Le Lézard
Classified in: Business, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

Wiley Reports Fourth Quarter and Fiscal Year 2022 Results


Wiley (NYSE: WLY), a global leader in scientific research and career-connected education, today announced results for the fourth quarter and fiscal year ended April 30, 2022.

FOURTH QUARTER SUMMARY

FULL YEAR SUMMARY

MANAGEMENT COMMENTARY

"Wiley delivered another solid year in Fiscal 2022 as we materially accelerated organic growth, delivered on our financial targets, and surpassed $2 billion in revenue for the first time," said Brian Napack, President and CEO. "Our consistent strategy to lead in open scientific research and career-connected education, our strong cash flow, and our dedication to operational excellence position us well for the future."

FOURTH QUARTER PERFORMANCE

GAAP Measures
Unaudited ($millions except for EPS)

Q4 2022

Q4 2021

Change

 

 

Revenue

$545.7

$536.3

2%

 

Operating Income

$58.4

$51.2

14%

 

Diluted EPS

$0.76

$0.73

4%

 

Non-GAAP Measures

Q4 2022

Q4 2021

Change

 

Change
Constant Currency

Revenue

$545.7

$536.3

+2%

+4%

Adjusted EBITDA

$110.9

$112.7

(2%)

0%

Adjusted EPS

$1.08

$1.15

(6%)

(6%)

  • Excluding FX and acquisitions, revenue rose 2% for the quarter.
  • Wiley recorded an unfavorable FX variance of $11 million in revenue and $1 million in Adjusted EBITDA. There was no material FX variance to Adjusted EPS.

Revenue

Adjusted EBITDA

EPS

FISCAL YEAR 2022 PERFORMANCE

GAAP Measures

Unaudited ($millions except for EPS)

Fiscal 2022

Fiscal 2021

Change

 

Revenue

$2,082.9

$1,941.5

+7%

 

Operating Income

$219.3

$185.5

+18%

 

Diluted EPS

$2.62

$2.63

(0.4%)

 

Net Cash Provided by Operating Activities

$339.1

$359.9

(6%)

 

Non-GAAP Measures

Fiscal 2022

Fiscal 2021

Change

Change
Constant Currency

Revenue

$2,082.9

$1,941.5

+7%

+7%

Adjusted EBITDA

$433.0

$419.0

+3%

+3%

Adjusted EPS

$4.16

$4.00

+4%

+1%

Free Cash Flow Less Product Development Spending

$223.2

$256.6

(13%)

 

  • Excluding FX and acquisitions, revenue rose 5%.
  • Wiley recorded a favorable FX variance of $6 million in revenue and $1 million in Adjusted EBITDA, along with a favorable FX variance of $0.11 in Adjusted EPS.
  • Starting in Fiscal 2022, Wiley's Adjusted EPS metric now excludes the impact of certain non-cash items related to acquisitions, notably the amortization of acquired intangible assets. The Company does not consider these non-cash items to be indicative of ongoing operating performance.

FISCAL YEAR 2023 OUTLOOK

Metric
($millions, except EPS)

Fiscal 2022*

Fiscal 2023 Outlook*
At constant currency

FX Impact**

Fiscal 2023 Outlook^
At spot rates

Revenue

$2,083

$2,175 - $2,215

($75)

$2,100 - $2,140

Adjusted EBITDA

$433

$425 - $450

($25)

$400 - $425

Adjusted EPS

$4.16

$3.70 - $4.05

($0.30)

$3.40 - $3.75

Free Cash Flow

$223

$210 - $235

($25)

$185 - $210

*Based on Fiscal 2022 average rates of 1.15 euro and 1.36 British pound
**Variance between Fiscal 2022 average rates and spot rates as of June 10: 1.06 euro and 1.24 British pound
^Fiscal 2023 outlook at spot rates as of June 10

EARNINGS CONFERENCE CALL

Scheduled for today, June 15 at 10:00 am (ET). Access webcast at Investor Relations at investors.wiley.com, or directly at https://events.q4inc.com/attendee/828353638. U.S. callers, please dial (888) 210-3346 and enter the participant code 2521217#. International callers, please dial (646) 960-0253 and enter the participant code 2521217#.

