Q1 2024 John Wiley & Sons Inc Earnings Call
At this time I'd like to introduce Wiley Vice President of Investor Relations, Brian Campbell. Please go ahead.
Thank you and welcome everyone with me today are Brian in APAC, while he was president and CEO and Kristina Vantassel Executive Vice President and CFO .
Speaker 1: Good morning and welcome to Wiley's first quarter fiscal 2020 for earnings call. As a reminder this conference is being recorded. At this time I'd like to introduce Wiley's Vice President of Investor Relations Brian Campbell. Please go ahead.
Note that our comments and responses to your questions reflect management's views as of today and will include forward looking statements.
Actual results may differ materially from those statements. The company does not undertake any obligation to update them to reflect subsequent events or circumstances.
Speaker 2: Thank you and welcome everyone. With me today are Brian Napak, Wiley's President and CEO , and Christina Van Tassel, Executive Vice President and CFO .
Also while it provides non-GAAP measures as a supplement to evaluate underlying operating profitability and performance trends. These measures do not have standardized meanings prescribed by U S. GAAP and therefore may not be comparable to similar measures used by other companies.
Speaker 2: Note that our comments and responses to your questions reflect management's views as of today and will include forward-looking statements.
Speaker 2: Actual results may differ materially from those statements.
Speaker 2: The company does not undertake any obligation to update them to reflect subsequent events or circumstances.
Nor should they be viewed as alternatives to measures under GAAP.
Unless otherwise noted we will refer to non-GAAP metrics on the call and our answers are on a year over year basis, and will exclude held for sale assets and the impact of currency.
Speaker 2: Also, Wiley provides non-GET measures as a supplement to evaluate underlying operating profitability and performance trends.
Additional information is included in our filings with the SEC.
A copy of this presentation and transcript will be available on our Investor relations webpage at investors that widely dot com.
I'll now turn the call over to Brian APAC.
Good morning, everyone. Thanks for joining last quarter, we announced some important actions that we're taking it wildly to unlock value for our shareholders. These.
These include divesting non core assets to focus wildly on its greatest strengths and his biggest opportunities. So that we can deliver superior financial performance.
Today's widely as in knowledge company, a global leader in the creation and distribution of new knowledge to solve real world problems speaking more practically one of the world's leading publishers of top quality research academic and professional content.
Complementing our role as a publisher we're also a leading provider of digital solutions that power the knowledge ecosystem and that specifically helped people to access new knowledge and use it to achieve their goals.
Research is <unk> largest and most profitable business and it's at the core of our knowledge company strategy the market for new research content growth consistently and widely has one of the world's leading research journal portfolios in the industry's most widely used research content delivery platform.
The company is fundamentally strong maintaining a healthy balance sheet and delivering consistent cash generation.
Today over 80% of <unk> revenues digital and 50% of it is recurring.
Current dividend yield is 4%. We've now delivered 30 consecutive years of dividend increases there arent too many companies that can say that.
For over two centuries, Wiley has delivered new high impact knowledge to the world and this legacy matters, the Wiley brand and our reputation and help us to win and retain customers and all of our businesses.
All of this is to say that we are in a good position to transition to the future to win in the market and to drive increasing shareholder value.
Q1 played out largely as expected we saw a year on year revenue and profit declines that reflect the publishing posit hendawi and the lingering effect of market headwinds and researches advertising and recruiting lines and also an academic publishing.
All of this offset our continuing strong growth in open access assessments and <unk> XI books courseware.
I am pleased to report that we are seeing good underlying demand momentum in research. We're publishing volume is improving across all regions as measured by increasing article submissions and publications.
Further we're seeing continuing gains in our journal impact factor scores, which are key to driving publishing demand and continued strength in new partner signings.
As you saw in our recent filing we've now reorganized to reflect our new more focused strategy.
We reduced the number of business segments from three to two research and learning more on this later.
We will also be temporarily reporting on our held for sale businesses as a third segment.
We're working through the sale processes for University services Cross knowledge and Wiley edge.
We found a high level of buyer engagement, although the market remains challenging.
Given the ongoing processes were not yet able to provide timing or expected proceeds.
As you know we are eager to complete these transactions. So that we can reap the full benefits of simplification.
Including moving even more aggressively on our cost base.
