What happened
Who says American education is on the decline? That surely isn't the feeling Scholastic (SCHL 0.52%) investors had on Friday; they bid their stock up by almost 6% on the day, on the back of the children's and scholarly publisher's latest set of quarterly results.
So what
For its second quarter of fiscal 2023, Scholastic booked just under $588 million in revenue, a figure that was 12% higher on a year-over-year basis. Net income also headed north, rising at a 10% pace to hit slightly over $75 million, or $2.12 per share.
Despite its education-tinged name, Scholastic actually brings in the bulk of its revenue from the publishing and distribution of children's books. Happily for the company this end of its operations did very well, with revenue rising nearly $66 million to land at more than $418 million for the quarter. In addition to good old-fashioned customer demand, distribution efficiencies and pricing initiatives contributed to the category's success.
Although Scholastic has a commanding presence in schools and oftentimes on bookstore shelves, its stock is not closely followed by analysts. As a result, outside estimates for its expected performance were not available.
Now what
What was immediately to hand was Scholastic's guidance. In the earnings release, the company reiterated its existing guidance for the entirety of fiscal 2023. It is forecasting adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $195 million to $205 million, and revenue growth of 8% to 10% over the fiscal 2022 tally.