ABOUT WILEY

Wiley (NYSE: WLY) is a global leader in research and education, unlocking human potential by enabling discovery, powering education, and shaping workforces. For over two hundred 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 investors.wiley.com, 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," "Adjusted Operating Income," "Adjusted EBITDA," "Adjusted CTP," "Adjusted Income before Taxes," "Adjusted Income Tax Provision," "Adjusted Effective Income 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 2023 outlook for the most directly comparable U.S. 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 U.S. 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 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 online 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 2023 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: 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

 

Year Ended

April 30,

 

April 30,

2022

 

2021

 

2022

 

2021

Revenue, net

$

545,653

 

$

536,252

 

$

2,082,928

 

$

1,941,501

 

Costs and expenses:
Cost of sales

 

187,004

 

 

168,037

 

 

700,658

 

 

625,335

 

Operating and administrative expenses

 

279,331

 

 

286,882

 

 

1,079,585

 

 

1,022,660

 

Restructuring and related (credits) charges

 

(266

)

 

8,497

 

 

(1,427

)

 

33,310

 

Amortization of intangible assets

 

21,153

 

 

21,596

 

 

84,836

 

 

74,685

 

Total costs and expenses

 

487,222

 

 

485,012

 

 

1,863,652

 

 

1,755,990

 

 
Operating income

 

58,431

 

 

51,240

 

 

219,276

 

 

185,511

 

As a % of revenue

 

10.7

%

 

9.6

%

 

10.5

%

 

9.6

%

 
Interest expense

 

(5,063

)

 

(4,455

)

 

(19,802

)

 

(18,383

)

Foreign exchange transaction losses

 

(1,704

)

 

(1,504

)

 

(3,192

)

 

(7,977

)

Gain on sale of certain assets

 

-

 

 

-

 

 

3,694

 

 

-

 

Other income, net

 

161

 

 

4,992

 

 

9,685

 

 

16,761

 

 
Income before taxes

 

51,825

 

 

50,273

 

 

209,661

 

 

175,912

 

 
Provision for income taxes

 

8,679

 

 

8,944

 

 

61,352

 

 

27,656

 

Effective tax rate

 

16.7

%

 

17.8

%

 

29.3

%

 

15.7

%

Net income

$

43,146

 

$

41,329

 

$

148,309

 

$

148,256

 

As a % of revenue

 

7.9

%

 

7.7

%

 

7.1

%

 

7.6

%

 
Earnings per share
Basic

$

0.78

 

$

0.74

 

$

2.66

 

$

2.65

 

Diluted

$

0.76

 

$

0.73

 

$

2.62

 

$

2.63

 

 
Weighted average number of common shares outstanding
Basic

 

55,668

 

 

55,814

 

 

55,759

 

 

55,930

 

Diluted

 

56,529

 

 

56,616

 

 

56,598

 

 

56,461

 

 
 
Notes:
(1) The supplementary information included in this press release for the three months and year ended April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K with the Securities and Exchange Commission.

In the year ended April 30, 2022, we completed the acquisition of certain assets of XYZ Media Inc. (Education Services segment), the assets of the eJournalPress business and J&J Editorial Services, LLC (both in Research Publishing & Platforms segment), two immaterial businesses in our Research Publishing & Platforms segment, and one immaterial business included in our Education Services segment.
 
(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 Year Ended

April 30,

 

April 30,

2022

 

2021

 

2022

 

2021

US GAAP Earnings Per Share - Diluted

$

0.76

 

$

0.73

 

$

2.62

 

$

2.63

 

Adjustments:
Restructuring and related (credits) charges

 

-

 

 

0.12

 

 

(0.02

)

 

0.44

 

Foreign exchange losses (gains) on intercompany transactions

 

0.02

 

 

(0.01

)

 

0.02

 

 

(0.02

)

Amortization of acquired intangible assets (3)

 

0.29

 

 

0.31

 

 

1.21

 

 

1.08

 

Gain on sale of certain assets (4)

 

-

 

 

-

 

 

(0.05

)

 

-

 

Income tax adjustments (5) (6)

 

0.01

 

 

-

 

 

0.38

 

 

(0.13

)

Non-GAAP Adjusted Earnings Per Share - Diluted

$

1.08

 

$

1.15

 

$

4.16

 

