NEW YORK, Dec. 20, 2018 /PRNewswire/ -- Scholastic
Corporation (NASDAQ: SCHL), the global children's publishing,
education and media company, today reported results for the
Company's fiscal 2019 second quarter ended November 30, 2018. The Company reported second
quarter 2019 earnings per diluted share of $1.99, compared to $1.60 in the second quarter of 2018. Excluding
one-time items, second quarter earnings per diluted share was
$2.09 versus $1.92 in the prior year period.
Second quarter revenue was $604.7
million, an increase of 1% compared to $598.3 million in the second quarter of 2018. The
impact of the new ASC 606 revenue recognition guidelines in the
current fiscal year served to lower revenues by $10.8 million in the quarter. Without the impact
of these new accounting guidelines, the current period's revenue
would have shown an increase of 3%, as compared to the second
quarter of 2018.
Operating profit in the second quarter was $98.2 million, compared to an operating profit of
$107.2 million a year ago. The
adoption of ASC 606 in the current fiscal year resulted in a
reduction of operating profit in the current quarter of
$5.6 million. Without the impact of
ASC 606 and excluding one-time items, the operating profit in the
second quarter was $108.5 million,
compared to an operating profit of $110.9
million in the second quarter of 2018.
Net income for the current period was $71.6 million, compared to net income in the
prior year period of $57.1 million,
an increase of 25%, partly the result of a lower effective tax
rate. Net income for the first six months of the 2019 fiscal year
was $10.3 million versus a net loss
of $6.6 million in the first six
months of fiscal 2018, on revenue of $823.1
million compared to $787.5
million in the prior year, an increase of $35.6 million or 5%.
Richard Robinson, Scholastic
Chairman, President and Chief Executive Officer commented: "Our
quarter and first half results were solid, keeping us on track to
achieve our operating objectives for the fiscal year, although we
continue to experience rising product and fulfillment costs similar
to other businesses. In the quarter, children's book revenues were
up on strong performance in trade, while our school club and fair
channels were on par with last year. Scholastic's trade publishing
in the U.S. and across the globe once again was at the top of all
the bestseller lists. Frontlist titles including Dav Pilkey's Dog Man, Harry Potter 20th Anniversary
editions, and Fantastic Beasts™: The Crimes of
Grindelwald, the new original screenplay by J. K. Rowling,
continue to show the power of great storytellers published by
Scholastic. A notable backlist title The Wonky Donkey rose
to number one of all books in the U.S. with more than one million
books sold in October as Scholastic responded quickly to a
read-aloud video on social media that resonated with families
around the world.
Mr. Robinson continued, "In education, the second quarter's
results were in line with the Company's expectations with momentum
in classroom magazines, classroom libraries, and professional
learning. We are organizing for the second half launch of our new
K-6 curriculum reading program Scholastic Literacy, bringing
together our engaging book titles with proven instructional design
and professional services. Our technology transformation remains on
schedule with the successful introduction of three significant new
digital subscription programs and platforms this quarter, as well
as the continued implementation of the Company's new ERP
platform."
Fiscal 2019 Outlook Affirmed
Scholastic believes it is on course to achieve its operating
goals for the 2019 fiscal year and has affirmed its outlook for
revenues in the range of $1.65 to
$1.70 billion and earnings per
diluted share, excluding one-time items, in the range of
$1.60 to $1.70. The Company has also affirmed its target
for Adjusted EBITDA (a non-GAAP performance measure defined in the
accompanying tables and reconciled to net income) of $160 to $170
million. The Company's capital investments in technology and
facilities upgrades remain on track with capital expenditures
projected in the $70 to $80 million range. The Company continues to
experience rising costs for product and fulfillment, which it
believes it can successfully offset through cost management and
pricing to achieve this earnings outlook.
Cash Flow and Cash Position
Net cash provided by operating activities was $128.5 million in the current fiscal quarter
compared to $120.8 million in the
second quarter of fiscal 2018. The Company had free cash flow (a
non-GAAP liquidity measure defined in the accompanying tables) of
$93.5 million in the current quarter,
compared to free cash flow of $90.7
million a year ago.
At quarter end, the Company's cash and cash equivalents exceeded
the Company's total debt by $344.6
million, compared to $376.5
million a year ago, reflecting the timing of $23.2 million of capital investment in
technology, facilities, and other upgrades, as well as $11.8 million in prepublication and production
costs including the planned introduction of Scholastic
Literacy in early 2019.
Overall Results
As noted above, net income for the second quarter was
$71.6 million compared to
$57.1 million in the second quarter
of 2018. Adjusted EBITDA (as defined in the accompanying tables)
for the second fiscal quarter of 2019 was $123.2 million, compared to $126.7 million in the second quarter of 2018,
reflecting the add-back of a non-cash partial settlement of the
Company's domestic pension obligations in the prior year period, as
well as higher levels of depreciation in the current period related
to earlier investments in facilities and technology upgrades now in
service. The Company believes that Adjusted EBITDA is a meaningful
measure of operating profitability and useful for measuring returns
on capital investments over time as it is not distorted by unusual
gains, losses, or other items.
