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FALSE000010714000001071402023-09-072023-09-070000107140us-gaap:CommonClassAMember2023-09-072023-09-070000107140us-gaap:CommonClassBMember2023-09-072023-09-07

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
September 7, 2023
(Date of Report)
(Date of earliest event reported)
JOHN WILEY & SONS, INC.
(Exact name of registrant as specified in its charter)
New York
(State or other jurisdiction of incorporation)
001-11507 13-5593032
(Commission File Number) (IRS Employer Identification No.)
111 River Street, Hoboken New Jersey
07030
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code:
(201) 748-6000
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐
 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Class A Common Stock, par value $1.00 per share WLY New York Stock Exchange
Class B Common Stock, par value $1.00 per share WLYB New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o On September 7, 2023, John Wiley & Sons Inc., a New York corporation (the “Company”), issued a press release announcing the Company’s financial results for the first quarter of fiscal year 2024.


Item 2.02 Results of Operations and Financial Condition.
A copy of the Company’s press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On September 7, 2023, the Company held its first quarter of fiscal year 2024 earnings conference call. The Company is furnishing as Exhibit 99.2 to this Current Report on Form 8-K the presentation materials that were provided and discussed during the earnings conference call.
The information in these Items 2.02 and 7.01, including the exhibits hereto, (x) shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and (y) shall not be incorporated by reference into any filing of the Company with the Securities and Exchange Commission, whether made before or after the date hereof, regardless of any general incorporation language in such filings (unless the Company specifically states that the information or exhibits in this particular report are incorporated by reference).
Item 9.01 Financial Statements and Exhibits.
Exhibit No. Description
99.1 - Press release dated September 7, 2023 “Wiley Reports First Quarter Fiscal Year 2024 Results.”
99.2 - Presentation materials dated September 7, 2023.
104 - Cover Page Interactive Data File (embedded within the Inline XBRL document).


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
JOHN WILEY & SONS, INC.
(Registrant)
By /s/ Brian A. Napack
Brian A. Napack
President and
Chief Executive Officer
By /s/ Christina Van Tassell
Christina Van Tassell
Executive Vice President and
Chief Financial Officer
Dated: September 7, 2023

EX-99.1 2 wly-2024731xex991.htm EX-99.1 Document

image0a.jpg

Wiley Reports First Quarter 2024 Results
September 7, 2023 - Hoboken, NJ – Wiley (NYSE: WLY and WLYB), a global knowledge company and a leader in research, publishing, and knowledge solutions today reported results for the first quarter ended July 31, 2023.

•GAAP Results: Revenue of $451 million (-7%), Operating loss of -$16 million (+4%), and EPS loss of -$1.67 (-$1.35). GAAP earnings impacted by impairment charges totalling $103 million, including non-cash goodwill and assets held-for-sale impairment and loss on sale of a business.
•Adjusted Results at Constant Currency (excluding Held for Sale or Sold segment results): Adjusted Revenue of $367 million (-8%), Adjusted EBITDA of $60 million (-10%), and Adjusted EPS of $0.27 (-37%).

FISCAL YEAR 2024 TRANSITION
•Wiley recently realigned its organization to focus on its core strengths in research, academic, and professional publishing, improve profit and performance, and drive greater operating and capital efficiency.
•In June of 2023, Wiley announced that it was divesting University Services, Wiley Edge, and CrossKnowledge. These businesses are currently reported in Held for Sale or Sold segment.
•Wiley is rightsizing its cost structure to reflect smaller revenue base and a more narrowly focused company.
•The benefits of these portfolio and restructuring actions are expected to be realized in Fiscal 2025 and Fiscal 2026.

MANAGEMENT COMMENTARY
“Our Q1 performance was as expected as we continue to execute on our plans and position Wiley for the future,” said Brian Napack, President and CEO. “While Research was down due to an unusual publishing pause in the second half of last year, we are seeing underlying strength and momentum returning, including growing article volumes, higher journal impact scores, and new partner signings. We are making steady progress on our transition and recently streamlined Wiley into one focused, market-facing team to better leverage our collective strength and drive operating leverage.”

FINANCIAL PERFORMANCE
See accompanying financial tables for the First Quarter 2024. For GAAP purposes, Wiley’s reporting structure consists of three segments: (1) Research, (2) Learning, and (3) Held for Sale or Sold. Research is unchanged with reporting lines of Research Publishing and Research Solutions. Learning includes reporting lines of Academic (education publishing) and Professional (professional publishing and assessments).

Research
•Revenue of $258 million was down 6%, or 7% at constant currency, mainly due to the Hindawi publishing pause and macro headwinds impacting our corporate advertising and recruitment offerings. This offset continued strong growth in our core open access publishing program. Excluding Hindawi, revenue was flat.
•Adjusted EBITDA of $77 million was down 18% at constant currency due to the Hindawi publishing pause. Adjusted EBITDA margin for the quarter was 29.8% compared to 33.8% in the prior year period. Excluding Hindawi, Adjusted EBITDA was up modestly.




Learning
•Revenue of $109 million was down 9% as reported and at constant currency due to lower print sales in a seasonally light quarter for academic publishing, offsetting solid growth in assessments.
•Adjusted EBITDA of $21 million was up 19% as reported and at constant currency mainly due to restructuring savings. Adjusted EBITDA margin for the quarter was 19.4% compared to 14.9% in the prior year period.

Businesses Held for Sale or Sold
•Revenue of $84 million was down 10% on a reported and constant currency basis driven by declines in Wiley Edge (Talent Development) and CrossKnowledge, and the disposal of test prep and advancement courses lines. Adjusted EBITDA of $6 million is up from a $2 million loss in the prior year.

Corporate Expenses
•Corporate Expenses of $49 million declined 24% due to restructuring savings and lower occupancy costs. Adjusted Corporate Expenses (Adjusted EBITDA) of $38 million declined 15%.

EPS
•GAAP EPS loss of $1.67 compared to a loss of $0.32 in the prior year period due to (1) non-cash goodwill impairment and (2) impairment of held-for-sale assets and a loss on the sale of a business totalling $103 million.
•Adjusted EPS excluding businesses held for sale or sold of $0.27 was down 37% primarily due to higher interest expense and lower Adjusted Operating Income.

