Q4 2024 Scholastic Corp Earnings Call

Thank you for standing by and welcome to the Scholastic Report's fourth quarter fiscal year 2024 results.

Operator: At this time, all participants are in listen-only mode.

Operator: At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 11 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 11 again.

Operator: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. If your question has been answered, and you'd like to remove yourself from the queue, simply press star 1-1 again.

Speaker Change: At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you'll need to press star-one-one on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star-one-one again. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program,

Operator: As a reminder, today's program is being recorded.

Operator: As a reminder, today's program is being recorded. And now, I'd like to introduce your host for today's program, Jeffrey Mathews. Please go ahead.

Jeffrey Mathews: And now I'd like to introduce your host for today's program, Jeffrey Mathews. Please go ahead. So, and welcome everyone to Scholastic's fiscal 2024 fourth quarter earnings call. Today on the call, I'm joined by Peter Warwick, our President and Chief Executive Officer, and Haji Glover, 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 already done so.

Jeffrey Mathews: Hello and welcome everyone to Scholastic's fiscal 2024 fourth quarter earnings call. Today on the call, I'm joined by Peter Warwick, our President and Chief Executive Officer, and Haji Glover, our Chief Financial Officer.

Jeffrey Mathews. Please go ahead. Hello and welcome everyone to Scholastic's fiscal 2024 fourth quarter earnings call.

Speaker Change: Today on the call, I'm joined by Peter Warwick, our President and Chief Executive Officer, and Haji Glover, our Chief Financial Officer.

Jeffrey Mathews: 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 already done so. 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 those measures to the most directly comparable gap measures may be found in a company's earnings release and a company financial table, filed this afternoon on Form 8K.

Speaker Change: As usual, we have posted the company investor presentation on our IR website.

Speaker Change: at investor.scholastic.com, which you may download now if you've not already done so.

Jeffrey Mathews: 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 those measures to the most directly comparable gap measures may be found in the company's earnings release and in company financial tables filed this afternoon on a form A.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.

Speaker Change: 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.

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

Speaker Change: The reconciliation of those measures to the most directly comparable GAAP measures may be found in the company's earnings release and accompanying financial tables filed this afternoon on a Form 8K.

Jeffrey Mathews: 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 our IR email address, investor_relations at scholastic.com. And now I would like to turn the call over to Peter Warwick to begin this afternoon's presentation.

Speaker Change: 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.

Jeffrey Mathews: Should you have any questions after the disease call, please send them directly to our IR email address, investor_relations@sclassic.com.

Speaker Change: Should you have any questions after today's call, please send them directly to our IR email address, investor underscore relations at scholastic.com. And now I would like to turn the call over to Peter Warwick to begin this afternoon's presentation.

Peter Warwick: And now I would like to turn the call over to Peter Wark to begin this afternoon's presentation. Thank you, Jeff, and good afternoon, everyone. Thank you for joining us. In the fourth quarter of fiscal 2024, Scholastic continued to execute on its strategy, investing in key growth initiatives and long-term opportunities while navigating current market headwinds. Increasing pressure on spending affecting our education solutions and school reading events businesses impacted consolidated revenue last quarter, resulting in a 10% or 53 million dollar decline relative to last year's strong quarter for performance. And that's in contrast to our expectations for modest growth.

Peter Warwick: Thank you, Jeff, and good afternoon, everyone. Thank you for joining us. In the fourth quarter of fiscal 2024, Scholastic continued to execute on its strategy, investing in key growth initiatives and long-term opportunities while navigating current market headwinds, increasing pressure on spending affecting our education solutions and school reading events impacted consolidated revenue last quarter, resulting in a 10% or $53 million decline relative to last year's strong Q4 performance. And that's in contrast to our expectations for modest growth. Consequently, profits in our seasonally most important fourth quarter fell below the prior year and our revised guidance. Fourth quarter adjusted operating income was $67 million, down from last year's record of $92 million.

Peter Warwick: Thank you, Jeff, and good afternoon, everyone. Thank you for joining us.

Peter Warwick: In the fourth quarter of fiscal 2024 Scholastic continued to execute on its strategy investing in key growth initiatives and long-term opportunities while navigating current market headwinds.

Speaker Change: Increasing pressure on spending affecting our education solutions and school reading events businesses impacted consolidated revenue last quarter resulting in a 10 percent or 53 million dollar decline relative to last year's strong quarter four performance.

Peter Warwick: Consequently, profits in our seasonally most important fourth quarter fell below the prior year and our revised guidance. Fourth quarter adjusted operating income with 67 million dollars, down from last year's record of 92 million. Adjusted a bit down was 91 million dollars compared to 150 million dollars a year ago. We took steps to manage expenses in line with lower than expected demand. SGNA and corporate overhead excluding one-time items both improved, even as we maintain spending on long-term opportunities. For fiscal 2024, adjusted a bit down was 137 million dollars versus 196 million dollars a year ago. Again, reflecting the revenue headwinds we've experienced since last four.

Speaker Change: and that's in contrast to our expectations for modest growth.

Speaker Change: Consequently, profits in our seasonally most important fourth quarter fell below the prior year and our revised guidance.

Speaker Change: Fourth quarter adjusted operating income was $67 million, down from last year's record of $92 million. Adjusted EBITDA was $91 million compared to $115 million a year ago.

Peter Warwick: Adjusted EBITDA was $91 million compared to $115 million a year ago. We took steps to manage expenses in line with lower-than-expected demand. SG&A and corporate overhead, excluding one-time items, both improved, even as we maintained spending on long-term opportunities. For fiscal 2024, adjusted EBITDA was $137 million versus $196 million a year ago, again reflecting the revenue headwinds we've experienced since last fall. With careful work in capital management and our business's capital efficient models, we continue to generate strong free cash flow of $73 million, up from $60 million in the prior year.

Speaker Change: We took steps to manage expenses in line with lower than expected demand. SG&A and corporate overhead, excluding one-time items, both improved, even as we maintained spending on long-term opportunities.

Speaker Change: For fiscal 2024, adjusted EBITDA was $137 million versus $196 million a year ago, again reflecting the revenue headwinds we've experienced since last fall.

Peter Warwick: With careful working capital management and our businesses' capital efficient models, we continue to generate strong free cash flow of 73 million dollars, up from 60 million in the prior year. This exceeded our revised outlook of 55 to 65 million dollars. Delivering on our commitment to capital allocation, we also deployed Scholastic's strong balance sheet to drive long-term value in fiscal 2024. We returned over 181 million dollars to shareholders through dividends and share purchases during the year. We also announced a 182 million dollar strategic investment in Nine-Story Media Group, which we closed on June 20. Scholastic's investment to acquire 100% economic interest in Nine-Story is a major advance in our evolution as a global children's media company.

Speaker Change: With careful work in capital management and our business's capital efficient models, we continue to generate strong free cash flow of $73 million up from 60 million in the prior year.

Peter Warwick: This exceeded our revised outlook of $55 million to $65 million. Delivering on our commitment to capital allocation, we also deployed Scholastic's strong balance sheet to drive long-term value in fiscal 2024. We returned over $181 million to shareholders through dividends and share repurchases during the year.

Speaker Change: This exceeded our revised outlook of $55 million to $65 million.

Speaker Change: Delivering on our commitment to capital allocation, we also deployed Scholastic's strong balance sheet to drive long-term value in fiscal 2024. We returned over $181 million to shareholders through dividends and share repurchases during the year.

Peter Warwick: We also announced a $182 million strategic investment in Nine Story Media Group, which we closed on June 20th. Scholastic's investment to acquire a 100% economic interest in Nine Story is a major advance in our evolution as a global children's media company. It greatly expands Scholastic's ability to reach more kids where they are and profitably participate in the full life cycle of our children's franchises and intellectual property. Starting this fiscal year, Nine Story will be consolidated and integrated with Scholastic Entertainment in a new entertainment sector.

Speaker Change: We also announced $182 million strategic investment in Nine Story Media Group, which we closed on June 20th.

Speaker Change: Scholastic's investment to acquire 100% economic interest in Nine Story is a major advance in our evolution as a global children's media company.

Peter Warwick: It greatly expands Scholastic's ability to reach more kids where they are and profitably participate in the full life cycle of our children's franchises and IP. Starting this fiscal year, Nine Story will be consolidated and integrated with Scholastic Entertainment in a new entertainment segment. Since its 2017 reboot, Scholastic Entertainment has successfully proven that there's significant demand for Scholastic's brand and publishing IP on screens, as well as on the page, and that we can effectively and profitably meet this demand. In addition to adding a sizable business with solid EBITDA margins today, the nine-story acquisition significantly expands Scholastic's opportunities to leverage its trusted brand, best-selling publishing, and beloved global children's franchises across print, screens, and merchandising.

Speaker Change: It greatly expands Scholastic's ability to reach more kids where they are and profitably participate in the full life cycle of our children's franchises and IP.

Speaker Change: Starting this fiscal year, Nine Story will be consolidated and integrated with Scholastic Entertainment in a new entertainment segment.

Peter Warwick: Since its 2017 reboot, Scholastic Entertainment has successfully proven that there's significant demand for Scholastic's brand and publishing IP on screens, as well as on the page, and that we can effectively and profitably meet this demand. In addition to adding a sizable business with solid EBITDA margins today, the nine-storey acquisition significantly expands Scholastic's opportunities to leverage its trusted brand, best-selling publishing, and beloved global children' After only a month, the Combined Division is quickly moving forward with an integrated plan, as I'll discuss shortly.

Speaker Change: Since its 2017 reboot, Scholastic Entertainment has successfully proven that there's significant demand for Scholastic's brand and publishing IP on screens, as well as on the page, and that we can effectively and profitably meet this demand.

Speaker Change: In addition to adding a sizable business with solid EBITDA margins today, the nine-story acquisition significantly expands Scholastic's opportunities.

Speaker Change: to leverage its trusted brand, best-selling publishing, and beloved global children's franchises across print, screens, and merchandising.

Peter Warwick: After only a month, the combined division is quickly moving forward with an integrated plan, as I'll discuss shortly. Blast quarter trade publishing, the starting point for much of Scholastic's content, saw sales increased by 3%, excluding revenues from Scholastic Entertainment. The spring release of the 12th book in Dave Pilkey's Dogman series reached the number one best-selling spot across all book categories in the US, Canada, Ireland, Australia, and New Zealand, and the top children's book spot in the UK. Its success also drove strong sales of earlier titles in the series, demonstrating again Scholastic's ability to build global franchises.

Speaker Change: After only a month, the Combined Division is quickly moving forward with an integrated plan, as I'll discuss shortly.

Peter Warwick: Last quarter, trade publishing, the starting point for much of Scholastic's content, saw sales increase by 3%, excluding revenues from Scholastic Entertainment. The spring release of the 12th book in Dave Pilkey's Dogman series reached the number one bestselling spot across all book categories in the US, Canada, Ireland, Australia, and New Zealand, and the top children's book spot in the UK.

Speaker Change: Last quarter, trade publishing, the starting point for much of Scholastic's content, saw sales increase by three percent, excluding revenues from Scholastic Entertainment.