Segment Results
All comparisons detailed in this section refer to operating
results for the second fiscal quarter 2019 versus the second fiscal
quarter 2018. The results for the second fiscal quarter of 2019
include the impact of the newly adopted revenue recognition
guidelines under ASC 606. Prior period's results have not been
restated. The new standard requires the Company to defer certain
revenues associated with its book fairs incentive program. It also
requires the Company to recognize, as a current period expense,
certain previously capitalized direct response marketing costs
primarily related to the classroom magazines business.
Children's Book Publishing and Distribution
In $
millions
|
Second
Quarter
|
|
|
|
2019
|
2018
|
$ Change
|
% Change
|
Revenue
|
|
|
|
|
Book
Clubs
|
$
101.3
|
$
99.9
|
$
1.4
|
1%
|
Book
Fairs
|
229.2
|
231.0
|
(1.8)
|
(1%)
|
Trade
|
95.9
|
82.8
|
13.1
|
16%
|
ASC 606
accounting change
|
(8.5)
|
-
|
(8.5)
|
-
|
Total
revenue
|
417.9
|
413.7
|
4.2
|
1%
|
Operating
income / (loss), before accounting change
|
112.8
|
115.0
|
(2.2)
|
(2%)
|
ASC 606
accounting change
|
(6.5)
|
-
|
(6.5)
|
-
|
Operating income /
(loss)
|
106.3
|
115.0
|
(8.7)
|
(8%)
|
Operating income /
(loss), before one-time items*
|
106.3
|
115.0
|
(8.7)
|
(8%)
|
* Please refer to the
non-GAAP financial tables attached
|
Second quarter revenues increased $4.2
million, or 1%, with continued growth in trade publishing
propelled by frontlist bestsellers including Dav Pilkey's Dog Man: Lord of the Fleas
and J. K. Rowling's Fantastic Beasts: The Crimes of
Grindelwald, and the backlist sensation The Wonky
Donkey. Increased teacher sponsorship in book clubs resulted in
a higher number of book club events held with more teachers and
parents ordering club titles on-line. While book fair count
increased slightly over the prior period, fair revenue in the
quarter was adversely impacted by the newly adopted ASC 606
accounting guidelines. Operating income fell by $8.7 million to $106.3
million compared to last year, primarily reflecting the
lower fair revenue under ASC 606. The quarter's results were also
adversely impacted by additional sales tax accruals in book clubs,
as well as costs being incurred to comply with new state sales tax
collection rules for clubs. Other key trade titles in the current
period included, The Tales of Beedle the Bard: The Illustrated
Edition, The Hunger Games Trilogy 10th
anniversary editions, National Book Award Finalist Hey,
Kiddo by Jarrett Krosoczka,
Grenade by New York Times
bestselling author Alan Gratz, and
multiple titles in the Company's Klutz® line of premium
book plus activity kits for kids.
Education
In $
millions
|
Second
Quarter
|
|
|
|
2019
|
2018
|
$ Change
|
% Change
|
Revenue
|
$
71.5
|
$
69.0
|
$
2.5
|
4%
|
Operating
income / (loss), before accounting change
|
5.7
|
3.9
|
1.8
|
46%
|
ASC 606
accounting change
|
2.6
|
-
|
2.6
|
-
|
Operating income /
(loss)
|
8.3
|
3.9
|
4.4
|
113%
|
Operating income /
(loss), before one-time items*
|
8.3
|
3.9
|
4.4
|
113%
|
* Please refer to the
non-GAAP financial tables attached
|
Second quarter revenues increased $2.5
million, or 4%, mainly driven by higher sales of classroom
libraries, professional services, and custom publishing. Operating
income increased by $4.4 million
compared to last year on higher sales and favorable marketing
expenses, as well as the favorable seasonal impact of ASC 606 which
saw certain costs in the Company's classroom magazines business
recognized in the first fiscal quarter.
International
In $
millions
|
Second
Quarter
|
|
|
|
2019
|
2018
|
$ Change
|
% Change
|
Revenue, before
accounting change
|
$
117.6
|
$
115.6
|
$
2.0
|
2%
|
ASC 606
accounting change
|
(2.3)
|
-
|
(2.3)
|
-
|
Revenue
|
115.3
|
115.6
|
(0.3)
|
(0%)
|
Operating
income / (loss), before accounting change
|
14.7
|
14.7
|
0.0
|
0%
|
ASC 606
accounting change
|
(1.7)
|
-
|
(1.7)
|
-
|
Operating income /
(loss)
|
13.0
|
14.7
|
(1.7)
|
(12%)
|
Operating income /
(loss), before one-time items*
|
13.0
|
14.7
|
(1.7)
|
(12%)
|
* Please refer to the
non-GAAP financial tables attached
|
Second quarter revenues were $115.3
million, relatively flat with the prior year period, with
improved results in the Company's trade publishing operations in
major markets and the trade and education businesses in
Asia, especially China, offset by the adverse impact of
$4.6 million in foreign exchange in
the current quarter. Without this currency impact, local revenues
were up 4%. Operating income fell by $1.7
million, or 12%, compared to last year primarily reflecting
the adoption of the new ASC 606 accounting standard which resulted
in lower recognized revenue of $2.3
million and a corresponding $1.7
million drop in operating income in the quarter.
