Brian Campbell - VP, IR Mark Allin - President and CEO John Kritzmacher - EVP and CFO.

Daniel Moore - CJS Securities Drew Crum - Stifel Nicolaus Jeffrey Matthews - RAM Partners.

Good morning everyone and welcome to the Wiley's Fourth Quarter and Year End Earnings Call. Today's conference is being recorded. For opening remarks and introductions, I will turn the call over to Wiley's Vice President of Investor Relations, Mr. Brian Campbell. Brian, please go ahead..

Thank you. Good morning everyone and welcome to our fourth quarter and fiscal year 2015 earnings call. On June 1, Mark Allin became Wiley's 12th President and CEO since the company's founding in 1807.

Mark was previously Chief Operating Officer and before that, Executive Vice President in charge of the Professional Development segment, where he oversaw the divestiture of consumer publishing assets, the acquisitions of Inscape, eLS, Elan Guides, Profiles International and CrossKnowledge, and has transitioned to digital learning experiences and solutions.

He joined Wiley with the acquisition of Capstone Publishing in 2000, a company he founded. He went on to serve as Managing Director of Wiley Asia, with oversight of all three business lines in a rapidly growing region. Simultaneously, Steve Smith has retired from Wiley after 23 years at the company, and four years as President and CEO.

Mark will be talking about that in a few minutes. Before I pass the call over to him, I'd like to remind you that this call is being recorded and may include forward-looking statements.

You should not rely on such statements as actual results may differ materially and are subject to factors that are discussed in detail in the company's 10-K and 10-Q filings with the SEC. The company does not undertake any obligations to update or revise forward-looking statements to reflect subsequent events or circumstances.

For those who prefer to listen to the call over the phone, but would like to still view the slides, we recommend clicking on the gears icon located on the lower portion on the left-hand side window and selecting Live Phone.

This will eliminate any delays you may experience in viewing the slide transitions as well as remove any potential background noise should you ask a question on the call. A copy of this presentation will be available on our Investor Relations page at the conclusion of the call. Thank you. I'd now like to turn the call over to Mark..

Good morning everyone. I'd like to start out by saying that Steve is doing exceptionally well. In fact, he has a 300 mile cycling trip for charity planned through India, which is typical of Steve. On behalf of all our colleagues, the Board of Directors, John and I would like to thank Steve for his extraordinary contributions over 23 years.

He was instrumental in the development of Wiley's international operations. He played a key role in our largest ever acquisition, Blackwell Publishing, and led to company during a key phase of our transition to digital content and solutions. Steve made a lasting impact, and we have the better for it.

As usual, I will begin the call by discussing business performance and then John will follow with an update on operations and finance. We will follow those updates with our guidance for fiscal 2016.

Unless otherwise noted, I will be excluding the impact of foreign exchange when commenting on all variances, to give a consistent measure of operational performance. Also note, that adjusted numbers exclude the impact of restructuring charges and unusual items in the current period and the previous year.

Unless otherwise noted, I will be discussing numbers on an adjusted basis. Fiscal year 2015 was a good year for Wiley. We achieved both our revenue guidance on a constant currency basis, and our earnings guidance, even with a significant foreign exchange headwind.

In fact, we would have exceeded our EPS guidance range, if not for the adverse impact of a stronger dollar. Research journals, our largest and most profitable business line, showed steady growth of 4%, with subscriptions, funded access and backfiles, all contributing.

Talent Solutions revenue from our recent acquisition achieved double digit growth rates. Education Services, formerly Deltak, saw considerable progress with larger university partnerships, in the U.S. and internationally, and the pipeline in that business looks very good.

Meanwhile, CrossKnowledge continued to grow rapidly in its core market, and began gaining traction in its strategic entry into the U.S. market. With that said, books overall had a difficult year, and remain under long term pressure, particularly in professional development and research.

Plans are in development to integrate those two areas, and realign the overall cost structure to fit the revenue profile and enable focus on higher value opportunity. We continue to generate significant amounts of cash, with full year cash from operations at 19% of revenue.

Revenue growth and the shift to digital continued to drive gross profit expansion.

Moreover, add strong balance sheet, with a net debt-to-EBITDA ratio of 0.7 times, gives us the capacity to acquire companies or capabilities in areas such as learning and development for enterprise customers, technology enabled services targeting educational institutions, and journal content and technology.