$

4.00

 

 
Reconciliation of US GAAP Income Before Taxes to Non-GAAP Adjusted Income Before Taxes

Three Months Ended

 

Year Ended

(amounts in thousands)

April 30,

 

April 30,

2022

 

2021

 

2022

 

2021

US GAAP Income Before Taxes

$

51,825

 

$

50,273

 

$

209,661

 

$

175,912

 

Pretax Impact of Adjustments:
Restructuring and related (credits) charges

 

(266

)

 

8,497

 

 

(1,427

)

 

33,310

 

Foreign exchange losses (gains) on intercompany transactions

 

1,019

 

 

(385

)

 

1,513

 

 

(1,457

)

Amortization of acquired intangible assets

 

22,265

 

 

22,728

 

 

89,346

 

 

79,421

 

Gain on sale of certain assets (4)

 

-

 

 

-

 

 

(3,694

)

 

-

 

Non-GAAP Adjusted Income Before Taxes

$

74,843

 

$

81,113

 

$

295,399

 

$

287,186

 

 
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

$

8,679

 

$

8,944

 

$

61,352

 

$

27,656

 

Income Tax Impact of Adjustments (7)
Restructuring and related (credits) charges

 

(142

)

 

1,702

 

 

(260

)

 

8,065

 

Foreign exchange losses (gains) on intercompany transactions

 

41

 

 

40

 

 

597

 

 

(363

)

Amortization of acquired intangible assets

 

6,017

 

 

5,187

 

 

20,816

 

 

18,511

 

Gain on sale of certain assets (4)

 

-

 

 

-

 

 

(922

)

 

-

 

Income Tax Adjustments:
Impact of increase in UK statutory rate on deferred tax balances (5)

 

(689

)

 

3,261

 

 

(21,415

)

 

(3,511

)

Impact of US CARES Act (6)

 

-

 

 

-

 

 

-

 

 

13,998

 

Impact of change in certain U.S. state tax rates in 2021 (8)

 

-

 

 

(3,225

)

 

-

 

 

(3,225

)

Non-GAAP Adjusted Income Tax Provision

$

13,906

 

$

15,909

 

$

60,168

 

$

61,131

 

 
US GAAP Effective Tax Rate

 

16.7

%

 

17.8

%

 

29.3

%

 

15.7

%

Non-GAAP Adjusted Effective Tax Rate

 

18.6

%

 

19.6

%

 

20.4

%

 

21.3

%

 
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 and year ended April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K with the Securities and Exchange Commission.

 

 

 

 

 

 

 

 

 

 

 

 

(2)

 

All amounts are approximate due to rounding.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3)

 

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.

 

 

 

 

 

 

 

 

 

 

 

 

(4)

 

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 $3.7 million during the year ended April 30, 2022.

 

 

 

 

 

 

 

 

 

 

 

 

(5)

 

In the three months ended July 31, 2021, the UK enacted legislation that increased its statutory rate from 19% to 25% effective April 1, 2023. This resulted in a non-cash deferred tax expense from the re-measurement of the Company's applicable UK net deferred tax liabilities of $0.7 million, or $0.01 per share for the three months ended April 30, 2022, and $21.4 million, or $0.38 per share for the year ended April 30, 2022 . These adjustments impacted deferred taxes.

In the three months ended July 31, 2020, the UK enacted legislation that increased its statutory rate from 17% to 19%. This resulted in a $3.3 million, or $(0.06) per share, non-cash deferred tax benefit, and a $3.5 million, or $0.06 per share, non-cash deferred tax expense from the re-measurement of the Company's applicable U.K. net deferred tax liabilities for the three months and year ended April 30, 2021, respectively. These adjustments impacted deferred taxes.

 

 

 

 

 

 

 

 

 

 

 

 

(6)

 

In connection with the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and certain regulations, we carried back our April 30, 2020 US net operating loss (NOL) to our year ended April 30, 2015 and claimed a $20.7 million refund. The refund plus interest was received in February 2021. The NOL was carried back to fiscal year 2015 when the US corporate tax rate was 35.0%. The carryback to a year with a higher rate, plus certain additional net permanent deductions included in the carryback resulted in a $14.0 million tax benefit, or $(0.25) per share, $8.4 million from current taxes and $5.6 million from deferred taxes, for the year ended April 30, 2021.