Overhead
In $
millions
|
Second
Quarter
|
|
|
|
2019
|
2018
|
$ Change
|
% Change
|
Overhead
expense
|
$
29.4
|
$
26.4
|
$
(3.0)
|
(11%)
|
Overhead expense,
excluding one-time items*
|
24.7
|
22.7
|
(2.0)
|
(9%)
|
* Please refer to the
non-GAAP financial tables attached
|
Second quarter overhead expense was $24.7
million, or 9% higher than overhead expense in the second
quarter of 2018, excluding one-time items of $4.7 million and $3.7
million in each period, respectively. The higher overhead,
excluding one-time items, in the current period is primarily due to
higher depreciation expense for building and technology upgrades
now in service, as well as higher non-capitalized costs incurred
for certain technology upgrades and improvements.
One-Time Items
Non-recurring items reflected in the Company's pre-tax operating
results for the second quarter totaled $4.7
million and included $4.3
million for a proposed settlement and resolution of a legacy
sales tax assessment, and $0.4
million in pretax severance expense associated with the
Company's cost reduction programs. The Company's second quarter
results also include a one-time tax charge of $0.2 million related to the re-measurement of its
U.S. deferred tax balance. Non-recurring items in the prior year
period totaled $3.7 million primarily
for one-time severance expense. The prior year period also included
a $15.4 million non-cash partial
settlement charge below the operating line related to the
termination of the Company's U.S. defined benefit pension plan.
Year-to-Date Results
For the first half of fiscal 2019, revenue was $823.1 million, compared to $787.5 million in the prior year period, an
increase of $35.6 million, or 5%. The
Company reported income per diluted share in the first half of the
fiscal year of $0.29, compared to a
loss per diluted share of $0.19 a
year ago. Excluding one-time items of $0.11 and $0.46 per
diluted share, respectively, the Company's earnings per diluted
share from continuing operations was $0.40 in the first six months of fiscal 2019
versus $0.27 in the prior year
period. The favorable current period's results are mainly
attributable to robust trade sales globally in the first half of
fiscal 2019 including titles in the bestselling Dog Man
series by Dav Pilkey and
Harry Potter 20th
anniversary related publishing in the U.S. and Canada.
Adjusted EBITDA (as defined) for the first six months of fiscal
2019 was $58.7 million, compared to
$48.6 million in the first six months
of fiscal 2018, an increase of $10.1
million, or 21%, and primarily the result of higher reported
earnings and higher depreciation and amortization in the current
year period.
Net cash provided by operating activities was $39.5 million in the first six months of the
current fiscal year compared to $28.4
million in the same period last year. The Company had a free
cash use (as defined) of $32.4
million in the current fiscal year-to-date, compared to a
free cash use of $40.3 million in the
prior year period. The current year-to-date's free cash use
includes $51.3 million in capital
expenditures and $20.6 million in net
prepublication and production spend.
Other Financial Results
As previously announced, the Company's Board of Directors
declared a quarterly cash dividend of $0.15 per share on the Company's Class A and
Common Stock for the third quarter of fiscal 2019. The dividend is
payable on March 15, 2019 to
shareholders of record as of the close of business on January 31, 2019.
Additional Information
To supplement the financial statements presented in accordance
with GAAP, the Company includes certain non-GAAP calculations and
presentations, including, as indicated, "Adjusted EBITDA" and "Free
Cash Flow". Please refer to the non-GAAP financial tables attached
to this press release for supporting details on special one-time
items, the use of non-GAAP financial measures, and other financial
measures included in this release. This information should be
considered as supplemental in nature and not as a substitute for
the related financial information prepared in accordance with
GAAP.
Conference Call
The Company will hold a conference call to discuss its results
at 8:30 am ET today, December 20, 2018. Scholastic's Chairman,
President and CEO, Richard Robinson,
and Ken Cleary, the Company's CFO,
will moderate the call.
The conference call and accompanying slides will be webcast and
accessible through the Investor Relations section of Scholastic's
website, www.scholastic.com. Participation by telephone will be
available by dialing (877) 654-5161 from within the U.S. or +1
(678) 894-3064 internationally. Shortly following the call, an
archived webcast and accompanying slides from the conference call
will also be posted at investor.scholastic.com. An audio-only
replay of the call will be available by dialing (855) 859-2056 from
within the U.S. or +1 (404) 537-3406 internationally, and entering
access code 2376004. The recording will be available through
Friday, December 28, 2018.
