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Subject: Companies In The Leading Industry
Date: Thu, 19 Nov 92 13:26:44 EST
Message-ID: <7.1992Nov19.132644@AmeriCast.com>

11/19/92


TITLE Companies In The Leading Industry #m#gm#m##m#No
Photo#m#John Wiley & Sons Ready For Surge In College Textbooks

John A. Jones College textbook publishers like John Wiley & Sons
Inc. are looking forward to a heavy wave of first-year students
this decade, because of what demographers call the baby boom
echo.

Wiley, founded in New York in 1807, is an independent publisher
specializing in scientific and technical books and journals, pro-
fessional and consumer books and subscription services, textbooks
and other materials for colleges and universities.


Investor's Business Daily, Publishing - Books ranks 30th, based
on six-month stock-price performance with added weight given to
recent months. In this series, leading companies within the group
are reviewed.  The company has publishing, marketing and distri-
bution centers in the U.S., Canada, Europe, Asia and Australia,
making about a third of its sales abroad.  In the past few years,
Wiley has divested several businesses including a training com-
pany, a review series for medical students, and occupational
training materials.

Professional, Scholarly Focus

At the same time, the company has invested in other operations
such as a law publications division and a publisher of journals
and books in the life sciences, in line with its focus on profes-
sional and scholarly publications.  "We are now beginning to
realize the returns on these investments, as evidenced by the
adoption and the acceptance of our products in the market place,"
President and Chief Executive Charles R. Ellis said when he re-
ported higher earnings last summer.

Ellis, a company officer since 1988, became CEO in June 1990.
Previously, he was group president in charge of publishing.
Earnings for the fiscal first quarter ended July 31 rose 35% to
89 cents a share from 66 cents a year earlier, before an extraor-
dinary charge of 11 cents a share in fiscal 1991 for early repay-
ment of debt. Income rose 22% to $3.43 million from $2.81 million
before the extraordinary charge. Revenue rose 13% to $70.5 mil-
lion from $62.2 million.  For the fiscal year ended April 30,
earnings before extraordinary items rose 12% to 91 cents a share
from 81 cents the year before. The company had 14% fewer shares
outstanding after repurchasing 604,000 shares last year. Income
was up fractionally to $3.58 million from $3.57 million. Revenue
rose 5% to $248.2 million from $236.9 million.

Debt Covered By Cash

The annual earnings did not include the debt prepayment charge of
13 cents a share in fiscal 1992, or a net gain of 11 cents a
share in fiscal 1991 from the discontinued training business.
The year-end balance sheet showed long-term debt of $36 million
or 34% of total capital - and $40 million in cash.

Ellis noted that Wiley has focused in recent years on investing
in its core businesses. In the college division, he said, that
included "the development of a significant number of major new
and revised instructional packages in areas of our traditional
strengths, such as physical and life sciences, mathematics, en-
gineering and accounting." He said the company's improved perfor-
mance also reflects "more effective service levels" and cost con-
trols.  "Wiley has one of the strongest and most sought-after
franchises in the country, largely in the hard sciences," said
Ralph Kaplan, an analyst at Brean Murray, Foster Securities Inc.
"The company has underearned for many years now, but under the
current CEO, Charles Ellis, we expect it to start surfacing its
real, underlying earnings power." Kaplan said Wiley is strong in
the professional journal business, "and that's the business the
president came out of."


College List Doing Better

He said this is the first year that Wiley's college textbook list
fully reflects Ellis's guidance, and as a result it's doing
better.  Traditionally, the college segment was the best part of
the textbook business, he said. But in the '80s, other publishers
crowded into the field, and the used textbook market and paper-
back sales grew rapidly.  "They've had to adapt to that," Kaplan
said. He added that in the '80s Wiley "did not run as tight a
ship as they might have, particularly in the college division,"
sometimes missing publication deadlines.  Those problems now are
under control, Kaplan said.  J. Kendrick Noble, president of No-
ble Consultants Inc. in Bronxville, N.Y., a planning consultant
for media companies, said Wiley "had an excellent track record
until the early '80s, when it began losing market share." Besides
the stronger competition, Noble said, Wiley lost ground with
operations outside the core business.  "I think the prospects
from here are good" for college textbooks, Noble said. "It should
turn stronger between 1993 and 1995, simply because that's when
the baby boom echo generation reaches college age." Analysts also
said Wiley has been so conservative in writing down the value of
acquisitions that its past earnings actually were stronger than
reported.  Friday: Thomas Nelson Inc.

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