Balance Sheet, Cash Flow, and Capital Allocation
•Net Debt-to-EBITDA Ratio (Trailing Twelve Months) at quarter end was 1.9x compared to 2.1x at prior year end.
•Net Cash Used in Operating Activities was a use of $82 million compared to a use of $90 million in the prior year period due to reduced incentive compensation. Note, Wiley’s regular use of cash in the first half of the fiscal year is driven by the timing of cash collections for annual journal subscriptions, which are concentrated in Q3 and Q4.
•Free Cash Flow less Product Development Spending was a use of $106 million compared to a use of $114 million. Capex was essentially flat. Note, Wiley does not provide an adjusted free cash flow metric; results related to held for sale or sold businesses are included for the period owned.
•Returns to Shareholders: The Company raised its dividend for the 30th consecutive year in June. For the quarter, Wiley allocated $19 million toward dividends and $10 million toward repurchasing 301,000 shares at an average cost per share of $33.25. This compares to 212,000 shares repurchased in the prior year period. There were no material acquisitions in the quarter.

Fiscal Year 2024 TRANSITION YEAR Outlook
Wiley is reaffirming its Fiscal 2024 outlook. The outlook excludes businesses held for sale or sold: University Services, Wiley Edge (Talent Development), and CrossKnowledge. Collectively, these businesses generated $393 million of revenue, $43 million of Adjusted EBITDA, and $0.36 of Adjusted EPS in Fiscal 2023.




Metric ($millions, except EPS)
Fiscal 2023
All Company
Fiscal 2023
Ex-Divestitures
Fiscal 2024 Outlook
Ex-Divestitures
Adjusted Revenue* $2,020 $1,627 $1,580 to $1,630
Research $1,080 Flat (+3% ex-Hindawi)
Learning $547 Down low single digits
Adjusted EBITDA* $422 $379 $305 to $330
Adjusted EPS* $3.84 $3.48 $2.05 to $2.40

*Wiley’s Fiscal 2024 outlook (“Adjusted Revenue,” “Adjusted EBITDA,” and “Adjusted EPS”) exclude businesses held for sale, including University Services, Wiley Edge (formerly Talent Development), and CrossKnowledge, as well as those sold in Fiscal 2023: Test Prep and Advancement Courses.

Fiscal Year 2024 Transition Year Outlook
•Adjusted Revenue - primarily due to the Hindawi special issues publishing pause and lower print demand in Academic. Note, this is a new metric defined as revenue adjusted to exclude businesses held for sale or sold.
•Adjusted EBITDA - primarily due to projected revenue performance, notably Hindawi, and higher employee costs from the combination of an incentive compensation reset and wage inflation. From its portfolio and restructuring actions, the Company expects material margin improvement in Fiscal 2025 and Fiscal 2026.
•Adjusted EPS - further impacted by $0.42 of non-operational items including a higher tax rate (-$0.21/share), pension expense (-$0.11/share), and interest expense (-$0.10/share). Wiley’s higher tax rate is primarily due to a less favorable mix of earnings by country and an increase in the UK statutory rate. Wiley froze its U.S. and U.K. pension programs in 2015, and they are approximately 90% funded.

Wiley is not providing a Free Cash Flow outlook at this time due to the uncertainty around the timing of divestitures and the size and scope of restructuring payments.

EARNINGS CONFERENCE CALL
Scheduled for today, September 7 at 10:00 am (ET). Access webcast at Investor Relations at investors.wiley.com, or directly at https://events.q4inc.com/attendee/255554735. U.S. callers, please dial (888) 210-3346 and enter the participant code 2521217#. International callers, please dial (646) 960-0253 and enter the participant code 2521217#.

ABOUT WILEY
Wiley is a knowledge company and a global leader in research, publishing, and knowledge solutions. Dedicated to the creation and application of knowledge, Wiley serves the world’s researchers, learners, innovators, and leaders, helping them achieve their goals and solve the world's most important challenges. For more than two centuries, Wiley has been delivering on its timeless mission to unlock human potential. Visit us at Wiley.com. Follow us on Facebook, Twitter, LinkedIn and Instagram.




NON-GAAP FINANCIAL MEASURES
Wiley provides non-GAAP financial measures and performance results such as “Adjusted EPS,” “Adjusted Operating Income,” “Adjusted EBITDA,” “Adjusted CTP,” “Adjusted Income before Taxes,” “Adjusted Income Tax Provision,” “Adjusted Effective Income Tax Rate,” “Free Cash Flow less Product Development Spending,” “organic revenue,” “Adjusted Revenue,” and results on a Constant Currency basis to assess underlying business performance and trends. Management believes non-GAAP financial measures, which exclude the impact of restructuring charges and credits and certain other items, and the impact of acquisitions provide a useful comparable basis to analyze operating results and earnings. See the reconciliations of non-GAAP financial measures and explanations of the uses of non-GAAP measures in the supplementary information. We have not provided our 2024 outlook for the most directly comparable U.S. GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend on various factors, and could be material to our consolidated results computed in accordance with U.S. GAAP.

FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements concerning the Company's operations, performance, and financial condition. Reliance should not be placed on forward-looking statements, as actual results may differ materially from those in any forward-looking statements. Any such forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to uncertainties and contingencies, many of which are beyond the control of the Company and are subject to change based on many important factors. Such factors include, but are not limited to: (i) the level of investment in new technologies and products; (ii) subscriber renewal rates for the Company's journals; (iii) the financial stability and liquidity of journal subscription agents; (iv) the consolidation of book wholesalers and retail accounts; (v) the market position and financial stability of key online retailers; (vi) the seasonal nature of the Company's educational business and the impact of the used book market; (vii) worldwide economic and political conditions; (viii) the Company's ability to protect its copyrights and other intellectual property worldwide (ix) the ability of the Company to successfully integrate acquired operations and realize expected opportunities; (x) the ability to realize operating savings over time and in fiscal year 2024 in connection with our multiyear Global Restructuring Program and planned dispositions; (xi) the possibility that the divestitures will not be pursued, failure to obtain necessary regulatory approvals or required financing or to satisfy any of the other conditions to planned dispositions; and (xii) other factors detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any such forward-looking statements to reflect subsequent events or circumstances.

