Engstrom takes helm as Reed chief departs after eight months

<p>Ian Smith has resigned as chief executive of Reed Elsevier after less than a year in charge. The international publishing group said Smith had left by &quot;mutual agreement&quot; after leading the company through &quot;unprecedentedly turbulent economic times&quot;. His successor is Erik Engstrom, chief executive of the science wing Elsevier. Engstrom takes over with immediate effect.<br /><br />In August Reed was forced to raise &pound;824m through an &quot;accelerated&quot; placing of more than 160m new shares, after admitting that its debt levels, at &pound;5bn, were &quot;too high&quot;. The announcement sent Reed&#39;s share price to a new 52-week low of 405p, though it has since risen to 484.5p. The appointment of the former chief executive of the housebuilder Taylor Woodrow back in November last year was questioned by analysts, because he was an unfamiliar with publishing. Smith joined Reed in January as c.e.o. designate, and took over from the well regarded Crispin Davis in March.</p><p>According to to the FT Reed&rsquo;s shares have underperformed the FTSE 100 by more than 20% in the year to date. Engstrom has been a director of Reed Elsevier since 2004. He was also a director at SCA, the Swedish paper products company, and has worked in the publishing sector at Bertelsmann, Random House and Bantam Doubleday Dell North America. A spokesman told the <em>FT</em>: &quot;The feeling was this wasn&rsquo;t the right role for Ian given the current economic circumstances. It&rsquo;s been obviously a fairly tough year and this wasn&rsquo;t working out.&quot;</p><p>In a trading update provided today (11th November) Reed said the &quot;professional markets, accounting for the majority of Reed Elsevier&#39;s business, are proving more resilient than most but not immune from late cycle pressures given the subscription nature of much of the revenue&quot;. Its legal business LexisNexis had seen a modest decline in underlying revenues with softer legal and corporate markets in the US and internationally, while Elsevier was making &quot;revenue progress with good online sales and a strong medical publishing programme&quot;. Both Reed Exhibitions and Reed Business Information had been hit by &quot;revenue declines&quot;, amid &quot;difficult trading conditions&quot;.<br /><br />Overall, Reed said: &quot;The effects of operational gearing in a weak revenue environment combined with increased investment (particularly focused in US Legal Markets), which are only partially mitigated by restructuring and other cost actions, are likely to lead to a modest reduction in adjusted operating margin in 2010.&quot; It added that the cash run earlier in the year had improved credit metrics ensuring that the group was &quot;appropriately resourced to support its market and product strategies&quot;.</p>