As we said in June fiscal 'twenty four is a transition year for Wiley, we're very confident in the direction, but it will take some time to see the results. The benefits are expected to materialize in the latter part of this year with full realization in fiscal 'twenty five and 'twenty six.
I'll now summarize our performance for the quarter Kristina will provide more detail in her remarks.
I will be excluding the held for sale businesses from my comments, except where specified.
As we expected adjusted revenue was down 8% due to last year's Hendawi publishing pause, which impacted Q1 revenue performance by $19 million.
Excluding this event research publishing revenue in the quarter was up slightly driven by strong double digit growth in gold open access.
Earning segments saw print declines and academic offsetting growth in digital courseware and.
In our professional line was flat with assessments growth.
12% offsetting a 5% decline in publishing which reflected a best seller that we had in the prior year.
GAAP EPS was a loss of $1 67, reflecting a $103 million of impairment charges related to our held for sale University services and cross knowledge assets.
We also recorded a $12 million restructuring charges, we executed on targeted workforce reductions and real estate consolidation in advance of our divestitures.
Adjusted EBIT declined by $7 million or 10%.
And that always EBITDA impact was $18 million offsetting restructuring savings and learning and in corporate shared services.
Adjusted EPS was down 37% due to higher interest expense and lower EBITDA.
In the quarter held for sale businesses collectively generated $84 million of revenue down, 10% and adjusted EBITDA of $6 million up from a $2 million loss a year before.
As indicated we are reporting on these businesses separately and you can find this in the tables attached to our earnings release.
Let me provide an update on research publishing given its importance and the unusual near term dynamics that have affected our year on year performance.
First I.
I will emphasize that the research market remains robust with ever increasing global R&D spend driving higher research output as always.
We are confident and encouraged by the fundamental attributes of the business, which remains strong.
At this point the short term COVID-19 demand spike in snapback are mostly in the rearview mirror and we're returning to consistent demand growth.
Researchers around the world continue to submit their articles and increasing volumes to Wiley is peer reviewed journals and they do so because publishing in our journals drives their career success.
A few things to note first while these core publishing program is very healthy as expected, we're seeing a rebound in publishing volume in the core wildly portfolio with article submissions now up 4% year on year and article output, which naturally lag submissions up by 2%.
All subject areas are showing improvement, we're also seeing improvement across important geographies, including the U S. The UK and Germany.
As a reminder, research absent hendawi is projected to grow 3% this year.
Another important piece of data is that while these gold open access revenue was up 36% this quarter ex hendawi.
<unk> is the pay to publish model through which research appears in OE only journals, while gold OE makes up about 10% of our research publishing revenue. It is our fastest growing area and we expect it to drive consistent growth in the years to come.
We continue to benefit from the industry's mixed model environment.
Subscriptions and pay to read models remain important across the industry and this will continue for the foreseeable future.
As a scaled player in market leader wildly prospers under all of these models.
As you know in fiscal 'twenty, three and now we generated approximately $55 million in revenue and $23 million in EBITDA.
For this year, we project revenue to decline to $20 million with a moderate loss in EBITDA for.
For fiscal 'twenty five we expect to recover most of the revenue lost by fiscal 'twenty six we expect to be ahead of where we were in fiscal 'twenty three.
We continue to build on our position as a top ranked journal publisher, especially noteworthy is that we received good news this quarter. When 112 out of 200 Hendawi journals were given their first journal impact factors additional 35 journals saw their impact factor scores increase.
We're already seeing demand increase for these newly rated journals.
We also saw exceptional scores for wireless key journals in China.
These important developments speak to the growing quality and breadth of wireless publishing portfolio around the world and our long term confidence.
As indicated we've now reorganized widely into two operating segments down from three reflecting our greater focus in a simplified structure. The two segments research and learning complement each other because they both deliver high value content and solutions and related markets and serve similar verticals. The close alignment of our businesses will allow us to.
Capture both revenue and cost synergies.
The research segment remains our primary driver of growth profit and cash flow in fiscal 'twenty. Three research represented two thirds of Wiley is ongoing revenue and delivered a 35% EBIT margin it.
It has a large recurring revenue base that is 95% digital there is no change to our reporting lines and research.
Our new learning segment includes academic and professional publishing and platforms about a third of wireless 23, adjusted revenue was generated by a learning lines.