Category: Earnings releases




JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1) (2)
CONDENSED CONSOLIDATED STATEMENTS OF NET LOSS
(Dollars in thousands, except per share information)
(unaudited)
Three Months Ended
July 31,
2023 2022
Revenue, net $ 451,013  $ 487,569 
Costs and expenses:
  Cost of sales 157,101  174,031 
  Operating and administrative expenses 255,801  282,751 
  Impairment of goodwill (3)
 26,695  — 
  Restructuring and related charges 12,123  22,441 
  Amortization of intangible assets 15,648  25,311 
Total costs and expenses 467,368  504,534 
Operating loss (16,355) (16,965)
As a % of revenue -3.6  % -3.5  %
Interest expense (11,334) (6,332)
Foreign exchange transaction losses (1,620) (616)
Impairment charge related to assets held-for-sale and loss on sale of a business (3)
 (75,929) — 
Other (expense) income, net (1,485) 526 
Loss before taxes (106,723) (23,387)
Benefit for income taxes (14,459) (5,552)
Effective tax rate 13.5  % 23.7  %
Net loss $ (92,264) $ (17,835)
As a % of revenue -20.5  % -3.7  %
Loss per share
Basic $ (1.67) $ (0.32)
Diluted (4)
 $ (1.67) $ (0.32)
Weighted average number of common shares outstanding
Basic 55,270  55,736 
Diluted (4)
 55,270  55,736 


Notes:
(1) The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) All amounts are approximate due to rounding.
(3) As previously announced, we are divesting non-core businesses, including University Services, Wiley Edge, and CrossKnowledge. These dispositions are expected to be completed during fiscal year 2024. As a result, we reorganized our segments and our new structure consists of three reportable segments which includes Research (no change), Learning, and Held for Sale or Sold, as well as a Corporate expense category (no change). As a result of this realignment, we were required to test goodwill for impairment immediately before and after the realignment. Prior to the realignment, we concluded that the fair value of the University Services reporting unit within the Held for Sale or Sold segment was below its carrying value which resulted in a pretax non-cash goodwill impairment of $11.4 million. After the realignment, we concluded that the fair value of the CrossKnowledge reporting unit within the Held for Sale or Sold segment was below its carrying value which resulted in a pretax non-cash goodwill impairment of $15.3 million.

In addition, these three businesses met the held-for-sale criteria. We measured each business at the lower of carrying value or fair value less cost to sell. We recorded a pretax impairment of $40.6 million for University Services and $33.3 million for CrossKnowledge in the three months ended July 31, 2023.

In the three months ended July 31, 2023, the loss on sale of a business is due to the sale of our Tuition Manager business previously in our Held for Sale or Sold segment, which resulted in a pretax loss of approximately $2.0 million (net of tax loss of $1.6 million).
(4) In calculating diluted net loss per common share for the three months ended July 31, 2023 and 2022, our diluted weighted average number of common shares outstanding excludes the effect of unvested restricted stock units and other stock awards as the effect was antidilutive. This occurs when a US GAAP net loss is reported and the effect of using dilutive shares is antidilutive.


JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1) (2)
RECONCILIATION OF US GAAP MEASURES to NON-GAAP MEASURES
(unaudited)
Reconciliation of US GAAP EPS to Non-GAAP Adjusted EPS
  Three Months Ended
July 31,
  2023 2022
US GAAP Loss Per Share - Diluted $ (1.67) $ (0.32)
Adjustments:
Impairment of goodwill 0.43  — 
Restructuring and related charges 0.16  0.30 
Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3)
 —  0.01 
Amortization of acquired intangible assets (4)
 0.23  0.36 
Impairment charge related to assets held-for-sale and loss on sale of a business (5)
 1.17  — 
Held for Sale or Sold segment Adjusted Net (Income) Loss (5)
 (0.07) 0.10 
EPS impact of using weighted-average dilutive shares for adjusted EPS calculation (6)
 0.02  0.01 
Non-GAAP Adjusted Earnings Per Share - Diluted $ 0.27  $ 0.46 
Reconciliation of US GAAP Loss Before Taxes to Non-GAAP Adjusted Income Before Taxes
(amounts in thousands)
 Three Months Ended
July 31,
2023 2022
US GAAP Loss Before Taxes $ (106,723) $ (23,387)
  Pretax Impact of Adjustments:
Impairment of goodwill 26,695  — 
Restructuring and related charges 12,123  22,441 
Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3)
 (6) 666 
Amortization of acquired intangible assets (4)
 16,668  26,385 
Impairment charge related to assets held-for-sale and loss on sale of a business (5)
 75,929  — 
Held for Sale or Sold segment Adjusted (Income) Loss Before Taxes (5)
 (5,034) 7,594 
Non-GAAP Adjusted Income Before Taxes $ 19,652  $ 33,699 
Reconciliation of US GAAP Income Tax Benefit to Non-GAAP Adjusted Income Tax Provision, including our US GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate
US GAAP Income Tax Benefit $ (14,459) $ (5,552)
 Income Tax Impact of Adjustments (7)
Impairment of goodwill 2,697  — 
Restructuring and related charges 2,936  5,517 
Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3)
 (34) 175 
Amortization of acquired intangible assets (4)
 3,873  5,832 
Impairment charge related to assets held-for-sale and loss on sale of a business (5)
 10,660  — 
Held for Sale or Sold segment Adjusted Tax (Provision) Benefit (5)
 (996) 1,569 
Non-GAAP Adjusted Income Tax Provision $ 4,677  $ 7,541 
US GAAP Effective Tax Rate 13.5  % 23.7  %
Non-GAAP Adjusted Effective Tax Rate 23.8  % 22.4  %
Notes:
(1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) All amounts are approximate due to rounding.
(3) In fiscal year 2023 due to the closure of our operations in Russia, the Russia entity was deemed substantially liquidated. In the three months ended July 31, 2023, we wrote off an additional $0.9 million cumulative translation adjustment in earnings. This amount is reflected in Foreign exchange transaction losses on our Condensed Consolidated Statements of Net Loss.
(4) Reflects the amortization of intangible assets established on the opening balance sheet for an acquired business. This includes the amortization of intangible assets such as developed technology, customer relationships, tradenames, etc., which is reflected in the "Amortization of intangible assets" line in the Condensed Consolidated Statements of Net Loss. It also includes the amortization of acquired product development assets, which is reflected in Cost of sales in the Condensed Consolidated Statements of Net Loss.
(5) We are divesting non-core businesses, including University Services, Wiley Edge, and CrossKnowledge. These three businesses met the held-for-sale criteria and we measured each business at the lower of carrying value or fair value less cost to sell. We recorded a pretax impairment of $40.6 million for University Services and $33.3 million for CrossKnowledge in the three months ended July 31, 2023.

In the three months ended July 31, 2023, the loss on sale of a business is due to the sale of our Tuition Manager business previously in our Held for Sale or Sold segment, which resulted in a pretax loss of approximately $2.0 million (net of tax loss of $1.6 million).

