The education-focused publishing company seemed subdued today, less than a week after the tragic school shootings in Connecticut. In a conference call with analysts to discuss earnings, Scholastic CEO Richard Robinson expressed sympathy for families of the murdered students and teachers. He also urged schools to continue to promote “optimism and hope,” while officials provide the “mental health resources our schools must have.” As for the financials: Cost savings helped, but weren’t enough to overcome declining sales of The Hunger Games trilogy and other disappointments. Shares are down 2.8% in early trading after Scholastic reported net income of $61.8M for the three months that ended in November, -25.4% vs the period last year, on revenues of $616.2M, -10.1%. Analysts expected revenues of about $632.5M. Earnings, at $1.89 a share, also fell short of the $2.05 that the Street anticipated. Hurricane Sandy took a toll: many schools closed and cancelled book fairs featuring Scholastic’s titles. In addition, school districts held off buying the company’s highly profitable education technology products as they invested in training teachers to handle the new Common Core State Standards, a state-led initiative to establish national educational benchmarks. The company says that it expected some decline in Hunger Games sales vs last year when excitement was building for the Lionsgate film released in March. But Scholastic didn’t see the sales bump it anticipated after the home video was released in August. Execs say that they will work with Lionsgate to gin up book sales around the November release of the second film, The Hunger Games: Catching Fire.
By DAVID LIEBERMAN, Financial Editor | Thursday December 20, 2012 @ 10:11am ESTTags: Scholastic, The Hunger Games
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