 

 

 

 

 

 

 

 

 

 

 

 

(7)

 

For the three months and year ended April 30, 2022 and 2021, substantially all of the tax impact was from deferred taxes.

 

 

 

 

 

 

 

 

 

 

 

 

(8)

 

In connection with the increase in certain US state tax apportionment factors in 2021, we recorded income tax expense of $3.2 million, or $0.06 per share for the three months and year ended April 30, 2021. These adjustments impacted deferred taxes.

 
JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
RECONCILIATION OF US GAAP NET INCOME TO NON-GAAP EBITDA AND ADJUSTED EBITDA
(unaudited)
 
Three Months Ended Year Ended
April 30, April 30,

2022

 

2021

 

2022

 

2021

Net Income

$

43,146

 

$

41,329

 

$

148,309

 

$

148,256

 

Interest expense

 

5,063

 

 

4,455

 

 

19,802

 

 

18,383

 

Provision for income taxes

 

8,679

 

 

8,944

 

 

61,352

 

 

27,656

 

Depreciation and amortization

 

52,686

 

 

52,936

 

 

215,170

 

 

200,189

 

Non-GAAP EBITDA

 

109,574

 

 

107,664

 

 

444,633

 

 

394,484

 

Restructuring and related (credits) charges

 

(266

)

 

8,497

 

 

(1,427

)

 

33,310

 

Foreign exchange transaction losses

 

1,704

 

 

1,504

 

 

3,192

 

 

7,977

 

Gain on sale of certain assets

 

-

 

 

-

 

 

(3,694

)

 

-

 

Other income, net

 

(161

)

 

(4,992

)

 

(9,685

)

 

(16,761

)

Non-GAAP Adjusted EBITDA

$

110,851

 

$

112,673

 

$

433,019

 

$

419,010

 

Adjusted EBITDA Margin

 

20.3

%

 

21.0

%

 

20.8

%

 

21.6

%

 
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 and year ended April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K with the Securities and Exchange Commission.
 
JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
SEGMENT RESULTS
(in thousands)
(unaudited)
   
% Change
Three Months Ended April 30, Favorable (Unfavorable)

2022

2021

Reported   Constant
Currency
Research Publishing & Platforms:  
Revenue, net  
Research Publishing

$

281,907

 

$

272,030

 

4%

 

6%

Research Platforms

 

16,185

 

 

11,325

 

43%

 

44%

Total Revenue, net

$

298,092

 

$

283,355

 

5%

 

8%

   
Contribution to Profit

$

76,985

 

$

68,371

 

13%

 

15%

Adjustments:  
Restructuring charges

 

-

 

 

316

 

100%

 

100%

Non-GAAP Adjusted Contribution to Profit

$

76,985

 

$

68,687

 

12%

 

15%

Depreciation and amortization

 

23,759

 

 

23,403

 

-2%

 

3%

Non-GAAP Adjusted EBITDA

$

100,744

 

$

92,090

 

9%

 

12%

Adjusted EBITDA margin

 

33.8

%

 

32.5

%

 
   
Academic & Professional Learning:  
Revenue, net  
Education Publishing (2)

$

89,533

 

$

97,492

 

-8%

 

-7%

Professional Learning

 

70,864

 

 

74,398

 

-5%

 

-3%

Total Revenue, net

$

160,397

 

$

171,890

 

-7%

 

-5%

   
Contribution to Profit

$

28,375

 

$

26,308

 

8%

 

9%

Adjustments:  
Restructuring (credits) charges

 

(375

)

 

1,601

 

#   #
Non-GAAP Adjusted Contribution to Profit

$

28,000

 

$

27,909

 

0%

 

2%

Depreciation and amortization

 

16,011

 

 

18,240

 

12%

 

14%

Non-GAAP Adjusted EBITDA

$

44,011

 

$

46,149

 

-5%

 

-3%

Adjusted EBITDA margin

 

27.4

%

 

26.8

%

 
   
Education Services:  
Revenue, net  
University Services (3)

$

58,566

 

$

64,452

 

-9%

 

-9%

Talent Development Services (2) (4)

 

28,598

 

 

16,555

 

73%

 

