【海外ITニュース速報】Scholastic Corporation(SCHL)Q1 2023収益コールトランスクリプト

【海外ITニュース速報】Scholastic Corporation(SCHL)Q1 2023収益コールトランスクリプト

Scholastic Corporation (SCHL) Q1 2023 Earnings Call Transcript

Scholastic Corporation(SCHL)Q1 2023収益コールトランスクリプト


Scholastic's fiscal 2023 first quarter earnings call is scheduled to be held on September 22, 2022. The company participants include EVP, Corporate Development and IR Peter Warwick, President and CEO Ken Cleary. The company's financial statements are subject to various risks and uncertainties and actual results may differ materially from those currently anticipated. The company has filed a Form 8-K filing with the Securities and Exchange Commission. Notably, all participants are in a listen-only mode.


Scholasticの2023年度第1四半期の収益コールは、2022年9月22日に開催される予定です。会社の参加者には、EVP、企業開発、Ir Peter Warwick、社長兼CEOのKen Clearyが含まれます。当社の財務諸表はさまざまなリスクと不確実性の対象となり、実際の結果は現在予想されている結果とは大きく異なる場合があります。同社は、証券取引委員会にフォーム8-K提出を提出しました。特に、すべての参加者はリスニングのみのモードにあります。


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It's the best place for stock analysis on the web » Scholastic Corporation (NASDAQ:SCHL) Q1 2023 Earnings Conference Call September 22, 2022 4:30 PM ET Company Participants Jeffrey Mathews - EVP, Corporate Development and IR Peter Warwick - President and CEO Ken Cleary - CFO Conference Call Participants Operator Thank you for standing by.

Web上の株式分析に最適な場所です»Scholastic Corporation(NASDAQ:SCHL)Q1 2023収益電話会議2022年9月22日午後4時30分ET社の参加者ジェフリーマシューズ - EVP、企業開発およびIRピーターワーウィック - 社長兼CEOケンCleary -CFO電話会議の参加者オペレーターが待機してくれてありがとう。

Welcome to Scholastic Reports First Quarter Fiscal Year 2023 Results.

Scholastic Reports第1四半期の2023年度の結果へようこそ。

During the program today, all participants are in a listen-only mode.


As a reminder, today's program may be recorded.


And now I'd like to introduce your host for today's program, Jeff Matthews, Executive Vice President, Corporate Development and Investor Relations.


Please go ahead, sir.


Jeffrey Mathews Hello and welcome everyone to Scholastic fiscal 2023 first quarter earnings call.

Jeffrey Mathewsこんにちは、Scholastic Fiscal 2023第1四半期の収益コールに皆様を歓迎します。

I'm excited to be back at Scholastic, a company defined by its incredible people emission, over the coming months I look forward to reconnecting with and getting to know again it's classics investment community, as we work to reach a new level of understanding of our shareholders perspective and communicate our strategy, opportunity and progress.

信じられないほどの人々の排出量によって定義された会社であるScholasticに戻ってきたことに興奮しています。今後数か月間、私たちは新しいレベルの理解に到達するために取り組んでいるので、Classics Investment Communityと再び接続し、再び知ることを楽しみにしています。私たちの株主の視点、そして私たちの戦略、機会、進歩を伝えます。

Today on the call, I'm joined by Peter Warwick, our President and Chief Executive Officer; and Ken Cleary, our Chief Financial Officer.


As usual, we have posted the company investor presentation on our IR website at investor.scholastic.com, which you may download now, if you've not done so already.


We would like to point out that certain statements made today will be forward-looking.


These forward-looking statements by their nature are subject to various risks and uncertainties and actual results may differ materially from those currently anticipated.


In addition, we will be discussing some non-GAAP financial measures as defined in Regulation G.


The reconciliation of these measures to the most directly comparable GAAP measures may be found in the company's earnings release and in company's financial tables, filed this afternoon on a Form 8-K.


This earnings release has also been posted to our Investor Relations website.