Speaker Change: The spring release of the 12th book in Dave Pilkey's Godman series reached the number one best-selling spot across all book categories in the US, Canada, Ireland, Australia and New Zealand, and the top children's book spot in the UK.

Peter Warwick: Its success also drove strong sales of earlier titles in the series, demonstrating again Scholastic's ability to build a global franchise. Despite solid trade results, last quarter's revenues in the children's book segment declined by nine percent, reflecting the resizing of book clubs and the increasing pressure this spring on consumer spending and participation in school books. School Book Club's revenues were down 45% with planned resizing, while we also tested new offers, marketing, and promotional formats for the school year ahead. Sales in school book fairs decreased by 6% in Q4, reflecting lower revenue per fair relative to last year's record level, partly offset by growth in fair count.

Speaker Change: Its success also drove strong sales of earlier titles in the series demonstrating again Scholastic's ability to build global franchises.

Peter Warwick: Despite solid trade results, Blast quarter's revenues in the children's book segment declined by 9%, reflecting the resizing of book clubs and the increasing pressure this spring on consumer spending and participation in school book fairs. School book clubs revenues were down 45% with planned resizing, while we also tested new offers, marketing, and promotional formats for the school year ahead. Sales in school book fairs decreased by 6% in quarter four, reflecting lower revenue per fair relative to last year's record level, partly offset by growth in fair accounts. As we've discussed, revenue per fair has been partly impacted by the addition of smaller fairs as we've grown fair accounts, as well as increased churn among some higher-value fairs.

Speaker Change: Despite solid trade results, last quarter's revenues in the children's book segment declined by 9%.

Speaker Change: reflecting the resizing of book clubs and the increasing pressure this spring on consumer spending and participation in school book fairs.

Speaker Change: School Book Club's revenues were down 45% with planned resizing, while we also tested new offers, marketing and promotional formats for the school year ahead.

Speaker Change: Sales in school book fairs decreased by 6% in quarter four, reflecting lower revenue per fair relative to last year's record level, partly offset by growth in fair count.

Peter Warwick: As we've discussed, revenue per fare has been partly impacted by the addition of smaller fares as we've grown our fare count as well as increased churn among some higher-value fares. Headwinds in the school environment, in particular high rates of absenteeism this year and increasing pressure on consumer spending across the economy, especially among the fair's core market, middle-class families, have impacted the number of transactions per fair, especially this spring when schools host second fairs. This has more than offset the benefit of higher transaction sizes, which reflects our strong merchandise. Turning to our education solutions segment, revenues declined by 17% in the business's seasonally most important fourth quarter.

Speaker Change: As we've discussed, revenue per fare has been partly impacted by the addition of smaller fares as we've grown fare count as well as increased churn among some higher value fares.

Peter Warwick: Hedwin's in the school environment, in particular high rates of absenteeism this year, and increasing pressure on consumer spending across the economy, especially among fairs core market, middle class families, have impacted the number of transactions per fair, especially this spring when schools host second fairs. This is more than offset the benefit of higher transaction sizes, which reflects our strong merchandising. Turning to our education solution segment, revenues declined by 17% in the business's seasonally most important for quarter. As many schools have adopted core curricula and implemented new structured literacy programs this year, they paused spending on supplemental curriculum products this spring.

Speaker Change: Hedwins in the School Environment

Speaker Change: In particular, high rates of absenteeism this year and increasing pressure on consumer spending across the economy, especially among fares core market middle class families, have impacted the number of transactions per fare, especially this spring when schools host second fares.

Speaker Change: This has more than offset the benefit of higher transaction sizes, which reflects our strong merchandising.

Speaker Change: Turning to our education solutions segment, revenues declined by 17% in the business's seasonally most important fourth quarter.

Peter Warwick: As many schools have adopted core curricula and implemented new structured literacy programs this year, they paused spending on supplemental curriculum products this spring. This particularly impacted sales of classroom libraries and book collections, as well as products not explicitly aligned with the science of reading. In contrast, sales to non-school state and community literacy partners rose overall. As we navigated the currently challenging market, we continued investing in this segment's long-term growth potential in anticipation of a cyclical return of spending on supplemental products in the 2025 and 2026 school years. We're currently executing on a comprehensive new product plan, as I'll discuss shortly. Finally, international revenues declined modestly last quarter, mostly reflecting headwinds in Asia.

Speaker Change: As many schools have adopted core curricula and implemented new structured literacy programs this year, they paused spending on supplemental curriculum products this spring. This particularly impacted sales of classroom libraries and book collections.

Peter Warwick: This particularly impacted sales of classroom libraries and book collections, as well as products not explicitly aligned with the signs of reading. In contrast, sales to non-school state and community literacy partners rose overall. As we navigated the currently challenging market, we continued investing in this segment's long-term growth potential, in anticipation of a cyclical return of spending on supplemental products in the 2025 and 2026 school years. We are currently executing on a comprehensive new product plan, as I'll discuss shortly. Finally, international revenues declined modestly last quarter, mostly reflecting headwinds in Asia. As I laid out a year ago, scholastic strategy to grow long-term earnings and free cash flow builds on the unique strengths of our domestic and international children's book and education businesses, while also protecting the profitability and cash flow generation of our core business models.

Speaker Change: as well as products not explicitly aligned with the science of reading.

Speaker Change: In contrast, sales to non-school, state, and community literacy partners rose overall.

Speaker Change: As we navigated the currently challenging market, we continued investing in this segment's long-term growth potential in anticipation of a cyclical return of spending on supplemental products in the 2025 and 2026 school years.

Speaker Change: We're currently executing on a comprehensive new product plan, as I'll discuss shortly.

Speaker Change: Finally, international revenues declined modestly last quarter, mostly reflecting headwinds in Asia.

Peter Warwick: As I laid out a year ago, Scholastic's strategy to grow long-term earnings and free cash flow builds on the unique strengths of our domestic and international children's book and education business while also protecting the profitability and cash flow generation of our core business model. Leveraging our balance sheet and strong free cash flow outlook, we aim to sustainably fund these growth investments and return capital to shareholders. Scholastic's growth investments are guided by four key market trends and growth factors, which I'll run through. First, as brands, content, and channels proliferate online and on screens, accelerated by new technologies like generative AI, we're leaning into our trusted brand with families and education and our global best-selling children's franchises to differentiate ourselves and grow sustainably.

Speaker Change: as I laid out a year ago.

Speaker Change: Scholastic's strategy to grow long-term earnings and free cash flow builds on the unique strengths of our domestic and international children's book and education businesses.

Speaker Change: while also protecting the profitability and cash flow generation of our core business models.

Peter Warwick: Leveraging our balance sheet and strong free cash flow outlook, we aim to sustainably fund these growth investments and return capital to shareholders.

Speaker Change: Leveraging our balance sheet and strong free cash flow outlook

Speaker Change: We aim to sustainably fund these growth investments and return capital to shareholders.

Peter Warwick: Scholastic growth investments are guided by four key market trends in growth factors, which I'll run through. First, as brands, content, and channels proliferate online and on screens, accelerated by new technologies like Generative AI, we're leaning into Scholastic's trusted brand with families and educators and our global best-selling children's franchises to differentiate ourselves and grow sustainably. Second, as kids spend more and more time on screens, we're expanding our ability to reach kids where they are with high-quality, engaging content both on screen and on the page. Third, the school's struggle to reverse declining reading scores are seen again with recent NAEP results at 30 plus year lows.

Speaker Change: Scholastic's growth investments are guided by four key market trends and growth factors which I'll run through.

Peter Warwick: Second, as kids spend more and more time on screens, we're expanding our ability to reach kids where they are with high quality, engaging content, both on screen and on the page. Third, schools struggle to reverse declining reading scores, as seen again with recent NAPE results at 30-plus year lows.

Speaker Change: First, as brands, content and channels proliferate online and on screens, accelerated by new technologies like generative AI, we're leaning into Scholastic's trusted brand with families and educators.

Speaker Change: and our global best-selling children's franchises to differentiate ourselves and grow sustainably.

Speaker Change: Second, as kids spend more and more time on screens, we're expanding our ability to reach kids where they are with high quality engaging content both on screen and on the page.

Speaker Change: Third, the schools struggle to reverse declining reading scores.

Peter Warwick: We're developing new partnership models with state, community, and philanthropic organizations to support and fund literacy programs outside schools. And fourth, as parents and families take a more active role in their children's education at school and at home, especially post-Covid, we're building new channels to reach and support families. Turning to our near and long-term, for Fiscal 2025, we're targeting modest growth in revenue and adjusted EBITDA, including the benefit of our strategic investment in Nine Storey, as Haji will discuss.

Peter Warwick: We're developing new partnership models with state, community, and philanthropic organisations to support and fund literacy programs outside the school. And fourth, as parents and families take a more active role in their children's education at school and at home, especially post-COVID, we're building new channels to reach and support families directly. Turning to our near and long-term outlook, for fiscal 2025, we're targeting modest growth in revenue and adjusted EBITDA, including the benefit of our strategic investment in Nine-Story, as had you will discuss. As I've said, we're moving ahead with investments in our most compelling growth opportunities while we navigate continuing market headwinds, especially for education solutions.

Speaker Change: As seen again with recent NAPE results at 30 plus year lows, we're developing new partnership models with state, community and philanthropic organizations to support and fund literacy programs outside the school.

Speaker Change: And fourth, as parents and families take a more active role in their children's education at school and at home, especially post-Covid, we're building new channels to reach and support families directly.

Speaker Change: Turning to our near and long-term outlook.

Speaker Change: For Fiscal 2025, we're targeting modest growth in revenue and adjusted EBITDA, including the benefit of our strategic investment in Nine Storey, as Haji will discuss.

Peter Warwick: As I've said, we're moving ahead with investments in our most compelling growth opportunities while we navigate continuing market headwinds, especially for education solutions. In the new entertainment segment, we're executing on an expanded development and production. While green lights and production orders from the key platforms continue well below their record levels two and three years ago, we'll continue to build on core properties in fiscal 2025 while preparing for growth through synergies with Scholastic in fiscal 26 and beyond.

Haji Glover: As I've said, we're moving ahead with investments in our most compelling growth opportunities while we navigate continuing market headwinds, especially for education solutions.

Peter Warwick: In the new entertainment segment, we're executing on an expanded development and production slate. While green lights and production orders from the key platforms continue well below their record levels two and three years ago, we'll continue to build on core properties in fiscal 2025, while preparing for growth through synergies with Scholastic in fiscal 26 and beyond. Nine story has long standing and valuable IP partnerships that have buttressed their results during the current cycle. For example, the company produces a significant profit participation in Daniel Tiger's Neighborhood and Wild Crafts. PBS is top two shows currently. Baroptimistic both will continue for at least several more seasons.

Haji: In the new entertainment segment, we're executing on an expanded development and production slate.

Haji: While green lights and production orders from the key platforms continue well below their record levels two and three years ago, we'll continue to build on core properties in fiscal 2025 while preparing for growth through synergies with Scholastic in fiscal 26 and beyond.

