The first half results as reported today were mixed with revenue flat but in excess of many analysts estimates. The company confirmed they are on target for a 10% increase in EPS. Revenues were up 6% and operating income up 10% in constant terms. All operating units performed consistently in revenue but Lexis Nexis lead the group in operating income growth of 13% and Business Information lagged at 7%. (The company is impacted by the weak dollar and taking into account currency changes total revenue growth was only 1% ).
- Elsevier: good momentum, strong renewals, good book revenue, growing online sales
- Lexis: positive outlook, good demand for online services and total solutions, and risk and analytics
- Business Information: cycling in of biennial shows, online revenue growth more than off-setting declines in print.
- Digital revenues are on target to represent 45% of total revenue
- To focus on additional cost efficencies the company has hired c-level positions in outsourcing, procurement and technology
- Davis commented to journalists that the company rejected a P/E approach for the business information division in 2006. The unit could be worth over $2.0bill
- Davis also said he continues to look for acquisitions and is particularly interested in those over $100mm.