We encourage you to review the disclaimers in the release and investor presentation and to review the risk factors disclosed in the company's annual and quarterly reports filed with the SEC.


Should you have any questions after today's call, please send them directly to me at our IR email address, investor_relations@scholastic.com.


And now, I'd like to turn the call over to Peter to begin this afternoons' presentation.


Peter Warwick Good afternoon, everyone and thank you, Jeff.


I'll start by welcoming you back to Scholastic in the new role of Executive Vice President, Corporate Development and Investor Relations.


I am confident that Jeff is the right person to assume this important new position, which marks a key milestone in our plan to strategically expand the expertise available in our already highly skilled management team.


Jeff's previous tenure have some deep knowledge of Scholastic, combined with his recent experience advising an expansive list of high level corporate clients will be invaluable to the company and our shareholders.


He's already been instrumental to advancing our strategic growth investments, leading the recently announced Learning Ovations acquisition.

彼はすでに私たちの戦略的成長投資を促進するのに役立ち、最近発表されたLearning Ovationsの買収を率いています。

In advance of Ken's detailed walk-through of our first quarter of fiscal year 2023, I am pleased to share that results are in-line with our plan for top and bottom line growth in 2023, with lower year-over-year operating income and earnings as expected, primarily reflecting increased investments in growth initiatives in our education business and a return to more typical seasonal revenue patterns post pandemic, as I'll discuss in a moment.


Based on quarter one performance and the momentum we see today, we are affirming guidance to deliver an 8% to 10% increase in revenue in fiscal year '23.


And adjusted EBITDA of $195 million to $205 million, up from $189 million in fiscal 2022. Back to school significant, to both our first and second fiscal quarters.


The circumstances this year contrast with those of last year.


A year ago, concerned about supply chain issues resulted in that years' back to school purchasing season, beginning earlier than usual, because teachers, libraries and parents were aware of book supply issues.


Purchasing this year has reverted to a more normal path, which means we anticipate proportionately higher revenues from back to school in quarter two than last year.


We planned for and prepared for this shift and are excited to be there for our young readers, their teachers and their families.


From our Trade Publishing Group, we've seen sustained success publishing best sellers.

私たちの貿易出版グループから、私たちはベストセラーを出版するSustaine Successを見てきました。

To date, in calendar year 2022, Scholastic titles have garnered nearly a 100 star reviews from influential outlets, such as Publishers Weekly and School Library channel.

これまで、2022年の暦年に、学問的なタイトルは、Publishers WeeklyやSchool Library Channelなど、影響力のあるアウトレットから100星近くのレビューを獲得しています。

Scholastic titles also had a strong presence on the New York Times bestseller list this year, with graphic novels capturing a record 11 out of 15 spots in the category.

Scholasticのタイトルは、今年New York Timesのベストセラーリストにも強い存在感を示しており、グラフィック小説はこのカテゴリの15スポットのうち11スポットを記録しています。

This fall, we have a number of exciting releases, including the stunning picture book from Civil rights icon, Ruby Bridges.

この秋、公民権のアイコンであるRuby Bridgesの見事な絵本など、多くのエキサイティングなリリースがあります。

The Three Billy Goats Gruff from the renowned award winning duo and Picture Book pioneers, Mac Barnett and Jon Klassen.


In addition, for the latest Bad Guys number 16 by Aaron Blabey and a illustrated addition of Harry Potter and the order of the Phoenix.


Looking into the next calendar year, we'll also have Dav Pilkey's recently announced next Dog Man book, Colin Kaepernick's YA Graphic Novel Memoir, a new Wings of Fire graphic novel by Tui Sutherland, and Brian's sales mix victory.

翌年の年を見ると、Dav Pilkeyの最近発表されたNext Dog Man Book、Colin Kaepernick's Graphic Novel Memoir、Tui Sutherlandによる新しい翼のグラフィック小説、ブライアンのセールスミックスの勝利も発表しました。

They continue to bring more and varied opportunities to our content through Scholastic Entertainment.

