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Nov 30, 2020
Scholastic Q2 2021 Earnings Report
Scholastic's Q2 2021 earnings were impacted by COVID-19, but other major businesses showed improvements in operating income.
Key Takeaways
Scholastic Corporation reported a decrease in revenue for the second quarter of fiscal year 2021, primarily due to the impact of COVID-19 on its book fairs business. However, other major businesses showed improvements in operating income, and the company took steps to reduce operating costs.
Second quarter revenue was $406.2 million, a decrease of 32% compared to the prior year.
Operating income was $48.8 million, compared to $105.1 million a year ago.
Net income was $35.1 million, compared to $71.0 million in the prior year period.
Earnings per diluted share was $1.02, compared to $2.02 in the prior year period.
Scholastic
Scholastic
Scholastic Revenue by Segment
Scholastic Revenue by Geographic Location
Revenue by Segment
Education Solutions Revenue
CapyFin.comRevenue by Geographic Location
International Revenue
CapyFin.com Forward Guidance
Scholastic is cautiously optimistic about improved results in the fourth quarter, particularly in its book fairs operations, as schools successfully re-adjust to in-person learning, but is not providing a financial outlook for fiscal year 2021.
Positive Outlook
- Returning children to the classroom will be a top priority for school districts.
- Company expects higher levels of engagement and motivation for schools to host in-person book fairs.
- Expanded offering of digital subscription programs should continue to see higher sales.
- Strong second half pipeline of new releases will continue to position the trade business for growth.
- Company has met its previously announced $100 million cost savings target and has identified opportunities for additional savings in the second half of the fiscal year.
Challenges Ahead
- Ongoing variability in school instruction patterns and schedules.
- Possibility of new COVID outbreaks and their potential impact on schools.
- Lower expected book fairs revenues in the third quarter.
- Schools faced daily challenges in meeting the needs of their students with only one-third of all schools open for in-person learning.
- Economy and educational systems continued to be upended by the devastating pandemic.