About Scholastic
Scholastic Corporation (NASDAQ: SCHL) is the world's largest
publisher and distributor of children's books, a leading provider
of literacy curriculum, professional services and classroom
magazines, and a producer of educational and entertaining
children's media. The Company creates and distributes quality books
and ebooks, print and technology-based learning programs for pre-K
to grade 12 and other products and services that support children's
learning and literacy both in school and at home. With 14
international operations and exports to 165 countries, Scholastic
makes quality, affordable books available to all children around
the world through school-based book clubs and book fairs, classroom
libraries, school and public libraries, retail and online. True to
its mission of 98 years to encourage the personal and intellectual
growth of all children beginning with literacy, the Company has
earned a reputation as a trusted partner to educators and families.
Learn more at www.scholastic.com.
Forward-Looking Statements
This news release contains certain forward-looking statements.
Such forward-looking statements 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 within those markets, and other risks and factors
identified from time to time in the Company's filings with the
Securities and Exchange Commission. Actual results could differ
materially from those currently anticipated.
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Table 1
|
Scholastic
Corporation
|
|
Consolidated
Statements of Operations
|
|
(Unaudited)
|
|
(In $
Millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
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|
THREE MONTHS
ENDED
|
|
SIX MONTHS
ENDED
|
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|
|
11/30/18
|
11/30/17
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|
|
11/30/18
|
11/30/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$604.7
|
$598.3
|
|
|
$823.1
|
$787.5
|
|
|
|
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|
|
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|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
262.4
|
253.6
|
|
|
387.7
|
369.2
|
|
|
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|
Selling, general and
administrative expenses (1)
|
227.0
|
223.4
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|
389.3
|
381.0
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Bad debt
expense
|
2.7
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4.3
|
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|
4.1
|
6.2
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|
|
|
|
Depreciation and
amortization
|
14.4
|
9.8
|
|
|
27.6
|
19.0
|
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|
|
Asset impairments
(2)
|
-
|
-
|
|
|
-
|
6.7
|
|
|
|
|
|
|
|
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|
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Total operating costs
and expenses
|
506.5
|
491.1
|
|
|
808.7
|
782.1
|
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Operating income
(loss)
|
98.2
|
107.2
|
|
|
14.4
|
5.4
|
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Interest income
(expense), net
|
0.5
|
-
|
|
|
1.3
|
0.3
|
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|
|
Other components of
net periodic benefit (cost) (3)
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(0.3)
|
(15.5)
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(0.7)
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(15.6)
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Earnings (loss)
before income taxes
|
98.4
|
91.7
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|
15.0
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(9.9)
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Provision (benefit)
for income taxes (4)
|
26.8
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34.6
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|
4.7
|
(3.3)
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Net income
(loss)
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$71.6
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$57.1
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$10.3
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($6.6)
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Basic and diluted
earnings (loss) per share of Class A and Common Stock
(5)
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Basic
|
$2.03
|
$1.63
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|
0.29
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(0.19)
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Diluted
|
$1.99
|
$1.60
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|
0.29
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(0.19)
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Basic weighted
average shares outstanding
|
35,241
|
35,034
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|
35,165
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35,114
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Diluted weighted
average shares outstanding
|
35,863
|
35,588
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|
35,809
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35,739
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(1)
|
In the three and six
months ended November 30, 2018, the Company recognized a $4.3
pretax charge related to a proposed settlement of a legacy sales
tax assessment and pretax severance of $0.4 and $0.9, respectively.
In the three and six months ended November 30, 2017, the Company
recognized pretax severance and stock compensation charges of $3.7
and $5.3, respectively.
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(2)
|
In the six months
ended November 30, 2017, the Company recognized a pretax impairment
charge of $6.7 related to legacy building improvements.
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(3)
|
In the three and six
months ended November 30, 2017, the Company recognized a $15.4
pretax charge related to a partial settlement of the Company's
domestic defined benefit pension plan.
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(4)
|
In the three and six
months ended November 30, 2018, the Company recognized a benefit
for income taxes in respect to one-time pretax charges of $1.3 and
$1.4, respectively, partially offset by $0.2 and $0.2,
respectively, of income tax provision related to the remeasurement
of the Company's U.S. deferred tax balance in connection with the
passage of the Tax Cuts and Jobs Act of 2017. In the three
and six months ended November 30, 2017, the Company recognized a
benefit for income taxes in respect to one-time pretax charges of
$7.7 and $11.0, respectively.
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(5)
|
Earnings (loss) per
share are calculated on non-rounded net income (loss) and shares
outstanding. Recalculating earnings per share based on numbers
rounded to millions may not yield the results as
presented.