78%

Total Revenue, net

$

87,164

 

$

81,007

 

8%

 

9%

   
Contribution to Profit

$

1,733

 

$

6,995

 

-75%

 

-76%

Adjustments:  
Restructuring charges

 

31

 

 

237

 

87%

 

87%

Non-GAAP Adjusted Contribution to Profit

$

1,764

 

$

7,232

 

-76%

 

-76%

Depreciation and amortization

 

8,781

 

 

7,672

 

-14%

 

-14%

Non-GAAP Adjusted EBITDA

$

10,545

 

$

14,904

 

-29%

 

-29%

Adjusted EBITDA margin

 

12.1

%

 

18.4

%

 
   
Corporate Expenses:

$

(48,662

)

$

(50,434

)

4%

 

0%

Adjustments:  
Restructuring charges

 

78

 

 

6,343

 

99%

 

99%

Non-GAAP Adjusted Contribution to Profit

$

(48,584

)

$

(44,091

)

-10%

 

-14%

Depreciation and amortization

 

4,135

 

 

3,621

 

-14%

 

-16%

Non-GAAP Adjusted EBITDA

$

(44,449

)

$

(40,470

)

-10%

 

-14%

   
Consolidated Results:  
Revenue, net

$

545,653

 

$

536,252

 

2%

 

4%

   
Operating Income

$

58,431

 

$

51,240

 

14%

 

15%

Adjustments:  
Restructuring (credits) charges

 

(266

)

 

8,497

 

#   #
Non-GAAP Adjusted Operating Income

$

58,165

 

$

59,737

 

-3%

 

-2%

Depreciation and amortization

 

52,686

 

 

52,936

 

0%

 

2%

Non-GAAP Adjusted EBITDA

$

110,851

 

$

112,673

 

-2%

 

0%

Adjusted EBITDA margin

 

20.3

%

 

21.0

%

 
   
Notes:  
(1) The supplementary information included in this press release for the three months and year ended April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K 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 $1.0 million, $(0.2) million, and $(0.2) million, respectively, for the three months ended April 30, 2021. The Revenue, Adjusted Contribution to Profit and Adjusted EBITDA for WileyNXT was $2.7 million, $(0.7) million, and $(0.7) million, respectively, for the year ended April 30, 2021. 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)
SEGMENT RESULTS
(in thousands)
(unaudited)
% Change
Year Ended April 30, Favorable (Unfavorable)

2022

2021

Reported   Constant
Currency
Research Publishing & Platforms:  
Revenue, net  
Research Publishing

$

1,057,022

 

$

972,512

 

9%

 

8%

Research Platforms

 

54,321

 

 

42,837

 

27%

 

27%

Total Revenue, net

$

1,111,343

 

$

1,015,349

 

9%

 

9%

   
Contribution to Profit

$

294,989

 

$

273,059

 

8%

 

9%

Adjustments:  
Restructuring charges (credits)

 

238

 

 

(36

)

#   #
Non-GAAP Adjusted Contribution to Profit

$

295,227

 

$

273,023

 

8%

 

9%

Depreciation and amortization

 

94,899

 

 

83,866

 

-13%

 

-13%

Non-GAAP Adjusted EBITDA

$

390,126

 

$

356,889

 

9%

 

10%

Adjusted EBITDA margin

 

35.1

%

 

35.1

%

 
   
Academic & Professional Learning:  
Revenue, net  
Education Publishing (2)

$

349,992

 

$

361,194

 

-3%

 

-4%

Professional Learning

 

296,831

 

 

280,667

 

6%

 

6%

Total Revenue, net

$

646,823

 

$

641,861

 

1%

 

1%

   
Contribution to Profit

$

112,372

 

$

88,860

 

26%

 

26%

Adjustments:  
Restructuring (credits) charges

 

(455

)

 

3,503

 

#   #
Non-GAAP Adjusted Contribution to Profit

$

111,917

 

$

92,363

 

21%

 

20%

Depreciation and amortization

 

69,561

 

 

71,997

 

3%

 

3%

Non-GAAP Adjusted EBITDA

$

181,478

 

$

164,360

 

10%

 

10%

Adjusted EBITDA margin

 

28.1

%

 

25.6

%

 
   