The two reporting lines under learning, our academic which is higher education publishing and professional which includes professional publishing and assessments.
<unk> delivered a 29% EBITDA margin in fiscal 'twenty three approximately 55% of its revenue is digital.
While we will be reporting on two segments wireless market facing efforts will now be managed as one team led by Jay Flynn.
You'll recall that we previously had three separate teams competing for investment in mind share.
Now as one Wiley will better leverage our collective scale and strength in publishing and solutions.
I am fortunate to have a very talented and seasoned leadership team overall.
Jay has been leading our research unit and has over 25 years of experience in the global research market and in digital publishing he has been a needle moving leader in wireless since 2010 and has driven the transformation of our research business into an engine of profitable growth and innovation. He is widely recognized as an industry leader.
I'll point out a second change to our team structure for the first time, we're creating unified operations team, which you can see here is led by Matt Levy.
This team is charged with overseeing operations and driving operating excellence and efficiency across Wiley. The operations group includes functions such as content operations supply chain program management and customer service.
Beyond the obvious efficiencies. This consolidation enables it's also driving greater speed and improved execution, one efficient infrastructure to support one market facing team.
Matt has a uniquely effective executive with decades of experience, leading digital content and platform businesses in our industry. Before this he was running our academic unit, where he was very effective in helping widely to adapt to consistent market changes, while driving significant efficiency and this allowed us to offset various revenue challenges.
So recapping the plan we laid out in June we're now executing a three part program to unlock value for our shareholders.
First we're focusing Wiley on publishing and the delivery of knowledge solutions in research and learning areas, where we have competitive advantage and scale.
We're simplifying wildly by divesting three businesses that are not core to our new more focused strategy.
Third we are streamlining and right sizing widely to improve efficiency speed and execution, all of which will drive material performance and margin improvement.
These actions are substantial and realizing their benefits will not happen overnight. Nonetheless, we're moving swiftly and are already seeing positive early signs from our new focus and simplicity.
I'll now turn it over to Cristina discuss segment performance, our cost savings initiatives and our outlook.
Thank you Bryan and Hello, everyone.
As discussed we would now be aligned the company to focus on our core strengths to improve performance, probably drive greater operating and capital efficiency.
Our leadership team is collaborating to extract the benefits of our new strategy and sharply focused organization.
Specifically, Jason and I are working together to identifying and investing growth opportunities in research and learning, while streamlining our publishing business where appropriate.
Matt Levy and I are tightly connected and driving towards a leaner organization with lighter infrastructure simplify processes and improved analytics and insight the execution of these programs is our top priority.
Let me start with our performance in research.
Research publishing revenue declined 8% this quarter, mainly due to our year over year impact of last year's finale pause.
Absent Hendawi research publishing revenue was up modestly.
As Brian noted, we feel good about our volume trends this quarter and our open access and then Tim the God OE revenue up 36% and gold output up to 20% <unk>.
We're also pleased with our growth in China, which is the fastest growing large marketing research today.
Several of our new China journals received their first impact factors and we're proud to say that the scores are at the top of their fields.
We saw strong rankings in smart manufacturing and sustainable materials as while it continues to build on its global leadership in material science and other areas critical technology economy.
Research solutions revenue declined 2% this quarter due to lower corporate spend in advertising and recurring.
Lower corporate revenue offset growth in our publishing services business, which includes services to help society partners and other publishers manage their peer review process and open access transactions.
You're lying momentum in this business remained strong.
During the quarter, we signed four new solutions customers and up sold an additional 20.
We converted five publishing only customers into multi service partnerships.
As a reminder, the services. We provide include everything from distributing research content on our delivery platforms.
Providing editorial in peer review support.
Our partner pipeline is well ahead of where it was in Q4.
During the quarter, we also signed up several career center partnerships in the financial services sector.
Adjusted EBITDA in research this quarter declined 18% weighed down by <unk> was $18 million EBITDA impact.
Excluding this adjusted EBIT for research was up 1%.
Our Q1, adjusted EBITDA margin, including <unk> was 29, 8% down from 33, 8% in the prior year period.
Of note, we expect research to have another challenging quarter in Q2 due to the remaining down year over year impact.
