November 4, 2015 - Wolters Kluwer, a global
leader in professional information services, today released its
scheduled 2015 third-quarter trading update.
Highlights
- Full-year 2015 guidance
reiterated.
- Nine-month revenues up 3% in
constant currencies and up 3% organically.
- Leading, growing positions (52% of total
revenues) grew 7% organically.
- Digital products (71% of total) up 6%
organically, more than offsetting decline in print.
- North America (60% of total) and Asia Pacific
& Rest of World (8% of total) driving growth.
- Nine-month adjusted operating
profit increased in constant currencies and the adjusted operating
profit margin improved, as expected.
- Nine-month adjusted free cash
flow also increased in constant currencies.
- Net-debt-to-EBITDA was 2.0x as
of September 30, 2015.
Nancy McKinstry, CEO and Chairman
of the Executive Board, commented:
"Our strategy of focusing our investment on our
leading, high growth positions is delivering improved year-on-year
organic growth. Margins are on track to rise this year, despite
increased investment in product innovation, sales and marketing,
and continued restructuring. We face tougher comparables for
non-recurring revenues in the fourth quarter, but we are confident
we will deliver on our guidance for the full year."
Nine Months to September 30,
2015
Nine-month revenues increased 17% overall due to
the effect of exchange rate movements, in particular the
depreciation of the euro against the U.S. dollar. In constant
currencies, revenues grew 3%, including organic growth of 3%. The
net effect of acquisitions and disposals in the first nine months
was small, but nonetheless additive to both revenues and adjusted
operating profits.
By geographic region, North America and Asia
Pacific & Rest of World maintained organic growth of
respectively 5% and 6% through September. Revenues generated in
Europe declined 1% in the nine-month period. Total recurring
revenues (77% of total revenues), which includes subscriptions and
other recurring revenues, grew 3% organically in the first nine
months. The rate of growth in Corporate Legal Services (CLS)
transactional revenues and other non-recurring revenues slowed
moderately in the third quarter, however the rate of decline in
print books abated somewhat.
The nine-month adjusted operating profit margin
increased, despite increased investment in new products, sales and
marketing, and restructuring in this period. Over 70% of
restructuring costs relate to initiatives in Legal & Regulatory
Solutions.
Legal & Regulatory: Corporate Legal Services
(CLS) delivered 7% organic growth in the first nine months, slowing
in the third quarter. Service and software subscription revenues
saw sustained organic growth, while CLS transactional revenue
growth slowed to 6% in the third quarter. For the full year, we
expect Corporate Legal Services to achieve organic revenue growth,
albeit at a more moderate pace due to a challenging comparable in
the fourth quarter. CLS margins are expected to be broadly stable
for the full year.
Legal & Regulatory Solutions saw organic
revenue decline of 3% in the first nine months, a slight
improvement on the trend seen in the first half of this year.
Digital products achieved modest but positive organic growth, while
print and services revenues continued to decline, as expected,
particularly in Europe. The adjusted operating margin in Legal
& Regulatory Solutions moved to the low teens, as a result of
revenue trends, underlying cost inflation, and higher restructuring
charges. For the full year, we continue to expect Legal &
Regulatory Solutions organic revenue and margins to decline, with
conditions in our legal markets remaining challenging. On September
16, we completed the disposal of a 55% interest in Wolters Kluwer
Russia Publishing Holding.
Tax & Accounting: Nine-month organic growth
was 3%, in line with our first half performance. Tax and accounting
software solutions again delivered good organic revenue momentum in
all regions of the world. Twinfield in Europe
maintained double-digit growth; ProSoft in
Brazil saw organic growth moderate. Overall organic growth for the
division continues to be tempered by weakness in print formats,
training, and bank products. For the full year, we continue to
expect organic growth to be similar to 2014, with growth in
software solutions more than offsetting ongoing decline in print,
services and bank products. We expect full year margins to improve.
Lower restructuring costs are expected to be partly offset by
increased investment in new products and sales and marketing.