I am excited and energized by what we do at Wiley. We are a global company, delivering must-have knowledge and learning. We enable our customers to be successful and gain the skills they need to make a difference, we help improve scientific outcomes.

We deliver the credentials students require to progress, and the experience professionals need to develop their careers. Today, Wiley generates less than 25% of its revenue from print books, and now derives 60% from digital products and service. That shift will continue to accelerate over the next couple of years.

The opportunities in front of us, are many. Now on to performance; fiscal year revenue rose 4%, driven by steady growth in journals, contributions from our two professional development acquisitions, and organic growth in our solutions business, which together offset a decline in book revenue.

Organic revenue, which excludes the combined contribution of $65 million from CrossKnowledge and Profiles International was up 1% over prior year. Adjusted operating income increased 9%, due to higher margin digital revenue growth and cost savings from restructuring.

Adjusted operating margin was 14.6% versus 14.3% in the prior year, adjusted EPS grew 10% to $3.26, driven by higher operating income and a lower effective tax rate. Note that foreign exchange was a significant headwind, reducing revenue by $27 million and EPS by $0.11.

Fourth quarter revenue growth of 2% was driven by the contribution from our recent acquisitions and organic growth in our solutions businesses, as well as a 6% in other journal revenue, which includes products like backfiles and article sales.

Journal subscription revenue declined 2% in the quarter, due to publication timing and the adverse impact of the Swets bankruptcy. As many of you may recall, publication timing often plays a role in quarterly performance, particularly year end.

As previously announced, Swets Information Services, a subscription agent between libraries and publishers, declared bankruptcy in September, which negatively impacted fiscal year journal subscription revenue by around $2 million, with $1.5 million of that coming in the fourth quarter.

Wiley continues to anticipate a total impact from the Swets bankruptcy to be $5 million, with a $3 million remainder adversely impacting our fiscal 2016. Fourth quarter earnings improved 17% to $0.81 a share, driven by gross margin expansion from the shift to digital, as well as cost savings from restructuring, and a lower effective tax rate.

Turning now to our segments, research revenue rose 2% over prior year to $1.04 billion. For the year, journal revenue growth of 4% was driven by modest growth in subscriptions and strong growth in funded access and backfile sales.

Calendar year 2015 journal subscription billings were up 1% as of the end of April, with approximately 97% of expected calendar year 2015 subscriptions closed. The growth rate for subscription billings reflects net losses in society licensing agreements for calendar year 2015, and the adverse impact of the Swets bankruptcy.

For the year, society journal publishing bids netted to an annual calendar year revenue loss of $4 million. But we are very encouraged by what we see in the pipeline for calendar year 2016. Research books had a difficult year, with revenue down 7%.

S previously announced, we are focused on aligning the research and professional development book businesses to drive portfolio optimization, marketing and sales efficiencies, and cost improvements. Adjusted contribution to profit grew by 5%, driven primarily by revenue growth and cost savings from restructuring.

Professional development revenue grew 13% over prior year to $407 million, due to the contribution of recently acquired businesses and growth in online test preparation and post hour assessment. Excluding the $65 million of revenue contribution from CrossKnowledge and Profiles International, revenue declined 5% as a result of the decline in books.

Online test preparation and certification had a strong year, thanks to the additions of the Chartered Financial Analyst or CFA and Certified Management Accountant or CMA programs to our test preparation platform.

Our post-hire assessment business, formerly known as Inscape, continued its solid growth on the strength of the five [ph] behaviors of a cohesive team. Our management assessment program, in partnership with Wiley best selling author, Patrick Lencioni.

For the year, adjusted contribution to profit grew 28%, with restructuring savings and higher gross profits offsetting the modestly dilutive impact of the acquisitions. On an EBITDA basis, both CrossKnowledge and Profiles International were positive for the year.

CrossKnowledge which provides online learning and development solutions for enterprises is seeing very good momentum in Europe and the U.S. Examples of clients signed in the fourth quarter, include MasterCard, PVH, which owns Calvin Klein and Tommy Hilfiger among several other known brands, Central Insurance and Covidien [ph] in Canada.

