Wolters Kluwer 2009 Half-Year Results
(Thomson Reuters ONE) - Full-Year Guidance ReiteratedAmsterdam (July 29, 2009) - Wolters Kluwer, a market-leading globalinformation services and publishing company focused on professionals,released today its 2009 half-year results. Highlights include animproved operating margin, strong free cash flow growth, and stableperformance from subscription businesses. These results reflect aresilient company, supported by an effective cost savings program, astrong financial foundation, and a growing online and softwareportfolio designed to drive long-term profitable growth.Highlights * Diluted ordinary EPS grew 12% to ?0.70 (2008: ?0.62) or ?0.64 at constant currencies * Ordinary EBITA margin improved 70 basis points to 18.6% reflecting success of cost savings programs, growth in electronic revenue, and the contribution of recent acquisitions * Free cash flow grew 38% to ?146 million (2008: ?106 million) or ?134 million at constant currencies * Revenue growth of 2% at constant currencies, organic revenue declined 3% due to the economic cycle effect on transactional and cyclical product lines, currencies lifted reported growth to 7% * Springboard operational excellence cost savings program on track and expected to comfortably deliver full-year run rate savings of ?55 million this year and ?120 million by 2011 * Net debt reduced to ?2,235 million (?2,254 million at December 31, 2008) * Progressive annual dividend policy reiterated * 2009 full-year guidance reiteratedKey Figures First Half 2009+-------------------------------------------------------------------+| Six months ended | 2009 | 2008 | change | change CC | change OG || June 30 | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Revenue (? | 1,720 | 1,608 | 7% | 2% | (3%) || millions) | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Electronic | | | | | || revenue % of | 52% | 50% | | | || total | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Ordinary EBITA | 320 | 288 | 11% | 4% | (6%) || (? millions) | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Ordinary EBITA | 18.6% | 17.9% | | | || margin (%) | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Ordinary net | | | | | || income (? | 203 | 178 | 14% | 2% | || millions) | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Diluted EPS (?) | 0.45 | 0.50 | (10%) | (21%) | ||------------------+-------+-------+--------+-----------+-----------|| Diluted ordinary | 0.70 | 0.62 | 12% | 0% | || EPS (?) | | | | | ||------------------+-------+-------+--------+-----------+-----------|| Free cash flow | 146 | 106 | 38% | 27% | || (? millions) | | | | | ||-------------------------------------------------------------------|| change - % Change; change CC - % Change constant currency || (EUR/USD 1.47); change OG - % Organic growth |+-------------------------------------------------------------------+Nancy McKinstry, CEO and Chairman of the Executive Board, commentedon the company's half-year performance:"We are pleased to deliver solid profitability and cash flow in thefirst half of 2009. The performance over the first half demonstratesthat the stable subscription base and growing online and softwareportfolio is serving Wolters Kluwer well. Electronic revenue grew 7%and now comprises 52% of total revenue, up from 50% in the prioryear.With a continued focus on operational excellence and a commitment toinvest 8-10% of revenues in the business, we have the foundation inplace to support long-term growth. We are confident that the macrotrends leading to increased regulation, more complex compliancerequirements, and a strong focus on productivity among all ourcustomer segments will continue to drive the need for our highquality information and software solutions. Based on our performancefor the first half of 2009, we are confident to reiterate ourfull-year 2009 guidance."OverviewDespite challenging market conditions, the company's profitabilityimproved in the period. Ordinary EBITA grew by 11% and the ordinaryEBITA margin improved 70 basis points to 18.6% from 17.9% in 2008driven by strong growth in higher margin online and softwareproducts, the contribution of acquisitions completed in the prioryear, and operational excellence programs, including projectSpringboard. As a result of these improvements, diluted ordinaryearnings per share grew 12% in 2009 to ?0.70; at constant currencies,diluted ordinary earnings per share were ?0.64.The company's leading brands, resilient portfolio, and strong cashgeneration continue to support a solid financial position. In the sixmonths ended June 30, 2009, free cash flow grew 38% to ?146 million.Net debt as of June 30, 2009, was ?2,235 million (?2,254 millionDecember 31, 2008) representing a net-debt-to-EBITDA