margin
19.5
%
19.0
%
Notes: (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) SEGMENT RESULTS (in thousands) (unaudited)
% Change
Three Months Ended July 31,
Favorable (Unfavorable)
2021
2020
Reported
Constant Currency
Research Publishing & Platforms: Revenue, net Research Publishing$
263,358
$
230,464
14
%
10
%
Research Platforms
11,398
10,346
10
%
10
%
Total Revenue, net$
274,756
$
240,810
14
%
10
%
Contribution to Profit$
78,808
$
69,818
13
%
10
%
Adjustments: Restructuring charges (credits)
216
(197
)
# # Non-GAAP Adjusted Contribution to Profit$
79,024
$
69,621
14
%
10
%
Depreciation and amortization
23,762
19,701
-21
%
-18
%
Non-GAAP Adjusted EBITDA$
102,786
$
89,322
15
%
12
%
Adjusted EBITDA margin
37.4
%
37.1
%
Academic & Professional Learning: Revenue, net Education Publishing (2)$
66,380
$
63,603
4
%
1
%
Professional Learning
72,884
62,829
16
%
13
%
Total Revenue, net$
139,264
$
126,432
10
%
7
%
Contribution to Profit$
8,152
$
(278
)
# # Adjustments: Restructuring charges
171
33
# # Non-GAAP Adjusted Contribution to Profit
$
8,323
$
(245
)
# # Depreciation and amortization
18,364
18,804
2
%
5
%
Non-GAAP Adjusted EBITDA$
26,687
$
18,559
44
%
37
%
Adjusted EBITDA margin
19.2
%
14.7
%
Education Services: Revenue, net University Services (3)$
54,394
$
50,262
8
%
8
%
Talent Development Services (2) (4)
19,974
13,822
45
%
34
%
Total Revenue, net$
74,368
$
64,084
16
%
13
%
Contribution to Profit$
(1,827
)
$
456
# # Adjustments: Restructuring (credits) charges
(34
)
139
# # Non-GAAP Adjusted Contribution to Profit
$
(1,861
)
$
595
# # Depreciation and amortization
8,303
7,279
-14
%
-13
%
Non-GAAP Adjusted EBITDA$
6,442
$
7,874
-18
%
-21
%
Adjusted EBITDA margin
8.7
%
12.3
%
Corporate Expenses:$
(44,165
)
$
(39,957
)
-11
%
-9
%
Adjustments: Restructuring (credits) charges
(629
)
2,243
# # Non-GAAP Adjusted Contribution to Profit
$
(44,794
)
$
(37,714
)
-19
%
-17
%
Depreciation and amortization
4,137
3,723
-11
%
-11
%
Non-GAAP Adjusted EBITDA$
(40,657
)
$
(33,991
)
-20
%
-18
%
Consolidated Results: Revenue, net$
488,388
$
431,326
13
%
9
%
Operating Income$
40,968
$
30,039
36
%
28
%
Adjustments: Restructuring (credits) charges
(276
)
2,218
# # Non-GAAP Adjusted Contribution to Profit
$
40,692
$
32,257
26
%
18
%
Depreciation and amortization
54,566
49,507
-10
%
-12
%
Non-GAAP Adjusted EBITDA$
95,258
$
81,764
17
%
12
%
Adjusted EBITDA margin
19.5
%
19.0
%
(1) The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering have been included in Education Services - Talent Development Services. The Revenue, Adjusted Contribution to Profit and Adjusted EBITDA for WileyNXT was $0.5 million, $0.1 million, and $0.1 million, respectively, for the three months ended July 31, 2020. There were no changes to our total consolidated financial results. (3) University Services was previously referred to as Education Services OPM. (4) Talent Development Services was previously referred to as mthree. # Variance greater than 100% JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (in thousands) (unaudited)July 31,
April 30,
2021
2021
Assets: Current assets Cash and cash equivalents$
82,982
$
93,795
Accounts receivable, net
284,579
311,571
Inventories, net
40,392
42,538
Prepaid expenses and other current assets
70,736
78,393
Total current assets
478,689
526,297
Product development assets, net
49,017
49,517
Royalty advances, net
27,668
39,582
Technology, property and equipment, net
273,306
282,270
Intangible assets, net
995,613
1,015,302
Goodwill
1,301,599
1,304,340
Operating lease right-of-use assets
122,334
121,430
Other non-current assets
114,574
107,701
Total assets$
3,362,800
$
3,446,439
Liabilities and shareholders' equity: Current liabilities Accounts payable$
62,230
$
95,791
Accrued royalties
90,064
78,582
Short-term portion of long-term debt
12,500
12,500
Contract liabilities
418,459
545,425
Accrued employment costs
66,771
144,744
Accrued income taxes
9,628
8,590
Short-term portion of operating lease liabilities
21,547
22,440
Other accrued liabilities
81,902
80,900
Total current liabilities
763,101
988,972
Long-term debt
952,020
809,088
Accrued pension liability
136,391
146,247
Deferred income tax liabilities
188,880
172,903
Operating lease liabilities
145,340
145,832
Other long-term liabilities
99,163
92,106
Total liabilities
2,284,895
2,355,148
Shareholders' equity
1,077,905
1,091,291
Total liabilities and shareholders' equity$
3,362,800
$
3,446,439
(1) The supplementary information included in this press release for July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited)Three Months Ended
July 31,
2021
2020
Operating activities: Net income$
13,830
16,334
Amortization of intangible assets
21,151
16,891
Amortization of product development assets
9,058
9,148
Depreciation and amortization of technology, property, and equipment
24,357
23,468
Other noncash charges
35,856
25,932
Net change in operating assets and liabilities
(189,026
)
(212,556
)
Net cash used in operating activities
(84,774
)
(120,783
)
Investing activities: Additions to technology, property, and equipment
(17,910
)
(18,964