In addition, our Adjusted EPS excludes the Adjusted Net (Income) Loss of our Held for Sale or Sold segment.
(6) Represents the impact of using diluted weighted-average number of common shares outstanding (55.8 million shares and 56.5 million shares for the three months ended July 31, 2023 and 2022, respectively) included in the Non-GAAP Adjusted EPS calculation in order to apply the dilutive impact on adjusted net income due to the effect of unvested restricted stock units and other stock awards. This impact occurs when a US GAAP net loss is reported and the effect of using dilutive shares is antidilutive.
(7) For the three months ended July 31, 2023 and 2022, substantially all of the tax impact was from deferred taxes.


JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
RECONCILIATION OF US GAAP NET LOSS TO NON-GAAP EBITDA AND ADJUSTED EBITDA
(unaudited)
Three Months Ended
July 31,
2023 2022
Net Loss $ (92,264) $ (17,835)
Interest expense 11,334  6,332 
Benefit for income taxes (14,459) (5,552)
Depreciation and amortization 43,728  58,279 
Non-GAAP EBITDA (51,661) 41,224 
Impairment of goodwill 26,695  — 
Restructuring and related charges 12,123  22,441 
Foreign exchange losses, including the write off of certain cumulative translation adjustments 1,620  616 
Impairment charge related to assets held-for-sale and loss on sale of a business 75,929  — 
Other expense (income), net 1,485  (526)
Held for Sale or Sold segment Adjusted EBITDA (2)
 (6,521) 2,435 
Non-GAAP Adjusted EBITDA $ 59,670  $ 66,190 
Adjusted EBITDA Margin 16.3  % 16.8  %
Notes:
(1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) Our Non-GAAP Adjusted EBITDA excludes the Held for Sale or Sold segment Non-GAAP Adjusted EBITDA.


JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1) (2) (3)
SEGMENT RESULTS
(in thousands)
(unaudited)
% Change
Three Months Ended
July 31,		 Favorable (Unfavorable)
2023
2022 (3)
 Reported Constant
Currency
Research:    
Revenue, net    
Research Publishing $ 223,000  $ 239,523  -7  % -8  %
Research Solutions 34,804  35,390  -2  % -2  %
Total Revenue, net $ 257,804  $ 274,913  -6  % -7  %
Contribution to Profit $ 51,580  $ 69,023  -25  % -26  %
Adjustments:
Restructuring charges 1,947  81  # #
Non-GAAP Adjusted Contribution to Profit $ 53,527  $ 69,104  -23  % -23  %
Depreciation and amortization 23,212  23,801  2  % 3  %
Non-GAAP Adjusted EBITDA $ 76,739  $ 92,905  -17  % -18  %
Adjusted EBITDA margin 29.8  % 33.8  %  
       
Learning:        
Revenue, net        
Academic $ 48,292  $ 58,748  -18  % -18  %
Professional 61,028  60,899  0  % 0  %
Total Revenue, net $ 109,320  $ 119,647  -9  % -9  %
Contribution to Profit $ 7,408  $ 610  # #
Adjustments:
Restructuring charges 218  3,131  93  % 93  %
Non-GAAP Adjusted Contribution to Profit $ 7,626  $ 3,741  # #
Depreciation and amortization 13,552  14,055  4  % 4  %
Non-GAAP Adjusted EBITDA $ 21,178  $ 17,796  19  % 19  %
Adjusted EBITDA margin 19.4  % 14.9  %  
       
Held for Sale or Sold:        
Revenue, net $ 83,889  $ 93,009  -10  % -10  %
Contribution to Profit $ (26,234) $ (22,194) -18  % -19  %
Adjustments:
Restructuring charges 2,623  3,492  25  % 25  %
Impairment of goodwill 26,695  —  # #
Accelerated amortization of an intangible asset (4)
 —  4,594  # #
Non-GAAP Adjusted Contribution to Profit $ 3,084  $ (14,108) # #
Depreciation and amortization 3,437  11,673  71  % 70  %
Non-GAAP Adjusted EBITDA $ 6,521  $ (2,435) # #
Adjusted EBITDA margin 7.8  % -2.6  %
Corporate Expenses: $ (49,109) $ (64,404) 24  % 24  %
Adjustments:
Restructuring charges 7,335  15,737  53  % 53  %
Non-GAAP Adjusted Contribution to Profit $ (41,774) $ (48,667) 14  % 15  %
Depreciation and amortization 3,527  4,156  15  % 16  %
Non-GAAP Adjusted EBITDA $ (38,247) $ (44,511) 14  % 15  %
Consolidated Results:        
Revenue, net $ 451,013  $ 487,569  -7  % -8  %
Less: Held for Sale or Sold Segment (5)
 (83,889) (93,009) -10  % -10  %
Adjusted Revenue, net $ 367,124  $ 394,560  -7  % -8  %
Operating Loss $ (16,355) $ (16,965) -4  % -1  %
Adjustments:
Restructuring charges 12,123  22,441  46  % 46  %
Impairment of goodwill 26,695  —  # #
Accelerated amortization of an intangible asset (4)
 —  4,594  # #
Held for Sale or Sold Segment Adjusted Contribution to Profit (5)
 (3,084) 14,108  # #
Non-GAAP Adjusted Operating Income $ 19,379  $ 24,178  -20  % -21  %
Depreciation and amortization 43,728  53,685  19  % 19  %
Less: Held for Sale or Sold Segment depreciation and amortization (5)
 (3,437) (11,673) 71  % 71  %
Non-GAAP Adjusted EBITDA $ 59,670  $ 66,190  -10  % -10  %
Adjusted EBITDA margin 16.3  % 16.8  %  

Notes:
(1) The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) All amounts are approximate due to rounding.
(3) As previously announced, in the three months ended July 31, 2023 we changed our reportable segments. Our new segment reporting structure consists of three reportable segments which includes Research (no change), Learning, and Held for Sale or Sold, as well as a Corporate expense category (no change). Prior period segment results have been revised to the new segment presentation. There were no changes to our consolidated financial results.
(4) On January 1, 2020, Wiley acquired mthree, a talent placement provider that addresses the IT skills gap by finding, training, and placing job-ready technology talent in roles with leading corporations worldwide. Its results of operations are included in our Held for Sale or Sold segment. In late May 2022, Wiley renamed the mthree talent development solution to Wiley Edge and discontinued use of the mthree trademark during the three months ended July 31, 2022. As a result of these actions, we determined that a revision of the useful life was warranted, and the intangible asset was fully amortized over its remaining useful life resulting in accelerated amortization expense of $4.6 million in the three months ended July 31, 2022.
(5) Our Adjusted Revenue, Adjusted Operating Income and Adjusted EBITDA excludes the impact of our Held for Sale or Sold segment Revenue, Adjusted Operating Income or Loss and Adjusted EBITDA results.
# Variance greater than 100%



JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands)
(unaudited)
July 31,
2023		 April 30,
2023
Assets:
Current assets
Cash and cash equivalents $ 75,144  $ 106,714 
Accounts receivable, net 153,392  310,121 
Inventories, net 30,289  30,733 
Prepaid expenses and other current assets 79,703  93,711 
Current assets held-for-sale (2)
 139,250  — 
Total current assets 477,778  541,279 
Technology, property and equipment, net 223,534  247,149 
Intangible assets, net 657,093  854,794 
Goodwill 1,102,499  1,204,050 
Operating lease right-of-use assets 82,415  91,197 
Other non-current assets 141,159  170,341 
Non-current assets held-for-sale (2)
 241,483  — 
Total assets $ 2,925,961  $ 3,108,810 
Liabilities and shareholders' equity:
Current liabilities
Accounts payable $ 43,713  $ 84,325 
Accrued royalties 98,690  113,423 
Short-term portion of long-term debt 5,000  5,000 
Contract liabilities 369,562  504,695 
Accrued employment costs 52,307  80,458 
Short-term portion of operating lease liabilities 17,869  19,673 
Other accrued liabilities 68,541  87,979 
Current liabilities held-for-sale (2)
 50,257  — 
Total current liabilities 705,939  895,553 
Long-term debt 890,917  743,292 
Accrued pension liability 81,367  86,304 
Deferred income tax liabilities 109,916  144,042 
Operating lease liabilities 106,652  115,540 
Other long-term liabilities 78,838  79,052 
Long-term liabilities held-for-sale (2)
 15,126  — 
Total liabilities 1,988,755  2,063,783 
Shareholders' equity 937,206  1,045,027 
Total liabilities and shareholders' equity $ 2,925,961  $ 3,108,810 


Notes:
(1) The supplementary information included in this press release for July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) As previously announced, we are divesting non-core businesses, including University Services, Wiley Edge and CrossKnowlegde. These businesses met the held-for-sale criteria and were measured at the lower of carrying value or fair value less cost to sell. We recorded a pretax impairment of $40.6 million for University Services and $33.3 million for CrossKnowledge in the three months ended July 31, 2023 which is recorded as a contra asset account within Non-current assets held for sale.


JOHN WILEY & SONS, INC.
SUPPLEMENTARY INFORMATION (1)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended
July 31,
2023 2022
Operating activities:    
Net loss $ (92,264) $ (17,835)
Impairment of goodwill 26,695  — 
Impairment charge related to assets held-for-sale and loss on sale of a business 75,929  — 
Amortization of intangible assets 15,648  25,311 
Amortization of product development assets 6,687  8,288 
Depreciation and amortization of technology, property, and equipment 21,393  24,680 
Other noncash charges 8,753  27,714 
Net change in operating assets and liabilities (145,176) (158,097)
Net cash used in operating activities (82,335) (89,939)
   
Investing activities:    
Additions to technology, property, and equipment (20,086) (17,923)
Product development spending (3,747) (5,825)
Businesses acquired in purchase transactions, net of cash acquired (1,500) (96)
Proceeds related to the sale of a business 457  — 
Acquisitions of publication rights and other (866) 2,038 
Net cash used in investing activities (25,742) (21,806)
   
Financing activities:    
Net debt borrowings 145,473  156,873 
Cash dividends (19,382) (19,468)
Purchases of treasury shares (10,000) (10,000)
Other (10,277) (9,416)
Net cash provided by financing activities 105,814  117,989 
   
Effects of exchange rate changes on cash, cash equivalents and restricted cash 2,257  (1,985)
Change in cash, cash equivalents and restricted cash for period (6) 4,259 
Cash, cash equivalents and restricted cash - beginning 107,262  100,727 
Cash, cash equivalents and restricted cash - ending (2)
 $ 107,256  $ 104,986 
CALCULATION OF NON-GAAP FREE CASH FLOW LESS PRODUCT DEVELOPMENT SPENDING (3)
Three Months Ended
July 31,
2023 2022
Net cash used in operating activities $ (82,335) $ (89,939)
Less: Additions to technology, property, and equipment (20,086) (17,923)
Less: Product development spending (3,747) (5,825)
Free cash flow less product development spending $ (106,168) $ (113,687)
Notes:
(1) The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
(2) Cash, cash equivalents and restricted cash as of July 31, 2023 includes held-for-sale cash, cash equivalents and restricted cash of $32.1 million.
(3) See Explanation of Usage of Non-GAAP Performance Measures included in this supplemental information.


JOHN WILEY & SONS, INC.
EXPLANATION OF USAGE OF NON-GAAP PERFORMANCE MEASURES
In this earnings release and supplemental information, management may present the following non-GAAP performance measures:
•Adjusted Earnings Per Share (Adjusted EPS);
•Free Cash Flow less Product Development Spending;
•Adjusted Revenue;
•Adjusted Contribution to Profit and margin;
•Adjusted Operating Income and margin;
•Adjusted Income Before Taxes;
•Adjusted Income Tax Provision;
•Adjusted Effective Tax Rate;
•EBITDA, Adjusted EBITDA and margin;
•Organic revenue; and
•Results on a constant currency basis.
Management uses these non-GAAP performance measures as supplemental indicators of our operating performance and financial position as well as for internal reporting and forecasting purposes, when publicly providing our outlook, to evaluate our performance and calculate incentive compensation.
We present these non-GAAP performance measures in addition to US GAAP financial results because we believe that these non-GAAP performance measures provide useful information to certain investors and financial analysts for operational trends and comparisons over time. The use of these non-GAAP performance measures may also provide a consistent basis to evaluate operating profitability and performance trends by excluding items that we do not consider to be controllable activities for this purpose.
The performance metric used by our chief operating decision maker to evaluate performance of our reportable segments is Adjusted Contribution to Profit. We present both Adjusted Contribution to Profit and Adjusted EBITDA for each of our reportable segments as we believe Adjusted EBITDA provides additional useful information to certain investors and financial analysts for operational trends and comparisons over time. It removes the impact of depreciation and amortization expense, as well as presents a consistent basis to evaluate operating profitability and compare our financial performance to that of our peer companies and competitors.
For example:
•Adjusted EPS, Adjusted Revenue, Adjusted Contribution to Profit, Adjusted Operating Income, Adjusted Income Before Taxes, Adjusted Income Tax Provision, Adjusted Effective Tax Rate, Adjusted EBITDA, and organic revenue (excluding acquisitions) provide a more comparable basis to analyze operating results and earnings and are measures commonly used by shareholders to measure our performance.
•Free Cash Flow less Product Development Spending helps assess our ability, over the long term, to create value for our shareholders as it represents cash available to repay debt, pay common stock dividends, and fund share repurchases and acquisitions.
•Results on a constant currency basis remove distortion from the effects of foreign currency movements to provide better comparability of our business trends from period to period. We measure our performance excluding the impact of foreign currency (or at constant currency), which means that we apply the same foreign currency exchange rates for the current and equivalent prior period.
In addition, we have historically provided these or similar non-GAAP performance measures and understand that some investors and financial analysts find this information helpful in analyzing our operating margins and net income, and in comparing our financial performance to that of our peer companies and competitors. Based on interactions with investors, we also believe that our non-GAAP performance measures are regarded as useful to our investors as supplemental to our US GAAP financial results, and that there is no confusion regarding the adjustments or our operating performance to our investors due to the comprehensive nature of our disclosures.
We have not provided our 2024 outlook for the most directly comparable US GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend on various factors, and could be material to our consolidated results computed in accordance with US GAAP.
Non-GAAP performance measures do not have standardized meanings prescribed by US GAAP and therefore may not be comparable to the calculation of similar measures used by other companies and should not be viewed as alternatives to measures of financial results under US GAAP. The adjusted metrics have limitations as analytical tools, and should not be considered in isolation from, or as a substitute for, US GAAP information. It does not purport to represent any similarly titled US GAAP information and is not an indicator of our performance under US GAAP. Non-GAAP financial metrics that we present may not be comparable with similarly titled measures used by others. Investors are cautioned against placing undue reliance on these non-GAAP measures.

