Wolters Kluwer appear to have completed a strategic transformation of their business which began more than three years ago as the current CEO Nancy McKinstry took up her role. The company did not see significant top line improvement in 2007 - up 4% - but they have gained in operating margin to 20% and with a better product mix they should continue to see improvement. During 2007, the company divested their education division and booked a nice gain (similar to Reed and Thomson in that respect).
In her comments, McKinstry noted that over half the companies revenues come from online and electronic products and services, and she believes improved results will derive from this better product mix. As the company continues to invest in work-flow solutions and integrated products she went on to say "I am confident in our ability to leverage our superior market positions, our improved organic growth and more efficient operating structure to achieve enhanced value to our customers and shareholders."
Other highlights from their press release:
- Organic revenue growth was 4% (2006: 3%)
- Reported revenues of €3,413 million, grew 6% in constant currencies (2006: €3,377 million)
- Ordinary EBITA margin improved to 20% (2006: 17%)
- Ordinary EBITA of €667 million increased 27% in constant currencies (2006: €556 million)
- Diluted ordinary EPS increased 25% to €1.38 (2006: €1.10), 35% in constant currencies
Free cash flow of €405 million (2006: €399 million, which included a €53 million one-time tax refund)
- Revenues from online and workflow solutions grew 9%
- Structural cost savings of €161 million, an increase of 26% (2006: €128 million)
- Divestment of Education: sales price €774 million; book profit €595 million; net proceeds €665 million
- Share buy-back program completed (€645 million returned to shareholders)
- Net profit for the full year was €918 million (compared to 2006: €322 million), supported by he divestiture of the Education division