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Reed reports flat first half

26.07.07 Philip Jones

Reed Elsevier saw growth stutter in the first half of the year reporting sales growth of just 1% from its continuing operations. Nevertheless the group's chief executive, Sir Crispin Davis, said it was "seeing good momentum across our businesses, particularly with the growing impact of our online solutions strategy".

Reed said that sales were up 6% and adjusted operating profits up 10% at constant currencies. But actual revenue dropped £2,237m to £2,235m in the six months to 30th June 2007.

Operating profit rose to £530m, compared with £513m a year earlier. Underlying adjusted operating profit was 9% higher reflecting what the group called the revenue growth and margin improvement, with good performances across all the continuing businesses.

Divisionally, the science arm, Elsevier, saw sales fall from £721m to £711m; the legal business LexisNexis saw sales fall from £768m to £764m; while the professional arm Reed Business pushed revenues up from £748m to £760m. Reed said that at constant currencies sales were up 4%, 8%, and 6% respectively.

Reed said that it had seen 12% growth in online information and digital services which now accounted for 45% of its revenues.

Davis added: "The 2007 first half financial results are encouraging. Market conditions continue to be generally favourable, our strategy is clear, the business well focused, and we are leveraging our resources to good effect. Reed Elsevier is well placed for a strong second half and we are firmly on track to deliver our 2007 goals."

The company said it was on track to deliver in 2007 a minimum 10% growth in adjusted earnings per share at constant currencies.

The figures do not include its education business, which it has now agreed to sell for a total of $4.95bn. It said that it aimed to return about $4bn to shareholders following completion. Harcourt Education saw revenues 10% lower than in the prior first half at constant currencies.

Financial Philip Jones reed elsevier stm

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