Education revenue rose 3% over prior year, to $375 million. Double digit growth for education services or Deltak, Custom Products, WileyPLUS/Course Workflow and Digital Books, offset a 9% decline in print textbook revenue. The Education Services business, formerly Deltak, is showing good progress in signing larger U.S.

university partnerships, as well as taking advantage of international opportunities. This quarter, we signed the University of Delaware in the U.S. and University College Cork, in Ireland, as new partners, and added 11 new online programs. Cork is our second prominent university partner outside the U.S. along with Birmingham.

Also in the fourth quarter, we retired two inactive partners and three programs with limited market demand, that did not warrant additional investment. Between them, they have three programs. Note that we regularly assess the portfolio of partners and programs, to ensure we retain market relevance, competitiveness and performance.

At the end of April, we had 38 partners and 200 programs under contract. The pipeline continues to be very active, and the opportunity remains as strong as ever. Adjusted contribution to profit for education rose 1% for the year, as revenue growth and gross margin improvement were offset by the investment in Deltak for growth in market position.

For the year, Deltak was dilutive to EPS by $0.14, due to investments in larger U.S. and international partnerships, as well as a host of new partners that are now in build mode, but not yet generating meaningful revenue. For the year, Deltak was marginally negative on an EBITDA basis.

I will now hand it over to John to provide some additional commentary..

Thank you, Mark. Picking up on the next slide, adjusted shared services costs were flat with prior year, as the 10% decline in distribution and operation services and a 1% decline in finance costs, offset increases in technology and content management and other administration costs.

Technology, excluding content management increased 10% for the year, as we continue to invest in platform enhancement and expand our solutions businesses.

Cost reductions across distributions and operation services and content management, were driven by restructuring savings, and the benefits of our shift to a more variable cost structure to track with declining print volumes.

The noteworthy increase in other administration expenses, reflects the expiration of a real estate tax incentive for our Hoboken headquarters. Some early stage investment in our multiyear global ERP implementation, and occupancy costs related to our recent acquisitions.

Turning to the balance sheet, net debt grew $79 million over prior year, due to our CrossKnowledge acquisition. Our net debt-to-EBITDA ratio on a trailing 12 month basis remains very low at 0.7, providing us with significant capacity to make further strategic acquisitions.

Areas of acquisition interest include talent management, with a focus on learning and development solutions for enterprise customers. Technology enabled services targeting educational institutions, including additional scale and online program management, and finally journal's content and journal related technology.

Our strong interest in talent management and Education Services acquisition is consistent with our overall strategy to offer solutions spanning education to employment.

Free cash flow of $247 million was $3 million lower than prior year, driven by a $12 million increase in capital investment and technology, and higher cash payments related to restructuring. Cash from operations of $355 million was $7 million higher than last year.

We expect higher capital expenditures for the next few years, primarily due to investment in our ERP deployment and other technology platforms. I will comment further on forward-looking cash flow drivers in just a moment. For the year, Wiley purchased 1.1 million shares at an average cost of $57.26.

We did not purchase any shares in the fourth quarter, as we decided it was prudent to not actively trade shares, while the Board conducted its review and decision process with respect to CEO succession. Over 2 million shares remain in the current share repurchase authorization. I'd like to shift now to our outlook for fiscal 2016.

Our mission continues to focus on enabling the skills and knowledge that researchers, professionals and students worldwide need in order to be successful.

The business of learning represents a large and rapidly growing opportunity, as the world shifts to knowledge based economies and outcomes based education, and as companies and workers attempt to differentiate themselves, in a global marketplace. Wiley is well positioned to address these trends, by leveraging our content and solutions capabilities.

We will also continue to acquire companies and capabilities that create lasting competitive advantages in learning. Research journals, which accounted for over 45% of our 2015 revenue, and a higher percentage of our profit, provide a strong foundation for the long term success of our business.

Wiley has one of the largest and highest ranked journal portfolios in the world. Most of the journal subscription business is under multiyear license, and nearly 90% of the revenue is digital.

The journals business has very favorable cash flow characteristics, that enable us to invest in organic growth, strategic acquisitions and technology platforms, to improve our operating efficiency.

Our books business is under sustained pressure, so we will adjust our books portfolio to focus on high value content, and will optimize our costs accordingly. We know that there are significant opportunities to improve efficiency across our shared services functions as well.

