First-half profits jump of 22% vindicates Reed Elsevier link: Integration of publishers forges ahead as savings and efficiency boost returns

REED ELSEVIER, the Anglo-Dutch publishing group, yesterday celebrated its first six months as a merged company with a 22 per cent increase in pre-tax profits to pounds 297m.

Peter Davis, chief executive, said the group was 'well advanced' on integrating the two businesses, which formally merged on 1 January. The business publishing arms of the two businesses in the US have been integrated, the medical publishing interests are operating under a single management, and Elsevier's scientific publishing arm is running the Reed scientific business.

But he added that the group had spent as much on integrating the business as it had saved in the six months to June. 'Rationalisation was never a big deal in the merger, it was not a driving force,' he said.

The merger, which created the world's most profitable publishing group, was designed to give it the financial muscle and expertise for acquisitions. Reed is particularly strong in the UK, US and Australia, where it has a range of business and professional publications - including Butterworths, the legal publisher - as well as the IPC consumer magazine group. Elsevier, by contrast, is stronger on the Continent and has extensive interests in scientific publishing.

The group has already made one acquisition - of Editions Techniques, the French legal publisher - and is in negotiations with the administrators of Maxwell Communication Corporation to purchase the Official Airline Guides.

The interim figures were helped by currency fluctuations and a pounds 16m profit on the disposal of Reed's stake in BSkyB. Excluding these, profits were 13 per cent higher while sales rose 1 per cent to pounds 1.27bn. Earnings per Reed share were 21p, or 19.5p excluding currencies and disposals, up from 17.4p last time. The dividend was increased by 3 per cent to 7.5p a share.

Both Reed and Elsevier are still quoted separately, and each owns a share of the merged group. Reed's share of the pre-tax profits was pounds 157m, up from pounds 138m, while Elsevier took 408m guilders, compared with 347m guilders.

The profit improvement was largely due to cost savings and improved efficiency. Best performer was the professional division, which improved profits by 18 per cent to pounds 60m, at constant exchange rates. That was spurred by the educational division, which recorded a 69 per cent increase helped by the national curriculum.

The consumer division produced a 16 per cent increase to pounds 54m, again at constant exchange rates.

(Photograph omitted)

Bottom Line, page 25

Start your day with The Independent, sign up for daily news emails
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant - Swiss Banking and Finance

£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...

Ashdown Group: Marketing Executive - 6 month FTC - Central London

£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...

Ashdown Group: Junior Project Manager (website, web application) - Agile

£215 per day: Ashdown Group: Junior Project Manager (website, web application ...

Guru Careers: Software Engineer / Software Developer

£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before