Reed Elsevier’s revenues were up 4% in 2006, to £5.3 million, driven by a 10% increase in digital revenues.
Organic revenue growth was 5% despite the weak education markets. Organic adjusted operating profit was 8%, reflecting underlying margin improvement across the rest of the business.
Overall operating margin was up 0.3% points at reported exchange rates, impacted by the US dollar decline as it works its way through the Elsevier subscriptions rolling currency hedging programme.
In a trading statement released today, Reed Elsevier said that it is sharpening its strategic focus to capitalise on growing digital opportunities in its markets.
Sir Crispin Davis, chief executive officer, said: “2006 saw important progress in the development of Reed Elsevier’s business. There is momentum behind our digital revenues driven by a widening range of innovative online information products, increasingly embedded in customer workflows. The planned sale of our Harcourt Education division announced today sharpens our strategic focus and concentrates our resources on the digital opportunities across an increasingly synergistic portfolio.
“The 2006 financial results were encouraging, with revenue growth in line with our expectations and improved underlying margins. Strong cash generation and higher returns on invested capital have also been delivered. Recent acquisitions in e-health, legal solutions, risk management and business to business online are accelerating our digital progress and delivering increasing returns.
“Going into 2007, market conditions are generally favourable. Our strategy is clear, the business well focused, and we are leveraging our resources to good effect. The digital horizon is expanding and Reed Elsevier is well placed.”
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