We are investing in technology, including in ERP, to enable the achievement of competitive cost benchmarks across all our shared service functions, including IT, finance, customer service and HR.

Moving now to our fiscal 2016 projections, our revenue outlook is for low single digit growth, excluding both the impact of currency and the previously announced timing shift in journals.

As a reminder, starting in calendar year 2016, Wiley will be moving to digital subscription agreement, that are defined by time intervals, rather than publication date. This time based approach will enable a new database option, that we are introducing for customers in our mature markets.

This option will provide access to our entire journal portfolio, rather than access, specialized by title [ph], which will greatly simplify the contracting and administration of our subscriber agreements.

The accounting implication of our change to time based subscriptions, is that a portion of journal revenue will shift to the next fiscal year on a recurring basis, beginning in January of 2016. The estimated initial impact is a shift of $35 million in revenue, and $0.35 of EPS from fiscal 2016 to fiscal 2017.

Please note, that our free cash flow performance will not be impacted by this change. Returning to the revenue outlook, our low single digit growth expectations reflects steady growth in journals, excluding the timing shift, and double digit growth in our solutions businesses.

Books will likely remain under pressure, with education books, including WileyPLUS, anticipated to be flat, and research and professional development books expected to decline at mid-single digit rates. Our fiscal 2016 earnings are expected to be flat, excluding foreign exchange and the timing shift in journals.

While we anticipate solid earnings improvement from revenue growth and cost savings overall, net earnings growth will be offset by incremental investment of more than $0.15 per share in ERP and related systems. The revenue and profitability of our journals business will continue to improve in our fiscal 2016.

Our solutions business will grow at double digit rates, but profit improvement in those businesses will be muted by our pursuit of additional market share. And the books businesses overall will put pressure on earnings, although cost reductions will relieve some of that pressure.

Our ERP and related systems investments will yield significant operating efficiency and effectiveness gains across the IT, finance, customer service and HR function, once fully deployed over the next two to three years.

Our investment in the global ERP through fiscal 2017 is expected to be about $75 million, with roughly half expense and half capitalized. As already noted, plans are underway company-wide to achieve fully competitive cost benchmarks, that leverage our technology investment and aligned to our evolving revenue profile.

We will be prepared to communicate more specifics on these savings when we report our Q1 fiscal 2016 results in September. I'd like to turn now to fiscal 2016 cash flow drivers. Steady cash flow generation is the key strength of our business, and we expect next year's cash from operations to be in line with fiscal 2015.

As a reminder, no cash impact is expected from the shift to time based journal subscription agreement. Free cash flow will be lower in fiscal 2016, due to near term investments, with CapEx expected to increase by roughly $35 million.

Driving the CapEx increase is investment in ERP and related systems, which will enable future operating efficiency gains. The increase in capital expenditures also includes the remodeling and transformation of our Hoboken headquarters, which will enable consolidation savings and productivity gains over time.

All in, we continue to see very positive long term trends for cash flow, including the expected gains and profitability from our near term investments in the business. Now I'd like to turn the call back to Mark, for his perspective on the opportunity ahead..

Thank you, John. I am deeply honored to hold this position. I am positive, I am committed to our future. Wiley is a unique business, with a history of performance and innovation over decades. We have tremendously powerful content, brands and relationships. We have some of the most talented people in the industry.

To-date, we are at the intersection of some significant global trends, including the emergence of knowledge-based economies, the critical importance of education in research and development to economic progress, the shift to online, adaptive and outcomes based learning, and the global need for higher level skills.

Companies, individuals and students, all need to differentiate themselves, in a changing global marketplace. Wiley enables them to do this. We help to develop better professionals and better scientists. No other company spans education and employment, the way we do. Our mission is to deliver the skills and knowledge people need to be successful.

We will leverage our core content and capabilities, alongside our new businesses, to create lasting, competitive advantage, and we will make acquisitions to accelerate growth in scale. Looking beyond fiscal year 2016, we are expecting good underlying growth in revenue, EPS and operating margin.

As a reminder, we set down goals in September 2013 that called for mid single digit revenue growth for FY 2017, as well as 10% or better EPS growth, and 17% or better operating margin.