ratio of 3.1.The net-debt-to-EBITDA ratio was reduced in the first half in keepingwith management's intention to move closer to its target of 2.5 timesnet-debt-to-EBITDA over the medium term. Prior year debt refinancingat attractive rates extended the maturity profile out beyond 2013,ensuring a strong liquidity position and sufficient headroom inexcess of the company's ?500 million policy minimum.Revenue growth components(All amounts are in millions of euros unless otherwise indicated)+-------------------------------------------------------------------+| Six months | % of | 2009 | 2008 | change | change | change || ended June 30 | Total | | | | CC | OG ||----------------+-------+-------+-------+--------+--------+--------|| Subscription & | | | | | | || other | 73% | 1,257 | 1,137 | 11% | 6% | (1%) || non-cyclical | | | | | | ||----------------+-------+-------+-------+--------+--------+--------|| Books | 9% | 149 | 141 | 6% | 1% | 1% ||----------------+-------+-------+-------+--------+--------+--------|| Advertising & | 5% | 81 | 88 | (8%) | (13%) | (13%) || promotional | | | | | | ||----------------+-------+-------+-------+--------+--------+--------|| CFS | 5% | 92 | 92 | 0% | (13%) | (13%) || transactional | | | | | | ||----------------+-------+-------+-------+--------+--------+--------|| Other cyclical | 8% | 141 | 150 | (6%) | (10%) | (10%) ||----------------+-------+-------+-------+--------+--------+--------|| Total revenues | 100% | 1,720 | 1,608 | 7% | 2% | (3%) ||-------------------------------------------------------------------|| change - % Change; change CC - % Change constant currency || (EUR/USD 1.47); change OG - % Organic growth |+-------------------------------------------------------------------+Wolters Kluwer revenue grew 7% to ?1,720 million for the six monthsended June 30, 2009, compared to ?1,608 million in the same period ofthe prior year. Key strategic acquisitions contributed growth of 5%while underlying revenue declined 3%, reflecting the economy's impacton transactional and cyclical product lines, while the positiveimpact of currencies as compared to the prior year contributed 5% tototal growth.Underlying subscription and other non-cyclical revenues, which makeup 73% of total half-year revenues, were materially in line with theprior year. With retention rates largely stable across the business,subscription revenues showed a solid performance compared with theprior year, while other non-cyclical products, which include tax formclicks and related bank products, were weaker due to recessionarymarket conditions. New subscription sales experienced downwardpressure in the first half driven by weak economic conditions assales cycles lengthened. This has largely impacted the Tax,Accounting & Legal and Legal, Tax & Regulatory Europe divisions.Despite these conditions, customers continue to demand integratedworkflow and software solutions driving growth in electronic revenue.Electronic revenues now comprise 52% of total revenues up from 50% inthe prior year.Underlying transactional product revenues, which make up 27% of totalhalf-year revenues, declined 8% and continue to remain under pressuredue to recessionary market conditions. Cyclical revenues in theCorporate & Financial Services division make up 5% of total WoltersKluwer revenue and include products related to transaction volumes inthe M&A, IPOs, UCC lending, mortgage, and indirect lending markets.As expected, these revenues declined 13% in the period. Similarly,advertising and pharmaceutical promotion revenues, 5% of totalhalf-year revenue, continued to be challenged by the weak economicconditions and posted a 13% decline in the period - primarily in theHealth division, France, and the Netherlands. Other cyclical revenuesrepresent 8% of total revenue and include training, consulting, andtransport services. These product lines declined 10% in the half yearprimarily impacting the Tax, Accounting & Legal and Legal, Tax &Regulatory Europe divisions. Partially offsetting these trends, bookproducts which make up 9% of revenues showed growth of 1% in theperiod. Strong ordering ahead of the fall semester selling seasonbenefited results in the Health division and Legal Education withinthe Tax, Accounting & Legal division.The full press release on the 2009 half-year results is availablehere: PDF version of Press ReleaseMedia Investors/AnalystsCaroline Wouters Kevin EntrickenVice President, Corporate Vice President, InvestorCommunications Relationst + 31 (0)20 60 70 459 t + 31 (0)20 60 70 407press(at)wolterskluwer.com ir(at)wolterskluwer.comhttp://hugin.info/130682/R/1331350/314976.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 29.07.2009 - 08:00 Uhr
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