UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: April 30, 2022
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission file number 001-11507
JOHN WILEY & SONS, INC.
(Exact name of Registrant as specified in its charter)
New York
State or other jurisdiction of incorporation or organization
13-5593032
I.R.S. Employer Identification No.
111 River Street, Hoboken, NJ
Address of principal executive offices
07030
Zip Code
(201) 748-6000
Registrant’s telephone number including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Class A Common Stock, par value $1.00 per share
Class B Common Stock, par value $1.00 per share
Trading Symbol
WLY
WLYB
Name of each exchange on which registered
New York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller
reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller
reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒
Non-accelerated filer ☐
Accelerated filer ☐
Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of the voting stock held by non-affiliates of the registrant, computed by reference to the closing price as of
the last business day of the registrant’s most recently completed second fiscal quarter, October 31, 2021, was approximately $2,371
million. The registrant has no non-voting common stock.
The number of shares outstanding of the registrant’s Class A and Class B Common Stock as of May 31, 2022 was 46,717,599 and
9,031,313 respectively.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive proxy statement for use in connection with its annual meeting of stockholders scheduled to be
held on September 29, 2022, are incorporated by reference into Part III of this Annual Report on Form 10-K.
JOHN WILEY & SONS, INC. AND SUBSIDIARIES
FORM 10-K
FOR THE FISCAL YEAR ENDED APRIL 30, 2022
INDEX
Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures
Information About Our Executive Officers
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
[Reserved]
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Exhibits and Financial Statement Schedules
Form 10-K Summary
PART I
ITEM 1.
ITEM 1A.
ITEM 1B.
ITEM 2.
ITEM 3.
ITEM 4.
PART II
ITEM 5.
ITEM 6.
ITEM 7.
ITEM 7A.
ITEM 8.
ITEM 9.
ITEM 9A.
ITEM 9B.
ITEM 9C.
PART III
ITEM 10.
ITEM 11.
ITEM 12.
ITEM 13.
ITEM 14.
PART IV
ITEM 15.
ITEM 16.
SIGNATURES
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Cautionary Notice Regarding Forward-Looking Statements “Safe Harbor” Statement under the Private Securities Litigation
Reform Act of 1995:
This report contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995 concerning our business, consolidated financial condition, and results of operations. The Securities and Exchange
Commission (SEC) encourages companies to disclose forward-looking information so that investors can better understand a
company’s prospects and make informed investment decisions. Forward-looking statements are subject to risks and uncertainties,
many of which are outside our control, which could cause actual results to differ materially from these statements. Therefore, you
should not rely on any of these forward-looking statements. Forward-looking statements can be identified by such words as
“anticipates,” “believes,” “plan,” “assumes,” “could,” “should,” “estimates,” “expects,” “intends,” “potential,” “seek,” “predict,”
“may,” “will,” and similar references to future periods. All statements other than statements of historical facts included in this report
regarding our strategies, prospects, financial condition, operations, costs, plans, and objectives are forward-looking statements.
Examples of forward-looking statements include, among others, statements we make regarding our fiscal year 2023 outlook, the
anticipated impact on the ability of our employees, contractors, customers, and other business partners to perform our, and their,
respective responsibilities and obligations relative to the conduct of our business in the future due to the coronavirus (COVID-19)
outbreak, anticipated restructuring charges and savings, operations, performance, and financial condition. Reliance should not be
placed on forward-looking statements, as actual results may differ materially from those described in any forward-looking
statements. Any such forward-looking statements are based upon many assumptions and estimates that are inherently subject to
uncertainties and contingencies, many of which are beyond our control, and are subject to change based on many important factors.
Such factors include, but are not limited to (i) the level of investment by Wiley in new technologies and products; (ii) subscriber
renewal rates for our journals; (iii) the financial stability and liquidity of journal subscription agents; (iv) the consolidation of book
wholesalers and retail accounts; (v) the market position and financial stability of key retailers; (vi) the seasonal nature of our
educational business and the impact of the used book market; (vii) worldwide economic and political conditions; (viii) our ability to
protect our copyrights and other intellectual property worldwide; (ix) our ability to successfully integrate acquired operations and
realize expected opportunities; (x) the ability to realize operating savings over time and in fiscal year 2023 in connection with our
multiyear Business Optimization Program; (xi) the impact of COVID-19 on our operations, performance, and financial condition; and
(xii) other factors detailed from time to time in our filings with the SEC. We undertake no obligation to update or revise any such
forward-looking statements to reflect subsequent events or circumstances.
Please refer to Part I, Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for important factors that we believe could cause
actual results to differ materially from those in our forward-looking statements. Any forward-looking statement made by us in this
report is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no
obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as
a result of new information, future developments, or otherwise.
Non-GAAP Financial Measures:
We present financial information that conforms to Generally Accepted Accounting Principles in the United States of America (US
GAAP). We also present financial information that does not conform to US GAAP, which we refer to as non-GAAP.
In this report, we may present the following non-GAAP performance measures:
• Adjusted Earnings Per Share (Adjusted EPS);
• Free Cash Flow less Product Development Spending;
• Adjusted Contribution to Profit and margin;
• Adjusted Operating Income and margin;
• Adjusted Income Before Taxes;
• Adjusted Income Tax Provision;
• Adjusted Effective Tax Rate;
• EBITDA, Adjusted EBITDA and margin;
• Organic revenue; and
• Results on a constant currency basis.
