Revenue grew by 2% in STMS, 4% for P/T, and 2% for Global Education.EPS grew $0.34 to $0.80 in the quarter. Higher revenues, improved margins and a 9% reduction in operating and administrative expense is contributed to the result. Reduction and expense this is mainly due to cost savings initiative, lower accretive incentive compensation and lower bad debt provisions. For the full-year revenue of $1.783 billion was up 1% on a currency neutral basis but grew 2% including the positive foreign exchange impact. Adjusted EPS for the fiscal year which excludes non-recurring one-off tax benefits in the prior Borders’ provision grew 13% to $3.21 including favorable foreign exchange. Excluding favorable foreign exchange, adjusted EPS grew by 11%. Gross profit margin increased 0.3% for the year to 69.5%, reflecting increased sales of digital products, partially offset by higher composition costs. STMS and P/T reported gross margin improvement whereas Global Education margin declined as a result of higher composition and royalty costs. Year-to-date direct operating expenses excluding the Borders’ bad debt provision decreased by 2%. Expense savings were achieved across all three businesses as a result of lower accrued incentive compensation and prudent expense management. Year-to-date, shared services and administrative expenses were 3% higher than prior year reflecting increases in technology spending offset by reduced distribution expense and lower accrued incentive costs. Free cash flow for fiscal 2012 of $260 million was $10 million lower than prior year but $5 million better than we expected reflecting the combined effect of increased cash earnings offset by the timing of journal subscription cash collections and increased capital spending driven by cost related to new lease facilities and investments in digital products and infrastructure. Days sales outstanding improved by four days, while inventory decreased from a year ago due to smaller print runs resulting from the growth in e-book sales and lower returns in P/T.
Net debt, that’s long-term debt less cash and cash equivalents, was reduced from prior year by $37 million to $215 million including approximately $85 million of new debt to fund the Inscape acquisition. In addition, we returned $48 million to shareholders in the form of dividend and repurchased $87 million worth of treasury shares during the year. At the end of April, cash on hand was approximately $260 million.Now I’d like to provide some information regarding the performance of Wiley’s global businesses. STMS revenue for the quarter was up 2% to $291 million mainly due to strong digital book sales, pay-per-view, research revenue, and the sale of journal rights partially offset by lower journal reprint and backfile revenue. Direct contribution to profit grew 7% to $140 million in the quarter due to top line results, lower accrued incentive compensation and prudent expense management. For the full-year, STMS revenue increased 2% on a currency neutral basis to $1.041 billion and was up 4% including the positive effect of foreign exchange. Revenue growth was driven by increased journal subscriptions, new journal society business, book growth and journal reprint revenue. Digital book growth was partially offset by a decline in print book sales. Digital book sales including digital licensing now account for 21% of total STMS book sales up from 16% a year ago. Total digital revenue accounted 61% of full-year STMS revenue up from 59% a year ago. Journal subscription receipts for calendar year 2012 are showing roughly 3% growth with 95% of targeted business closed. Growth in Asia Pacific, EMEA and an improving picture in the Americas contributed to the results. Direct contribution to profit for the 12 months rose 4% to $452 million. In the fourth quarter, STMS signed new contracts with society to publish two new journals and renewed or extended contracts to publish 16 journals. Only one journal contract with modest revenue was not renewed.
In fiscal year 2012, the Wiley STMS platform delivered 236 million full text accesses to customers, up 26% compared with fiscal year 2011. Usage for online books grew 45% to 6.5 million. This growth is attributed to the launch of Wiley Online Library, which dramatically improved user experience, functionality and search. Growth of our license customer base, new society business and expansion of our digital product offerings also contributed to higher use.Read the rest of this transcript for free on seekingalpha.com