Scholastic Corporation (NASDAQ:SCHL) has reported stronger-than-expected fourth-quarter earnings and guided for an increase in 2024 revenue, sending its shares over 12% higher on Friday morning.
The global children’s publishing, education and media company attributed the performance to its response to the short-term headwinds encountered earlier in the year as well as the operational efficiencies it has achieved since the Covid-19 pandemic.
It noted that its Children’s Books segment outperformed general softness in retail, growing sales by 5%, with the latest Dog Man title ranked at the top of children's bestseller lists during the quarter.
Education Solutions also delivered higher sales and substantially improved margins, it added.
“Last quarter we also continued our investments in long-term drivers of Scholastic's growth and earnings, while returning over $63 million to shareholders through our dividend and share repurchases. In total in fiscal 2023, the company returned $161 million to shareholders,” CEO Peter Warwick said in a statement.
Revenue for the three months to May 31, 2023, rose 3% to $528 million, below the $542 million consensus estimate of analysts polled by FactSet.
Earnings per share jumped 55% to $2.26, well ahead of the $1.70 expected by analysts.
The company has guided for fiscal 2024 revenue growth of 3% to 5% and adjusted underlying earnings (EBITDA) of $190 million to $290 million. It said its board has also approved an additional $100 million for repurchases under its stock repurchase program.
Its shares were up 12.5% at $44.69 in early trade.
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