Wolters Kluwer First Quarter 2003 Trading Statement.Business Editors AMSTERDAM Amsterdam, city, Netherlands Amsterdam (ăm`stərdăm', Dutch ämstərdäm`), city (1994 pop. 724,096), constitutional capital and largest city of the Kingdom of the Netherlands, North Holland prov. , Netherlands--(BUSINESS WIRE)--May 14, 2003 - Today Wolters Kluwer Wolters Kluwer N.V. (Euronext: WKL) is a leading global information services and publishing company. The company provides products and services for professionals in the health, tax, accounting, corporate, financial services, legal and regulatory, and education sectors. reported its (un-audited) trading update for the quarter ended March 31, 2003. -- First quarter 2003 results impacted by weak trading conditions, compounded by negative currency effects and divestments; nevertheless total continuing revenues were flat (expressed in constant currencies) -- Share of electronic revenues at 35% thanks to sizeable growth of Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the sales (+20% in constant currencies) -- Overall EBITA EBITA Earnings Before Interest Taxes Amortization margin down, mainly due to pressure on top line, divestments and one-off (1) One at a time. CD-ROM recorders (CD-R drives) are commonly called one-off machines because they write one CD-ROM at a time. (2) Only once. Software that is written to solve a specific problem only one time is sometimes called a one-off. charges in Legal, Tax & Business North America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. -- Benchmark ordinary net income (before amortization of intangible fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → ) down to EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 39 million; negatively influenced by currency effects of EUR 12 million and divestments of EUR 5 million -- Stable free cash flow thanks to stringent working capital management -- Net debt reduced by 25% to EUR 2.2 billion -- Implementation of overall cost savings programs to minimize margin deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. -- At present market conditions, we have to decrease our outlook expectations for 2003 by a few percentage points Rob Pieterse, Chairman of Wolters Kluwer's Executive Board, commented: "The first quarter is typically the weakest for Wolters Kluwer, due to the seasonal nature of parts of our business. The increase in Internet sales encourages us to accelerate product development to ensure future growth. Business was hampered by a weaker economic environment, which put pressure on margins, particularly in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . To minimize margin deterioration we are implementing overall cost savings measures. The strengthening of the euro versus the dollar and other currencies had a negative impact on reported earnings. Despite these adverse circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or we were able to generate a stable free cash flow and to improve our overall financial situation, by significantly reducing net debt."
EUR million Q1 Q1 % Change
2003 2002 Constant
% Change Currencies
-------------------------------- ----- ----- --------- -----------
Total Revenues 779 921 -15 -5
-------------------------------- ----- ----- --------- -----------
EBITA 87 144 -40 -30
-------------------------------- ----- ----- --------- -----------
EBITA margin % 11 16
-------------------------------- ----- ----- --------- -----------
Ordinary net income (a) 39 74 -47 -31
-------------------------------- ----- ----- --------- -----------
Variances Revenues EBITA Ordinary net
income (a)
------------ ------------------ ------------------ ------------------
EUR EUR EUR
million % change million % change million % change
------------ -------- --------- -------- --------- -------- ---------
Organic -25 -3 -36 -25
------------ -------- --------- -------- --------- -------- ---------
Acquisitions +25 +3 +4 +3
------------ -------- --------- -------- --------- -------- ---------
Continuing
revenues 0 0 -32 -22
------------ -------- --------- -------- --------- -------- ---------
Divestments -46 -5 -11 -8
------------ -------- --------- -------- --------- -------- ---------
At constant
rates -46 -5 -43 -30 -23 -31
------------ -------- --------- -------- --------- -------- ---------
Currency -96 -10 -14 -10 -12 -16
------------ -------- --------- -------- --------- -------- ---------
Total (EUR) -142 -15 -57 -40 -35 -47
------------ -------- --------- -------- --------- -------- ---------
(a) Benchmark ordinary net income before amortization intangible fixed assets. Overall Business Development: Within Legal, Tax & Business Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , which showed a stable
performance, most countries performed well and showed good organic
growth figures. A transnational sourcing project has begun to leverage