彼らは、Scholastic Entertainmentを通じて、私たちのコンテンツにより多くのさまざまな機会をもたらし続けています。

We've recently announced the deal to co-develop and co-produce the Middle Braid Memoir, Signs of Survival and Memoir of the Holocaust by Rene Hoffmann and Joshua M.

私たちは最近、Rene HoffmannとJoshua Mによるミドルブレードの回想録、生存の兆候、ホロコーストの回顧録を共同開発し、共同制作する契約を発表しました。



The project is in partnership with Amblin television and Oscar winning actress Marlee Matlin's, Solo One productions.


This joins an ever expanding pipeline of media projects, the majority with creators like Amar'e Stoudemire and Sterling K.

これには、メディアプロジェクトのパイプラインが拡大するパイプラインに参加します。これは、Amar'e StoudemireやSterling Kのようなクリエイターとの大部分に参加します。

Brown and distributors such as Paramount, Amazon Prime, Apple TV Plus and Disney Plus.

パラマウント、Amazon Prime、Apple TV Plus、Disney Plusなどのブラウンやディストリビューター。

Turning to our school distribution channels, we're excited to see that full season book fairs and children bringing home the first monthly club order form in their backpacks, once again have captured and amplified the energy we all feel from the time on a tradition of back to school.


In-person book fair confirmation rates are strong, well outpacing prior year, putting us on track to meet our projected target of 85% of pre-pandemic bookings in fiscal '22, an increase from 72% last fiscal.


Early fairs data also revealed strong attendance rates in revenue per fair.


Additionally, during quarter one, Scholastic dollars redemptions was strong and we are readily meeting demand.


In clubs, having result prior year systems issues, we're well prepared for this coming year with an excellent inventory position and strategic marketing that increases our interactions with customers.


Even if it's too early in the business season to delve deeply into results, we're already seeing a positive response from our participating teachers.


Now we look at our consolidated education solutions division, we continue to make great progress addressing classroom and school districts most pressing needs around literacy and reading, while strategically increasing investments to scale go to market capabilities and expand our differentiated offering of this digital solutions.


Where our results were somewhat lower, reflecting the fact that last year's revenue benefited from a significant number of orders that have been delayed from quarter four 2021, education solutions nonetheless continue this underlying long-term growth trajectory in quarter one.


Beginning the quarter, our teams were laser focused on supporting summer reading through solutions, such as take home book packs and thanks to their close partnerships with customers, we've seamlessly shifted to supporting in school needs this year.


The demand for independent reading is still evidence and tangible and our innovative partnership with the State of Florida and the University of Florida, Los Angles center for learning is gearing up for the second year with a strong base of participants already in the program.

独立した読書の需要は依然として証拠であり、具体的であり、フロリダ州およびフロリダ大学との革新的なパートナーシップであるLOS Angles Center for Learningは、2年目に準備が整っています。

As the recent NAEP results revealed, the learning gap in the US has widened significantly, as a result of the profound disruption in our schools caused by the pandemic.


Sadly, we saw the largest drop in reading skills in 30 years and the first ever drop in maths scores since the nation's report cards inception.


This is a priority issue to be address to both federal and state levels with historic levels of funding going to schools today.


Today is a pivotal moment and opportunity for Scholastic too, as we work to significantly expand the number of schools, teachers and students that we support.


We're confident in our ability to be a best choice as a partner, just as we've time and time again and unparalleled trust from educators.


Thanks to our passion submission paired with high quality content.


And as from this position of experience and strength that we're working with schools and districts to design and implement solutions that deliver outcomes they need, in accordance with the funding streams that they have available.


At the same time, we're investing both organically and inorganically to drive long-term growth through strategic enhancements to our literacy platform, such as our recently announced acquisition of Learning Ovations.

同時に、私たちは、最近発表されたLearning Ovationsの買収など、識字プラットフォームへの戦略的強化を通じて長期的な成長を促進するために、有機的および無機的に投資しています。

And Learning Ovations is the creator of A2i, short for Assessment to Instruction, which is a signs of reading based literacy assessments in structural system.