Peter Warwick: Nine Story has long-standing and valuable IP partnerships that have buttressed their results during the current cycle. For example, the company produces and has significant profit participation in Daniel Tiger's Neighbourhood and Wild Kratts, PBS's top two shows currently.

Speaker Change: Nine Story has long-standing and valuable IP partnerships that have buttressed their results during the current cycle. For example, the company produces and has significant profit participation in Daniel Tiger's Neighbourhood and Wild Kratts.

Peter Warwick: We're optimistic both will continue for at least several more seasons. We're quickly moving forward to update our franchise licensing and distribution plans for key Scholastic brands, including Clifford and Magic School Bus, as development moves forward on major projects, even in the currently tight market. These core brands have significant value to our partners and upside to Scholastic, leveraging Nine Stories' licensing and merchandising sales. Nine Stories' strong YouTube presence and expertise present another opportunity for Scholastic's content that we've also begun executing.

Speaker Change: PBS's top two shows currently.

Peter Warwick: We're quickly moving forward to update our franchise licensing and distribution plans for key scholastic brands, including Clifford and Magic School Bus, as development moves forward on major projects even in the currently tight market. These core brands have significant value to our partners and upside to Scholastic, leveraging Nine Stories' strong YouTube presence and expertise presents another opportunity for Scholastic content that we've also begun executing on. In children's books, we have a bestseller field publishing plan featuring two of today's largest children's franchises in the world. First, we'll be publishing another Dogman title this fall, followed by the worldwide theatrical release of the Dogman movie in January 2025.

Haji: We're optimistic both will continue for at least several more seasons.

Haji: We're quickly moving forward to update our franchise licensing and distribution plans for key Scholastic brands including Clifford and Magic School Bus as development moves forward on major projects even in the currently tight market.

Haji: These core brands have significant value to our partners and upside for Scholastic, leveraging nine stories licensing and merchandising sales teams.

Haji: Nine Stories' strong YouTube presence and expertise presents another opportunity for Scholastic's content that we've also begun executing on.

Peter Warwick: In children's books, we have a bestseller-filled publishing plan featuring two of today's largest children's franchises in the world. First, we'll be publishing another Dogman title this fall, followed by the worldwide theatrical release of the Dogman movie in January 2025. Second, we're thrilled to be publishing Sunrise on the Reaping, the highly anticipated fifth book in Suzanne Collins' worldwide best-selling Hunger Games series, and doing so in March 2025 simultaneously in the US, Canada, the UK, Australia, and New Zealand.

Haji: In children's books, we have a bestseller-filled publishing plan featuring two of today's largest children's franchises in the world. First, we'll be publishing another Dogman title this fall, followed by the worldwide theatrical release of the Dogman movie in January , 2025.

Peter Warwick: Second, we're thrilled to be publishing "Sunrise on the Reeping," the highly anticipated fifth book in Suzanne Collins' worldwide best-selling Hunger Games series, and doing so in March 2025 simultaneously in the US, Canada, UK, Australia, and New Zealand. Lionsgate has already announced the movie adaptation of the book scheduled to be released in November 2026, which promises to continue bringing new readers to this mega franchise through fiscal 2027 and beyond. This fall, we also look forward to publishing Christmas at Hogwarts, a timeless picture book that will delight families and Harry Potter fans of all ages. We're all so excited about the Harry Potter Bake, Create and Decorate book, a companion to the New York Times bestsellers, the Official Harry Potter Baking Book and the Official Harry Potter Cookbook.

Haji: Second, we're thrilled to be publishing Sunrise on the Reaping, the highly anticipated fifth book in Suzanne Collins' worldwide best-selling Hunger Games series and doing so in March 2025 simultaneously in the US, Canada, UK, Australia and New Zealand.

Peter Warwick: Lionsgate has already announced a movie adaptation of the book, scheduled to be released in November 2026, which promises to continue bringing new readers to this mega-franchise through fiscal 2027 and beyond. This fall, we also look forward to publishing Christmas at Hogwarts, a timeless picture book that will delight families and Harry Potter fans of all ages. We're also excited about the Harry Potter Bake, Create, and Decorate book, a companion to the New York Times bestsellers, the official Harry Potter baking book and the official Harry Potter cookbook.

Speaker Change: Lionsgate has already announced a movie adaptation of the book, scheduled to be released in November 2026, which promises to continue bringing new readers to this mega franchise through fiscal 2027 and beyond.

Speaker Change: This fall, we also look forward to publishing Christmas at Hogwarts, a timeless picture book that will delight families and Harry Potter fans of all ages.

Speaker Change: We're also excited about the Harry Potter Bake, Create and Decorate book, a companion to the New York Times bestsellers The Official Harry Potter Baking Book and The Official Harry Potter Cookbook.

Peter Warwick: Building upon our leading positioning graphic novels, which have dominated the children's publishing industry and their ability to engage kids, this August, we launched Unico Awakening, the highly anticipated first title in a multi-volume, kid-friendly manga series, and we'll also launch two additional middle grade full-color manga series later in the fiscal year. In addition, we have a full line of exciting new titles from beloved and bestselling authors, Raina Telgemeier, Alice Hoffman, Pam Minya Thrayan, and Brian Sells. Nick. We have new publishing in our major series like The Babysitters Club, Goosebumps, and I Survived, and we'll be publishing the finale of Aaron Blabey's Bad Guy series in December, with another movie to follow in summer 2025.

Peter Warwick: Building upon our leading position in graphic novels, which have dominated the children's publishing industry and their ability to engage kids, this August, we launch UNICO Awakening, the highly anticipated first title in a multi-volume, kid-friendly manga series, and we'll also launch two additional middle-grade full-color manga series later in the fiscal year.

Speaker Change: Building upon our leading position in graphic novels, which have dominated the children's publishing industry and their ability to engage kids, this August we launched Unico Awakening, the highly anticipated first title in a multi-volume, kid-friendly manga series.

Speaker Change: and we'll also launch two additional middle grade full-color manga series later in the fiscal year.

Peter Warwick: In addition, we have a full lineup of exciting new titles from beloved and best-selling authors Rainer Telgemeier, Alice Hoffman, Pam Minyoth-Ryan, and Brian Selznick. We have new books in our major series like The Babysitter's Club, Goosebumps, and I Survived, and we'll be publishing the finale of Aaron Blaby's Bad Guys series in December with another movie to follow in summer 20 In March, we'll be publishing That's Not Funny, David, a brand new No David book from internationally acclaimed Caldecott Honor creator David Shannon.

Speaker Change: In addition, we have a full lineup of exciting new titles from beloved and best-selling authors Rainer Telgemeier, Alice Hoffman, Pam Minyoth-Ryan and Brian Selznick.

Speaker Change: We have new publishing in our major series like The Babysitter's Club, Goosebumps and I Survived, and we'll be publishing the finale of Aaron Blaby's Bad Guys series in December with another movie to follow in summer 2025.

Peter Warwick: In March, we'll be publishing, that's not funny, David, a brand new, no-David book from internationally acclaimed Colticottonor Creator, David Shannon. In school bookfares, we're planning for modest growth for fiscal 2025, as we invest in long-term growth initiatives, including actions to grow revenue per fair this year and beyond. Share the Fair is a new giving program enabling schools to collect digital contributions from the school community to support students who need help buying books. The program was successfully piloted in fiscal 2024, and we're optimistic about its full rollout in fiscal 2025. Continued category optimization, new case types, and strategic value pricing should also contribute positively to revenue per fair.

Speaker Change: In March, we'll be publishing That's Not Funny, David, a brand new No David book from internationally acclaimed Caldecott Honor creator, David Shannon.

Peter Warwick: In school book fairs, we're planning for modest growth for fiscal 2025 as we invest in long-term growth initiatives including actions to grow revenue per fair this year and beyond. Share the Fair is a new giving program enabling schools to collect digital contributions from the school community to support students who need help buying books. The program was successfully piloted in fiscal 2024, and we're optimistic about its full rollout in fiscal 2025. Continued category optimisation, new case types, and strategic value pricing should also contribute positively to revenue per fair.

Speaker Change: In school book fairs, we're planning for modest growth for fiscal 2025 as we invest in long-term growth initiatives.

Speaker Change: including actions to grow revenue per fare this year and beyond.

Speaker Change: Share the Fair is a new giving program enabling schools to collect digital contributions from the school community to support students who need help buying books. The program was successfully piloted in fiscal 2024 and we're optimistic about its full rollout in fiscal 2025.

Speaker Change: Continued category optimization, new case types and strategic value pricing should also contribute positively to revenue per fair. We've exciting plans around the release of the next Dogman title and film, leveraging Scholastic Book Fair's exclusive access.

Peter Warwick: We've exciting plans around the release of the next Dogman title and film, leveraging Scholastic Bookfairs' exclusive access to the hottest children's and young adult titles. With respect to fair counts, we've invested in our sales structure and processes to increase prospecting, reduce churn, and ensure our bookfair host success. So far, we're on track with early bookings to achieve our fiscal 2025 target of 90,000 fairs. This year, we'll continue investing to grow long-term fair count and the addressable market for bookfares, with piloting new operating models to profitably serve schools outside our core public school markets and investing in our sponsored fairs growth with taps local and national organisations to bring bookfares to schools in high-need communities, which we currently don't serve.

Peter Warwick: We have exciting plans around the release of the next Dogman title in film, leveraging Scholastic Book Fair's exclusive access to the hottest children's and young adult titles. With respect to fare counts, we've invested in our sales structure and processes to increase prospecting, reduce churn, and ensure our book fair hosts' success. So far, we're on track with early bookings to achieve our fiscal 2025 target of 90,000

Speaker Change: to the Hottest Children's and Young Adult titles.

Speaker Change: With respect to fair counts

Speaker Change: We've invested in our sales structure and processes to increase prospecting, reduce churn and ensure our book fair hosts' success.

Speaker Change: So far, we're on track with early bookings.

Peter Warwick: This year we'll continue investing to grow long-term fare count and the addressable market for book fares. We're piloting new operating models to profitably serve schools outside our core public school markets and investing in our sponsored fares growth, which taps local and national organizations to bring book fares to schools in high-need communities which we currently don't serve. In school book clubs, we're launching redesigned flyers and new offers and enhancing our value proposition with unique scholastic assets to re-engage a profitable core of customers and revitalise this strategic channel to teachers and families.

Speaker Change: to achieve our fiscal 2025 target of 90,000 fares.

Speaker Change: This year, we'll continue investing to grow long-term fare count and the addressable market for book fares.

Speaker Change: We're piloting new operating models to profitably serve schools outside our core public school markets and investing in our sponsored fares growth which taps local and national organisations to bring book fares to schools in high-need communities which we currently don't serve.

Peter Warwick: In school bookfabs, we're launching redesigned flyers and new offers and enhancing our value proposition with unique scholastic assets to re-engage a profitable core of customers and revitalize this strategic channel to teachers and families. Complementing our school-based channels to kids and families and leveraging our trusted brand and distribution infrastructure, we've also begun piloting new direct-to-home channels and offers to families of young children. Based on extensive research and testing, we're targeting a substantial opportunity to help parents and caregivers support their kids' early development as readers and learners. While we don't expect these investments to materially contribute to top-line growth in fiscal 2025, we're optimistic about the opportunity in fiscal 2026 and beyond, and we look forward to providing further updates.

Speaker Change: In school book clubs, we're launching redesigned flyers and new offers and enhancing our value proposition with unique scholastic assets to re-engage a profitable core of customers and revitalise this strategic channel to teachers and families.

Peter Warwick: Complementing our school-based channels to kids and families, and leveraging our trusted brand and distribution infrastructure, we've also begun piloting new direct-to-home channels and offers to families of young children. Based on extensive research and testing, we're targeting a substantial opportunity to help parents and caregivers support their kids' early development as readers and learners. While we don't expect these investments to materially contribute to top land growth in fiscal 2025, we're optimistic about the opportunity in fiscal 2026 and beyond, and we look forward to providing further updates.

Speaker Change: Complementing our school-based channels to kids and families and leveraging our trusted brand and distribution infrastructure, we've also begun piloting new direct-to-home channels and offers to families of young children.

Speaker Change: Based on extensive research and testing, we're targeting a substantial opportunity to help parents and caregivers support their kids early development as readers and learners.

Speaker Change: While we don't expect these investments to materially contribute to top line growth in fiscal 2025, we're optimistic about the opportunity in fiscal 2026 and beyond, and we look forward to providing further updates.

Peter Warwick: Turning to education solutions, we're targeting solid growth in ourselves to state and community literacy partners as these organisations continue investing to improve kids' access to books at home and outside the school, which is proven to benefit reading development. We're also launching new partnership models and programmes for philanthropic organisations to give kids in high-need schools and communities the ability to choose and build their own home. We expect growth from new literacy funding sources to help offset further declines in sales of supplemental literacy materials, especially those not explicitly aligned with the signs of reading. This year we plan to continue investing in a pipeline of literacy programs better aligned with current literacy instruction.

Peter Warwick: Turning to education solutions, we're targeting solid growth in our sales to state and community literacy partners as these organizations continue investing in improving kids' access to books at home and outside the school, which is proven to benefit reading development. We're also launching new partnership models and programs for philanthropic organizations to give kids in high-need schools and communities the ability to choose and build their own home life. We expect growth from new literacy funding sources to help offset further declines in sales of supplemental literacy materials, especially those not explicitly aligned with the science of reading.

Speaker Change: Turning to education solutions, we're targeting solid growth in our sales to state and community literacy partners as these organizations continue investing to improve kids' access to books at home and outside the school, which is proven to benefit reading development.

Speaker Change: We're also launching new partnership models and programs for philanthropic organizations to give kids in high-need schools and communities the ability to choose and build their own home libraries.

Speaker Change: We expect growth from new literacy funding sources to help offset further declines in sales of supplemental literacy materials, especially those not explicitly aligned with the science of reading.

Peter Warwick: This year we plan to continue investing in a pipeline of literacy programs better aligned with current literacy instruction. These include a new middle school ELA program leveraging our extensive and engaging classroom magazine content, new knowledge building libraries to replace our level book rooms and guided reading collections, and engaging new decodable collections, including for older students, building on our Ready for Reading program which we launched last year. We expect to launch these products in the 2025-26 school year and anticipate they'll contribute to growth beginning in fiscal 2026 as the funding cycle for supplemental products improves.

Speaker Change: This year we plan to continue investing in a pipeline of literacy programs better aligned with current literacy instruction.

Peter Warwick: These include a new middle school ELA program leveraging our extensive and engaging classroom magazine content, new knowledge building libraries to replace our level book rooms and guided reading collections, and then engaging new decodable collections, including for older students, building on our Ready for Reading program which we launched last year. We expect to launch these products in the 2025-26 school year and anticipate they'll contribute to growth beginning in fiscal 2026 as the funding cycle for supplemental products improves. In international modest growth across major markets, including in trade and continued operation improvements in Canada, are expected to drive further improvements in operating margins and contribution relative to fiscal 2024 as we pursue opportunities to build operating scale in major markets and expand our English language offering in Asia.

Speaker Change: These include a new middle school ELA program leveraging our extensive and engaging classroom magazine content, new knowledge building libraries to replace our level book rooms and guided reading collections, and engaging new decodable collections including for older students.

Speaker Change: building on our Ready for Reading program which we launched last year. We expect to launch these products in the 2025-26 school year and anticipate they'll contribute to growth beginning in fiscal 2026 as the funding cycle for supplemental products improves.

Peter Warwick: In international, modest growth across major markets, including in trade and continued operation improvements in Canada, is expected to drive further improvements in operating margins and contribution relative to fiscal 2024, as we pursue opportunities to build operating scale in major markets and expand our English language offering in Asia. Haji will provide more details in a moment, including the expected contribution of our strategic investment in Nine Storey and actions we're taking on the cost.

Speaker Change: In international, modest growth across major markets, including in trade and continued operation improvements in Canada are expected to drive further improvements in operating margins and contribution relative to fiscal 2024.

Speaker Change: as we pursue opportunities to build operating scale in major markets and expand our English language offering in Asia.

Haji Glover: Had you'll provide more details in a moment, including the expected contribution of our strategic investment in nine-story and actions we're taking on the cost side.

Speaker Change: Haji will provide more details in a moment including the expected contribution of our strategic investment in Nine Storey and actions we're taking on the cost side.

Peter Warwick: In summary, Scholastic's fiscal 2025 plan is to continue and accelerate the progress of fiscal 2024 toward our strategic goal. As we respond to our dynamic markets, both in the short and long term, we remain committed to realizing the full potential of Scholastic's unique strength, our trusted brand, our unique channels, and our extensive content to meet an essential growing need among kids, parents, and educators, giving kids the power and joy of stories and learning. With that, I'll turn the call over to Haji to review our Fiscal 2024 results and Fiscal 2025 guide.

Peter Warwick: In summary, Scholastic's fiscal 2025 plan is to continue and accelerate the progress of fiscal 2024 toward our strategic goals. As we respond to our dynamic markets, both in the short and long term, we remain committed to realizing the full potential of Scholastic's unique strengths, our trusted brand, our unique channels, and our extensive content to meet an essential growing need among kids, parents, and educators, giving kids the power and joy of stories and learning.

Speaker Change: In summary, Scholastic's Fiscal 2025 plan is to continue and accelerate the progress of Fiscal 2024 toward our strategic goals.

Speaker Change: As we respond to our dynamic markets, both in the short and long term, we remain committed to realising the full potential of Scholastic's unique strengths, our trusted brand, our unique channels and our extensive content.

Speaker Change: to meet an essential growing need among kids, parents and educators.

Haji Glover: With that, I'll turn the call over to Haji to review our fiscal 2024 results in fiscal 2025 guidelines. Thank you, Peter, and good afternoon, everyone. Today I will refer to our adjusted results for the fourth quarter in full fiscal year, including one-time items that less otherwise indicated.

Speaker Change: giving kids the power and joy of stories and learning.

Speaker Change: With that, I'll turn the call over to Haji to review our fiscal 2024 results and fiscal 2025 guidance.

Haji Glover: Thank you, Peter, and good afternoon, everyone. Today I will refer to our adjusted results for the fourth quarter and full fiscal year, including one-time items unless otherwise indicated. Please refer to our press release tables and SEC filings for a complete discussion of one-time items. As Peter noted, a more challenging market for our education and book fair businesses caused Q4 performance to fall below our prior year period and below our revised guidance.

Haji: Thank you, Peter, and good afternoon, everyone. Today, I will refer to our adjusted results for the fourth quarter and full fiscal year, excluding one-time items unless otherwise indicated.

Haji Glover: Please refer to our press release tables in SEC filings for a complete discussion of one-time items. As Peter noted, a more challenging market for our education and book fair businesses calls Q4 performance to fall below our prior year period and below our revised guidance. widespread adoptions of ELA Q4 curriculum and the continued shift of science-based approaches for literacy instructions impacted spending on supplementary materials while increasing softness and customer spending impacted revenues per fair and book fairs. While steps were taken to preserve operating margin, we maintained spending on key initiatives, including new structured literacy programs, which we expect to launch in the 2025-26 school years.

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

Haji: As Peter noted, a more challenging market for our education and book fair businesses caused Q4 performance to fall below our prior year period and below our revised guidance.

Haji Glover: Widespread adoptions of ELA core curricula and the continued shift of science-based approaches for literacy instruction impacted spending on supplementing materials, while increasing softness in customer spending impacted revenues per fair and book fair. While steps were taken to preserve operating margins, we maintained spending on key initiatives, including new structured literacy programs, which we expect to launch in the 2025-2026 school year. In Book Fares, we successfully added new fares, but due to the strong operating leverage in this business, operating margins were negatively impacted by lower average revenue per fare.

Haji: Widespread adoptions of ELA core curricula and the continued shift of science-based approaches for literacy instructions impacted spending on supplementing materials while increasing softness in customer spending impacted revenues per fair and book fairs.

Speaker Change: While steps were taken to preserve operating margins, we maintained spending on key initiatives, including new structured literacy programs, which we expect to launch in the 2025-2026 school years.

Haji Glover: In book fairs, we successfully added new fairs, but due to the strong operating leverage in this business, operating margins were negatively impacted by lower average revenue per fair. In response to these headwinds, we tightly managed inventorying cash, contributing to favorable free cash flow. Despite these challenges, trade channels in the U.S. and UK perform well due to a strong publishing pipeline, and we resize our U.S. book club business as we tested new offerings to profitably grow this channel in future periods. Internationally, our Canadian operations continue to benefit from restructuring activities in prior periods.

Speaker Change: In book fares, we successfully added new fares, but due to the strong operating leverage in this business, operating margins were negatively impacted by lower average revenue per fare.

Haji Glover: In response to these headwinds, we tightly managed inventory, contributing to favorable free cash flow. Despite these challenges, trade channels in the U.S. and U.K. perform well due to a strong publishing pipeline, and we resized our U.S. book club's business as we tested new offerings to profitably grow this channel in future periods. Internationally, our Canadian operations continue to benefit from restructuring activities in prior periods.

Speaker Change: In response to these headwinds, we tightly managed inventory and cash, contributing to favorable free cash flow.

Speaker Change: Despite these challenges, trade channels in the U.S. and U.K. performed well due to a strong publishing pipeline, and we resized our U.S. book club's business as we tested new offerings to profitably grow this channel in future periods.

Speaker Change: Internationally, our Canadian operations continue to benefit from restructuring activities in prior periods.

Haji Glover: Turning to our Consolidated Financial Results, in the fourth quarter, relative to prior a year, revenues decreased 10% to 474.9 million, reflecting the market headwinds I just described. Operating income of 66.8 million was down 25.2 million. Net income was 50.5 million compared to 75.7 million in the prior year period, and earnings per diluted share were $1.73 compared to $2.26. This reflected in the lower net income, partially offset by the benefit of significant share repurchases, which lowered diluted share count to 29.2 million from 33.5 million a year ago. Adjusted EBITDA decreased to 91 million from 115 million in the prior year period.