scale by enabling efficiency, consistency and quality improvements.In the United Kingdom, next to a strong growth in consultancy, we saw a decline in subscriptions. In Belgium Belgium (bĕl`jəm), Du. België, Fr. La Belgique, officially Kingdom of Belgium, constitutional kingdom (2005 est. pop. 10,364,000), 11,781 sq mi (30,513 sq km), NW Europe. operational issues showed improvement, notwithstanding the loss of loose-leaf loose-leaf adj. Relating to, having, or being leaves that can be easily removed, rearranged, or replaced: a loose-leaf notebook; loose-leaf paper. subscriptions and delays in new product development. The Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. saw a decrease in advertising, flat revenues in other areas, and order management difficulties, which affected some volumes. In March, Wolters Kluwer improved its competitive position in the Italian legal market by acquiring a 33% interest in CEDAM CEDAM Conservation, Education, Diving, Archaeology & Museums , Italy's highly regarded publisher of legal doctrine Legal doctrine is a framework, set of rules, procedural steps, or test, often established through precedent in the common law, through which judgments can be determined in a given legal case. and authoritative proprietary content, with an option for 100% ownership. Within our Legal, Tax & Business North America cluster Tax Compliance and CCH CCH Colegio de Ciencias y Humanidades (Spanish) CCH Certified Clinical Hypnotherapist CCH Cook County Hospital CCH Certified in Classical Homeopathy CCH Country Club Hills (Fairfax City, VA, USA) Canada continued to perform well, showing good organic growth. At CCH US Publishing overall revenue growth was flat. The already stagnant stagnant /stag·nant/ (stag´nant) 1. motionless; not flowing or moving. 2. inactive; not developing or progressing. economy, significantly diminished di·min·ish v. di·min·ished, di·min·ish·ing, di·min·ish·es v.tr. 1. a. To make smaller or less or to cause to appear so. b. acquisition activity and corporations not making capital investments depressed the results for Bankers System Inc. and Legal Information Systems. Aspen aspen, in botany aspen: see willow. Aspen, city, United States Aspen (ăs`pən), city (1990 pop. 5,049), alt. 7,850 ft (2,390 m), seat of Pitkin co., S central Colo. Publishers had a very slow start and showed lower results than in the first quarter last year. In reaction to these developments, the cluster has initiated significant cost savings initiatives. Plans for realigning the cluster, accelerating investment in new products and increasing efficiency are being rolled out. The revenue growth of the Legal, Tax & Business Asia Pacific cluster was primarily driven by the acquisition of the practice management company Diskcovery. New product launches are on target and new sales results in the quarter were good. The restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of the business and the investments made in the past year in a shared services shared services, n.pl the administrative, clinical, or other service functions that are common to two or more hospitals or their health care facilities and used jointly or cooperatively by them. model to improve efficiency and leverage scale clearly started to bear fruit. In the Health cluster comparison with last year is skewed skewed curve of a usually unimodal distribution with one tail drawn out more than the other and the median will lie above or below the mean. skewed Epidemiology adjective Referring to an asymmetrical distribution of a population or of data due to a change in the nature of our business, following the migration from print (one-off sales) to electronic (subscription income). Further investments were made in Pharma Solutions and Clinical Tools. The cluster continues its strategy to expand its portfolio of top medical content, increase market share in medical research, accelerate growth of clinical tools, and revitalize re·vi·tal·ize tr.v. re·vi·tal·ized, re·vi·tal·iz·ing, re·vi·tal·iz·es To impart new life or vigor to: plans to revitalize inner-city neighborhoods; tried to revitalize a flagging economy. its core text-, reference- and pharmaceutical businesses. Health enjoyed a growth in Internet revenues, as management successfully managed to migrate clients from CD-Rom to the Internet. Indicative of its expanding lead in content, Ovid enjoyed a 5% growth in journal articles over last year. The acquisition of Skolar, a well-established on-line reference service, was completed in March. The Education cluster's first quarter results are not very indicative of anticipated performance for the full year due to the seasonal nature of the schoolbook business, where most revenues and profits are realized later in the year. In the United Kingdom the total market showed a decline. In reaction to this an immediate additional cost cutting exercise was put in place. Furthermore new management will be installed. For the cluster, new product development is on schedule and will be available in the summer when the new school season arrives. Excluding divestments, non-core businesses showed a decline in revenues due to shortfalls in the advertising market, but managed to show a flat EBITA due to strict cost control measures taken. The divestment divestment to strip one's investment from an entity. of ten Hagen & Stam (the Netherlands) was cancelled. Financial Overview Clusters Legal, Tax & Business Europe
Change
---------------------------------- -----------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
---------------------- ----- ----- ------- ------------ -------- -----
Revenues (EUR) 301 297 -3 +13 -6 +4
---------------------- ----- ----- ------- ------------ -------- -----
EBITA
(EUR) 44 46 -2 +1 -1 -2
---------------------- ----- ----- ------- ------------ -------- -----
EBITA margin % 15 15
---------------------- ----- -----
