Company News: Page (1) of 1 - 10/28/11 Email this story to a friend. email article Print this page (Article printing at MyDmn.com).print page facebook

McGraw-Hill Ryerson Reports Third Quarter Results

(October 28, 2011)

WHITBY, ONTARIO -- (Marketwire) -- 10/28/11 -- McGraw-Hill Ryerson Limited (TSX:MHR) -

Attention: Business/Financial Editors

Three Months to September 30($000) 2011 2010 ------------------------------------------------- Sales revenue, less returns $34,319 $33,702 Other 1,545 1,043 ------------------------- Total revenue $35,864 $34,745 Net Income $7,759 $6,439 Net Income per share $3.89 $3.22 Nine Months to September 30($000) ------------------------------------------------- Sales revenue, less returns $58,867 $57,541 Other 2,418 1,980 ------------------------- Total revenue $61,285 $59,521 Net Income $6,112 $4,239 Net Income per share $3.06 $2.12

Summary


Our revenues are typically more heavily weighted towards the second half of the calendar year leading up to beginning of the school season. In the third quarter, McGraw-Hill Ryerson's revenues generally exceed the total of the first two quarters combined. Sales and net income in the third quarter this year were above that of prior year's third quarter.

Three Months Ended September 30, 2011

Total revenue for the third quarter increased by 1.8% to $35.9 million in 2011 compared to $34.7 million in 2010, driven by an increase in sales in the School Division.

The Higher Education Division sales remained consistent with a slight increase of $0.4 million over the third quarter of 2010 to $24.5 million, as a result of increased Canadian product sales. Digital and custom products continue to be a growth area for this Division.

The School Division sales increased 4.7% to $8.1 million in the third quarter of 2011, from $7.7 million in the corresponding quarter of 2010. This increase was mainly driven by orders placed by the Western provinces.

In the Professional Division, sales decreased by $0.1 million in the third quarter of 2011 to $1.8 million, from $1.9 million in the comparative period of the prior year.

Other Revenue, representing billed freight, copyright licensing, translation fees, sales commission for U.S. digital products and rental revenue from the tenant at the Company's Whitby, Ontario facility increased in the third quarter of 2011 compared to the third quarter of 2010 as a result of the timing of payments of copyright revenue.

Income before tax was $10.9 million compared to $9.5 million in the third quarter last year. This variance was mainly the result of higher revenue.

Nine Months Ended September 30, 2011

Total revenue for the first nine months increased by 3.0% to $61.3 million in 2011 compared to $59.5 million in 2010, driven by an increase in sales in the School Division.

The Higher Education Division sales decreased slightly by $0.6 million to $36.4 million compared to the first nine months of 2010. Increased competition from used and rental textbooks is causing a decrease in imported product sales. Digital and custom products continue to be a growth area for this Division.

The School Division sales increased 15.2% to $18.2 million in the first nine months of 2011, from $15.8 million in the corresponding period of 2010. This increase was mainly driven by increased ordering from the Western provinces.

In the Professional Division, sales decreased by $0.6 million in the first nine months of 2011 to $4.2 million, from $4.8 million in the comparative period of the prior year. This decrease was caused by reduced orders from retailers.

Other Revenue, representing billed freight, copyright licensing, translation fees, sales commission for U.S. digital products and rental revenue from the tenant at the Company's Whitby, Ontario facility increased in the first nine months of 2011 compared to the first nine months of 2010. The increase is the result of timing of payments for copyright licensing.

Year to date income before tax was $8.8 million, compared to $6.4 million for the same period last year. This increase in income was mainly caused by the sales increase.

Notice to Reader

The attached financial statements have been prepared by management of McGraw-Hill Ryerson Limited. The financial statements for the three and nine month periods ended September 30, 2011 and 2010 have not been reviewed by the auditors of McGraw-Hill Ryerson Limited.

In business since 1944, McGraw-Hill Ryerson Limited is a leading Canadian publisher of educational resources, and information products and services for lifelong learning and enjoyment. Revenue in 2010 was $81 million. Additional information is available at http://www.mcgrawhill.ca.

STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (in thousands of dollars except per share data) (unaudited) Three months ended Nine months ended September 30 September 30 2011 2010 2011 2010 $ $ $ $ ---------------------------------------------------------------------------- Sales revenue, less returns 34,319 33,702 58,867 57,541 Other income 1,393 892 1,969 1,547 Rental income 152 151 449 433 ---------------------------------------------------------------------------- Total revenue 35,864 34,745 61,285 59,521 Cost of goods sold 12,995 13,195 21,312 22,304 ---------------------------------------------------------------------------- Gross profit 22,869 21,550 39,973 37,217 Operating expenses 7,852 7,764 23,347 23,474 Amortization - pre-publication costs 3,838 4,081 7,217 6,558 Depreciation - property, plant and equipment 237 243 711 719 ---------------------------------------------------------------------------- Operating income 10,942 9,462 8,698 6,466 Finance income 46 41 266 105 Finance costs 22 30 78 101 Foreign exchange gain (loss) (103) (8) (91) (76) ---------------------------------------------------------------------------- Income before income taxes 10,863 9,465 8,795 6,394 Income tax expense 3,104 3,026 2,683 2,155 ---------------------------------------------------------------------------- Net income and comprehensive income for the period attributable to equity holders of the Company 7,759 6,439 6,112 4,239 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Earnings per share Basic and diluted $3.89 $3.22 $3.06 $2.12 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- STATEMENTS OF FINANCIAL POSITION (in thousands of dollars) (unaudited) As at September 30, December 31, September 30, 2011 2010 2010 $ $ $ ---------------------------------------------------------------------------- ASSETS Current Cash and cash equivalents 31,721 44,394 30,189 Marketable securities 681 832 786 Trade and other receivables, net 17,651 9,273 17,262 Inventories, net 6,081 5,370 6,724 Due from parent and affiliated companies 2,639 1,403 1,556 Income taxes receivable - - 890 Prepaid expenses and other assets 329 291 286 ---------------------------------------------------------------------------- Total current assets 59,102 61,563 57,693 ---------------------------------------------------------------------------- Property, plant and equipment, net 14,197 14,630 14,725 Intangible assets 15,475 18,205 17,126 Deferred tax assets 735 812 965 ---------------------------------------------------------------------------- Total non-current assets 30,407 33,647 32,816 ---------------------------------------------------------------------------- 89,509 95,210 90,509 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- LIABILITIES AND EQUITY Current liabilities Trade and other payables 10,033 9,949 9,337 Income taxes payable 609 6 - Due to parent and affiliated companies 4,025 4,675 3,846 ---------------------------------------------------------------------------- Total current liabilities 14,667 14,630 13,183 ---------------------------------------------------------------------------- Employee future benefits 2,415 2,588 2,582 Long-term payable 133 391 - ---------------------------------------------------------------------------- Total liabilities 17,215 17,609 15,765 ---------------------------------------------------------------------------- Equity Issued capital Authorized 5,000,000 no par value common shares Issued and outstanding 1,996,638 common shares 1,997 1,997 1,997 Paid-in capital 613 372 258 Retained earnings 69,684 75,232 72,489 ---------------------------------------------------------------------------- Total equity 72,294 77,601 74,744 ---------------------------------------------------------------------------- 89,509 95,210 90,509 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- STATEMENTS OF CHANGES IN EQUITY (in thousands of dollars) (unaudited) Share Paid in Retained capital Capital earnings Total $ $ $ $ ---------------------------------------------------------------------------- Balance, January 1, 2010 1,997 104 74,829 76,930 Dividends paid ($3.295 per share) - - (6,579) (6,579) Additional paid-in capital - 154 - 154 Net income and comprehensive income attributable to equity holders of the Company - - 4,239 4,239 ---------------------------------------------------------------------------- Balance, September 30, 2010 1,997 258 72,489 74,744 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- --------------------------------------------------------------------------- Balance, December 31, 2010 1,997 372 75,232 77,601 Dividends paid ($5.840 per share) - - (11,660) (11,660) Additional paid-in capital - 241 - 241 Net income and comprehensive income attributable to equity holders of the Company - - 6,112 6,112 ---------------------------------------------------------------------------- Balance, September 30, 2011 1,997 613 69,684 72,294 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- STATEMENTS OF CASH FLOWS (in thousands of dollars) (unaudited) Nine months ended September 30 2011 2010 $ $ ---------------------------------------------------------------------------- Operating activities Net income for the period 6,112 4,239 Add (deduct) charges not affecting cash: Amortization - pre-publication costs 7,217 6,558 Depreciation - property, plant and equipment 711 719 Decrease in long-term payable (258) - Employee future benefits (173) 27 Deferred taxes 77 (270) Net change in non-cash working capital balances related to operations (10,304) (5,795) ---------------------------------------------------------------------------- Cash provided by operating activities 3,382 5,478 ---------------------------------------------------------------------------- Investing activities Investment in pre-publication costs (4,509) (4,515) Investment in property, plant and equipment (278) (262) Decrease in financial instruments 151 35 ---------------------------------------------------------------------------- Cash used in investing activities (4,636) (4,742) ---------------------------------------------------------------------------- Financing activities Dividends paid to shareholders (11,660) (6,579) Change in paid-in capital 241 154 ---------------------------------------------------------------------------- Cash used in financing activities (11,419) (6,425) ---------------------------------------------------------------------------- Net decrease in cash and cash equivalents (12,673) (5,689) Cash and cash equivalents, beginning of period 44,394 35,878 ---------------------------------------------------------------------------- Cash and cash equivalents, end of period 31,721 30,189 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Supplemental cash flow information Income taxes refunded 157 2,540 Income taxes paid 2,143 2,709 ---------------------------------------------------------------------------- ----------------------------------------------------------------------------

Contacts:
McGraw-Hill Ryerson Limited
Brenda Arseneault
Acting Chief Financial Officer
(905) 430-5223
http://www.mcgrawhill.ca


Copyright @ Marketwire

Page: 1


Related Keywords: McGraw-Hill Ryerson Limited , USA, Marketwire, , Financial, Business, Other,

HOT THREADS on DMN Forums
Content-type: text/html  Rss  Add to Google Reader or
Homepage    Add to My AOL  Add to Excite MIX  Subscribe in
NewsGator Online 
Real-Time - what users are saying - Right Now!

Our Privacy Policy --- @ Copyright, 2015 Digital Media Online, All Rights Reserved