I am grateful for the unwavering support of Wiley's executive leadership team and the Wiley board of directors and I'm as passionate as I've ever been to be leading this great company through a period of exciting change and opportunity.I'd like to now focus our attention on the company's first quarter results. In a difficult global economy, Wiley showed positive revenue growth for the quarter, both as reported and on a performance basis. Including the positive effect of foreign exchange, revenue advanced 5%. Wiley's currency adjusted revenue growth of 0.4% versus prior year reflects the ongoing momentum in our STMS business offset by anticipated decline in P/T and a decline in global education resulting from weak market conditions. On a US GAAP basis, earnings per share increased $0.10 including FX to $0.82 or by $0.05 excluding FX. US GAAP EPS includes deferred tax benefits of $0.14 and $0.07 per share for fiscal year 2012 and 2011 respectively. The tax benefit was derived from two consecutive legislations productions in the United Kingdom corporate income tax rates. The benefits had no current cash tax impact. Adjusted EPS of $0.68 increased $0.03 including the effects of foreign exchange but declined by $0.02 on a currency neutral basis. Higher operating administrative costs were partially offset by lower interest expense, a lower effective tax rate and gross margin growth. Adjusted EPS excludes the deferred tax benefits. Operating and administrative costs of $231 million were up 10% of 5% excluding the adverse effects of foreign exchange driven mostly by technology spending to support investments in digital products and infrastructure and increase volatility and other direct costs to support business growth. Free cash flow for the quarter was a use of $59 million, $22 million greater than prior year. Lower cash earnings was a result of the acceleration of calendar year 2011 journal cash collections into fiscal 2011 and higher capital spending on technology with a major driver to the higher cash usage.
Net debt was $353 million at the end of the quarter, down from $573 million a year earlier. During the quarter, Wiley repurchased 184,700 shares at a cost of $9.4 million. In June, Wiley increased its quarterly dividend by 25% to $0.20. It was the 18th consecutive annual increase.Now I'd like to provide some information regarding the performance of Wiley's global businesses. STMS revenue of $253 million for the quarter increased 10% or 3% excluding the favorable effects of foreign exchange. Journal's revenue grew by 6.4% over prior year and by solid underlying subscription growth of 3.4% per calendar year 2011 receipts to date, strong publication flow, impressive back [file] sales growth and an excellent start to the year for corporate sales. Institutional licensing business continues to grow accounting for 77% of total calendar year 2011 subscriptions versus the prior year of 72%. The STMS book business was down by 2.5% against prior largely as a result of a one-time $5 million digital book sale to Saudi Arabia in the corresponding quarter of the prior year as discussed previously. Direct contribution to profit for the quarter of $106 million was 13% ahead of prior year or 6% on a currency neutral basis. In the quarter, STMS signed new contracts with societies that published 14 new journals with combined annual revenue of $4 million and renewed or extended contracts to publish 36 journals with combined annual revenues of $5 million. No journal contracts were lost. For the 12 months ended in July 2011, full [fixed] accesses on Wiley Online Library increased by 63% across all product types compared with the same period a year ago. During this period, usage of journals was up 64% and our books 86%. Read the rest of this transcript for free on seekingalpha.com