Wolters Kluwer Half-Year 2006 Results
Revenues Increase 12%; Full-Year Outlook Reiterated
Amsterdam (August 2, 2006) - Wolters Kluwer, a leading multinational publishing and information services company, today released its half-year results showing a 12% increase in revenue with ordinary EBITA up 9%. Strong growth in the Corporate & Financial Services and Tax, Accounting & Legal divisions supported organic revenue growth of 2%, as the Company continued to successfully execute its three-year strategy.
Six months ended June 30, 2006:
* Revenues of €1,770 million, a 12% increase over first half of 2005 (€1,580 million)
* Organic revenues grew 2%, in line with full-year outlook
* Ordinary1 EBITA of €262 million, an increase of 9% over first half of 2005 (€242 million), ordinary EBITA margin 15% (2005: 15%)
* Product development spending of €126 million (an increase of 13% over last year)
* Structural cost savings of €58 million (an increase of 23% over last year)
* Strong free cash flow of €79 million (2005: €23 million)
Second quarter 2006:
* Revenues of €916 million, a 10% increase over second quarter of 2005 (€834 million)
* Organic revenue growth of 3%
* Ordinary EBITA of €148 million, an increase of 6% over second quarter of 2005 (€140 million), ordinary EBITA margin 16% (2005: 17%) due to increase in product development and marketing and sales spending
* Product development spending of €67 million (an increase of 13% over last year)
* Structural cost savings of €30 million (an increase of 20% over last year)
* Strong free cash flow of €36 million (2005: €11 million) due to the increase of EBITA and a refund of corporate income tax
Nancy McKinstry, chairman of the Executive Board, commented on the half-year 2006 results:
“With half-year results in line with our expectations, plus strong organic growth in the Corporate & Financial Services division and Tax and Accounting unit, and steady cost and process improvements, we continue to benefit from the strategic roadmap we set in place two and a half years ago. Innovative electronic products and software, solid acquisitions, and strong market knowledge are driving our transformation and delivering greater value for our customers, and therefore our shareholders. As we move into the next two quarters, we are confident that we are on track to achieve the objectives of our three-year strategy.”
Key highlights by division:
Health: Revenues increased in the first half year, driven by acquisitions and solid performance in Professional & Education and Pharma Solutions. Organic growth was impacted by the timing of shipments in the 2006 publishing calendar and continued softness in advertising. Integration of acquisitions is progressing well.
Corporate & Financial Services: Strong demand for software across the division and robust transaction services at Corporate Legal Services associated with increased volume of mergers and acquisitions and business formation activity drove significant growth.
Tax, Accounting & Legal: Significant growth in core software products for the tax and accounting market, driven by continued investments in product development, delivered strong results in the U.S. and Canada; while new online product introductions in Law & Business delivered double-digit growth.
Legal, Tax & Regulatory Europe: Steady progress continued with good revenue improvements over 2005 in the second quarter. Italy, Spain and Central Europe performed well, boosted by investments in online and electronic products and strong online revenue growth. Effects of restructuring in the Netherlands and Belgium show positive results, with restructuring in the U.K. still underway.
Education: As expected, Education showed 3% organic growth in the second quarter as the normal sales cycle begins within the division, with encouraging results in the U.K. and the Netherlands.
PDF version of full press release: www.wolterskluwer.com/NR/rdonlyres/82F51251-8895-4FCF-98C2-8EF98985ACCF/
1 Wherever used in this report, the term “ordinary” refers to figures adjusted for exceptional items and, where applicable, amortization of publishing rights. Exceptional items for 2005 consist of restructuring expenses relating to initiatives that followed the strategic update. “Ordinary” figures are non-IFRS compliant financial figures, but are internally regarded as key performance indicators to measure the underlying performance of our base business. These figures are presented as additional information and do not replace the information in the income statement and in the cash flow statement. The term “ordinary” is not a defined term under International GAAP.
- Contact Information
- Caroline Wouters
- Vice President, Corporate Communications
- Wolters Kluwer
- Contact via E-mail
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