Acquisitions Boost Sales At Thomson Learning

The addition of several Harcourt properties that were acquired in July 2001 helped lift revenues in Thomson Learning 45%, to $451 million, in the second quarter ended June 30, parent company Thomson Corp. reported last week. Operating profit, before amortization and restructuring charges, increased 44%, to $23 million. Thomson Learning had $5 million in integration charges in the quarter related to folding the Harcourt divisions into Thomson's existing operations.

The company said results were up in its higher education and international segments, but were off in the corporate training and library reference divisions. Library reference sales were "down a few percentage points," executives said, with sales of print products especially soft. Corporate training continues to suffer from weakness in the IT market—sales were down 10% in the quarter and 15% in the first half of 2002. Despite the sales decline, Thomson remains committed to the training market and during the quarter acquired some electronic-learning properties from McGraw-Hill.

In a conference call, executives said they were satisfied with results in the division and predicted that Thomson Learning "will at minimum meet expectations" for the year. For the first half of 2002, revenues increased 53%, to $848 million, and the operating loss was trimmed to $18 million from $19 million. Executives said that most of the integration of Harcourt already has been completed and that Thomson Learning will enter 2003 "fully integrated."

In results from some other Thomson segments, revenues in the legal and regulatory group rose 7%, to $733 million, with acquisitions accounting for 6% of the increase. Online sales continued to drive revenue growth, with Westlaw reporting a 6% increase in U.S. sales while online revenues nearly doubled in Europe. Sales of CD ROM and print products were down in the quarter. Operating profit rose 9% in the quarter, to $186 million.