Haji Glover: Turning to our Consolidated Financial Results, in the fourth quarter, relative to the prior year, revenues decreased 10% to $474.9 million, reflecting the market headwinds I just described. Property income of $66.8 million was down $25.2 million. Net income was $50.5 million compared to $75.7 million in the prior year period, and earnings per diluted share were $1.73 compared to $2.26. This was reflected in the lower net income partially offset by the benefit of significant share repurchases, which lowered the diluted share count to 29.2 million from 33.5 million a year ago. Adjusted EBITDA decreased to $91 million from $115 million in the prior year period.

Speaker Change: Turning to our consolidated financial results.

Speaker Change: In the fourth quarter, relative to the prior year, revenues decreased 10% to $474.9 million, reflecting the market headwinds I just described.

Speaker Change: Operating income of $66.8 million was down $25.2 million.

Speaker Change: Net income was $50.5 million compared to $75.7 million in the prior year period, and earnings per diluted share were $1.73 compared to $2.26.

Speaker Change: This reflected in the lower net income partially offset by the benefit of significant share repurchases, which lowered diluted share count to 29.2 million from 33.5 million a year ago.

Speaker Change: Adjusted EBITDA decreased to $91 million from $115 million in the prior year period.

Haji Glover: For the full year, revenues decreased 7% to 1.6 billion. Operating income decreased 58% to 44.7 million. Net income was 34.6 million, down from 86.3 million in the prior year period, and adjusted EBITDA decreased to 136.9 million from 196.3 million in fiscal 2023.

Haji Glover: For the full year, revenues decreased 7% to $1.6 billion. Operating income decreased 58% to 44.7%. Net income was $34.6 million, down from $86.3 million in the prior year period. Adjusted EBITDA decreased to $136.9 million from $196.3 million in fiscal 2023. Full year earnings per diluted share were $1.14, down 54% from $2.49 in the prior year period. Now turning to our segment results.

Speaker Change: For the full year, revenues decreased 7% to $1.6 billion.

Speaker Change: Operating income decreased 58% to $44.7 million.

Speaker Change: Net income was $34.6 million, down from $86.3 million in the prior year period, and adjusted EBITDA decreased to $136.9 million from $196.3 million in fiscal 2023.

Haji Glover: Full year earnings per diluted share were $1.14, down 54% from $2.49 in the prior year period. Now turning to our segment results. In children's book publishing and distribution, revenues for the fourth quarter decreased 9% to 266 million, driven by resizing of book clubs, lower revenue per fair and book fairs, and timing-related revenue in Scholastic Entertainment, partially offset by increased sales and trade. Revenues were down 8% to 955.2 million for the full fiscal year. Segment operating income was down 8.5 million from the prior year period to 49.9 million, primarily reflecting the high operating leverage impact of lower revenue per fair.

Speaker Change: Full year earnings per diluted share were $1.14, down 54% from $2.49 in the prior year period.

Haji Glover: In children's book publishing and distribution, revenues for the fourth quarter decreased 9% to $266 million, driven by resizing of book clubs, lower revenue per fair and book fairs, and timing-related revenue in Scholastic Entertainment, partially offset by increased sales and trade. Overall, revenues were down 8% to $955.2 million for the full fiscal year. Segment operating income was down $8.5 million from the prior year period to $49.9 million, primarily reflecting the high operating leverage impact of lower revenue per fare.

Speaker Change: Now turning to our segment results.

Speaker Change: In children's book publishing and distribution, revenues for the fourth quarter decreased 9% to $266 million, driven by resizing of book clubs, lower revenue per fair and book fairs, and timing-related revenue in Scholastic Entertainment, partially offset by increased sales and trade.

Speaker Change: Revenues were down 8% to $955.2 million for the full fiscal year.

Speaker Change: Segment operating income was down $8.5 million from the prior year period to $49.9 million.

Speaker Change: primarily reflecting the high operating leverage impact of lower revenue per fare.

Haji Glover: For the full fiscal year, operating income for the children's book segment decreased 21.5 million to 121.9 million. Book fair revenues decreased 6% in the fourth quarter to 169.5 million, and 2% for the full year to 541.6 million. Although fair counting increased, revenue per fair was lower than prior year record levels, though while ahead of pre-pandemic levels, on lower transaction volumes. Merchandising efforts resulted in higher transaction sizes, partially offsetting the spending headwinds that impacted participation, as discussed by Peter. Book clubs' revenue in the fourth quarter of 14.4 million was down versus the prior year period revenues of 26.2 million.

Haji Glover: For the full fiscal year, operating income for the children's book segment decreased $21.5 million to $121.9 million. Book Fair revenues decreased 6% in the fourth quarter to $169.5 million and 2% for the full year to $541.6 million. Although fare count increased, revenue per fare was lower than prior year record levels, still well ahead of pre-pandemic levels on lower transaction volumes.

Speaker Change: For the full fiscal year, operating income for the children's book segment decreased $21.5 million to $121.9 million.

Speaker Change: Both their revenues decreased 6% in the fourth quarter to $169.5 million and 2% for the full year to $541.6 million.

Speaker Change: Although fare count increased, revenue per fare was lower than prior year record levels, though well ahead of pre-pandemic levels on lower transaction volumes.

Speaker Change: Merchandising efforts resulted in higher transaction sizes.

Speaker Change: partially are settings of spinning headwinds that impacted participation as discussed by Peter.

Haji Glover: Merchandising efforts resulted in higher transaction sizes, partially offsetting the spinning headwinds that impacted participation, as discussed above. Book Club's revenue in the fourth quarter of $14.4 million was down versus the prior year period revenues of $26.2 million, and full-year revenues of $62.7 million trail the prior year revenues of $117.8 million. As book clubs have resized to a smaller, more profitable business, efforts are underway to test various offerings to improve teacher engagement and Scholastic Entertainment revenues, which are also recorded in the Consolidated Trade Channel.

Speaker Change: Book Club's revenue in the fourth quarter of $14.4 million were down versus the prior year period revenues of $26.2 million.

Haji Glover: Full year revenues of 62.7 million trailed the prior year revenues of 117.8 million. As book clubs is resized to a smaller, more profitable business, efforts are underway to test various offerings to improve teacher engagement. The school is Scholastic Containment Revenues, which are also recorded in Consolidated Trade Channel. Trade revenue than the fourth quarter increased to 81.6 million compared to prior year revenues of 79.3 million. Full year revenues were 349 million, in line with 348.1 million in their prior year. Despite a difficult retail market, the company's best-selling publishing continues to resonate with customers.

Speaker Change: Full-year revenues of $62.7 million trail the prior-year revenues of $117.8 million.

Speaker Change: As book clubs is resized to a smaller, more profitable business, efforts are underway to test various offerings to improve teacher engagement.

Haji Glover: Trade revenue in the fourth quarter increased to $81.6 million compared to prior year revenues of $79.3 million. Full-year revenues were $349 million, in line with $348.1 million in the prior year. Despite a difficult retail market, the company's best-selling publishing continues to resonate with customers. Scholastic Entertainment revenues decreased due to the prior year release of Eva, the Outlet TV series. Beginning in fiscal 2025, Scholastic Entertainment will be combined with Nine Story Media Group in a new segment for the company.

Speaker Change: The school is Scholastic Entertainment Revenues, which are also recorded in Consolidated Trade Channel.

Speaker Change: Trade revenue in the fourth quarter increased to $81.6 million compared to prior year revenues of $79.3 million.

Speaker Change: Full-year revenues were $349 million, in line with $348.1 million in the prior year.

Speaker Change: Despite a difficult retail market, the company's best-selling publishing continues to resonate with customers.

Haji Glover: Scholastic Entertainment revenues decreased due to the prior year release of EVA of the outlet TV series. Beginning in fiscal 2025, Scholastic Containment will be combined with Nine-Story Media Group in a new segment for the company. Excluding the impact from resizing book clubs and the timing of Scholastic Containment Released dates, the revenues and the segment decreased 3% in the fourth quarter and 1% for the full year.

Speaker Change: Scholastic Entertainment revenues decreased due to the prior year release of Eva the Owlette TV series.

Speaker Change: Beginning in Fiscal 2025, Scholastic Entertainment will be combined with Nine Story Media Group in a new segment for the company.

Haji Glover: Excluding the impact of resizing book clubs and the timing of Scholastic Entertainment release dates, revenues in the segment decreased 3% in the fourth quarter and 1% for the full year. In education, Q4 revenues were $135.7 million, down 17% from the prior year period. And for the full year, revenues were $351.2 million, down 9% when compared to 2023. As we discussed, the challenging market for supplemental literacy curricula, as well as increasing competition, impacted sales for key product lines, including classroom libraries and summer reading collections.

Speaker Change: Excluding the impact from resizing book clubs and the timing of Scholastic Entertainment release dates, the revenues in the segment decreased 3% in the fourth quarter and 1% for the full year.

Haji Glover: In education, Q4 revenues were 135.7 million, down 17% from prior year period, and for the full year revenues were 351.2 million, down 9% would compare to 2023. As we discussed, the challenging market for supplemental literacy curricula, as well as increasing competition, impacted sales for key product lines, including classroom libraries and summer reading collections. This was partly offset by the growth in our sales to non-school, state, and community literacy partners, which we see as a strategic growth opportunity. Segment operating income decreased 19.4 million to 35.6 million in Q4 compared to the prior year period. Full year segment operating income decreased to 21.9 million compared to 58.4 million in the prior year period.

Speaker Change: In education, Q4 revenues were $135.7 million, down 17% from prior year period. And for the full year, revenues were $351.2 million, down 9% when compared to 2023.

Speaker Change: As we discussed, the challenging market for supplemental literacy curricula, as well as increasing competition, impacted sales for key product lines, including classroom libraries and summer reading collections.

Haji Glover: This was partly offset by the growth in our sales to non-school, state, and community literacy partners, which we see as a strategic growth opportunity. Segment operating income decreased $19.4 million to $35.6 million in Q4 compared to the prior year period. Full-year segment operating income decreased to $21.9 million compared to $58.4 million in the prior year.

Speaker Change: This was partly offset by the growth in our sales to non-school, state, and community literacy partners, which we see as a strategic growth opportunity.

Speaker Change: Segment operating income decreased $19.4 million to $35.6 million in Q4 compared to a prior year period.

Speaker Change: Full-year segment operating income decreased to $21.9 million compared to $58.4 million in the prior year period.

Haji Glover: Low revenues coupled with continued investment in future product offerings resulted in lower operating margins. The international segment revenue is a 70.8 million in the fourth quarter trail of the prior year period revenues of 73.9 million, partly reflected 400,000 year-over-year impact of unfavorable foreign currency exchange. For the full year, international segment revenues of 273.6 million were down from the prior year's revenue of 279.4 million. Year-over-year, the foreign exchange had a negative 1.1 million impact. The decrease in revenues was primarily due to lower sales in the Asia and Australia trade channels due to softness in the retail market.

Haji Glover: Lower revenues coupled with continued investment in future product offerings resulted in lower operating margins. The international segment revenues of $70.8 million in the fourth quarter trailed prior year period revenues of $73.9 million, partly reflecting the $400,000 year-over-year impact of unfavorable foreign currency exchanges. For the full year, international segment revenues of $273.6 million were down from the prior year's revenue of $279.4 million. Year over year, foreign exchange had a negative 1.1 million impact.