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Table 2
|
Scholastic
Corporation
|
|
Segment
Results
|
|
(Unaudited)
|
|
(In $
Millions)
|
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|
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|
THREE MONTHS
ENDED
|
|
SIX MONTHS
ENDED
|
|
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|
|
11/30/18
|
11/30/17
|
|
Change
|
|
11/30/18
|
11/30/17
|
|
Change
|
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Children's Book
Publishing and Distribution
|
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Revenue
|
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|
|
|
|
|
|
|
Book
Clubs
|
$101.3
|
$99.9
|
|
$1.4
|
1%
|
|
$110.4
|
$107.9
|
|
$2.5
|
2%
|
|
|
|
Book
Fairs
|
220.7
|
231.0
|
|
(10.3)
|
(4%)
|
|
245.9
|
243.1
|
|
2.8
|
1%
|
|
|
|
Consolidated Trade
|
95.9
|
82.8
|
|
13.1
|
16%
|
|
157.3
|
131.6
|
|
25.7
|
20%
|
|
|
|
Total
revenue
|
417.9
|
413.7
|
|
4.2
|
1%
|
|
513.6
|
482.6
|
|
31.0
|
6%
|
|
|
|
Operating income
(loss)
|
106.3
|
115.0
|
|
(8.7)
|
(8%)
|
|
60.3
|
56.1
|
|
4.2
|
7%
|
|
|
|
Operating
margin
|
25.4%
|
27.8%
|
|
|
|
|
11.7%
|
11.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
71.5
|
69.0
|
|
2.5
|
4%
|
|
119.4
|
111.9
|
|
7.5
|
7%
|
|
|
|
Operating income
(loss)
|
8.3
|
3.9
|
|
4.4
|
113%
|
|
(6.6)
|
(8.6)
|
|
2.0
|
|
|
|
|
Operating
margin
|
11.6%
|
5.7%
|
|
|
|
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
115.3
|
115.6
|
|
(0.3)
|
(0%)
|
|
190.1
|
193.0
|
|
(2.9)
|
(2%)
|
|
|
|
Operating income
(loss)
|
13.0
|
14.7
|
|
(1.7)
|
(12%)
|
|
11.0
|
11.9
|
|
(0.9)
|
(8%)
|
|
|
|
Operating
margin
|
11.3%
|
12.7%
|
|
|
|
|
5.8%
|
6.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead
expense
|
29.4
|
26.4
|
|
(3.0)
|
(11%)
|
|
50.3
|
54.0
|
|
3.7
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$98.2
|
$107.2
|
|
($9.0)
|
(8%)
|
|
$14.4
|
$5.4
|
|
$9.0
|
167%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 3
|
Scholastic
Corporation
|
|
Supplemental
Information
|
|
(Unaudited)
|
|
(In $
Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected
Balance Sheet Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11/30/18
|
11/30/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$358.1
|
$387.8
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
377.3
|
262.4
|
|
|
|
|
|
|
|
|
Inventories,
net
|
365.6
|
355.7
|
|
|
|
|
|
|
|
|
Accounts
payable
|
250.3
|
222.1
|
|
|
|
|
|
|
|
|
Accrued
royalties
|
58.5
|
46.9
|
|
|
|
|
|
|
|
|
Lines of credit,
short-term debt and current portion of long-term debt
|
13.5
|
11.3
|
|
|
|
|
|
|
|
|
Long-term debt,
excluding current portion
|
-
|
-
|
|
|
|
|
|
|
|
|
Total debt
|
13.5
|
11.3
|
|
|
|
|
|
|
|
|
Total capital lease
obligations
|
10.8
|
7.8
|
|
|
|
|
|
|
|
|
Net debt
(1)
|
(344.6)
|
(376.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
equity
|
1,284.6
|
1,302.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected
Cash Flow Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
SIX MONTHS
ENDED
|
|
|
|
|
11/30/18
|
11/30/17
|
|
|
11/30/18
|
11/30/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities
|
$128.5
|
$120.8
|
|
|
$39.5
|
$28.4
|
|
|
|
|
Less: Additions to property, plant
and equipment
|
23.2
|
21.3
|
|
|
51.3
|
54.0
|
|
|
|
|
Pre-publication
and production costs
|
11.8
|
8.8
|
|
|
20.6
|
14.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow (use)
(2)
|
$93.5
|
$90.7
|
|
|
($32.4)
|
($40.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net debt is defined
by the Company as lines of credit and short-term debt plus
long-term-debt, net of cash and cash equivalents. The Company
utilizes this non-GAAP financial measure, and believes it is useful
to investors, as an indicator of the Company's effective leverage
and financing needs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Free cash flow (use)
is defined by the Company as net cash provided by or used in
operating activities (which includes royalty advances), reduced by
spending on property, plant and equipment and prepublication and
production costs. The Company believes that this non-GAAP financial
measure is useful to investors as an indicator of cash flow
available for debt repayment and other investing activities, such
as acquisitions. The Company utilizes free cash flow as a