Health: Nine-month organic growth was 6%,
improving modestly from the first half. Clinical Solutions
delivered double-digit organic growth in the first nine months, led
by UpToDate. Health Learning, Research &
Practice remained stable as the ongoing decline in print journals
and books was offset by organic growth in digital products
including Ovid online journals and digital
learning solutions. For the full year, the Health division is on
track to maintain good organic growth, driven by robust growth in
Clinical Solutions. Margins are expected to rise despite increased
product, sales and marketing investment, and first-half weighted
restructuring. On August 31, we completed the acquisition of
Learner's Digest International, a provider of mobile-delivered
continuing medical education to physicians.
Financial & Compliance Services: Organic
growth for the first nine months was 6%, improving on the first
half trend, mainly due to a strong third quarter for our Audit
unit. Finance, Risk & Compliance maintained positive momentum,
despite double-digit growth in the comparable period. Audit
improved its organic growth for the first nine months, driven by
stronger third quarter customer implementations. Originations
sustained its recovery, driven by software upgrades and
professional services to support customers around the new U.S.
lending regulation, TILA RESPA, which became effective in October;
Financial Services (FS) transactional revenues declined modestly in
the first nine months. Transport Services in Europe saw its rate of
revenue decline improve. For the full year, we expect positive
organic growth driven by our Finance, Risk & Compliance, Audit
and Orginations units, with comparables becoming more challenging
in the fourth quarter, especially for Audit and Originations.
Margins are expected to improve.
Cash Flow, Acquisitions,
Divestitures, and Net Debt
Nine-month operating cash conversion was 90%,
ahead of 88% in the comparable period. For the full year, we
continue to expect cash conversion to return to our historic
average of around 95% (FY 2014: 100%). Nine-month adjusted free
cash flow increased in constant currencies, as improved cash
conversion and lower paid financing more than offset higher
corporate taxes paid and net use of restructuring provisions. Our
guidance for full-year 2015 adjusted free cash flow remains
unchanged at >= €500-€525 million in constant currencies.
In the nine months to September 30, 2015, net
acquisition spending, including earnouts, amounted to €182 million,
including €134 million for Learners Digest International in the
third quarter. Twelve month rolling net-debt-to-EBITDA was 2.0x as
of September 30, 2015, compared to 2.5x a year ago.
Subsequent to the third quarter, we paid an
interim dividend of €0.18 per ordinary share (€53 million in
total). A final dividend remains planned for May 2016 and is
subject to approval at the Annual General Meeting of Shareholders
in April 2016.
Full-Year 2015 Outlook
Our guidance for the full year is unchanged. We
note that comparables become more challenging in the fourth
quarter, particularly for Corporate Legal Services and Financial
& Compliance Services, and, as indicated in July, investments
this year are second-half-weighted. Nonetheless, we expect the
adjusted operating profit margin to increase in 2015. This includes
restructuring costs which are expected to be approximately €35
million for the full year (2014: €36 million) and to occur mainly
in Legal & Regulatory Solutions. The table below provides our
guidance for the full-year.
2015 Outlook |
Performance indicators |
2015 guidance |
Adjusted operating profit margin |
21.0%-21.5% |
Adjusted free
cash flow |
€500-€525 million |
Return on
invested capital |
>= 8% |
Diluted adjusted EPS |
Mid-single-digit growth |
Guidance
for adjusted free cash flow and diluted adjusted EPS is in constant
currencies (EUR/USD 1.33). Guidance for EPS growth reflects
announced share repurchases. Adjusted operating profit margin and
ROIC are in reporting currencies. |
Our guidance is based on constant exchange rates.
Wolters Kluwer generates more than half of its revenues and
adjusted operating profit in North America. As a rule of thumb,
based on our 2014 currency profile, a 1 U.S. dollar cent move in
the average EUR/USD exchange rate for the year causes an opposite 1
euro-cent change in diluted adjusted EPS. Currency is expected to
have a more significant influence on results in 2015 than in recent
years.
For the full-year, we expect adjusted net
financing costs of approximately €100 million excluding the impact
of exchange rate movements on currency hedging and intercompany
balances. Including the effect of currency and assuming current
exchange rates (including a EUR/USD rate of around 1.10) prevail
until year-end, we estimate adjusted net financing costs of around
€125 million. We expect the benchmark effective tax rate to be
between 27% and 28% in 2015.