We expect improvement in the second half as article volumes continue to grow in comps become more favorable.
Now onto our new learning segment.
Academic publishing revenue in the quarter was down 18% in a seasonally light quarter professional is flat.
The academic decline was driven by lower sell through for <unk> materials.
The rate of decline was in line with our expectations.
Contributing to our Q1 performance with order timing in some of our key retail accounts.
It's important to note that Q1 is our smallest quarter for academic and saw ordering is typically very lumpy.
I'll, just say Q1 is not indicative of our full year expectations.
Our XIAFLEX stem courseware recorded another quarter of double digit growth up 37% over prior year.
Recently, we launched a new product called <unk> labs designed to help computer science students cutting skills and cloud based environment, which they wouldn't counter on the job.
Here, we're applying now is to train future railroad problem solvers.
Professional soft good growth continuing for assessments of 12% over prior year.
Demand remains strong as companies continue to invest and team development.
In the quarter, we signed 169, new training partners at 22% over prior year.
These partners are independent distributors, our assessment products delivering team effectiveness training and learning experiences to employees and professional publishing backlist growth was offset by a softer frontlist compared to last year's unusually strong titles.
Adjusted EBITDA for learning this quarter was up 19% with restructuring savings is a primary driver.
Our Q1 adjusted EBITDA margin was 19, 4% up from 14, 9% in the prior year period.
Turning to our cash flow and balance sheet.
Free cash flow for the quarter was a use of $106 million a modest improvement from a use of $114 million in prior year.
The increase was driven by lower incentive compensation payments due to fiscal 'twenty three underperformance.
As a reminder, our cash flow is normally used for the first half of the year due to the timing of collections for journal subscriptions, which are concentrated in the third and fourth quarters.
Also note we did not provide an adjusted cash flow metrics and numbers include the business as held for sale are sold.
Capex of $24 million was even with prior year and there were no acquisitions in the quarter.
Our main focus right now is executing on our divestitures and our reorganization so acquisitions will not be a priority this year.
As Brian mentioned, we raised our dividend for the 13th straight year and our current dividend yield is now around 4%.
We allocated $10 million towards share repurchases this quarter buying back 301000 shares compared to 212000 shares in Q1 of last year.
We are in a good financial position as we navigate this transitional period.
Net debt to EBITDA ratio was one 9% at the end of July compared to two 1% in the prior year.
Finally, although our expectations are modest in terms of our divestitures, we will be looking at using proceeds for general corporate purposes, including reducing debt.
The Scot research publishing and solutions and.
And repurchasing shares.
Onto our multi year business optimization and cost savings program.
Our recent realignment means simpler functional organization and is an essential step towards executing our plan for a leaner and more agile workforce with improved operating efficiencies and modern infrastructure.
This will allow us to realize cost synergies across our publishing businesses.
I also see opportunity to deploy our capital more effectively where we have a clear right to win in research and publishing.
We expect meaningful performance and margin improvement from these initiatives and I look forward to further outlining them at our Investor day.
While some of this work is dependent on timing of our divestitures, we've already begun executing on these initiatives.
During the quarter, we made targeted workforce reductions at the corporate level and rationalize additional office space in accordance with our plan and most of these savings are reflected in our current outlook.
Additional restructuring actions are still to come.
As a reminder, from these efforts, we expect to generate run rate savings of $100 million to fiscal 'twenty six.
These savings are bucket in three areas.
One reducing our corporate overhead in line with our smaller portfolio.
Our actions will reduce our revenue base by approximately 20%. So we'll be right sizing the organization to reflect this.
To eliminate stranded costs related to divestitures, particularly in technology and corporate functions and <unk>.
III, making operational improvements reflect a more focused portfolio and realigned organization.
These include eliminating departmental redundancies streamlining systems and processes consolidating our vendors and further rationalizing our real estate footprint.
<unk> will also allow us to realize cost synergies in areas like content management sales and go to market.
We will be reinvesting a portion of these savings into our profitable growth initiatives and upgrading systems to improve efficiency and productivity.
Moving on to our transition year outlook.
As a reminder, our guidance excludes the businesses held for sale.
Given Q1 timing issues and leading indicators, we are reaffirming our guidance.
We continue to project research revenue to be flat, but up 3% excluding <unk>.