In terms of revenue, our overall book revenue has been more unfavorable than expected, and we are working to migrate that business to a higher value offering, and align our costs.

In addition, we have not made any new solutions acquisitions since May 2014, which was a condition of reaching our mid-single digit growth goal, although we remain active and positive. In regards to earnings, besides the impacts of lower anticipated revenue, there is the significant investment required for our ERP deployment.

$75 million through 2017, with half of that expensed and half of that capitalized. The outcome of this deployment however, will make a much improved Wiley over the long term. We will achieve considerable operating efficiency gain throughout. We will be more agile, efficient and quicker to market.

In summary, we still expect good underlying revenue and earnings growth in 2017, with consistent revenue and profit growth in continuing in our journals business and continued double digit growth in our solutions businesses.

We'd also expect continued strong cash flow generation, which, along with our very strong balance sheet, will allow us to make targeted but meaningful acquisitions, that accelerate growth across our portfolio. In summary, we are pleased with our fiscal year 2015 performance.

We achieved our earnings guidance, despite a $0.11 headwind from foreign exchange. We saw revenue growth of 4% and EPS growth of 10%. Our journals and solutions businesses continued to perform well, although book revenue was more unfavorable than expected.

In our fiscal year 2016 outlook, we anticipate low single digit revenue growth, and EPS that is operationally flat. Both exclude the impact of the currency and the shift to time based journal subscription agreement.

EPS performance is being driven by revenue and gross profit growth, offset by investment in market share expansion and solutions businesses, and incremental investments in ERP and related systems. Finally, as we said, planning is underway company-wide to achieve fully competitive cost benchmarks. We will have more to say about that, in September.

Finally, I am confident and energized by Wiley's long term prospects.

Given our steady business performance in our journal's business, the expected growth from our professional and education solutions businesses, and the anticipated cost alignment, we expect improvements in revenue, earnings and operating margin to accelerate in fiscal 2017 and beyond. With that as a background, we welcome your comments and questions..

[Operator Instructions]. And we will go first to Daniel Moore, CJS Securities..

Good morning..

Hi Dan..

First question, if FX rates stayed where they are today, what would be the estimated revenue and EPS impact on a year-over-year basis in the fiscal year 2016, relative to fiscal year 2015?.

As Mark noted in his comments, the 2015 versus 2014 impacts were $27 million in revenue and $0.11 on EPS. And if the current rates were to prevail the impacts on revenue for Wiley's fiscal 2016 year-over-year, would be more on the order of approaching $40 million in revenue and approaching $0.14, $0.15 in terms of the EPS impact.

So till considerable headwind at the current FX rates..

At current rates, okay. That's helpful, thank you.

In terms of journals, what type of growth rate is embedded in your low single digit revenue guidance, constant currency for next year, and I think you said you're encouraged by the pipeline for calendar 2016, if you could elaborate on that, that'd be helpful?.

So let me start, and then Mark can jump in if he has something to add. So with respect to our expectations around journal growth overall, we said we'd expect to see the positive journal revenue to rise in the low single digits.

Inside of that, is an anticipation that we are going to see journal subscription growth on the order of 1% to 2%, probably in that lower end of the low single digit range, consistent with what we have seen in the performance that we have reported over the last few quarters..

And I would just add Dan, on the [indiscernible] wins and losses, this is a very competitive market. We have ups and downs, as we go from year-to-year, but as we look into 2016, we have a healthy pipeline. We are continuing to work that, but we are not able to say more about that at this point..

And Mark included in his comments, the balance of the Swets bankruptcy, that carries over into fiscal 2016 is about a $3 million, so that's one of the things that's putting pressure on a year-over-year growth rate for journals.

And then as we have noted, we had net losses in the overall balance of calendar year 2015 this year, so that's also putting some pressure on the rate growth..

Understood.

Shifting gears to Deltak, what level of EPS profitability or loss is embedded in this fiscal 2016 guidance?.

I am sorry.

Could you repeat that please?.

In terms of Deltak, I believe it contributed a loss of about $0.14 in fiscal 2015, just wondering what that number would translate to for your 2016 guidance?.

