McGraw-Hill (MHP) posted a flat fourth-quarter profit after restructuring and tax charges.
The New York publisher made $189 million, or 50 cents a share, for the quarter ended Dec. 31, compared with the year-ago $190 million, or 49 cents a share. The latest quarter was hit by a 4-cent charge related to the company's last round of job cuts and a 3-cent tax increase related to its repatriation of foreign profit under the American Jobs Creation Act. Analysts were looking for a 55-cent profit.
Revenue rose 13% from a year ago to $1.54 billion, in line with the $1.55 billion Thomson First Call estimate. The company said a record quarter at its Standard & Poor's unit boosted revenue gains.
In the fourth quarter, revenue for the education segment increased 12.1% to $593.5 million. Operating profit grew by 27.7% to $36.5 million. Delayed ordering in Texas skewed the timing of sales, pushing some business into the fourth quarter and possibly into early 2006. Late orders from California and South Carolina were also factors in the fourth quarter.
Revenue for financial services grew by 10% to $650.4 million. Operating profit for the fourth quarter increased 14.9% to $286.5 million. "The record revenue, operating profit and operating margin for both 2005 and the fourth quarter underscore another outstanding performance by Standard & Poor's in global financial markets," CEO Harold McGraw said.
In information and media, revenue increased 23.4% to $297.5 million, including $60.1 million from J.D. Power and Associates, which had no material impact on operating profit in this period. Revenue for the Business-to-Business Group, which includes
, J.D. Power and Associates, construction, aviation and energy products and services, rose 28.2% to $265.0 million in the fourth quarter. The revenue increases in both periods reflect the acquisition of J.D. Power and Associates. But advertising pages at
declined 18.8% in the fourth quarter and 12.8% for the year, according to the Publishers Information Bureau.