EX-99.2 3 q124earningspresentation.htm EX-99.2 q124earningspresentation
First Quarter Fiscal 2024 Earnings Review September 7, 2023

 
SAFE HARBOR STATEMENT This presentation contains certain forward-looking statements concerning the Company's operations, performance, and financial condition. Reliance should not be placed on forward-looking statements, as actual results may differ materially from those in any forward-looking statements. Any such forward- looking statements are based upon many assumptions and estimates that are inherently subject to uncertainties and contingencies, many of which are beyond the control of the Company and are subject to change based on many important factors. Such factors include, but are not limited to: (i) the level of investment in new technologies and products; (ii) subscriber renewal rates for the Company's journals; (iii) the financial stability and liquidity of journal subscription agents; (iv) the consolidation of book wholesalers and retail accounts; (v) the market position and financial stability of key retailers; (vi) the seasonal nature of the Company's educational business and the impact of the used book market; (vii) worldwide economic and political conditions; (viii) the Company's ability to protect its copyrights and other intellectual property worldwide (ix) the ability of the Company to successfully integrate acquired operations and realize expected opportunities; (x) the Company’s ability to realize operating savings over time and in fiscal year 2024 in connection with our multi-year Global Restructuring Program; (xi) the possibility that the divestitures will not be pursued, failure to obtain necessary regulatory approvals or required financing or to satisfy any of the other conditions to planned dispositions; and (xii) other factors detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any such forward-looking statements to reflect subsequent events or circumstances. NON-GAAP MEASURES In this presentation, management provides the following non-GAAP performance measures:  Adjusted Revenue  Adjusted Earnings Per Share (“Adjusted EPS”);  Free Cash Flow less Product Development Spending;  Adjusted Contribution to Profit (“Adjusted CTP”) and margin;  Adjusted EBITDA and margin;  Organic revenue; and  Results on a constant currency (“CC”) basis. Management believes non-GAAP financial measures, which exclude our held for sale or sold businesses, impairment charges, and the impact of restructuring charges and credits and other items, provide supplementary information to support analyzing operating results and earnings and are commonly used by shareholders to measure our performance. Free Cash Flow less Product Development Spending helps assess our ability over the long term to create value for our shareholders. Results on a constant currency basis removes distortion from the effects of foreign currency movements to provide better comparability of our business trends from period to period applying the same foreign currency exchange rates for the current and equivalent prior period. We have not provided our 2024 outlook for the most directly comparable U.S. GAAP financial measures, as they are not available without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend on various factors, and could be material to our consolidated results computed in accordance with U.S. GAAP. 2

 
The Knowledge Company Wiley enables the creation of new knowledge and its application in science, learning, and innovation

 
Overview Q1 performance as expected due to the Hindawi publishing pause; underlying strength and momentum returning in Research with increasing article volume, favorable journal rankings, and new partner signings Reorganized Wiley from three separate teams to one market-facing team to leverage collective strength in publishing and solutions and drive operating leverage Moving expeditiously on divesting non-core assets in a challenging market Performance improvement and margin acceleration expected to begin later in Fiscal 2024 and be fully realized in Fiscal 2025 and 2026 First Quarter Overview 4

 
Q124 Earnings Presentation.pptx 5  Adjusted Revenue weighed down by anticipated Hindawi decline and print declines in Academic publishing, offsetting double-digit growth in gold open access and assessments  GAAP earnings mainly impacted by non-cash impairment charges  Adjusted EBITDA performance as expected mainly due to Hindawi impact offsetting restructuring savings  Adjusted EPS performance also impacted by higher interest expense First Quarter Performance GAAP Revenue ▼7% $451M Adj. Revenue* ▼8% $367M GAAP EPS ▼$1.35 ($1.67) Adj. EPS* ▼37% $0.27 Adj. EBITDA* ▼10% $60M *Adjusted Revenue, Adjusted EPS, and Adjusted EBITDA performance excludes businesses held for sale or sold. Collectively, these businesses generated $84 million of revenue and $6 million of Adjusted EBITDA. All variances at constant currency except GAAP Revenue and EPS. Q1 Summary

 
Q124 Earnings Presentation.pptx 6  Demand to publish improving with core article submissions +4%* and output +2%.* All subject areas and regions showing improvement  Increasing momentum in Gold Open Access, with strong double-digit revenue growth  Leading indicators of research output remain strong, such as global R&D funding  Mixed-model publishing environment continues (subscriptions, transformational agreements, and open access); Wiley prospers under all these models  Hindawi to recover growth trajectory in Fiscal 2025 and exceed Fiscal 2023 revenue in Fiscal 2026  Wiley’s journal brand asset continues to grow; 112 Hindawi journals recently received first Impact Factor and 35 saw higher scores (out of a total of 200 journals); demand improving. Strong scores for Wiley journals in China Research Publishing: Solid fundamentals with momentum growing *Excluding Hindawi