Legal, Tax & Business North America
Change
----------------- ----- ----- --------------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
----------------- ----- ----- ------- ------------ -------- -----
Revenues (USD) 272 278
(EUR) 254 317 -17 +11 -57 -63
----------------- ----- ----- ------- ------------ -------- -----
EBITA (USD) 51 70
(EUR) 48 79 -22 +2 -11 -31
----------------- ----- ----- ------- ------------ -------- -----
EBITA margin % 19 25
----------------- ----- -----
Legal, Tax & Business Asia Pacific
Change
---------------- ----- ----- --------------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
---------------- ----- ----- ------- ------------ -------- -----
Revenues (AUD) 32 29
(EUR) 18 17 0 +2 -1 +1
---------------- ----- ----- ------- ------------ -------- -----
EBITA (AUD) 5 5
(EUR) 3 3 0 0 0 0
---------------- ----- ----- ------- ------------ -------- -----
EBITA margin % 17 16
---------------- ----- -----
Health
Change
---------------- ----- ----- --------------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
---------------- ----- ----- ------- ------------ -------- -----
Revenues (USD) 153 152
(EUR) 143 174 0 +1 -32 -31
---------------- ----- ----- ------- ------------ -------- -----
EBITA (USD) 12 15
(EUR) 11 17 -4 0 -2 -6
---------------- ----- ----- ------- ------------ -------- -----
EBITA margin % 8 10
---------------- ----- -----
Education
Change
---------------- ----- ----- --------------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
---------------- ----- ----- ------- ------------ -------- -----
Revenues
(EUR) 39 43 -4 +1 -1 -4
---------------- ----- ----- ------- ------------ -------- -----
EBITA
(EUR) -10 -6 -4 0 0 -4
---------------- ----- ----- ------- ------------ -------- -----
EBITA margin % -26 -15
---------------- ----- -----
Non core activities
Change
---------------- ----- ----- --------------------------------------
Million Q1 Q1 Organic Acquisition/ Currency Total
2003 2002 Divestment
---------------- ----- ----- ------- ------------ -------- -----
Revenues
(EUR) 25 74 -2 -47 0 -49
---------------- ----- ----- ------- ------------ -------- -----
EBITA
(EUR) 0 10 +1 -11 0 -10
---------------- ----- ----- ------- ------------ -------- -----
EBITA margin % -1 14
---------------- ----- -----
Miscellaneous announcements over the first quarter: -- March 11, 2003 - Nancy McKinstry Nancy McKinstry (b. 4 January, 1959 in Connecticut, USA, now living in Wassenaar, the Netherlands[1]) is CEO and Chairman of the Executive Board of Wolters Kluwer. was appointed Chairman of the Executive Board as of September 1, 2003. -- March 14, 2003 - Wolters Kluwer announced that it intends to buy up to a maximum of 10,000,000 of its own depository The place where a deposit is placed and kept, e.g., a bank, savings and loan institution, credit union, or trust company. A place where something is deposited or stored as for safekeeping or convenience, e.g., a safety deposit box. receipts, equaling a maximum of 3.2% of the fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share capital (to date, approximately 650,000 shares have been bought). -- March 28, 2003 - Wolters Kluwer announced that clusters will report directly to the Chairman of the Executive Board enabling shorter reporting lines and better coordination. -- As announced on the 31st of March, 2003, the divestment of ISBW is close to completion. -- April 16, 2003 - Boudewijn Beerkens (CFO See Chief Financial Officer. ) was appointed as a Member of the Executive Board as of May 1, 2003. -- April 16, 2003 - Wolters Kluwer shareholders approved the proposed dividend of EUR 0.55. This year 52% of the dividend was paid out in stock (last year 38%). This press release is based on un-audited figures and data for the first quarter of the year 2003. The financial results for the first half year 2003, including the profit and loss account, balance sheet, cash flow statement and other financial details, will be released on August 12, 2003 before trading. Wolters Kluwer will release a quarterly trading update over the third quarter on November 12, 2003. Forward-looking statement forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This trading statement contains forward-looking statements. These statements may be identified by words such as 'expect', 'should', 'could', 'shall', and similar expressions. These statements are subject to risks and uncertainties, and actual results and events could differ materially from what is expected presently. Factors leading thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. may include without limitations general economic conditions, conditions in the markets in which Wolters Kluwer is engaged, behavior of customers, suppliers and competitors, technological developments, as well as legal and regulatory rules affecting Wolters Kluwer's businesses. Note for the editor Wolters Kluwer is a multinational information services See Information Systems. company with annual revenues of more than EUR 3.9 billion, employing almost 20,000 people in Europe, North America, and Asia Pacific. The company's core activities are Legal, Tax & Business, Health and Education. Wolters Kluwer's shares are quoted on the Euronext Amsterdam and are included in the AEX AEX See: Amsterdam Exchange and Euronext 100 indices. Internet: www.wolterskluwer.com |
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