Speaker Change: Lower revenues coupled with continued investment in future product offerings resulted in lower operating margins.

Speaker Change: The international segment revenues of $70.8 million in the fourth quarter trailed prior year period revenues of $73.9 million, partly reflecting $400,000 year-over-year impact of unfavorable foreign currency exchange.

Speaker Change: For the full year, international segment revenues of $273.6 million were down from the prior year's revenue of $279.4 million.

Haji Glover: The decrease in revenues was primarily due to lower sales in the Asia and Australia trade channels due to softness in the retail market. However, this was partially offset in the UK, where the company's popular global titles performed well. The segment operating income in the fourth quarter decreased to $1.8 million compared to $2.2 million in the prior period. For fiscal 2024, the segment operating loss was $3.1 million compared to a loss of $3.6 million in the prior year.

Speaker Change: Year over year, the foreign exchange had a negative 1.1 million impact.

Speaker Change: The decrease in revenues was primarily due to lower sales in the Asia and Australia trade channels due to softness in the retail market. This was partially offset in the UK, where the company's popular global titles performed well.

Haji Glover: This was partially offset in the UK, where the company's popular global titles performed well. The segment operating income in the fourth quarter decreased to 1.8 million compared to 2.2 million in the prior period. For fiscal 2024, segment operating loss was $3.1 million compared to a loss of $3.6 million in the prior year.

Speaker Change: The segment operating income in the fourth quarter decreased to $1.8 million compared to $2.2 million in the prior period.

Speaker Change: For fiscal 2024, segment operating loss was $3.1 million compared to a loss of $3.6 million in the prior year.

Haji Glover: Unallocated overhead costs were 20.5 million in the fourth quarter, improving from 23.6 million in the prior period, reflecting lower employee-related costs. For the full year, unallocated overhead costs of 96 million dollars were 4% higher when compared to prior year of 91.9 million. The year-over-year increase was primarily related to the inflationary impact on lower-end costs.

Haji Glover: Unallocated overhead costs were $20.5 million in the fourth quarter, improving from $23.6 million in the prior period, reflecting lower employee-related costs. For the full year, unallocated overhead costs of $96 million were 4% higher when compared to the prior year of $91.9 million. The year-over-year increase was primarily related to the inflationary impact on overhead costs.

Speaker Change: Unallocated overhead costs were $20.5 million in the fourth quarter, improving from $23.6 million in the prior period, reflecting lower employee-related costs.

Speaker Change: For the full year, unallocated overhead costs of $96 million were 4% higher when compared to prior year of $91.9 million.

Haji Glover: Now turning to cash flow in the balance sheet. For the full year, net cash provided by operating activities was 154.6 million compared to 148.9 million in the prior year. 3 cash flow increase to 73.4 million in fiscal 2024 compared to 60 million in the prior year period. Improvements in cash flow were largely driven by lower inventory purchases, partially offset by lower customer remittance on decreased sales. At the end of the fiscal year, cash and cash equivalents, net of total debt, was 107.7 million compared to 218.5 million at the end of the prior year. In fiscal 2024, the company continued executing strategies to deploy capital, including returning excess cash to shareholders.

Speaker Change: The year-over-year increase was primarily related to inflationary impact on overhead costs.

Haji Glover: Now I'm turning to cash flow in the balance sheet. For the full year, net cash provided by operating activities was $154.6 million compared to $148.9 million in the prior year. Free cash flow increased to $73.4 million in fiscal 2024 compared to $60 million in the prior year period. Improvements in cash flow were largely driven by lower inventory purchases, partially offset by lower customer remittance on decreased sales.

Speaker Change: Now I'm turning to cash flow in the balance sheet.

Speaker Change: For the full year, net cash provided by operating activities was $154.6 million compared to $148.9 million in the prior year.

Speaker Change: Free cash flow increased to $73.4 million in fiscal 2024 compared to $60 million in the prior year period.

Speaker Change: Improvements in cash flow were largely driven by lower inventory purchases, partially offset by lower customer remittance on decreased sales.

Haji Glover: At the end of the fiscal year, cash and cash equivalents, net of total debt, were $107.7 million compared to $218.5 million at the end of the prior year. In fiscal 2024, the company continued executing its strategies to deploy capital, including returning excess cash to shareholders. Open market share repurchases combined with a regular dividend returned over $181 million to shareholders in the fiscal year 2024, including nearly $20 million in the quarter. This represents a $21 million increase over fiscal 2023.

Speaker Change: At the end of the fiscal year, cash and cash equivalents, net of total debt, was $107.7 million compared to $218.5 million at the end of the prior year. In fiscal 2024, the company continued executing its strategies to deploy capital, including returning excess cash to shareholders.

Haji Glover: Open market share repurchases combined with regular dividend return over 181 million to shareholders in the fiscal year 2024, including nearly 20 million in the quarter. This represents a 21 million increase over Fiscal 2023. In total, we were purchased over 3.9 million shares, which, net of 500,000 shares issued related to stock compensation, represented 11% of company shares outstanding. Over the past two fiscal years, we were purchased 7.3 million shares, which net of 1.3 million shares issued for stock compensation represented 18% of the company shares outstanding.

Speaker Change: Open market share repurchases combined with regular dividend returns over $181 million to shareholders in the fiscal year 2024, including nearly $20 million in the quarter.

Haji Glover: In total, we repurchased over 3.9 million shares, which net of 500,000 shares issued related to stock compensation represented 11% of the companies' shares outstanding. Over the past two fiscal years, we repurchased 7.3 million shares, which net of 1.3 million shares issued for stock compensation represented 18% of the company's shares outstanding.

Speaker Change: This represents a $21 million increase over fiscal 2023. In total, we repurchased over 3.9 million shares, which net of 500,000 shares issued related to stock compensation represented 11% of companies' shares outstanding.

Speaker Change: Over the past two fiscal years, we repurchased 7.3 million shares, which net of 1.3 million shares issued for stock compensation, represented 18% of the company's shares outstanding.

Haji Glover: As we begin fiscal 2025, the company borrowed approximately 200 million under its existing revolving credit facility to complete the nine-story media transaction and meet the seasonal, summertime working capital needs of the organization. We are currently in the process of securing a more permanent debt facility to fund the acquisition. Based on budgeted growth investments and current forecast working capital needs, including inventory purchasing and lower expected earnings, our current outlook for pre-cast flow is 20 to 30 million. We will continue to pursue opportunities to leverage our balance sheet and deploy capital by first, investing in growth opportunities; second, maintaining the strong and efficient balance sheet; and third, returning SSKAS to shareholders to enhance their returns.

Haji Glover: As we begin fiscal 2025, the company borrowed approximately $200 million under its existing revolving credit facility to complete the NYSERDA immediate transaction and meet the seasonal summertime working capital needs of the organization. We are currently in the process of securing a more permanent debt facility to fund the acquisition. Based on budgeted growth investments and current forecast working capital needs, including inventory purchasing and lower expected earnings, our current outlook for free cash flow is $20 to $30 million.

Speaker Change: As we begin fiscal 2025, the company borrowed approximately $200 million under its existing revolving credit facility to complete the nine-story media transaction and meet the seasonal summertime working capital needs of the organization.

Speaker Change: We are currently in the process of securing a more permanent debt facility to fund the acquisition.

Speaker Change: Based on budgeted growth investments and current forecast working capital needs, including inventory purchasing and lower expected earnings, our current outlook for free cash flow is $20 to $30 million.

Haji Glover: We will continue to pursue opportunities to leverage our balance sheet and deploy capital by, first, investing in growth opportunities, second, maintaining a strong and efficient balance sheet, and third, returning excess cash to shareholders to enhance their returns. As discussed, beginning in fiscal 2025, we will be adding a new entertainment segment, which will consolidate results from the company's existing Scholastic Entertainment division, reported historically in the children's book segment, with the newly added nine-story media group.

Speaker Change: We will continue to pursue opportunities to leverage our balance sheet and deploy capital by first, investing in growth opportunities, second, maintaining a strong and efficient balance sheet, and third, returning excess cash to shareholders to enhance their returns.

Haji Glover: As discussed, beginning in fiscal 2025, we will be adding a new entertainment segment, which will consolidate results from the company's existing Scholastic Entertainment Division and report it historically in the children's book segment, with the newly added nine-story media group. The current slide, as well as tables in the earnings press release, provides historical results for both Scholastic Entertainment and Nine-Story. As Peter Jeff discuss, both businesses' results benefited in the fiscal 2022 and 2023 from high levels of spending on new productions by major streaming platforms. This retracted in 2024 with fewer productions being greenlit and is expected to remain under pressure for the next 12 to 18 months.

Speaker Change: As discussed beginning in fiscal 2025, we will be adding a new entertainment segment, which will consolidate results from the company's existing scholastic entertainment division reported historically in the children's book segment with the newly added nine-story media group.

Haji Glover: The current slide, as well as tables in the earnings press release, provides historical results for both Scholastic Entertainment and Nine Stories. As Peter just discussed, both businesses' results benefited in fiscal 2022 and 2023 from high levels of spending on new productions by major streaming platforms, but this retracted in 2024 with fewer productions being greenlit, and it is expected to remain under pressure for the next 12 to 18 months.

Speaker Change: The current slide, as well as tables in the earnings press release, provide historical results for both Scholastic Entertainment and Nine Story.

Speaker Change: As Peter just discussed, both businesses' results benefited in fiscal 2022 and 2023 from high levels of spending on new productions by major streaming platforms.

Peter Warwick: This retracted in 2024 with fewer productions being greenlit and is expected to remain under pressure for the next 12 to 18 months.

Haji Glover: While this has impacted all players in the industry, Nine Story has been able to outperform peers on the strength of its premium reputation, IP, and partnerships, much less Scholastic Entertainment has. In fiscal 2025, we expect solid growth and segment adjusted EBITDA, as we execute on the company-wide synergies and franchise plans, which should benefit the segment and children's books results in fiscal 2026 and beyond. In fiscal 2025, our priorities to continue executing our strategic growth initiatives, including the integration of nine-story, while navigating continued ahead to within our education solution segment, resuming modest growth in children's books and tightly managing short-term spending.

Haji Glover: While this has impacted all players in the industry, Ninth Story has been able to outperform peers on the strength of its premium reputation, IP, and partnerships, much like Scholastic Entertainment has. In fiscal 2025, we expect solid growth and segment-adjusted EBITDA as we execute on the company-wide synergies and franchise plans, which should benefit this segment and children's book results in fiscal 2026 and beyond. In fiscal 2025, our priority is to continue executing our strategic growth initiatives, including the integration of 9-3, while navigating continued headwinds in our education solutions, resuming modest growth in children's books, and tightly managing short-term spending.

Speaker Change: While this has impacted all players in the industry, Ninth Story has been able to outperform peers on the strength of its premium reputation, IP, and partnerships, much like Scholastic Entertainment has.

