Sales and profits fell in the third quarter ended September 30 at McGraw-Hill Education, and parent company McGraw-Hill Cos. said it expects to have a decision soon on whether to sell or spinoff its publishing division. Total revenue fell 11%, to $836 million, while adjusted operating profit declined 15%, to $268 million. According to MHC, the decline in revenue was due in part to the impact of increased deferred revenue associated with higher sales coming through “subscription-centric” business models; excluding the impact of deferred sales, revenue would have been down 7%. The decline in operating income was cut due to expense reductions of 9%.

In its two business units, revenue in the School Education Group decreased 16%, to $352 million for the quarter. Excluding the impact of increased deferred revenue, third quarter revenue decreased 10%. MHC attributed the decline to continued weakness in state and local educational funding plus a drop in state adoptions. While maintaining a focus on reducing expenses, the school group “has aligned its products with the Common Core State Standards and expanded its all-digital and hybrid print-digital offerings,” MHC said.

Sales in the Higher Education, Professional and International Group declined 6%, to $484 million, in the third quarter compared to the same period last year as all three components of HPI hadd revenue declines. Excluding the impact of increased deferred revenue, third quarter revenue decreased 5%.

Economic conditions were challenging around the world MHC said, but sales of digital products rose. The higher education unit recorded 16% of its revenue in the quarter from digital sales, an increase of 23% compared to the third quarter of 2011. Digital products and services accounted for 29% of revenue in the professional group. The international segment also saw a large gain in digital sales in the quarter and year-to-date.

MHC has been evaluating whether to sell or spinoff MHE for about a year and the company said a final decision will be made “in the coming weeks.”