So we are not going to guide specifically at that level of detail. But I would say, Dan, for sure, that we are expecting that that will improve in our fiscal 2016 period. I think it's also worth noting, while Deltak is dilutive to the business overall and we include in the interest costs associated with the acquisition of the business.

At an EBITDA level, it was just marginally negative in our fiscal 2015, and we expect that that will turn positive in fiscal 2016..

Perfect. And then -- you gave great detail on the shared services and technology.

Just to clarify, the ERP investment of $75 million through 2017, is that a figure that is starting from zero -- in other words, starting from the beginning of fiscal 2016, an incremental $75 million, and do you expect that to be relatively evenly spread across the two years?.

We had some investment included in our fiscal 2015 results. So the $75 is an incremental to that and more than $0.15 is again, incremental 2016 against 2015. The bulk of our investment is the $75 million, it happens inside of 2016 and 2017, and then it will begin to tail off in fiscal 2018..

Okay. I will jump back in queue. Thank you..

Thanks Dan..

[Operator Instructions]. We will go next to Drew Crum with Stifel..

Okay, thanks. Good morning everyone. And Mark, welcome. My first question pertains to the fiscal 2017 guidance. Mark, you provided some comments, some updates there.

Are you guys abandoning the 17% EBIT margin target that you had established a couple of years ago?.

The numbers we talked about, those were goals, Drew, and we continue to believe that those goals are attainable, and to work towards them; for the reasons that we have walked through, given the underlying strength of the journals business and the growth in the solutions business.

Book performance has been more unfavorable than we expected, during that period, and we didn't make further acquisitions during the last fiscal, which was a condition of reaching those goals in 2017. Those remain our goals.

We don't expect to reach them in 2017, but they remain the numbers that we are focused on, but we are not giving guidance beyond that at this point..

Okay, got it.

And then, as far as CrossKnowledge and Profiles are concerned, can you talk a little more about the performance of those businesses? I think you noted that, they were modestly dilutive in fiscal 2015, what are you anticipating for fiscal 2016, in terms of accretion or dilution of the numbers?.

Okay. So I will talk a little bit about the performance of the businesses, and then I will hand over to John to talk about the impact. So CrossKnowledge is performing well; but putting accounting adjustments aside, the business grew operationally around 20% during the fiscal year. Good growth in the home markets in Europe.

We are making some real headway in the U.S., and we feel good about that. Operationally, Profiles actually declined by about 5% in the year. We took the decision early on to readjust the distribution model, so we could scale the business more quickly and grow the margins more quickly, in line with our existing assessment businesses.

So we basically improved some lower margin business and set that business up for growth going forward. So although we underperformed in the revenue line, it actually gets better in terms of profitability. So we feel good about both going forward..

And then Drew, with respect to dilution, we said at the beginning of the year, that we expect the combination of Profiles and CrossKnowledge together to be dilutive on the order of $0.10 for the year.

Our actual results for the year were just slightly favorable to that, and I am expecting that as we make our way through our fiscal 2016 period, that we will see some continued improvement.

Although, as I commented around the guidance, in general, from our solutions businesses, I am expecting the improvement in profitability to be muted by our continued investment in those businesses, with a priority on gaining share. So don't expect a large improvement, but I would expect an improvement..

Okay.

And then just last question from you John, the $35 million of incremental CapEx that you're anticipating in 2016, is that a run rate that we should expect beyond 2016, or does it drop off, once you get past fiscal 2016?.

I am expecting that it will start to tail down a bit after 2016. So 2016 is a peak for us, and we got a lot of work to do on the ERP implementation, and the $35 million on it, keep in mind, is also a significant level of capital investment in our Hoboken facility.

We hit over that peak, and in 2016, it will start to come down a bit in 2017 and then again beyond that..

Okay. Thanks guys..

Thank you..

[Operator Instructions]. We will go next to Jeffrey Matthews with RAM Partners..

Thank you for taking my question.

Can you hear me?.

Yes..

Great. I am just curious on two things, number one, on the ERP implementation, could you give an example or two of areas where you specifically believe that it will lead to cost savings? And number two, just in terms of acquisitions, I wonder if LinkedIn's acquisition of Lynda.com was something that maybe crossed your mind.

Is that an area that might have been or might be of interest to you at some point in the future, and do you think, LinkedIn in general becomes either a partner to Wiley or a potential competitor to Wiley? Thank you very much..