Education Services:  
Revenue, net  
University Services (3)

$

226,131

 

$

227,700

 

-1%

 

-1%

Talent Development Services (2)(4)

 

98,631

 

 

56,591

 

74%

 

72%

Total Revenue, net

$

324,762

 

$

284,291

 

14%

 

14%

   
Contribution to Profit

$

3,281

 

$

19,957

 

-84%

 

-84%

Adjustments:  
Restructuring charges

 

8

 

 

531

 

98%

 

98%

Non-GAAP Adjusted Contribution to Profit

$

3,289

 

$

20,488

 

-84%

 

-85%

Depreciation and amortization

 

34,157

 

 

29,654

 

-15%

 

-15%

Non-GAAP Adjusted EBITDA

$

37,446

 

$

50,142

 

-25%

 

-26%

Adjusted EBITDA margin

 

11.5

%

 

17.6

%

 
   
Corporate Expenses:

$

(191,366

)

$

(196,365

)

3%

 

2%

Adjustments:  
Restructuring (credits) charges

 

(1,218

)

 

29,312

 

#   #
Non-GAAP Adjusted Contribution to Profit

$

(192,584

)

$

(167,053

)

-15%

 

-16%

Depreciation and amortization

 

16,553

 

 

14,672

 

-13%

 

-13%

Non-GAAP Adjusted EBITDA

$

(176,031

)

$

(152,381

)

-16%

 

-16%

   
Consolidated Results:  
Revenue, net

$

2,082,928

 

$

1,941,501

 

7%

 

7%

   
Operating Income

$

219,276

 

$

185,511

 

18%

 

18%

Adjustments:  
Restructuring (credits) charges

 

(1,427

)

 

33,310

 

#   #
Non-GAAP Adjusted Operating Income

$

217,849

 

$

218,821

 

0%

 

-1%

Depreciation and amortization

 

215,170

 

 

200,189

 

-7%

 

-7%

Non-GAAP Adjusted EBITDA

$

433,019

 

$

419,010

 

3%

 

3%

Adjusted EBITDA margin

 

20.8

%

 

21.6

%

 
   
#  Variance greater than 100%  
 
JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands)
(unaudited)
 
April 30, April 30,

2022

2021

Assets:
Current assets
Cash and cash equivalents

$

100,397

$

93,795

Accounts receivable, net

 

331,960

 

311,571

Inventories, net

 

36,585

 

42,538

Prepaid expenses and other current assets

 

81,924

 

78,393

Total current assets

 

550,866

 

526,297

 
Technology, property and equipment, net

 

271,572

 

282,270

Intangible assets, net

 

931,429

 

1,015,302

Goodwill

 

1,302,142

 

1,304,340

Operating lease right-of-use assets

 

111,719

 

121,430

Other non-current assets

 

193,967

 

196,800

Total assets

$

3,361,695

$

3,446,439

 
Liabilities and shareholders' equity:
Current liabilities
Accounts payable

$

77,438

$

95,791

Accrued royalties

 

101,596

 

78,582

Short-term portion of long-term debt

 

18,750

 

12,500

Contract liabilities

 

538,126

 

545,425

Accrued employment costs

 

117,121

 

144,744

Short-term portion of operating lease liabilities

 

20,576

 

22,440

Other accrued liabilities

 

95,812

 

89,490

Total current liabilities

 

969,419

 

988,972

Long-term debt

 

768,277

 

809,088

Accrued pension liability

 

78,622

 

146,247

Deferred income tax liabilities

 

180,065

 

172,903

Operating lease liabilities

 

132,541

 

145,832

Other long-term liabilities

 

90,502

 

92,106

Total liabilities

 

2,219,426

 

2,355,148

Shareholders' equity

 

1,142,269

 

1,091,291

Total liabilities and shareholders' equity

$

3,361,695

$

3,446,439

 
Notes:
(1) The supplementary information included in this press release for April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K with the Securities and Exchange Commission.
 
JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
Year Ended
April 30,

 

2022

 

 

2021

 

Operating activities:
Net income

$

148,309

 

$

148,256

 

Amortization of intangible assets

 

84,836

 

 

74,685

 

Amortization of product development assets

 

35,162

 

 

34,365

 

Depreciation and amortization of technology, property, and equipment

 

95,172

 

 

91,139

 

Other noncash charges

 

80,050

 

 

111,382

 

Net change in operating assets and liabilities

 

(104,429

)

 

(99,904

)

Net cash provided by operating activities

 

339,100

 

 

359,923

 

 
Investing activities:
Additions to technology, property, and equipment

 

(88,843

)

 

(77,407

)

Product development spending

 

(27,015

)

 

(25,954

)

Businesses acquired in purchase transactions, net of cash acquired

 

(75,703

)

 

(299,942

)

Proceeds related to the sale of certain assets

 

3,375

 

 

-

 

Acquisitions of publication rights and other

 

(5,838

)

 

(29,851

)

Net cash used in investing activities

 

(194,024

)

 

(433,154

)

 
Financing activities:
Net debt (repayments) borrowings

 

(10,996

)

 

30,653

 

Cash dividends

 

(77,205

)

 

(76,938

)

Purchases of treasury shares

 

(30,000

)

 

(15,765

)

Other

 

(13,437

)

 

14,964

 

Net cash used in financing activities

 

(131,638

)

 

(47,086

)

 
Effects of exchange rate changes on cash, cash equivalents and restricted cash

 

(7,070

)

 

11,629

 

 
Change in cash, cash equivalents and restricted cash for period

 

6,368

 

 

(108,688

)

 
Cash, cash equivalents and restricted cash - beginning

 

94,359

 

 

203,047

 

Cash, cash equivalents and restricted cash - ending

$

100,727

 

$

94,359

 

 
CALCULATION OF NON-GAAP FREE CASH FLOW LESS PRODUCT DEVELOPMENT SPENDING (2)
 
Year Ended
April 30,

 

2022

 

 

2021

 

Net cash provided by operating activities

$

339,100

 

$

359,923

 

Less:Additions to technology, property, and equipment

 

(88,843

)

 

(77,407

)

Less:Product development spending

 

(27,015

)

 

(25,954

)

Free cash flow less product development spending

$

223,242

 

$

256,562

 

 Notes:           
(1) The supplementary information included in this press release for the year ended April 30, 2022 is preliminary and subject to change prior to the filing of our upcoming Annual Report on Form 10-K with the Securities and Exchange Commission.
 
(2) See Explanation of Usage of Non-GAAP Performance Measures included in this supplemental information.
 

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:
   

? Adjusted Earnings Per Share (Adjusted EPS);

? Free Cash Flow less Product Development Spending;

? Adjusted Contribution to Profit and margin;

? Adjusted Operating Income and margin;

? Adjusted Income Before Taxes;

? Adjusted Income Tax Provision;

? Adjusted Effective Tax Rate;

? EBITDA, Adjusted EBITDA and margin;

? Organic revenue; and

? Results on a constant currency basis.

  
Management uses these non-GAAP performance measures as supplemental indicators of our operating performance and financial position as well as for internal reporting and forecasting purposes, when publicly providing our outlook, to evaluate our performance and calculate incentive compensation.
  
We present these non-GAAP performance measures in addition to US GAAP financial results because we believe 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:
  

? Adjusted EPS, Adjusted Contribution to Profit, Adjusted Operating Income, Adjusted Income Before Taxes, Adjusted Income Tax Provision, Adjusted Effective Tax Rate, Adjusted EBITDA and organic revenue (excluding acquisitions) provide a more comparable basis to analyze operating results and earnings and are measures commonly used by shareholders to measure our performance.

  

? Free Cash Flow less Product Development Spending helps assess our ability, over the long term, to create value for our shareholders as it represents cash available to repay debt, pay common stock dividends and fund share repurchases and acquisitions.

  

? Results on a constant currency basis removes distortion from the effects of foreign currency movements to provide better comparability of our business trends from period to period. We measure our performance excluding the impact of foreign currency (or at constant currency), which means that we apply the same foreign currency exchange rates for the current and equivalent prior period.

  
In addition, we have historically provided these or similar non-GAAP performance measures and understand that some investors and financial analysts find this information helpful in analyzing our operating margins and net income, and in comparing our financial performance to that of our peer companies and competitors. Based on interactions with investors, we also believe that our 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 2023 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-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-GAAP measures.

 


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