We expect our cash conversion ratio to return
towards historic average of 95%, and capital expenditure to be
between 4% and 5% of total revenue. Our guidance assumes no
significant change in the scope of operations. We may make further
disposals which could be dilutive to margins and earnings in the
near term.
IFRS reported profits for 2015 will include a
one-time loss of approximately €18 million (the majority of which
is foreign exchange related) following the completion of the
disposal of our 55% interest in Wolters Kluwer Russia Publishing
Holding on 16 September, 2015.
On July 29, 2015, we announced the combination of
our Corporate Legal Services and Finance, Risk & Compliance
units into a new division serving Governance, Risk & Compliance
markets globally. On February 24, 2016, we will report our
full-year 2015 results under both the current and the new
divisional organization.
About Wolters
Kluwer
Wolters Kluwer is a global leader in professional information
services. Professionals in the areas of legal, business, tax,
accounting, finance, audit, risk, compliance and healthcare rely on
Wolters Kluwer's market leading information-enabled tools and
software solutions to manage their business efficiently, deliver
results to their clients, and succeed in an ever more dynamic
world. Wolters Kluwer reported 2014 annual revenues of €3.7
billion. The group serves customers in over 170 countries, and
employs over 19,000 people worldwide. The company is headquartered
in Alphen aan den Rijn, the Netherlands. Wolters Kluwer shares are
listed on Euronext Amsterdam (WKL) and are included in the AEX and
Euronext 100 indices. Wolters Kluwer has a sponsored Level 1
American Depositary Receipt program. The ADRs are traded on the
over-the-counter market in the U.S. (WTKWY). For more information
about our products and organization, visit www.wolterskluwer.com,
follow @Wolters_Kluwer on Twitter, or search for Wolters Kluwer
videos on YouTube.
Financial Calendar |
|
February
24, 2016 |
Full-Year
2015 Results |
March 9,
2016 |
Publication of 2015 Annual Report |
April 21,
2016 |
2016
Annual General Meeting of Shareholders |
April 25,
2016 |
Ex-dividend date: 2015 final dividend |
April 26,
2016 |
Record
date: 2015 final dividend |
May 11,
2016 |
First-Quarter 2016 Trading Update |
May 12,
2016 |
Payment
date: 2015 final dividend ordinary shares |
May 19,
2016 |
Payment
date: 2015 final dividend ADRs |
July 29,
2016 |
Half-Year
2016 Results |
November
2, 2016 |
Nine-Month 2016 Trading Update |
Media |
Investors/Analysts |
Annemarije Pikaar |
Meg
Geldens |
Corporate
Communications |
Investor
Relations |
t + 31
(0)172 641 470 |
t + 31
(0)172 641 407 |
annemarije.pikaar@wolterskluwer.com |
ir@wolterskluwer.com |
Forward-looking
Statements
This press release contains forward-looking
statements. These statements may be identified by words such as
"expect", "should", "could", "shall" and similar expressions.
Wolters Kluwer cautions that such forward-looking statements are
qualified by certain risks and uncertainties that could cause
actual results and events to differ materially from what is
contemplated by the forward-looking statements. Factors which could
cause actual results to differ from these forward-looking
statements may include, without limitation, general economic
conditions; conditions in the markets in which Wolters Kluwer is
engaged; behavior of customers, suppliers, and competitors;
technological developments; the implementation and execution of new
ICT systems or outsourcing; and legal, tax, and regulatory rules
affecting Wolters Kluwer's businesses, as well as risks related to
mergers, acquisitions, and divestments. In addition, financial
risks such as currency movements, interest rate fluctuations,
liquidity, and credit risks could influence future results. The
foregoing list of factors should not be construed as exhaustive.
Wolters Kluwer disclaims any intention or obligation to publicly
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
PDF version of Press
Release
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Wolters Kluwer NV via Globenewswire
HUG#1963950
Wilsons Leather Experts (NASDAQ:WLSN)
Historical Stock Chart
From Jun 2024 to Jul 2024
Wilsons Leather Experts (NASDAQ:WLSN)
Historical Stock Chart
From Jul 2023 to Jul 2024