 
Full Year 2023* Research Learning Businesses Publishing and Solutions Publishing and Solutions Reporting Lines Research Publishing and Solutions Academic and Professional Key Verticals Science, Technical, Medical, Scholarly Business, Technology, Science, Engineering Total Adj. Revenue $1,080M $547M % of Wiley Revenue 66% 34% % Digital and Services 95% 55% % Recurring 66% 14% Adj. EBITDA Margin 34.9% 28.9% Reorganizing to reflect a more focused strategy 7 *Exclude businesses held for sale or sold, including University Services, Wiley Edge (formerly Talent Development), CrossKnowledge, Test Prep and Advancement Courses. These assets are currently reported as ‘businesses held for sale or sold. These businesses held for sale or sold generated $393 million of revenue (19% of old Wiley) and $43 million of Adjusted EBITDA (10% of old Wiley) in Fiscal 2023. #Segment Adjusted EBITDA for Fiscal 2023. Wiley total Adjusted EBITDA (excluding businesses held for sale or sold) was $379M, including Held for Sale Adjusted EBITDA (+$43M) and corporate expenses of (-$155M).

 
Q124 Earnings Presentation.pptx 8 Experienced Leadership Team Focused on execution Christina Van Tassell EVP & CFO 2021 Matt Leavy EVP, Operations 2018 Josh Jarrett SVP, Strategy 2021 Jay Flynn EVP, Research & Learning 2010 Brian Napack President & CEO Joined: 2017 Danielle McMahan EVP & Chief People Officer 2019 Deirdre Silver EVP & General Counsel 2002 Aref Matin EVP & CTO 2018 Shari Hofer EVP & CMO 2017 Todd Zipper EVP & GM, Talent 2018

 
Q124 Earnings Presentation.pptx 9 Focus on publishing and solutions in Research and Learning Focusing on must-have content, platforms, and solutions in vertical markets where we have strong competitive advantage, scale, and opportunity Divest non-core education assets Divesting University Services, Wiley Edge and CrossKnowledge to enhance focus, improve operating leverage, drive greater profitability, and optimize capital efficiency Right-size and optimize Right-sizing and streamlining the organization, infrastructure, and cost base for greater speed, synergy, efficiency, and profitability Actions underway to deliver performance and margin gains

 
Learning Segment Performance Financial Position

 
Q124 Earnings Presentation.pptx 11 Q1 Summary  Research Publishing decline mainly due to the Hindawi publishing disruption (-$19M); excluding Hindawi, publishing revenue up slightly. Underlying momentum improving  Research Solutions decline due to lower corporate spend on advertising and recruitment; underlying momentum continues in signing new society and corporate partners  EBITDA decline due to Hindawi earnings impact (-$18M); excluding Hindawi, Adjusted EBITDA +1% Research (millions) Q1 2024 Change Change CC Research Publishing $223 (7%) (8%) Research Solutions $35 (2%) (2%) Total Revenue $258 (6%) (7%) Adjusted EBITDA $77 (18%) Adjusted EBITDA Margin 29.8%

 
Q124 Earnings Presentation.pptx 12 Learning  Academic decline due to lower print sales and order timing in our key retail accounts, offsetting growth in digital courseware. Q1 a seasonally light quarter for Academic publishing  Professional performance driven by strong growth in assessments offsetting decline in publishing due to best seller in prior year  EBITDA growth mainly due to restructuring savings (millions) Q1 2024 Change Change CC Academic $48 (18%) (18%) Professional $61 0% 0% Total Revenue $109 (9%) (9%) Adjusted EBITDA $21 19% Adjusted EBITDA Margin 19.4% Q1 Summary

 
Q124 Earnings Presentation.pptx 13 Financial Position and Capital Allocation Free Cash Flow: Use of $106M vs. $114M in prior year. Variance due to lower incentive compensation payments. Capex: $24M in Q1, even with prior year M&A: No acquisitions in Q1. Wiley focusing on divesting non-core assets Dividends: 30 Years of consecutive increases; Yield at 4% (as of Sept 6) Share Repurchases: Acquired 301K shares for $10M at an average cost of $33.25/share (vs. 212K shares repurchased in prior year) Leverage: Net Debt-to-EBITDA of 1.9x ttm compared to 2.1x prior year Dividends and Repurchases Q1 Allocation $29M $29M Q123 Q124

 
Optimization and Cost Savings 14 Multi-year business optimization program underway • Driving toward a leaner and more agile workforce • Improving operating efficiency and modernizing infrastructure • Deploying capital more effectively Multi-year program expected to yield $100M in cost savings. Key buckets: 1. Right sizing corporate overhead 2. Eliminating stranded costs 3. Driving efficiency gains and cost synergies Q1 restructuring prior to divestitures  Targeted headcount reductions in corporate shared services and held for sale assets  Continued real estate consolidation

 
Q124 Earnings Presentation.pptx 15 Metric (Millions, except EPS) Fiscal 2023 ex-divestitures^ Fiscal 2024 Outlook ex-divestitures Total Adjusted Revenue* $1,627 $1,580 to $1,630 Research $1,080 Flat (+3% ex-Hindawi) Learning $547 Down low single digits Total Adjusted EBITDA* $379 $305 to $330 Total Adjusted EPS* $3.48 $2.05 to $2.40 *Wiley’s Fiscal 2024 outlook (“Adjusted Revenue,” “Adjusted EBITDA,” and “Adjusted EPS”) exclude businesses held for sale or sold, including University Services, Wiley Edge (formerly Talent Development), CrossKnowledge, Test Prep and Advancement Courses. ^Collectively, divested businesses (businesses held for sale or sold) generated $393 million of revenue, $43 million of Adjusted EBITDA, and $0.36 of Adjusted EPS in Fiscal 2023. Fiscal 2024 Outlook Reaffirmed  Adjusted Revenue primarily due to Hindawi publishing pause and lower print demand in Academic  Adjusted EBITDA primarily due to revenue performance, incentive compensation resetting, and wage inflation  Adjusted EPS further impacted by $0.42 of non-operational items including higher tax rate (-$0.21), pension expense (-$0.11), and interest (-$0.10)

 
Q1 performance as expected; Research leading indicators and momentum improving1 Moving expeditiously on divesting non-core assets in a challenging market 2 3 Fiscal 2024 a transition year with performance gains and margin acceleration expected in Fiscal 2025 and 20264 Key Highlights: Creating a stronger, more profitable Wiley Reorganized Wiley from three separate teams to one market-facing team to leverage collective strength and drive operating leverage