)
Product development spending
(5,670
)
(5,325
)
Businesses acquired in purchase transactions, net of cash acquired
(3,032
)
(136
)
Proceeds related to the sale of certain assets
3,375
-
Acquisitions of publication rights and other
(295
)
(3,855
)
Net cash used in investing activities
(23,532
)
(28,280
)
Financing activities: Net debt borrowings
142,703
67,356
Cash dividends
(19,307
)
(19,261
)
Purchases of treasury shares
(7,367
)
-
Other
(16,940
)
(4,611
)
Net cash provided by financing activities
99,089
43,484
Effects of exchange rate changes on cash, cash equivalents and restricted cash
(1,586
)
4,500
Change in cash, cash equivalents and restricted cash for period
(10,803
)
(101,079
)
Cash, cash equivalents and restricted cash - beginning
94,359
203,047
Cash, cash equivalents and restricted cash - ending
$
83,556
$
101,968
CALCULATION OF NON-GAAP FREE CASH FLOW LESS PRODUCT DEVELOPMENT SPENDING
Three Months Ended
July 31,
2021
2020
Net cash used in operating activities$
(84,774
)
$
(120,783
)
Less: Additions to technology, property, and equipment
(17,910
)
(18,964
)
Less: Product development spending
(5,670
)
(5,325
)
Free cash flow less product development spending$
(108,354
)
$
(145,072
)
See Explanation of Usage of Non-GAAP Performance Measures included in this supplemental information. (1) The supplementary information included in this press release for the three months ended July 31, 2021 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.JOHN WILEY & SONS, INC. EXPLANATION OF USAGE OF NON-GAAP PERFORMANCE MEASURES
In this earnings release and supplemental information, management may present the following non-GAAP performance measures:
Management uses these non-GAAP performance measures as supplemental indicators of our operating performance and financial position as well for internal reporting and forecasting purposes, when publicly providing its outlook, to evaluate the Company's performance and calculate incentive compensation.
The Company presents these non-GAAP performance measures in addition to US GAAP financial results because it believes that these non-GAAP performance measures provide useful information to certain investors and financial analysts for operational trends and comparisons over time. The use of these non-GAAP performance measures may also provide a consistent basis to evaluate operating profitability and performance trends by excluding items that we do not consider to be controllable activities for this purpose.
The performance metric used by our chief operating decision maker to evaluate performance of our reportable segments is Adjusted Contribution to Profit. We present both Adjusted Contribution to Profit and Adjusted EBITDA for each of our reportable segments since we believe Adjusted EBITDA provides additional useful information to certain investors and financial analysts for operational trends and comparisons over time as it removes the impact of depreciation and amortization expense, as well as a consistent basis to evaluate operating profitability and comparing our financial performance to that of our peer companies and competitors.
For example:
In addition, the Company has historically provided these or similar non-GAAP performance measures and understand that some investors and financial analysts find this information helpful in analyzing the Company's operating margins and net income, and in comparing the Company's financial performance to that of its peer companies and competitors. Based on interactions with investors, we also believe that the Company's non-GAAP performance measures are regarded as useful to our investors as supplemental to our US GAAP financial results, and that there is no confusion regarding the adjustments or our operating performance to our investors due to the comprehensive nature of our disclosures.
We have not provided our 2022 outlook for the most directly comparable US GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend on various factors, and could be material to our consolidated results computed in accordance with US GAAP.
Non-GAAP performance measures do not have standardized meanings prescribed by US GAAP and therefore may not be comparable to the calculation of similar measures used by other companies and should not be viewed as alternatives to measures of financial results under US GAAP. The adjusted metrics have limitations as analytical tools, and should not be considered in isolation from, or as a substitute for, US GAAP information. It does not purport to represent any similarly titled US GAAP information, and is not an indicator of our performance under US GAAP. Non-US GAAP financial metrics that we present may not be comparable with similarly titled measures used by others. Investors are cautioned against placing undue reliance on these non-US GAAP measures.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210902005271/en/
Investors: Brian Campbell 201.748.6874 brian.campbell@wiley.com
Media: Katie Roberts 602.373.7233 karoberts@wiley.com
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