We expect a better back half of the year as volumes continued to improve and comparisons become more favorable.
We look forward to putting the entirely disruption behind us and returning research to growth in fiscal year, 'twenty five and 'twenty six.
And learning academic remains challenged by lower demand for print products offsetting continued growth in digital content courseware and assessment.
We continue to anticipate a low single digit decline for this segment in fiscal 'twenty four.
Adjusted EBITDA, excluding divestitures is anticipated to be in the range of $305 million to $330 million.
This puts EBIT margin in the range of 19% to 20% down from 23, 3% in fiscal 'twenty three.
To refresh we expect to more than recover our fiscal 'twenty three EBIT margin of 23, 3% as we exit fiscal 2004 and expand from there.
On adjusted EPS, we are anticipating a range of $2 <unk> to $2 40.
We have 42% of non operational items weighing on EPS, including 21 tenths of tax impact.
<unk> 11 of higher pension expense and 10 tenths of higher interest expense.
Again, we expect to entirely publishing path to continue to weigh on our year over year performance in Q2 before comparisons become more favorable in Q3.
With regard to free cash flow our visibility remains limited.
We are working through our divestitures and can't adequately protect at the timing and scope of our restructuring programs.
As I just noted we don't report an adjusted free cash flow metric.
For these reasons, we are unable to provide a meaningful free cash flow outlook at this time.
That said, we do expect it to be materially lower in this transition year, given the combination of lower projected cash earnings.
Significant restructuring payments and higher interest payments.
These are mainly temporary issues in this year structural change.
As we make our way into fiscal 'twenty five 'twenty six we're fully confident in our margin trajectory and in the cash generation of our core business.
We will be providing our fiscal 'twenty free cash flow target at our Investor day.
And with that I'll pass it back to Brian . Thanks.
Thanks, Kristina to summarize before I open it up for questions.
Q1 performance was largely what we expected and we are encouraged by the continuing underlying strength and increasing momentum in research. Following the unusual dynamics over the past year. We are actively simplifying the companys structure to reflect our more focused strategy and drive efficiency.
Going forward, we will have one market facing team, enabling greater coordination of product and go to market efforts.
This group will be supported by one global operations group, enabling efficiency and driving operational excellence across the company.
We're now in mid process in our efforts to divest several of our noncore assets.
Processes are going well with good buyer engagement, although market is challenging.
Fiscal 'twenty four remains characterized as a transition year for Wiley as we worked through these substantial actions and as our core drivers rebound.
We expect to deliver performance gains in margin acceleration in fiscal 'twenty, five and 'twenty six.
As a reminder, we're hosting an investor day on Thursday October 12 at our corporate headquarters in Hoboken, New Jersey.
At that event, we will share our go forward vision for Wiley provide detail on our research and learning businesses outline our critical operation improvement initiatives, and we will introduce fiscal 'twenty six financial targets.
After the presentations, which will run from nine to 12 noon eastern.
We will hold a networking lunch for all attendees.
As always I want to thank our global colleagues for their tireless work and perseverance their dedication to each other and to this very special company.
Now open the floor to comments and questions.
At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad and your first question comes from the line of Daniel Moore from CJS Securities. Your line is open.
Good morning, Brian morning, Christina sorry, it's a jump off mute there.
Let me start with research I appreciate the commentary just kind of remind us where we are what is gold OE generally as a percentage of research revenue now and and.
And maybe just what can you say now that we're a little bit further removed from the pause in publishing you experienced in the back half of last year was it simply tough comps versus.
Versus the pandemic driven spike.
There are other factors and just your confidence in that improvement as we look to HTM.
Yes, Dan.
Well, thanks for joining the questions as always.
Youre starting in the right place is really important when we look at wildly to understand that we've just refocused our strategy and our company around around the research business and the core of that is research publishing business and the core of the future and future growth and profitability will come from my way. So we're starting in the right place.
So gold away now is around 10% with OE overall.
10% of our research revenues.
And.
Overall OE is around a third.
Of our of our publishing revenues I guess high twenties of our overall research revenue, 27%, 28% of our overall research revenues. So that's where we stand those areas are growing very nicely very rapidly and I think we are saw growth of 36% or something excluding <unk>.
We have gold OE and overall OE is growing very nicely as well.
