LONDON (Alliance News) – Anglo-Dutch publisher Reed Elsevier PLC Thursday announced plans to combine its UK and Dutch parent companies in an effort to simplify its corporate structure and “increase transparency” for shareholders, as it posted a rise in adjusted pretax profit for 2014.
The company is transferring ownership of all of its businesses and its two listed parent companies Reed Elsevier PLC and Reed Elsevier NV into a new single group entity, named RELX Group PLC, although it will not change its brand or name for customer-facing products and business units.
From July, it proposes to further simplify its structure by eliminating cross shareholding between the two parent companies, aligning their direct equity holdings in the new single group entity, with their external shareholders’ respective economic interests of 52.9% for PLC and 47.1% for NV. It plans to move the share equalisation ratio between Reed Elsevier PLC and Reed Elsevier NV to 1:1.
The new structure and share listings are subject to shareholder approvals.
Reed Elsevier proposed a full-year dividend of 26.0 pence for 2014, up from 24.60 pence a year before.
The publisher and events organiser posted adjusted earnings per share of 56.3 pence, up from 54.0 pence a year before, and in line with consensus analyst estimates of 56.28 pence. The company adjusts its figures to exclude amortisation, acquisition costs, disposal and other non operating items, and is the company’s preferred performance measure.
The company posted a pretax profit of GBP1.59 billion, up 1% from GBP1.57 billion a year before, on a decline in revenue to GBP5.77 billion from GBP6.04 billion, as a result of an improved operating margin. Revenue growth in electronic, conferences and events helped to partially offset a continuing decline in print revenue.
Reed Elsevier completed GBP600 million of share buybacks in 2014, it said, and has a total of GBP500 million in share buybacks planned for 2015.
“Business trends in the early part of 2015 remain consistent with 2014 trends across our business, and we are confident that, by continuing to execute on our strategy, we will deliver another year of underlying revenue, profit, and earnings growth in 2015,” said Chief Executive Officer Erik Engstrom in a statement.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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