Scholastic(SCHL) - 2024 Q3 - Quarterly Results

Financial Performance - Revenues for the third quarter were approximately $323.7 million, a slight decrease of $1.2 million from $324.9 million in the prior year[1][8] - Year-to-date revenues decreased by 5% to $1,114.8 million, primarily due to headwinds in the retail market and strategic repositioning of Book Clubs[1][20] - Revenues for the three months ended February 29, 2024, were $323.7 million, a decrease of 0.4% compared to $324.9 million for the same period last year[28] - Total revenues for the Children's Book Publishing and Distribution segment decreased by 5% to $193.6 million for the three months ended February 29, 2024, from $204.0 million in the same period last year[31] - The Education Solutions segment reported revenues of $68.5 million, down 2% from $70.0 million in the same period last year[31] - International revenues increased by 16% or $8.2 million, driven by improved trade channel revenues in Canada and the UK[1][13] - International segment revenues increased by 16% to $59.1 million for the three months ended February 29, 2024, compared to $50.9 million in the same period last year[31] Operating Loss and Income - Operating loss increased by 26% to $34.9 million, compared to $27.7 million a year ago, reflecting higher spending on growth initiatives[1][9] - Operating income for the three months ended February 29, 2024, was a loss of $34.9 million, compared to a loss of $27.7 million in the same period last year, representing a decline of 26%[31] - The company reported a significant increase in overhead costs, with a loss of $(81.4) million for the three months ended February 29, 2024, compared to a gain of $5.9 million for the same period last year[40] - Operating loss for the three months ended February 29, 2024, was $(32.7) million, compared to an operating income of $10.6 million for the same period last year[40] Net Income and Earnings Per Share - Diluted earnings per share for the third quarter were $(0.91), a decrease of 60% from $(0.57) in the prior year[1][5] - Net income for the three months ended February 29, 2024, was a loss of $26.5 million, compared to a loss of $19.3 million for the same period last year, indicating a worsening of 37%[28] - The company reported basic and diluted earnings per share of $(0.91) for the three months ended February 29, 2024, compared to $(0.57) for the same period last year[28] - For the three months ended February 29, 2024, the diluted loss per share was $(0.80), compared to earnings of $0.26 for the same period last year[40] - The net loss for the three months ended February 29, 2024, was $(23.8) million, compared to net income of $7.9 million for the same period last year[40] - The company reported a net loss of $(31.1) million for the nine months ended February 29, 2024, compared to net income of $16.8 million for the same period last year[44] Cash Flow and Shareholder Returns - Free cash flow use was $7.1 million, an improvement of 40% compared to $11.9 million in the prior period[1][18] - Free cash flow for the three months ended February 29, 2024, was a use of $7.1 million, an improvement from a use of $11.9 million in the same period last year[34] - The company returned over $60 million to shareholders through repurchases and dividends in the third quarter[1][2] - The company has authorized an additional $54.6 million for stock repurchases, increasing the total authorization to $100 million[1][19] Costs and Investments - The company recognized pretax costs of $3.0 million related to its planned investment in 9 Story Media Group during the three months ended February 29, 2024[28] - The company recognized a pretax cost of $3.0 million associated with its planned investment in 9 Story Media Group during the three months ended February 29, 2024[41] - The company incurred pretax severance costs of $0.8 million related to restructuring initiatives during the three months ended February 29, 2024[42] - For the nine months ended February 29, 2024, the adjusted EBITDA was $46.2 million, down from $81.3 million for the same period last year[44] - Adjusted EBITDA for the three months ended February 29, 2024, was $(7.2) million, compared to $(5.4) million for the same period last year[44] Cash and Equivalents - Cash and cash equivalents decreased to $110.4 million as of February 29, 2024, from $198.8 million a year earlier[34]