So what we're seeing overall is a return after the COVID-19.
Up and down in and changes and it was a very unusual period for us a return to the normal growth patterns, which is what we expected to see and what we are seeing across the business.
So we're doing very well in the high growth markets like China, and India, we're doing very well across.
Across the major western markets U S U K, Germany, and so wherever they were during the Covid period. They are now returning to where to normalcy and and that means growth.
So in every area as I said earlier in the comments in the prepared comments.
In every region and all of our major subject areas, we're seeing a return to volume growth.
And revenue growth.
Obviously, there's many dynamics that go on in this market.
But it's exactly what we wanted to see is exactly what we expected to see and it's what we've been talking about for a while so that should give you a foundation.
Very helpful.
Staying with research, but just to switch shifting to hendawi.
Just to clarify I think you said it was an $18 million impact does that year over year impact or was it.
A loss of $18 million in this quarter.
And with a loss.
Dan as Christina and was the last quarter.
Got it that's helpful.
And just.
Context.
Bottom of the context, it's important to.
Remember that one.
We were experiencing significant growth coming out of Hendawi.
<unk> represents low single digits to 3% of our research revenue. So we just need to put that in context, we certainly.
Sure.
Lament the loss of that revenue and now we're starting to see the metrics come back to where we want them to see them to be and we will.
You will see that coming back, but I, just always want to put that in context of our overall research business, we're talking about low single digits number.
Of course, and I know you gave the numbers Christina.
But just.
Remind us what's sort of embedded for hendawi in terms of EBITDA loss for the full year of 24 guide.
Think about the jumping off point for 25.
Sure So as I talked on the call revenues for the full year is expected to decline.
About 55 million.
And 23% to $20 million this year and it'll be a modest EBITDA loss for the full year and we'll see the first.
Yes, this quarter and next quarter have some tough comps and recover in the back half of the year.
Declined from 55 declined by 50.
Yes, good morning.
Yep.
Perfect.
Sure.
Because I know it has the next question is where we're going to go with it and so we.
We're executing our <unk>.
Revitalization plan and it's coming along nicely.
We expect to see.
Most of the.
A bad comparison to be through in the first half and then as we go through 'twenty five and into 26, we'll see ourselves get back to and above where we were before so we're not going to get it all back right away because you know we're coming we're coming conservative way to do it the right way and it takes a little while due to the lags in the business, but we.
<unk> to be to return to its contribution to wireless growth through 'twenty five and.
Be above where it was in 'twenty six.
Perfect.
In 2020.
<unk> thousand six be above where it was in 'twenty three I just want to be clear about my words right right in terms of the.
The progression okay.
And then shifting to learning I think overall, you said, 55% with digital.
Just starting with the academic which obviously another leg down this quarter, what's the mix there print versus digital.
Just talk about I understand the 18% is driven by timing.
But it continues over time to kind of work its way down.
Yes.
Secular opportunity there along over the next three to five years you bad part part of it is timing its not all timing right we're seeing.
Continue with.
Continuous decline what happened in the quarter was a combination of a very small quarter in a very unusual time of the year for those businesses.
Not representative of the full year, but nonetheless.
Beyond timing, which is <unk>.
Which has its own issue.
We.
We continue to expect to see a slow decline print now represents about 40% of that business with dish.
Digital being close to 50% and <unk>.
The digital continues to grow for us as you as you know so.
That transition continues to go on we expect it to continue to go on it's.
Not this quarter is not reflective of that progression, but we do expect.
Back to continue the migration from one to another.
Digital revenue basically offsetting.
The print decline.
And that digital revenue that is.
Save for quarters like this one and the timing.
What are you experiencing in terms of growth and do you expect that to inflect higher or just kind of remained steady.
We expect <unk> to remain steady we have pockets of very strong growth, where we are where we have fantastic products like <unk> I think <unk> is up mid thirties, if I'm not.
I should say to be precise it is up.
Mid thirties, and the balance of it is growing in proportion to the adoption of.
Of those products in the marketplace, which is more of a low single digit kind of.
The pace now we hope to continue that more than offset the print declines. So we're not going to see I want to say something generally about that business because I think it's very important from a expectation setting perspective, we don't expect the academic segment.
To be a driver of growth for Wiley in the future It will do okay.