Speaker Change: In fiscal 2025, we expect solid growth in segment-adjusted EBITDA as we execute on the company-wide synergies and franchise plans, which should benefit this segment and children's books results in fiscal 2026 and beyond.

Speaker Change: In Fiscal 2025, our priority is to continue executing our strategic growth initiatives, including the integration of 9-3, while navigating continued headwinds in our education solutions segment.

Haji Glover: Based on this plan, we expect revenue growth for 4% to 6% and targeting adjusted EBITDA of 140 to 150 million. and the Children's Book Secondary. We have a very exciting publishing plan, bit-and-on, and global franchises, and book fairs. We expect modest growth on increased fair count and new merchandise and sales initiatives. We will continue to explore strategies and book clubs to increase teacher engagement. In our new integrated entertainment segment, we expect to benefit from the addition of nice story in its strong franchises and partnerships, as we execute our strategic strategies, which we anticipate driving further growth in 2026 and beyond.

Haji Glover: Based on this plan, we expect revenue growth of 4% to 6% and are targeting adjusted EBITDA of $140 to $150 million. In the children's book segment, we have a very exciting publishing plan, bidding on our global franchises. In book fairs, we expect modest growth on increased fair count and new merchandising and sales initiatives. We will continue to explore strategies in book clubs to increase teacher engagement.

Speaker Change: resuming modest growth in children's books and tightly managing short-term spending.

Speaker Change: Based on this plan, we expect revenue growth of 4% to 6% and targeting adjusted EBITDA of $140 to $150 million.

Speaker Change: In the children's book segment, we have a very exciting publishing plan, bidding on global franchises. In book fairs, we expect modest growth on increased fair count and new merchandising and sales initiatives.

Haji Glover: In our new integrated entertainment segment, we expect to benefit from the addition of Nine Story, with its strong franchises and partnerships, as we execute our strategic strategies, which we anticipate driving further growth in 2026 and beyond. We expect Nine Story to contribute over $80 million in revenue with solid EBITDA in fiscal 2025. In the Education Solutions segment, we expect sales to hold steady despite soft spending on supplemental offerings, all set by forthcoming new product launches slated for the 2025-2026 school year. Our primary focus remains on expanding initiatives aimed at securing new funding sources to tackle the prevalent reading challenges nationwide.

Speaker Change: We will continue to explore strategies in book clubs to increase teacher engagement.

Speaker Change: In our new integrated entertainment segment, we expect to benefit from the addition of Ninth Story in its strong franchises and partnerships.

Speaker Change: as we execute our strategic strategies, which we anticipate driving further growth in 2026 and beyond.

Haji Glover: We expect Nice story to contribute over 80 million in revenue with solid EBITDA in fiscal 2025. In the education solution segment, we expect sales to hold steady despite soft spending on supplemental offerings, also set by forthcoming new product launches slated for the 2025-2026 school year. Our primary focus remains on expanding initiatives and add securing new funding sources to tackle the prevalent reading challenges nationwide. We expect unallocated overhead costs to remain approximately the level next year as we continue to improve efficiencies and build capabilities to support long-term growth.

Speaker Change: We expect Nine Story to contribute over $80 million in revenue with solid EBITDA in FY2025.

Speaker Change: In the Education Solutions segment, we expect sales to hold steady despite soft spending on supplemental offerings, offset by forthcoming new product launches slated for the 2025-2026 school year. Our primary focus remains on expanding initiatives aimed at securing new funding sources to tackle the prevalent reading challenges nationwide.

Haji Glover: We expect unallocated overhead costs to remain approximately the level of next year as we continue to improve efficiencies and build capabilities to support long-term growth. As a reminder, scholastic results are highly seasonal. We generally record our operating loss in our first and third quarters, coinciding with summer and winter school vacations, with profitable second and fourth quarters. We expect our seasonal loss in Q1 of fiscal 2025 to be in line with the prior period. We are looking forward to an exciting and busy year ahead. Thank you for your time today. And now, I will hand the call back to Peter for his final remarks.

Speaker Change: We expect unallocated overhead costs to remain approximately level next year as we continue to improve efficiencies and build capabilities to support long-term growth.

Haji Glover: As a reminder, Scholastic results are highly seasonal. We generally record our operating loss in our first and third quarters, coinciding with summer and winter school vacations, with profitable second and fourth quarters. We expect our seasonal loss in Q1 of fiscal 2025 to be in line with prior period. We are looking forward to an exciting and busy year ahead.

Speaker Change: As a reminder, Scholastic results are highly seasonal.

Speaker Change: We generally record our operating loss in our first and third quarters, coinciding with summer and winter school vacations, with profitable second and fourth quarters.

Speaker Change: We expect our seasonal loss in Q1 of fiscal 2025 to be in line with prior period.

Peter Warwick: Thank you for your time today, and now a hand to call back to Peter for his final remarks.

Speaker Change: We are looking forward to an exciting and busy year ahead.

Peter Warwick: Thank you, Haji. While market conditions are more challenging in quarter four, as the cyclical trends that we've seen this fiscal year continued, we manage our businesses carefully and kept sight on Scholastic's substantial strengths and opportunity. Scholastic strengths are trusted brand, proprietary distribution channels, unmatched children's content and global franchises, and our robust balance sheet and cash generating businesses. And in a dynamic market driven by long-term favorable macro forces, our opportunity is vast to serve the broader growing need for trusted children's books, reading, and media by investing in, building on, and adapting our strengths.

Speaker Change: Thank you for your time today, and now I will hand the call back to Peter for his final remarks.

Peter Warwick: While market conditions were more challenging in Quarter 4, as the cyclical trends that we've seen this fiscal year continued, we managed our businesses carefully and kept sight of Scholastic's substantial strengths and opportunities. Our trusted brand, proprietary distribution channels, unmatched children's content and global franchises, and our robust balance sheet and cash-generating business, and in a dynamic market driven by long-term favourable macro forces, our opportunity is vast to serve the broader, growing need for trusted children's books, reading, and media by investing in, building on, and adapting our strength.

Peter Warwick: Thank you Haji. While market conditions are more challenging in quarter four as the cyclical trends that we've seen this fiscal year continued, we managed our businesses carefully and kept sight on Scholastic's substantial strengths and opportunity.

Peter Warwick: Scholastic's strengths are deep. Our trusted brand, proprietary distribution channels, unmatched children's content and global franchises, and our robust balance sheet and cash generating businesses.

Peter Warwick: And in a dynamic market driven by long-term favourable macro forces, our opportunity is vast to serve the broader growing need for trusted children's books, reading and media by investing in, building on and adapting our strengths.

Peter Warwick: In fiscal 2025, with the talent and creativity of our employees, authors, illustrators, and creators, and the support of our shareholders, we look forward to continuing to pursue this opportunity to create value and impact.

Peter Warwick: In Fiscal 2025, with the talent and creativity of our employees, authors, illustrators, and creators, and the support of our shareholders, we look forward to continuing to pursue this opportunity to create value and impact. Thank you very much, and now, let me turn the call over to Peter. Thank you, Peter.

Peter Warwick: In fiscal 2025, with the talent and creativity of our employees, authors, illustrators and creators, and the support of our shareholders, we look forward to continuing to pursue this opportunity to create value and impact.

Jeffrey Mathews: Thank you very much, and now let me turn the call over to Jeff.

Operator: Thank you, Peter. With that, we will open the call for questions.

Operator: Thank you, Peter. With that, we will open the call for questions. Operator?

Peter Warwick: Thank you very much and now let me turn the call over to Geoff.

Jeff: Thank you, Peter. With that, we will open the call for questions. Operator?

Operator: Certainly, ladies and gentlemen, if you do have a question at this time, please press star 1-1 on your telephone. If your question has been answered, and you'd like to remove yourself from the queue, simply press star 1-1 again.

Operator: Certainly, ladies and gentlemen, if you do have a question at this time, please press star 11 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 11 again. And our first question for today comes from the line. Brendan McCarthy from Sidoti and Company. Your question, please.

Speaker Change: Certainly, ladies and gentlemen, if you do have a question at this time, please press star 1 1 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 1 1 again.

Brendan Mccarthy: And our first question for today comes from the line, a brand new McCarthy from Sedotti and Company. Your question, please. Hi, good afternoon, everybody, and thanks for taking my questions. I wanted to start off looking at the book fair's business. Can you talk about your outlook for revenue-per-fair looking into fiscal 25? Do you expect to surpass the 90% of pre-pandemic fair levels looking out into the next fiscal year?

Speaker Change: And our first question for today.

Brendan Michael McCarthy: Hi, good afternoon, everybody, and thanks for taking my question. I wanted to start off looking at the book fair business. Can you talk about your outlook for revenue per fair looking into fiscal 25? Do you expect to surpass the 90 percent of pre-pandemic fair levels looking out into the next fiscal year?

Speaker Change: Hi, good afternoon, everybody, and thanks for taking my questions.

Speaker Change: I wanted to start off looking at the book fairs business. Can you talk about your outlook for revenue per fair looking into fiscal 25? Do you expect to surpass the 90% of pre-pandemic fair levels looking out into the next fiscal year?

Peter Warwick: Peter, it's Peter here. So, in terms of revenue per fair going forward, we're expecting modest growth in the forthcoming financial year 2025. We would be, in terms of the revenue, than we were pre-pandemic. Because during the pre-pandemic period, we did do some book fairs that really didn't make very much money at all. And it's much better for us to focus on fairs which have the scale.

Peter Warwick: Yeah, it's Peter. It's Peter here. So in terms of revenue per fare going forward, we're expecting modest growth in the forthcoming financial year 2025. We would, in terms of revenue, we expect that we're going to probably be less than we were pre-pandemic because during the pre-pandemic period, we did some book fairs that really didn't make very much money at all, and it's much better for us to focus on fairs which have scale.

Speaker Change: Yeah, it's Peter, it's Peter here. So in terms of revenue per fare going forward, we're expecting modest growth in the forthcoming financial, in the financial year 2025. We would be, in terms of the revenue count, we expect that we're going to

Speaker Change: The

Speaker Change: probably less than we were pre-pandemic because during the pre-pandemic period we did do some book fairs that really didn't make very much money at all and it's much better for us to focus on fairs which have the scale. I think what's important is that we've put in place, as I described during the call, a number of big improvements I think.

Peter Warwick: I think what's important is that we put in place, as I described during the call, a number of big improvements. I think, which means that, you know, we will be able to make sure that the less churn, to make sure that we can really focus on the fairs that do the best thing. And really, we focused on the addressable market, which means the addressable market is one where we can, you know, we can do well with the size of revenues that we hold.

Peter Warwick: I think what's important is that we've put in place, as I described during the call, a number of big improvements, I think, which means that, you know, we will be able to make sure there's less churn, to make sure that we can really focus on the fairs that do the best thing, and really we focused on the addressable market, which means the addressable market is one where we can, you know, we can do well with the size of revenues that we hold.

Speaker Change: which means that, you know, we will be able.

Speaker Change: to make sure that there's less churn, to make sure that we can really focus on the fares that do the best thing. And really we focused on the addressable market, which means the addressable market is one where we can do well with the size of revenues that we hold.