また、Learning OvationsはA2iの作成者であり、構造システムにおける読書ベースのリテラシー評価の兆候である指導の評価に略です。

A2i is backed by over 12 years of rigorous research and more than 2,000 hours of classroom observation.


Turning it the highest efficacy rate possible under the EveryStudent Succeeds Act.

EveryStudent Succehts Actの下で可能な最高の有効率を回す。

The system provides educators with easy to administer, data driven guidance for instructional planning for both small group and individualized learning.


All customized to master reading needs of individual students.


Given A2i's gold standard effectiveness and validation and its ability to integrate hundreds of thousands of resources that's address essential reading skills, soon to include Scholastic unique and structural and curricular resources.


The addition of A2i in the learning Avation's team, significantly advances the development of our literacy platform.


And finally, strategy is also moved forward in our international division.


We continue to focus on growth areas, rationalizing our lines of business that no longer aligned with that strategy, including in Asia, where we completed the disposition of the direct sales business.


Despite the lingering impact of COVID, which is continue to fluctuate globally, we see positive indicators, particularly in Australia and New Zealand that our global fairs, clubs and trade businesses are rebounding with strength.


And now, I'll ask Ken to provide greater detail on the quarter's results.


Ken Cleary Thank you, Peter and good afternoon.


Today, I will refer to our adjusted results for the first quarter excluding one-time items unless otherwise indicated.


Please refer to our press release tables and SEC filings for a complete discussion of one-time items.


The first quarter of the fiscal year is seasonally our quietest quarter, as schools are not in session in most of North America, as Peter just described.


Our preparations for the upcoming fall and spring seasons are proceeding as planned and our readiness for the rest of the year is stronger than it's ever been at this point in time.


We have addressed the supply chain and operational issues we've faced last fiscal year, have dedicated substantial resources to ensure we are prepared for the strong demand we are expecting from our customers.


We have ordered inventory well in advance of the season, given the long lead times in our supply chain.


We have hired sufficient distribution staff to meet the strong expected demand.


Initial indicators from our first few Book Fair and Book Club offerings are positive and in line with our expectations.


In addition, we completed the acquisition of Learning Ovations on September 1, greatly accelerating the development of our Education Solutions literacy platform.

さらに、9月1日にLearning Ovationsの買収を完了し、教育ソリューションリテラシープラットフォームの開発を大幅に加速しました。

In short, we are off to a strong start to our fiscal year and we are therefore affirming our guidance of $1.8 billion of annual revenue and $195 million to $205 million of adjusted EBITDA for fiscal 2023 as we balance growth initiatives, were current returns for our shareholders.


Revenue for the first quarter grew 1% to $262.9 million versus $259.8 million in the prior year period.


Operating loss in the quarter was $58.1 million versus $36.2 million last year.


Net loss was $45.5 million compared to $27.3 million last year and adjusted EBITDA was a loss of $35.6 million compared to a loss of $13 million in the first quarter last year.


Loss per diluted share was $1.33 compared to a loss of $0.79 last year.


Net cash used in operating activities was $60.3 million compared to a net cash provided by operating activities of $63.6 million in the first quarter of last year.


Free cash used for the quarter was $76.5 million compared to free cash flow of $49.1 million last year, return to a seasonal Q1 cash use.


Last year, we were able to utilize leftover inventory from fiscal 2021, when inventory utilization was negatively impacted by the pandemic.


This year, given the long lead times required for procurement of product, we used our strong balance sheet to acquire inventory earlier and our first quarter domestic inventory purchases increased to $152.2 million from $76.5 million in fiscal 2022. Our procurement push has provided a sufficient inventory to meet our expected demand, and it has help to mitigate ongoing or threaten supply chain issues.


Additionally, last year's first quarter cash flow benefited from a $63.1 million federal tax refund and a $6.6 million insurance recovery.