We will keep pace with inflation with what with digital offsetting print, but what it really represents for US is a very solid business with good profitability characteristics and good cash generation characteristics that contributes to the overall empire as we see.
As we move toward a one wildly notion will start to see some real benefits from.
From expense savings as we combined things like content platforms and sales forces and other things like that.
I shouldn't say combine align is a better word than combine but what we're looking for is one strong operating infrastructure supporting our whole business and we should expect to see some revenue synergies as well out of that as for example, our research author who is a Phd at a university.
Publishes with us their box, which they always do and need to do so we expect to see some of that as well again I'm trying to provide the overall context for the role of academic and our expectations going forward. So that we know where our growth is going to come from where our profitability is going to come from.
Absolutely and if you wouldn't mind kind of the same outlook for professional.
Yes professional is a combination of our professional publishing which is mostly books in both print and digital format and our assessments business or what we call internally our team development business.
And the.
As a as a group we expect that to again contribute.
A modest growth.
More than than you would expect out of the academic segment and very good profitability again, it's a similar story, we have certain areas such as our team development business, where we have real strength and brand and competitive advantage and great profitability characteristics.
That tends to be a smaller part of that is a smaller part of the business call. It one third of the professional business. The book business continues to grow as the book business grows and we again like that business, but we don't expect outsized growth out of our book publishing our book publishing as professional book publishing it has consistent demand.
We do very well in it we are probably the world's leader in professional book publishing I would say probably one of our competitors recently backed office.
Our commitment to the area. So now where we are definitely a leader in that area and so but again, we expect it to be a modest growth business, but with very good.
Profit characteristics does that is that enough on that Dan I'm happy to go into more detail.
No that helps one or two more and I'll, let you off the hook here, but.
Anything you might say just in terms of preview of what not numbers, but what general.
Strategy, you might hope to convey at the upcoming Investor day in October .
Yes, it's a great question and I really am looking forward to seeing lots of people at the at our Investor Day.
I'd say, it's I would say what I've said before.
I wouldn't expect from widely a big reveal of some.
Unfamiliar or orthogonal strategy.
Giving a brand new growth area to us we believe deeply in the businesses. We're in starting with our research publishing business.
Building on it with our knowledge solutions business and supported by our consistent.
Our consistent learning businesses.
Particularly the.
Publishing businesses.
And we believe that there is significant opportunity due to the endemic.
Eric jurisdiction in the case of the.
The research business and the growth characteristics of those businesses.
And we believe that there are additional adjacencies that we've spoken about for the most part Dan areas like partner solutions areas like.
Like the way that we can expand our publishing portfolio.
Bye Bye building, our brands and so forth.
We believe that those areas provide more than enough growth at very attractive financial characteristics mean profitability and cash flow characteristics.
To provide.
Significant opportunity for us and most importantly to.
To generate value for shareholders, but there is there is a internal part of our strategy, that's critical as well, which I would summarize as just saying operational excellence that can result from focus on simplicity and I know. These are these are themes, we've talked about before we're well on our way we just.
We just came through a reorganization of the company that opens up a lot of those opportunities and we are going to execute it. We've just appointed a new head of operations as we talked about in our remarks who's dedicated to driving that operational excellence. So the internal part of Wiley strategy is just as important as our <unk>.
External part of the strategy because that's what allows us to improve our operating leverage which is what we all want to see.
Perfect and last one for me maybe Christina.
I appreciate the commentary on Hendawi.
So just looking at the overall for Q2.
Kind of fair to assume that revenue and more importantly, EBITDA, maybe down a little bit year over year relative to the adjusted numbers that you filed an 8-K last week.
With them.
More improvement in the back half is it the right way to think about it the cadence.
That's right that's right. So we'll see another next.
That's why you will see another year on year town and that will stabilize in the back half of the year.
Okay.
Yes. Thank you.
Thanks, very much Dan.
Thank you.
And there are no further questions at this time I will now turn the call back over to Mr. In APAC for some final closing comments.
Alright, well. Thank you very much for joining today and look forward to seeing you at our Investor day, and if you're not lucky enough to attend that we'll look forward to reporting our next results.
<unk> results on Q2.
At that moment. So thank you again for joining and have a great day.
This concludes today's conference call. Thank you for your participation you may now just.