Brendan Mccarthy: Great, thanks, Peter. I appreciate the color there.

Brendan Michael McCarthy: Great, thanks, Peter. I appreciate the color there.

Peter Warwick: I wanted to turn to the book club's business and the shrink-to-grow strategy. I'm wondering if you can provide some detail on how far along in that strategy the classic is and maybe how much longer the company argues how much more work on that front does the classic have to do as it relates to fiscal 25. Well, I think we've spent a lot of time working on what's the best ways of handling that. And I think that we've worked hard and trialled a number of things that we'll be implementing from the fall of this year. I think we're optimistic that the changes that we're making are going to be much more in tune with being able to grow back the business.

Speaker Change: Great, thanks Peter. I appreciate the color there. I wanted to turn to the book club's business.

Speaker Change: and the Shrink to Grow strategy. I'm wondering if you can provide some detail on how far along in that strategy.

Speaker Change: Scholastic is and maybe how much more work on that front does Scholastic have to do as it relates to Fiscal 25.

Speaker Change: Well, I think we've spent a lot of time working what's the best ways of handling that.

Speaker Change: And I think that we've worked hard and trialed a number of things.

Speaker Change: that we'll be implementing from the fall of this year. I think we're optimistic that the changes that we're making are going to be much more in tune with being able to grow back the business. But the key point about this, Brendan, is that this business needs to be profitable and we have...

Peter Warwick: But the key point about this, Brendan, is that we need this business to be profitable. And we have been able to make sure that the profitability year over year has not deteriorated. But what we want to be able to do is to modestly grow the business.

Speaker Change: been able to make sure that the profitability year-over-year has not deteriorated. But what we want to be able to do is to modestly grow the...

Peter Warwick: And also, I think, most importantly, to really engage as much as possible teachers with us, I think that we're really committed in the period going forward to be as teacher-centric as we possibly can in the way that we manage that business.

Speaker Change: grow the

Speaker Change: business and also I think most importantly to really engage as much as possible teachers with us.

Speaker Change: I think that we're really committed in the period going forward to be as teacher-centric as we possibly can in the way that we manage that business.

Brendan Mccarthy: Understood, understood. Turning to the education solutions business, I know the broad transition through the science of reading has been a bit of a headwind on spending. But, as it relates to Scholastic's capital allocation framework, I know acquisitions have always been a bit big part of that.

Speaker Change: understood understood and turning to the education solutions business I know the broad transition to the science of reading has been a bit of a headwind on spending but

Speaker Change: As it relates to Scholastic's capital allocation framework, I know acquisitions have always been a big part of that. Are you seeing any opportunity out there to maybe go out and acquire a company that is fully geared towards the science of reading?

Jeff: Are you seeing any opportunity out there to maybe go out and acquire a company that is fully geared towards the science of reading?

Jeff: Hi, Brendan.

Brendan Michael McCarthy: I wanted to turn to the book clubs business and the shrink to grow strategy. I'm wondering if you can provide some detail on how far along in that strategy Scholastic is and maybe how much longer the company, or I guess how much more work on that front does Scholastic have to do as it relates to Fiscal 25?

Jeff: This is Jeff Maddy. Here, I can address that on the corporate development.

Jeff: Hi, hey, Brendan. From the corporate development perspective, as we've discussed, we see broad opportunities across both education and our children's book segment. Now, adding that entertainment segment. Where we're seeing the most compelling opportunities are; we have some great products that weren't properly aligned. We're taking those great bones and making investments to align them with new pedagogy. The core value around independent reading is still there. That's mostly done organically. We continue to look at opportunities additionally in that segment while we review opportunities on the children's content and media service. as well.

Speaker Change: Hi Brendan, this is Jeff, Jeff Matthews here. I can address that from the corporate development perspective. Look, as we've discussed, we see broad opportunities across both education and our children's book segment, now adding the entertainment segment.

Speaker Change: where we're seeing the most compelling opportunities are.

Speaker Change: We have some great products that weren't properly aligned. We are taking those great bones and making investments to align them with new pedagogies, the core value around independent reading.

Speaker Change: is still there. That's mostly done organically. We continue to look at opportunities additionally in that segment while we review opportunities on the children's content and media side as well.

Brendan Mccarthy: Got it, thanks, Jeff.

Peter Warwick: One more question for me, looking out to Fiscal 25, and as it relates to some of the guidance members you provided, what factors did cause the material underperformance or outperformance relative to your expectations for Fiscal 25? Yeah, it's Peter here. There were two main factors. The first factor was really that during the final quarter, the number of kids who were actually buying books at our book fairs declined because they didn't have any money from their parents to buy the books. And I think this is very much reflective of the economic environment of many sort of middle-class families whose kids go to public schools.

Speaker Change: Got it. Thanks, Jeff. And one more question for me, looking out to Fiscal 25 and as it relates to some of the guidance numbers you provided. What factors are causing material underperformance or outperformance relative to your expectations for Fiscal 25?

Speaker Change: Yeah, it's Peter here. There were two main factors.

Speaker Change: And they were, the first factor was really that.

Speaker Change: during the final quarter. The number of kids who are actually buying books at our book fairs...

Peter Warwick: declined because they didn't have any money from their parents to buy the books. And I think this is very much reflective of the economic environment of many middle-class families whose kids go to public schools. That's certainly one fact. And that took us by surprise. The number of kids who were actually participating in the book fairs was lower than we had seen in the fall fairs.

Peter Warwick: That's certainly one factor, and that took us by surprise. The number of kids who were actually participating in the book fairs was lower than we had seen in the fall fairs.

Peter Warwick: The other factor was the one that we've already mentioned, really, about in the education area that we expected that there would be more opportunities than actually turned out to be the case for supplemental reading materials. And that was because just the sheer volume of new literacy programs and new curricula, and particularly those associated with the science of reading. We would see that as being a bit of a continuing headwind, if you like, during the forthcoming financial year, but it is cyclical. It's something which we'll be in a good position in the school years 25, 26 to be able to, you know, provide schools what they need in order to supplement the new materials they've got and to be able to, you know, then have much more time to be able to do that once.

Speaker Change: The other factor was the one that we've already mentioned really about.

Speaker Change: in the education area, that we expected that there would be more opportunities than actually turned out to be the case for supplemental reading materials. And that was because just the sheer volume of new literacy programs and new curricula, and particularly those associated with the science of reading.

Speaker Change: We would see that as being a bit of a continuing headwind, if you like, during the forthcoming financial year, but it is cyclical. It's something which we'll be in a good position in school years 25-26 to be able to, you know, provide schools what they need in order to supplement the new materials.

Speaker Change: they've got, and to be able to, you know, they'll have much more time to be able to do that once teachers are properly trained and fully familiar with the new core curriculum materials that they're using.

Peter Warwick: Teachers are properly trained and fully familiar with the new core curriculum materials that they're using.

Brendan Mccarthy: Thank you, everybody. That's all from me. Thank you.

Operator: This does conclude the question-and-answer session of today's program.

Speaker Change: Thank you, everybody. That's all for me.

Peter Warwick: I'd like to hand the program back to management for any further remarks. Well, thank you very much. Peter here, and thank you to all of those of you who joined us this afternoon. Scholastic's got an important, exciting year ahead. We look forward to engaging with our investors in the coming days and to providing further updates on our progress, including with our growth initiatives on our upcoming quarterly calls, including the next one in September.

Speaker Change: Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to management for any further remarks.

Brendan Michael McCarthy: And turning to the education solutions business, I know the broad transition to the science of reading has been a bit of a headwind on spending, but as it relates to, you know, Scholastic's capital allocation framework, I know acquisitions have always been a big part of that. Are you seeing any opportunity out there to maybe go out and acquire a company that is, you know, fully geared toward the science of reading?

Peter Warwick: Well, I think we've spent a lot of time working out the best ways of handling that, and I think that we've worked hard and trialed a number of things that we'll be implementing in the fall of this year. I think we're optimistic that the changes that we're making are going to be much more in tune with being able to grow the business back, but the key point here, Brendan, is that this business needs to be profitable, and we have been able to make sure that the profitability year over year has not deteriorated, but what we want to be able to do is to modestly grow the business, and also, I think, most importantly, to I think that we're really committed in the period going forward to being as teacher-centric as we possibly can in the way that we manage that business.

Jeffrey Mathews: Hi Brendan, this is Jeff. Jeff Mathews here.

Jeffrey Mathews: I can address that from the corporate development perspective. Look, as we've discussed, we see broad opportunities across both education and our children's book segment, now adding the entertainment segment. Where we're seeing the most compelling opportunities is that we have some great products that weren't properly aligned. We are taking those great bones and making investments to align them with new pedagogy. The core value of independent reading is still there, but that's mostly done organically. We continue to look at opportunities in that segment while we review opportunities on the children's content and media side as well.

Speaker Change: Well, thank you very much. It's Peter here and thank you to all of those of you who joined us this afternoon.

Brendan Michael McCarthy: Got it, got it. Thanks, Jeff. And one more question for me, looking out to fiscal 25 and as it relates to some of the guidance numbers you provided, what factors are causing material underperformance or outperformance relative to your expectations for fiscal 25?

Peter Warwick: Yeah, it's Peter here. There were two main factors, and the first factor was that, during the final quarter, the number of kids who were actually buying books at our book fairs declined because they didn't have any money from their parents to buy the books. And I think this is very much reflective of the economic environment of many middle class families whose kids go to public schools. That's certainly one factor.

Peter Warwick: And that took us by surprise; the number of kids who were actually participating in the book fairs was lower than we had seen at the fall fairs. The other factor was the one that we've already mentioned in the education area, that we expected that there would be more opportunities than actually turned out to be the case for supplemental reading materials, and that was because of just the sheer volume of new literacy programs and new curricula and particularly those associated with the science of reading.

Peter Warwick: We would see that as being a bit of a continuing headwind if you like during the forthcoming financial year but it is cyclical, it's something which we'll be in a good position in school years 25, 26 to be able to, you know, provide schools what they need in order to supplement the new materials they've got and to be able to, you know, they'll have much more time to be able to do that once teachers are properly trained and fully familiar with the new core curriculum materials that they use.

Brendan Michael McCarthy: Thank you, everybody. That's all for me.

Speaker Change: Scholastic's got an important, exciting year ahead. We look forward to engaging with our investors in the coming days and to providing further updates on our progress, including with our growth initiatives on our upcoming quarterly calls, including the next one in September .

Operator: Goodbye. Thank you, ladies and gentlemen, for your participation in today's conference.

Operator: Thank you. This does conclude the question and answer session for today's program. I'd like to hand the program back to management for any further remarks. Well, thank you very much.

Peter Warwick: Well, thank you very much. It's Peter here, and thank you to all of those of you who joined us this afternoon. Scholastic's got an important, exciting year ahead. We look forward to engaging with our investors in the coming days and to providing further updates on our progress, including with our growth initiatives, on our upcoming quarterly calls, including the next one in September.

Speaker Change: Goodbye.

Operator: Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

Operator: This does conclude the program. You may now disconnect.

Speaker Change: Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

Operator: Good day.