further indicator of operating performance and for planning
investing activities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4
|
Scholastic
Corporation
|
|
Consolidated
Statements of Operations - Supplemental
|
|
Excluding
One-Time Items
|
|
(Unaudited)
|
|
(In $
Millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
|
|
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
|
|
|
|
|
11/30/18
|
items
|
One-time
items
|
|
|
11/30/17
|
items
|
One-time
items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$604.7
|
$0.0
|
$604.7
|
|
|
$598.3
|
$0.0
|
$598.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
262.4
|
-
|
262.4
|
|
|
253.6
|
-
|
253.6
|
|
|
|
|
|
Selling, general and
administrative expenses (1)
|
|
227.0
|
(4.7)
|
222.3
|
|
|
223.4
|
(3.7)
|
219.7
|
|
|
|
|
|
Bad debt
expense
|
|
2.7
|
-
|
2.7
|
|
|
4.3
|
-
|
4.3
|
|
|
|
|
|
Depreciation and
amortization
|
|
14.4
|
-
|
14.4
|
|
|
9.8
|
-
|
9.8
|
|
|
|
|
|
Asset impairments
(2)
|
|
-
|
-
|
-
|
|
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating costs
and expenses
|
|
506.5
|
(4.7)
|
501.8
|
|
|
491.1
|
(3.7)
|
487.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
98.2
|
4.7
|
102.9
|
|
|
107.2
|
3.7
|
110.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
(expense), net
|
|
0.5
|
-
|
0.5
|
|
|
-
|
-
|
-
|
|
|
|
|
Other components of
net periodic benefit (cost) (3)
|
|
(0.3)
|
-
|
(0.3)
|
|
|
(15.5)
|
15.4
|
(0.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
before income taxes
|
|
98.4
|
4.7
|
103.1
|
|
|
91.7
|
19.1
|
110.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes (4)
|
|
26.8
|
1.1
|
27.9
|
|
|
34.6
|
7.7
|
42.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$71.6
|
$3.6
|
$75.2
|
|
|
$57.1
|
$11.4
|
$68.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share
|
|
$1.99
|
$0.10
|
$2.09
|
|
|
$1.60
|
$0.32
|
$1.92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX MONTHS
ENDED
|
|
|
|
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
|
|
|
|
|
11/30/18
|
items
|
One-time
items
|
|
|
11/30/17
|
items
|
One-time
items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$823.1
|
$0.0
|
$823.1
|
|
|
$787.5
|
$0.0
|
$787.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
387.7
|
-
|
387.7
|
|
|
369.2
|
-
|
369.2
|
|
|
|
|
|
Selling, general and
administrative expenses (1)
|
|
389.3
|
(5.2)
|
384.1
|
|
|
381.0
|
(5.3)
|
375.7
|
|
|
|
|
|
Bad debt
expense
|
|
4.1
|
-
|
4.1
|
|
|
6.2
|
-
|
6.2
|
|
|
|
|
|
Depreciation and
amortization
|
|
27.6
|
-
|
27.6
|
|
|
19.0
|
-
|
19.0
|
|
|
|
|
|
Asset impairments
(2)
|
|
-
|
-
|
-
|
|
|
6.7
|
(6.7)
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating costs
and expenses
|
|
808.7
|
(5.2)
|
803.5
|
|
|
782.1
|
(12.0)
|
770.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
14.4
|
5.2
|
19.6
|
|
|
5.4
|
12.0
|
17.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
(expense), net
|
|
1.3
|
-
|
1.3
|
|
|
0.3
|
-
|
0.3
|
|
|
|
|
Other components of
net periodic benefit (cost) (3)
|
|
(0.7)
|
-
|
(0.7)
|
|
|
(15.6)
|
15.4
|
(0.2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
before income taxes
|
|
15.0
|
5.2
|
20.2
|
|
|
(9.9)
|
27.4
|
17.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes (4)
|
|
4.7
|
1.2
|
5.9
|
|
|
(3.3)
|
11.0
|
7.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$10.3
|
$4.0
|
$14.3
|
|
|
($6.6)
|
$16.4
|
$9.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share
|
|
0.29
|
0.11
|
0.40
|
|
|
(0.19)
|
0.46
|
0.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
In the three and six
months ended November 30, 2018, the Company recognized a $4.3
pretax charge related to a proposed settlement of a legacy sales
tax assessment and pretax severance of $0.4 and $0.9, respectively.
In the three and six months ended November 30, 2017, the Company
recognized pretax severance and stock compensation charges of $3.7
and $5.3, respectively.
|
|
|
(2)
|
In the six months
ended November 30, 2017, the Company recognized a pretax impairment
charge of $6.7 related to legacy building improvements.
|
|
|
(3)
|
In the three and six
months ended November 30, 2017, the Company recognized a $15.4
pretax charge related to a partial settlement of the Company's
domestic defined benefit pension plan.