 
Q124 Earnings Presentation.pptx 17 October 12 Investor Day New Wiley Profile Focus and Extend Strategy Research and Learning — Target market — Products and business models — Competitive advantages and synergies — Growth and margin drivers Business Optimization Financial Overview and Fiscal 2026 Targets

 
Q124 Earnings Presentation.pptx 18 Thank you for joining us IR website at https://investors.wiley.com/ Contact us for follow-up at: brian.campbell@wiley.com Direct +1 (201) 748-6874

 
Q124 Earnings Presentation.pptx 19 Appendix – US GAAP to Non-GAAP EPS Reconciliation Reconciliation of US GAAP EPS to Non-GAAP Adjusted EPS 2023 2022 US GAAP Loss Per Share - Diluted (1.67)$ (0.32)$ Adjustments: Impairment of goodwill 0.43 - Restructuring and related charges 0.16 0.30 Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3) - 0.01 Amortization of acquired intangible assets (4) 0.23 0.36 Impairment charge related to assets held-for-sale and loss on sale of a business (5) 1.17 - Held for Sale or Sold segment Adjusted Net (Income) Loss (5) (0.07) 0.10 EPS impact of using weighted-average dilutive shares for adjusted EPS calculation (6) 0.02 0.01 Non-GAAP Adjusted Earnings Per Share - Diluted 0.27$ 0.46$ (amounts in thousands) 2023 2022 US GAAP Loss Before Taxes (106,723)$ (23,387)$ Impairment of goodwill 26,695 - Restructuring and related charges 12,123 22,441 Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3) (6) 666 Amortization of acquired intangible assets (4) 16,668 26,385 Impairment charge related to assets held-for-sale and loss on sale of a business (5) 75,929 - Held for Sale or Sold segment Adjusted (Income) Loss Before Taxes (5) (5,034) 7,594 Non-GAAP Adjusted Income Before Taxes 19,652$ 33,699$ US GAAP Income Tax Benefit (14,459)$ (5,552)$ Impairment of goodwill 2,697 - Restructuring and related charges 2,936 5,517 Foreign exchange (gains) losses on intercompany transactions, including the write off of certain cumulative translation adjustments (3) (34) 175 Amortization of acquired intangible assets (4) 3,873 5,832 Impairment charge related to assets held-for-sale and loss on sale of a business (5) 10,660 - Held for Sale or Sold segment Adjusted Tax (Provision) Benefit (5) (996) 1,569 Non-GAAP Adjusted Income Tax Provision 4,677$ 7,541$ US GAAP Effective Tax Rate 13.5% 23.7% Non-GAAP Adjusted Effective Tax Rate 23.8% 22.4% Pretax Impact of Adjustments: Three Months Ended July 31, Reconciliation of US GAAP Loss Before Taxes to Non-GAAP Adjusted Income Before Taxes Three Months Ended July 31, Reconciliation of US GAAP Income Tax Benefit to Non-GAAP Adjusted Income Tax Provision, including our US GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate Income Tax Impact of Adjustments (7)

 
Q124 Earnings Presentation.pptx 20 Appendix – US GAAP to Non-GAAP EPS Notes (5) We are divesting non-core businesses, including University Services, Wiley Edge, and CrossKnowledge. These three businesses met the held-for- sale criteria and we measured each business at the lower of carrying value or fair value less cost to sell. We recorded a pretax impairment of $40.6 million for University Services and $33.3 million for CrossKnowledge in the three months ended July 31, 2023. In the three months ended July 31, 2023, the loss on sale of a business is due to the sale of our Tuition Manager business previously in our Held for Sale or Sold segment, which resulted in a pretax loss of approximately $2.0 million (net of tax loss of $1.6 million). In addition, our Adjusted EPS excludes the Adjusted Net (Income) Loss of our Held for Sale or Sold segment. (6) Represents the impact of using diluted weighted-average number of common shares outstanding (55.8 million shares and 56.5 million shares for the three months ended July 31, 2023 and 2022, respectively) included in the Non-GAAP Adjusted EPS calculation in order to apply the dilutive impact on adjusted net income due to the effect of unvested restricted stock units and other stock awards. This impact occurs when a US GAAP net loss is reported and the effect of using dilutive shares is antidilutive. (7) For the three months ended July 31, 2023 and 2022, substantially all of the tax impact was from deferred taxes. (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) All amounts are approximate due to rounding. (3) In fiscal year 2023 due to the closure of our operations in Russia, the Russia entity was deemed substantially liquidated. In the three months ended July 31, 2023, we wrote off an additional $0.9 million cumulative translation adjustment in earnings. This amount is reflected in Foreign exchange transaction losses on our Condensed Consolidated Statements of Net Loss. (4) Reflects the amortization of intangible assets established on the opening balance sheet for an acquired business. This includes the amortization of intangible assets such as developed technology, customer relationships, tradenames, etc., which is reflected in the "Amortization of intangible assets" line in the Condensed Consolidated Statements of Net Loss. It also includes the amortization of acquired product development assets, which is reflected in Cost of sales in the Condensed Consolidated Statements of Net Loss.

 
Q124 Earnings Presentation.pptx 21 Appendix – Net Income to Adjusted EBITDA 2023 2022 Net Loss (92,264)$ (17,835)$ Interest expense 11,334 6,332 Benefit for income taxes (14,459) (5,552) Depreciation and amortization 43,728 58,279 Non-GAAP EBITDA (51,661) 41,224 Impairment of goodwill 26,695 - Restructuring and related charges 12,123 22,441 Foreign exchange losses, including the write off of certain cumulative translation adjustments 1,620 616 Impairment charge related to assets held-for-sale and loss on sale of a business 75,929 - Other expense (income), net 1,485 (526) Held for Sale or Sold segment Adjusted EBITDA (2) (6,521) 2,435 Non-GAAP Adjusted EBITDA 59,670$ 66,190$ Adjusted EBITDA Margin 16.3% 16.8% Notes: (1) See Explanation of Usage of Non-GAAP Performance Measures included in this supplementary information for additional details on the reasons why management believes presentation of each non-GAAP performance measure provides useful information to investors. The supplementary information included in this press release for the three months ended July 31, 2023 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission. (2) Our Non-GAAP Adjusted EBITDA excludes the Held for Sale or Sold segment Non-GAAP Adjusted EBITDA. July 31, JOHN WILEY & SONS, INC. SUPPLEMENTARY INFORMATION (1) RECONCILIATION OF US GAAP NET LOSS TO NON-GAAP EBITDA AND ADJUSTED EBITDA (unaudited) Three Months Ended