In its first full year of operation, WRC Media Inc. reported revenues of $218.8 million and a net loss of $62.0 million, a figure that includes a $53.6-million increase in depreciation and amortization expenses. WRC was formed in May 1999 by Ripplewood Holdings to acquire supplementary education companies; it bought CompassLearning in July 1999 and took over the supplemental education group of Primedia, consisting of Weekly Reader, American Guidance Services and World Almanac, in November 1999. Pro forma results for 1999 show sales of $214.0 million and a loss of $16.3 million.
WRC CEO Martin Kenney said he was "pleased with the progress we have made in the year 2000," pointing to a 9.9% improvement in EBITDA, to $50.9 million, as the company continues to streamline its operating infrastructure.
AGS posted the largest gain in the year with sales up 8.7%, to $54.0 million, due to higher sales of curriculum products and revised testing assessment materials. World Almanac revenues increased 4.1%, to $55.1 million. Gains were led by World Almanac's library services and Gareth Stevens units. Sales were down for the yearbooks produced by Funk & Wagnalls and World Almanac and also fell for the Book of Facts. WRC noted that the company is no longer soliciting new subscribers for its yearbooks, but depends on high renewal rates. The company also said that all of the revenues from the Funk & Wagnalls Encyclopedia are derived from licensing agreements since a print edition of the encyclopedia is no longer published.
Sales at Weekly Reader were flat in 2000 as higher revenues from the sale of its Skill Books series were offset by lower licensing revenue and the closing of Summer Weekly Reader. WRC attributed the 2.7% decline in sales, to $64.0 million, at CompassLearning to confusion in the educational software market caused by Internet startups that offered free software. Most of those companies had folded by the end of the year, the company said.
WRC has also brought the three prized reference units of its World Almanac Education Group together at its new corporate headquarters in midtown Manhattan. Facts on File News Services (and Facts.com), Funk & Wagnalls Encyclopedia and World Almanac Books have been moved into new office space at 7th Ave. and 38th St. The companies will occupy the floors below the parent company's offices.
WRC Media Sales by Segment, 19992000 ($ in millions)
|World Almanac Education||52.9||55.1||4.1|