Looking at the components in turn, starting in the right-hand column, underlying revenue growth was 1% with profit growth of 2% and an underlying margin improvement of 20 basis points in the first half. Including disposals and acquisitions at constant currencies, revenues were down 1% with profits up 3%. The margin up 19 basis points, mostly reflecting the disposal of low margin or unprofitable assets, particularly the RBI U.S.-controlled circulation [indiscernible] sold last year. At reported exchange rates, revenues declined 3%, which included a 2 percentage point currency translation effect of a weaker U.S. dollar. The currency translation effect is only 1% on an adjusted operating profit and that includes hedging benefits from our multiyear subscription currency hedging program and other currency translation effects, which added 40 basis points to the reported margin. It's perhaps worth reiterating that in our definition of underlying, we exclude all acquisitions and disposals made both in the year and in the prior year to give us a clearer like-for-like comparison. A number of other companies include small acquisitions in the definition of underlying, which can distort growth comparisons.
The next 2 charts summarize the constant currency growth rates across our businesses for revenue and adjusted operating profit, both in total and underlying. Erik will go into more detail later on the performance of each business and outlook. Elsevier saw underlying line growth of 2%; LexisNexis Risk Solutions was up 4%; Legal & Professional up 1%; Reed Exhibitions down 4%; and RBI up 2%, giving the overall 1% underlying revenue growth for Reed Elsevier. Excluding the biennial show cycling affects, Reed Exhibitions saw underlying growth of 10%. And as noted earlier, without these effects, Reed Elsevier first half underlying revenue growth would have been 3%.
The difference between the total and underlying growth figures is most marked at RBI and reflects the portfolio restructuring in that business. For adjusted operating profit, underlying profit growth was 4% at Elsevier; 6% at Risk Solutions; down 2% in Legal & Professional; down 8% in Exhibitions driven by cycling; and up 12% at RBI to give the overall Reed Elsevier underlying profit growth of 2%. Again the main difference between the total and underlying figures is in RBI and reflecting the portfolio changes.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV