By Sara Webb
AMSTERDAM, July 25 Anglo-Dutch information group
Reed Elsevier increased its share buyback
programme and announced a bigger than expected interim dividend
on Thursday as it continues to expand its electronic publishing
and professional events businesses at a faster pace than print
Shares in Reed, which competes with Thomson Reuters
and Dutch publisher Wolters Kluwer NV, were up 3
percent in London at 826 pence by 1032 GMT while the
Amsterdam-listed shares were up 2.6 percent at 14.06 euros.
Erik Engstrom, chief executive, said the group would
increase the size of this year's share buybacks by about 200
million pounds ($307 million) to a total of 600 million pounds,
and announced an 11 percent increase in the interim dividend to
6.65 pence a share.
"With a strong balance sheet and strong cash flow
characteristics, and average acquisition spend comfortably
covered by free cash flow, we will take a pragmatic approach to
ensuring that the value compounding within the business
translates into shareholder value," Engstrom said.
"This backs our view that Reed is likely to become a more
powerful returner of cash over the medium term as debt comes
down," analysts from Liberum Capital said in a research note.
The company also reported better-than-expected first-half
earnings on Thursday, thanks to stronger results across all its
divisions, particularly its Risks Solutions division, which
sells data and analytics to customers in insurance, business and
government to help detect fraud and other risks.
"The operating momentum in our business remains positive as
we enter the second half," Engstrom said, reiterating that he
expects further revenue and earnings growth for the full year.
Underlying adjusted operating profit in the first six months
of the year rose 6 percent to 870 million pounds, while
underlying revenue rose 2 percent to 3.025 billion pounds.
It said the underlying growth rate was running at 3 percent
which reflected continuing print revenue declines and 5 to 7
percent growth in revenues from its electronic and
"face-to-face" - or exhibitions and conferences - businesses
which together now account for 83 percent of the group's
Analysts polled by Reuters had forecast a first-half
underlying adjusted operating profit of 853 million pounds and
revenue of 3.09 billion pounds.
The owner of the LexisNexis legal database and Science
Direct, the scientific article database, also publishes a range
of trade magazines including New Scientist, Farmers' Weekly,
Flight International, and Estates Gazette but has shifted as
much of the business as possible online in recent years.