* Shares rise, outperform weaker FTSE 100
* 2011 adjusted pretax profit 1.39 bln pounds vs 1.37 bln
* Says macro economic outlook uncertain
* Sees another year of underlying revenue, profit growth
* Sees modest growth at Elsevier, legal market subdued
By Paul Hoskins
LONDON, Feb 16 Anglo-Dutch publishing and
events group Reed Elsevier reported a rise in
full-year profit and said it expected cost cutting and small
acquisitions to help generate more growth in an uncertain
economy this year.
"The macroeconomic outlook remains uncertain, but ... we
expect to deliver another year of underlying revenue and profit
growth in 2012," Chief Executive Erik Engstrom said in a
statement on Thursday.
The company said it would maintain a "relentless focus on
process efficiency" in the coming year to help it deliver that
growth although Engstrom declined to say during a conference
call with reporters whether that would involve job cuts.
The publisher of scientific, business and academic
information said adjusted pretax profit rose 9 percent to 1.39
billion pounds ($2.18 billion) in 2011, slightly ahead of the
1.37 billion pound average of 23 analysts' forecasts compiled by
Revenue at the group, which also runs the world's largest
exhibition business, dipped 1 percent to 6.0 billion pounds
although it was flat once the impact of foreign exchange
fluctuations had been stripped out and underlying growth was 2
Steady growth at more economically resilient parts of its
business such as academic publishing and events are also helping
offset subdued spending by legal clients and uncertainty over
It's main Elsevier business, which provides science and
health information and accounts for 47 percent of group profit,
reported underlying operating profit growth of 4 percent and
predicted "continued modest underlying revenue growth" in 2012.
Its LexisNexis Risk Solutions business reported 12 percent
profit growth and predicted good revenue growth in insurance and
business services but continued tough conditions among
The LexisNexis Legal & Professional division, which competes
with Thomson Reuters' Westlaw, said it had
returned to revenue growth last year, recording a 1 percent rise
after a 2 percent drop in 2010.
"Legal markets remain stable but subdued, limiting revenue
and margin growth potential in the short term," the group
Shares in Reed were up 0.8 percent at 538.5 pence in London
by 1024 GMT, outperforming a 0.7 percent weaker FTSE 100 index
Analysts at Numis described the results as "slightly ahead
of consensus" and said the company's outlook statement was
consistent with their expectations, prompting them to leave
their 2012 earnings estimates unchanged.
"We view the results and outlook statement as solid and
retain our "add" recommendation and (share) target price of 576
pence," they wrote in a note to clients.
Analysts at UBS said the results should reassure investors.
"The portfolio looks in robust shape and we believe the
shares should continue to see gradual re-rating as the company
move towards delivering the double-digit EPS growth it has in
the past," they wrote.
Engstrom told reporters that the group had no plans to sell
any of its main five operating businesses but that it would
continue making small disposals within all divisions as it has
done over the last two years.
In terms of growth, Engstrom said the focus remained on
organic growth supplemented by small acquisitions.