All right. Thank you. This is John. Let me take the ERP question, then I will ask Mark to take question on acquisitions.

So with regard to our ERP implementation, the scope of our implementation includes SAP implemented for recording core capabilities and also the implementation of a substantial element of our order to cash processes that are currently run on in-house builds and maintenance systems.

Among the examples of the gains we will get from our implementation, we will migrate from what our multiple instances of JD Edwards updated platform today, to one global SAP instance for all of our records report capabilities, and then again, incorporating order cash.

So we are moving to a modern platform, gives us global visibility around the business, with globally consistent data.

It greatly improves the efficiency and effectiveness, for example, of the finance function, where we will have ready access to reliable consistent information around the globe, that greatly simplifies our transactional activities through automation and consolidation centralization.

If you look at the results that we posted for the year, and you look at the -- we included in the slides, the amount of spend we have on the finance function, we will see that is well beyond typical benchmarks, at least as a percent of revenue for the finance function would cost.

The ERP implementation will be a very-very important enabler in us taking that level of finance spend down to a level of a competitive benchmark..

Thank you that's really helpful..

Thanks for the question on LinkedIn and Lynda, which is smart. Obviously I wouldn't comment on any particular transaction and whether we are engaged or not.

I would say that, that transaction and a number of others, including those we have participated in, indicate that this is a pretty hot marketplace right now, and one that I think underlines real demand worldwide for education employment solutions, and that's right in the heartland of where we are and where we are headed in the business.

I'd also say that, the LinkedIn-Lynda deal, shows that there is a real premium value on high quality content, and that's what took LinkedIn to Lynda, and we have that in abundance. One of the greatest things we bring to this marketplace is, years of experience and deep reservoirs of important content.

And the third, is that access to customers is important, and so is partnership. And certainly, as John and I both indicated, our pipeline is good, we continue to react here and look for both partners and acquisitions that can take the business forward.

Obviously I wouldn't comment on any particular potential partner and target in doing that, that's a great question. Thank you..

Well great answers. I appreciate them both. Thank you..

Thank you..

[Operator Instructions]. And we will take a follow-up from Daniel Moore with CJS Securities..

Thank you again. You highlighted obviously the exceptionally strong balance sheet. You generated a ton of cash and the fact that you took a pause during fiscal Q4, in terms of repurchasing stock, with the stock having drifted a bit.

Are you now in a position where you would be considering being more aggressive on buybacks?.

Dan, what I would say is, we took a pause only for the reason that we described.

So working through the CEO succession process, we felt that it was prudent for us not to be in the market, but in terms of our belief that there is value to be had in our shares that at current trading level, we continue to believe that, and we fully intend to resume share repurchases.

Probably in line with our pattern over the recent years, so and be be more specific than that, but we certainly expect to resume our purchases..

Got it. Thank you..

We will take our next question from Jeffrey Matthews with RAM Partners..

Hi. Thanks again. I appreciate it.

Jeff, just as a follow-up through the comments about the book publishing weakness; I just wonder if there is something new or incremental in that area or that space that has made it more difficult than in recent years in general?.

Jeff, its Mark. I think what we have seen -- the few things that we are seeing consistent with the industry, one is obviously changing in consumer buying patterns, there are so many different ways to consume content than books, and that continues to pace through multiple devices and choices.

That obviously has an impact, particularly on print purchases. That has a knock-on impact on the strength of retail channels, and reduces the number of outlets. And those really are continuing trends. I'd also point to some flattening out of the consumer e-book market over the last 12 months or so, which has impacted the industry.

Our own digital book business is driven as much by licensing to institutions and custom deals with universities and corporations which is strong, but the underlying consumer business has also shown some weakness, which is why we have mainly withdrawn from consumer and generally into those kinds of publishing.

So there is nothing new, it’s a continuing trend based on consumer demand, the consumption in the way the channels are behaving, and that's why we are moving with the pace we are, to keep up with that..

Understood. Thank you very much..

And gentlemen, with no other questions in queue, I will turn it back to you for closing remarks..

So we thank you again for joining us on the call today, and look forward to speaking to you again in September..

Ladies and gentlemen, thank you for your participation. This does conclude today's conference..