|
|
|
(4)
|
In the three and six
months ended November 30, 2018, the Company recognized a benefit
for income taxes in respect to one-time pretax charges of $1.3 and
$1.4, respectively, partially offset by $0.2 and $0.2,
respectively, of income tax provision related to the remeasurement
of the Company's U.S. deferred tax balance in connection with the
passage of the Tax Cuts and Jobs Act of 2017. In the three
and six months ended November 30, 2017, the Company recognized a
benefit for income taxes in respect to one-time pretax charges of
$7.7 and $11.0, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 5
|
Scholastic
Corporation
|
|
Consolidated
Statements of Operations - Supplemental
|
|
Adjusted
EBITDA
|
|
(Unaudited)
|
|
(In $
Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
|
|
|
|
|
11/30/18
|
|
|
11/30/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
before income taxes as reported
|
|
$98.4
|
|
|
$91.7
|
|
|
|
One-time items before
income taxes
|
|
4.7
|
|
|
19.1
|
|
|
|
Earnings (loss)
before income taxes excluding one-time items
|
|
103.1
|
|
|
110.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest (income)
expense
|
|
(0.5)
|
|
|
0.0
|
|
|
|
|
Depreciation and
amortization (1)
|
|
15.1
|
|
|
10.5
|
|
|
|
|
Amortization of
prepublication and production costs
|
|
5.5
|
|
|
5.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(2)
|
|
$123.2
|
|
|
$126.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX MONTHS
ENDED
|
|
|
|
|
|
|
11/30/18
|
|
|
11/30/17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
before income taxes as reported
|
|
$15.0
|
|
|
($9.9)
|
|
|
|
One-time items before
income taxes
|
|
$5.2
|
|
|
$27.4
|
|
|
|
Earnings (loss)
before income taxes excluding one-time items
|
|
20.2
|
|
|
17.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest (income)
expense
|
|
(1.3)
|
|
|
(0.3)
|
|
|
|
|
Depreciation and
amortization (1)
|
|
29.1
|
|
|
20.5
|
|
|
|
|
Amortization of
prepublication and production costs
|
|
10.7
|
|
|
10.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(2)
|
|
$58.7
|
|
|
$48.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
For the three and six
months ended November 30, 2018, amounts include depreciation of
$0.7 and $1.4, respectively, recognized in cost of goods sold and
amortization of deferred financing costs of $0.0 and $0.1,
respectively. In the three and six months ended November 30,
2017, amounts include depreciation of $0.6 and $1.3, respectively,
recognized in cost of goods sold and amortization of deferred
financing costs of $0.1 and $0.2, respectively.
|
|
|
(2)
|
Adjusted EBITDA is
defined by the Company as earnings (loss), excluding one-time
items, before interest, taxes, depreciation and amortization.
The Company believes that Adjusted EBITDA is a meaningful measure
of operating profitability and useful for measuring returns on
capital investments over time as it is not distorted by unusual
gains, losses, or other items.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6
|
Scholastic
Corporation
|
|
Segment
Results - Supplemental
|
|
Excluding
One-Time Items
|
|
(Unaudited)
|
|
(In $
Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
|
|
|
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
|
|
|
|
|
|
11/30/18
|
items
|
One-time
items
|
|
|
11/30/17
|
items
|
One-time
items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Children's Book
Publishing and Distribution
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book Clubs
|
|
$101.3
|
|
$101.3
|
|
|
$99.9
|
|
$99.9
|
|
|
|
|
|
|
Book Fairs
|
|
220.7
|
|
220.7
|
|
|
231.0
|
|
231.0
|
|
|
|
|
|
|
Consolidated
Trade
|
|
95.9
|
|
95.9
|
|
|
82.8
|
|
82.8
|
|
|
|
|
|
|
Total
revenue
|
|
417.9
|
|
417.9
|
|
|
413.7
|
|
413.7
|
|
|
|
|
|
|
Operating income
(loss)
|
|
106.3
|
-
|
106.3
|
|
|
115.0
|
-
|
115.0
|
|
|
|
|
|
|
Operating
margin
|
|
25.4%
|
|
25.4%
|
|
|
27.8%
|
|
27.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
71.5
|
|
71.5
|
|
|
69.0
|
|
69.0
|
|
|
|
|
|
|
Operating income
(loss)
|
|
8.3
|
-
|
8.3
|
|
|
3.9
|
-
|
3.9
|
|
|
|
|
|
|
Operating
margin
|
|
11.6%
|
|
11.6%
|
|
|
5.7%
|
|
5.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
115.3
|
|
115.3
|
|
|
115.6
|
|
115.6
|
|
|
|
|
|
|
Operating income
(loss)
|
|
13.0
|
-
|
13.0
|
|
|
14.7
|
-
|
14.7
|
|
|
|
|
|
|
Operating
margin
|
|
11.3%
|
|
11.3%
|
|
|
12.7%
|
|
12.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead
expense (1)
|
|
29.4
|
(4.7)
|
24.7
|
|
|
26.4
|
(3.7)
|
22.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
$98.2
|
$4.7
|
$102.9
|
|
|
$107.2
|
$3.7
|
$110.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX MONTHS
ENDED
|
|
|
|
|
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
Reported
|
One-time
|
Excluding
|
|
|
|
|
|
|
|
|
11/30/18
|
items
|
One-time
items
|
|
|
11/30/17
|
items
|
One-time
items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Children's Book
Publishing and Distribution
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book Clubs
|
|
$110.4
|
|
$110.4
|
|
|
$107.9
|
|
$107.9
|
|
|
|
|
|
|
Book Fairs
|
|
245.9
|
|
245.9
|
|
|
243.1
|
|
243.1
|
|
|
|
|
|
|
Consolidated
Trade
|
|
157.3
|
|
157.3
|
|
|
131.6
|
|
131.6
|
|
|
|
|
|
|
Total
revenue
|
|
513.6
|
|
513.6
|
|
|
482.6
|
|
482.6
|
|
|
|
|
|
|
Operating income
(loss)
|
|
60.3
|
-
|
60.3
|
|
|
56.1
|
-
|
56.1
|
|
|
|
|
|
|
Operating
margin
|
|
11.7%
|
|
11.7%
|
|
|
11.6%
|
|
11.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
119.4
|
|
119.4
|
|
|
111.9
|
|
111.9
|
|
|
|
|
|
|
Operating income
(loss)
|
|
(6.6)
|
-
|
(6.6)
|
|
|
(8.6)
|
-
|
(8.6)
|
|
|
|
|
|
|
Operating
margin
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
190.1
|
|
190.1
|
|
|
193.0
|
|
193.0
|
|
|
|
|
|
|
Operating income
(loss)
|
|
11.0
|
-
|
11.0
|
|
|
11.9
|
-
|
11.9
|
|
|
|
|
|
|
Operating
margin
|
|
5.8%
|
|
5.8%
|
|
|
6.2%
|
|
6.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead expense
(1)
|
|
50.3
|
(5.2)
|
45.1
|
|
|
54.0
|
(12.0)
|
42.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
$14.4
|
$5.2
|
$19.6
|
|
|
$5.4
|
$12.0
|
$17.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
In the three and six
months ended November 30, 2018, the Company recognized a $4.3
pretax charge related to a proposed settlement of a legacy sales
tax assessment and pretax severance of $0.4 and $0.9, respectively.