At the end of the quarter, cash and cash equivalents exceeded total debt by $233.4 million compared to $219.1 million at the end of the first fiscal quarter a year ago, demonstrating substantial liquidity.


Our strong balance sheet has allowed us to proactively manage working capital through the supply chain crisis by strengthening vendor relationships and negotiating volume rebates and early paid discounts, while also allowing us to invest in content with key bestselling authors.


Capital expenditures and capitalized prepublication costs in the first quarter were $16.2 million compared to $14.5 million last year.


We expect CapEx and prepub spend to see last year, as we invest in our Education Solutions business and Distribution Operations, we will still be well short of our spending levels from the years preceding the pandemic.


In the quarter, we continue to return capital through our share buyback program.


Through today, we have reacquired 122,000 shares for $5.7 million in the current fiscal year.


We expect to continue our share buyback program for the foreseeable future.


As previously announced, we have increased our regular quarterly dividend to $0.20 per share, which we paid on September 15 of this year.


Given our strong cash flow and expected earnings, the Board of Directors has approved a $0.20 per share, regular quarterly dividend to be paid in December.


We anticipate that the quarterly dividend will remain at this level, respectively.


Now turning to our segment results.


In Children's Book Publishing and Distribution, our Trade Division posted strong results, while our school channels prepared for the fall back to school season.


Trade revenue of $90.1 million, modestly trailed the prior period revenue of $93 million and was consistent with our expectations.


As Peter mentioned, we have a number of strong releases, supporting our Trade Division in the current fiscal year.


Additionally, our backlist continues to provide a steady source of reliable revenue each quarter, driven by our investments in series titles and innovative formats such as graphics.


Further supporting this strategy, our entertainment media business, which continues to market monetize our intellectual property has begun to recognize revenue for the delivery of Eva the Owlet, animated series to Apple TV Plus.

この戦略をさらにサポートしている私たちの知的財産の収益化を引き続き販売しているエンターテインメントメディアビジネスは、Apple TV PlusへのアニメシリーズであるEVA The Owletの提供の収益を認識し始めました。

Book Fair revenue of $28.3 million exceeded the prior period revenue of $16 million, as Scholastic Dollar redemptions were strong.


Scholastic Dollars are reward program earned by schools that conduct book fairs, which as they redeemed for Scholastic product, we recognize revenue associated with the redemptions.

Scholastic Dollarsは、Scholastic Productのために償還されたときに、償還に関連する収益を認識している、ブックフェアを実施する学校で獲得した報酬プログラムです。

Strong Scholastic Dollars redemptions are indicative of higher customer engagement.


As mentioned in July, and confirmed here, we expect our in-person fair count to be approximately 85% of our pre-pandemic in-person fair count level for fiscal 2023. Our Book Fairs division is operationally prepared for the upcoming fall season and early indications are consistent with our high expectations.


In Book Clubs, we have rectified system and distribution shortfalls we experienced last fall and we expect operations will run at our usual efficiency levels.


We are utilizing our proprietary data sources and long-standing relationships with schools and teachers to both re-engage with our existing teacher sponsors and to attract new sponsors.


First quarter Book Clubs revenue of $6.3 million was flat to the prior year's comparable period reported revenue of $6.8 million, but it's not significant as schools were not in session.


Total Children's Book Publishing and Distribution revenues for the current quarter of $124.7 million exceeded the prior year's revenues of $115.8 million.


Higher cost to support increased fair count expectations and rising freight charges resulted in operating loss of $30.1 million as compared to $21.7 million in the prior year period.


Education Solutions revenues of $73.2 million trailed the prior-year revenues of $80.1 million.


Quarterly operating loss was $4.3 million compared to prior year operating income of $7.3 million.


In the first quarter of the prior fiscal year, we shipped substantial product, mastered Summer Reading programs in June and July for orders we received in May of fiscal 2021. This past fourth quarter, our procurement and distribution teams were able to procure, pick pack and ship orders more timely resulting in most of the orders going out in the fourth quarter last year.


Accordingly, the first quarter this year