Earnings: Reed Elsevier Sharpens The Axe; $220 Million Extra Annuals Savings Targeted
This story was written by Patrick Smith.
Reed Elsevier (NYSE: RUK) has promised to aggressively cut back and restructure its businesses by an extra $220 million a year as it recovers from a tumultuous year that saw the failed auction of its Reed Business Information B2B division and doubts over its ability to pay off massive debts. Out-going CEO Sir Crispin Davies says the company was "disappointed" not to sell RBI last year and blamed the "macro-economic environment and poor credit market conditions" on forcing the price down too farbut he described the division as a good business with a "record of success in developing online services" and repeated the company's desire to sell it in the medium term "when conditions are more favourable".
In its preliminary full-year 2008 results today the company reported revenues seven percent higher year on year at 5.33 billion with adjusted operating profit 12 percent higher at 901 million, a one percent drop. Both those figures would have been higher but for the falling value of the pound. Reed reported six percent revenue growth each for science publisher Elsevier, LexisNexis and Reed Exhibitionsbut again the black sheep was RBI which is suffering badly on the print advertising side. More after the jump
By Patrick Smith