Scholastic Corporation · NASDAQ:SCHL
Scholastic — FY2011 Earnings Presentation
16 slides from Scholastic's earnings presentation, Jul 21, 2011
Slide 1: Fiscal 2011 Year End Earnings Presentation
FISCAL 2011 YEAR END EARNINGS PRESENTATION 1 July 21, 2011
Slide 2: Forward-Looking Statements
Forward--Looking Statements Forward This presentation contains certain forward-looking statements, which are subject to various risks and uncertainties, including the conditions of the children’s book and educational materials markets and acceptance of the Company’s products in those markets and oth
Slide 3: Regulation G
Regulation G Today’s comments include references to certain non- GAAP financial measures as defined in Regulation G. The reconciliation of these non-GAAP financial measures with the relevant GAAP financial information and other information required by Regulation G is provided in the Company’s earnin
Slide 4: Dick Robinson, Chief Executive Officer, President and Chairman
Dick Robinson Chief Executive Officer, President and Chairman 4
Slide 5: Educational Publishing
Educational Publishing Successful May launch of READ 180® Next Generation Double-digit growth in services in Q4 and FY11, driven by strong sales and renewals and expanding customer base Positive outlook for higher sales, profits in FY12 Continued investments in new reading, math, service programs 5
Slide 6: Digital Initiatives in Children's Books
Digital Initiatives in Children’s Books Accelerated ebook and ecommerce initiatives in FY11 with $30 incremental spending in Children’s Books Free, downloadable children’s ereading application built and tested, with full consumer launch expected early 2012 New COOL ecommerce platform rolled out, dri
Slide 7: Children's Books
Children’s Books Continued strong Trade sales and higher profits driven by Harry Potter and other bestselling series: The Hunger Games, 39 Clues Higher profits in School Book Fairs, reflecting higher revenue per fair and improved efficiencies Modest decline in School Book Club sales and profits, ass
Slide 8: International
International Higher FY11 revenue and profits, driven by Australia and Asia Targeting continued revenue growth and higher margins in FY12 Multipronged growth strategy in Asia, building upon profitable, well established platform across region 8
Slide 9: Maureen O'Connell, EVP, Chief Administrative Officer and CFO
Maureen O’Connell Executive Vice President, Chief Administrative Officer and Chief Financial Officer 9
Slide 10: One-Time Items
One--Time Items One FY 2011 FY 2010 $M (except per share) Op Income EPS Op Income EPS Results from continuing operations $100.7 1.29 $128.4 1.59 1 Bad debt expense related to Border's bankruptcy 3.5 0.06 - - 2 Expense associated with UK restructuring 3.0 0.09 4.7 0.12 3 Expense related to sales tax
Slide 11: Income Statement (adjusted)
Income Statement (adjusted) Fourth Quarter Fiscal Year Adjusted $M (except per share) 2011 2010 2011 2010 Revenues $545.8 $538.4 $1,906.1 $1,912.9 Cost of goods sold 241.8 232.7 885.9 859.1 Selling, general and administrative expenses 232.2 220.2 839.4 801.1 Bad debt expense 1.0 0.1 10.1 9.5 Depreci
Slide 12: Segment Results (adjusted)
Segment Results (adjusted) Fourth Quarter Fiscal Year Adjusted $M (except per share) 2011 2010 2011 2010 Children's Book Publishing & Distribution Revenue $268.8 $273.5 $922.0 $910.6 Operating income 41.6 50.7 81.6 117.9 Educational Publishing Revenue $126.5 $117.2 $428.0 $476.5 Operating income 18.
Slide 13: Free Cash Flow and Balance Sheet
Free Cash Flow and Balance Sheet Adjusted $M May 31, 2011 May 31, 2010 1 Free cash flow (12 month period) $120.5 $171.6 Accounts receivable, net $220.3 $212.5 Inventories, net $309.9 $315.7 Accounts payable $120.2 $101.0 Accrued royalties $35.4 $42.3 Total debt $203.4 $252.8 Cash and cash equivalent
Slide 14: Key Elements of Fiscal 2012 Outlook
Key Elements of Fiscal 2012 Outlook In Children’s Books, improved operating results in Clubs and Fairs offsetting higher spending on digital initiatives Solid growth and higher profits across Education segment Continued revenue growth and higher margins in International, driven by Asia Higher profit
Slide 15: Financial Guidance
Financial Guidance Revenue Approximately $1.9 billion Earnings from $1.75 to $2.10 per diluted share Continuing Operations Free Cash Flow $90 to $100 million Capital $55 to $65 million Expenditures Prepublication and $65 to $75 million Production Spending Note: Outlook for EPS and operating income e
Slide 16: Questions & Answers
Questions & Answers Participants Richard Robinson Maureen O’Connell Deborah Forte, Scholastic Media Margery Mayer, Scholastic Education Judy Newman, Scholastic Book Clubs and E-Commerce Hugh Roome, Scholastic Consumer and Professional Publishing 16