In the three and six months ended November 30, 2017, the Company
recognized pretax severance and stock compensation charges of $3.7
and $5.3, respectively. In the six months ended November 30, 2017,
the Company recognized a pretax impairment charge of $6.7 related
to legacy building improvements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7
|
Scholastic
Corporation
|
|
Segment
Results - Supplemental
|
|
Impact of
ASC 606 Accounting Adoption
|
|
(Unaudited)
|
|
(In $
Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED
|
|
|
|
|
|
|
|
|
Excluding
|
|
|
|
|
|
|
|
Reported
|
Accounting
|
Accounting
|
|
|
|
|
|
|
|
11/30/18
|
Adoption
(1)
|
Adoption
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Children's Book
Publishing and Distribution
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
Book Clubs
|
|
$101.3
|
$0.0
|
$101.3
|
|
|
|
|
|
Book Fairs
|
|
220.7
|
8.5
|
229.2
|
|
|
|
|
|
Consolidated
Trade
|
|
95.9
|
-
|
95.9
|
|
|
|
|
|
Total
revenue
|
|
417.9
|
8.5
|
426.4
|
|
|
|
|
|
Operating income
(loss)
|
|
106.3
|
6.5
|
112.8
|
|
|
|
|
|
Operating
margin
|
|
25.4%
|
|
26.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
71.5
|
-
|
71.5
|
|
|
|
|
|
Operating income
(loss)
|
|
8.3
|
(2.6)
|
5.7
|
|
|
|
|
|
Operating
margin
|
|
11.6%
|
|
8.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
115.3
|
2.3
|
117.6
|
|
|
|
|
|
Operating income
(loss)
|
|
13.0
|
1.7
|
14.7
|
|
|
|
|
|
Operating
margin
|
|
11.3%
|
|
12.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead
expense
|
|
29.4
|
-
|
29.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
$98.2
|
$5.6
|
$103.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX MONTHS
ENDED
|
|
|
|
|
|
|
|
|
Excluding
|
|
|
|
|
|
|
|
Reported
|
Accounting
|
Accounting
|
|
|
|
|
|
|
|
11/30/18
|
Adoption
(1)
|
Adoption
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Children's Book
Publishing and Distribution
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
Book Clubs
|
|
$110.4
|
$0.0
|
$110.4
|
|
|
|
|
|
Book Fairs
|
|
245.9
|
(3.5)
|
242.4
|
|
|
|
|
|
Consolidated
Trade
|
|
157.3
|
-
|
157.3
|
|
|
|
|
|
Total
revenue
|
|
513.6
|
(3.5)
|
510.1
|
|
|
|
|
|
Operating income
(loss)
|
|
60.3
|
(1.8)
|
58.5
|
|
|
|
|
|
Operating
margin
|
|
11.7%
|
|
11.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Education
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
119.4
|
-
|
119.4
|
|
|
|
|
|
Operating income
(loss)
|
|
(6.6)
|
0.6
|
(6.0)
|
|
|
|
|
|
Operating
margin
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
190.1
|
1.8
|
191.9
|
|
|
|
|
|
Operating income
(loss)
|
|
11.0
|
1.6
|
12.6
|
|
|
|
|
|
Operating
margin
|
|
5.8%
|
|
6.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead
expense
|
|
50.3
|
-
|
50.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
$14.4
|
$0.4
|
$14.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Amounts represent the
impact of the adoption of ASC 606 - Revenue from Contracts with
Customers in the current fiscal year.
|
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|
|
|
|
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|
|
|
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|
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|
SCHL: Financial
View original content to download
multimedia:http://www.prnewswire.com/news-releases/scholastic-reports-fiscal-2019-second-quarter-results-300769274.html
SOURCE Scholastic Corporation