Waverly reports profits fell 9.5% in second quarter Baltimore-based publisher expects new textbook sales will help boost revenue

July 27, 1996|By Abbe Gluck | Abbe Gluck,SUN STAFF

Waverly Inc., a Baltimore-based publisher of scientific books, journals and electronic media, said its second-quarter income fell 9.5 percent this year, as revenue from book publishing decreased and the company faced higher costs as it rolled out a newly acquired interactive training system for hospitals.

Net income for the quarter that ended June 30 was $1.9 million, or 20 cents per share, down from $2.1 million, or 24 cents per share, in the year-earlier quarter.

Net publishing revenues increased 10.3 percent, on gains of 19 percent in the Professional Learning System division and 16 percent in periodical publishing, the company said. Second-quarter revenue was $43.3 million, up from $39.2 million in 1995.

Net income for the first half of the year fell 22.6 percent, to $2.4 million, or 26 cents per share, from $3.1 million, or 35 cents per share, in 1995. The 1995 figures have been restated to adjust for the two-for-one stock split Waverly authorized in April.

The company said earnings for the year should exceed those for 1995.

Income will be boosted by sales of new textbooks -- the development and marketing of which eroded margins in the first two quarters -- and by strength in periodical publishing and increasing sales of de'Medici, the hospital training system, the company said.

Those are the reasons Barbara Chacour, an analyst at Brean Murray Foster in New York, is not changing her estimate for the year, she said.

"They're very committed to becoming more profitable," said Chacour, who predicted that the company would earn 20 cents this quarter. She estimated that Waverly will earn 65 cents per share for the year, compared with 58 cents in 1995.

"They're doing very well abroad, which is an important part of their business, and the journals are doing great," she said. "The weakness is in textbooks, and that's only temporary."

Waverly shares closed yesterday at $21, up 25 cents.

Pub Date: 7/27/96

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