McGraw-Hill (MHP) took a pretax charge of $43.7 million in connection with cutting about 600 employees, or 3% of its workforce.
The education and media conglomerate said late Tuesday that the restructuring charge would hit fourth-quarter earnings by about 8 cents a share.
"Reducing staff is never an easy decision, but we believe the steps we have taken will strengthen our organization, enhance our ability to serve our customers and maximize shareholder value," said Harold McGraw III, chairman, president and chief executive officer.
About 40% of the charge stems from changes in the company's education division. The Higher Education, Professional and International Group has taken steps to "consolidate certain sales, editorial, marketing and administrative functions, primarily in its international locations, to better address new and existing revenue streams for textbooks, facilitate its strategic shift toward increased investments in digital and custom products, and enable greater efficiencies," the company said.
The School Education Group also is making a "strategic shift toward more digital products, while taking steps to centralize certain management functions and to better leverage outsourcing opportunities."
The Financial Services segment accounts for $18.8 million of the pretax charge. The reduction was driven by the current business environment, as well as consolidation of several support functions across Standard & Poor's global operations. The segment's restructuring actions affected both Standard & Poor's ratings and non-ratings businesses.
Shares of McGraw-Hill climbed 1.7% in after-hours trading to $41.19. The stock has fallen about 43% in the past six months.
This article was written by a staff member of TheStreet.com.