Index
3
Management uses these non-GAAP performance measures as supplemental indicators of our operating performance and financial
position as well as for internal reporting and forecasting purposes, when publicly providing our outlook, to evaluate our performance
and calculate incentive compensation. We present these non-GAAP performance measures in addition to US GAAP financial results
because we believe that these non-GAAP performance measures provide useful information to certain investors and financial analysts
for operational trends and comparisons over time. The use of these non-GAAP performance measures may also provide a consistent
basis to evaluate operating profitability and performance trends by excluding items that we do not consider to be controllable activities
for this purpose.
The performance metric used by our chief operating decision maker to evaluate performance of our reportable segments is Adjusted
Contribution to Profit. We present both Adjusted Contribution to Profit and Adjusted EBITDA for each of our reportable segments as
we believe Adjusted EBITDA provides additional useful information to certain investors and financial analysts for operational trends
and comparisons over time. It removes the impact of depreciation and amortization expense, as well as presents a consistent basis to
evaluate operating profitability and compare our financial performance to that of our peer companies and competitors.
For example:
• Adjusted EPS, Adjusted Contribution to Profit, Adjusted Operating Income, Adjusted Income Before Taxes, Adjusted
Income Tax Provision, Adjusted Effective Tax Rate, Adjusted EBITDA, and organic revenue (excluding acquisitions)
provide a more comparable basis to analyze operating results and earnings, and are measures commonly used by shareholders
to measure our performance.
• Free Cash Flow less Product Development Spending helps assess our ability, over the long term, to create value for our
shareholders as it represents cash available to repay debt, pay common stock dividends, and fund share repurchases and
acquisitions.
• Results on a constant currency basis remove distortion from the effects of foreign currency movements to provide better
comparability of our business trends from period to period. We measure our performance excluding the impact of foreign
currency (or at constant currency), which means that we apply the same foreign currency exchange rates for the current and
equivalent prior period.
In addition, we have historically provided these or similar non-GAAP performance measures and understand that some investors and
financial analysts find this information helpful in analyzing our operating margins and net income, and in comparing our financial
performance to that of our peer companies and competitors. Based on interactions with investors, we also believe that our non-GAAP
performance measures are regarded as useful to our investors as supplemental to our US GAAP financial results, and that there is no
confusion regarding the adjustments or our operating performance to our investors due to the comprehensive nature of our disclosures.
We have not provided our 2023 outlook for the most directly comparable US GAAP financial measures, as they are not available
without unreasonable effort due to the high variability, complexity, and low visibility with respect to certain items, including
restructuring charges and credits, gains and losses on foreign currency, and other gains and losses. These items are uncertain, depend
on various factors, and could be material to our consolidated results computed in accordance with US GAAP.
Non-GAAP performance measures do not have standardized meanings prescribed by US GAAP and therefore may not be comparable
to the calculation of similar measures used by other companies and should not be viewed as alternatives to measures of financial
results under US GAAP. The adjusted metrics have limitations as analytical tools, and should not be considered in isolation from, or
as a substitute for, US GAAP information. It does not purport to represent any similarly titled US GAAP information and is not an
indicator of our performance under US GAAP. Non-GAAP financial metrics that we present may not be comparable with similarly
titled measures used by others. Investors are cautioned against placing undue reliance on these non-GAAP measures.
Index
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PART I
Item 1. Business
The Company, founded in 1807, was incorporated in the state of New York on January 15, 1904. Throughout this report, when we
refer to “Wiley,” the “Company,” “we,” “our,” or “us,” we are referring to John Wiley & Sons, Inc. and all of our subsidiaries, except
where the context indicates otherwise.
Please refer to Part II, Item 8, “Financial Statements and Supplementary Data,” for financial information about the Company and its
subsidiaries, which is incorporated herein by reference. Also, when we cross reference to a “Note,” we are referring to our “Notes to
Consolidated Financial Statements,” in Part II, Item 8, “Financial Statements and Supplementary Data” unless the context indicates
otherwise.
Wiley is a global leader in scientific research and career-connected education, unlocking human potential by enabling discovery,
powering education, and shaping workforces. For over 200 years, Wiley has fueled the world’s knowledge ecosystem. Today, our
high-impact content, platforms, and services help researchers, learners, institutions, and corporations achieve their goals in an ever-
changing world. Wiley is a predominantly digital company with approximately 83% of revenue generated by digital products and
tech-enabled services, and 58% of revenue is recurring which includes revenue that is contractually obligated or set to recur with a
high degree of certainty for the year ended April 30, 2022. Through the Research Publishing & Platforms segment, we provide peer-
reviewed scientific, technical, and medical (STM) publishing, content platforms, and related services to academic, corporate, and
government customers, academic societies, and individual researchers. The Academic & Professional Learning segment provides
Education Publishing and Professional Learning content and courseware, training, and learning services to students, professionals, and
corporations. The Education Services segment provides University Services, including online program management (OPM) services
for academic institutions, and Talent Development Services, including placement and training for professionals and businesses. Our
operations are primarily located in the United States (US), United Kingdom (UK), India, Sri Lanka, and Germany. In the year ended
April 30, 2022, approximately 47% of our consolidated revenue was from outside the US.
Wiley’s business strategies are tightly aligned with accelerating growth trends, including open research, career-connected education,
and talent development. Research strategies include driving publishing output to meet the global demand for peer-reviewed research
and expanding platform and service offerings for corporations and societies. Education strategies include expanding online degree
programs and driving online enrollment for university partners, scaling digital content and courseware, and expanding IT talent
placement and reskilling programs for corporate partners.
Business Segments
We report financial information for the following segments, as well as a Corporate category, which includes certain costs that are not
allocated to the reportable segments:
• Research Publishing & Platforms
• Academic & Professional Learning
• Education Services
Research Publishing & Platforms:
Research Publishing & Platforms’ mission is to support researchers, professionals and learners in the discovery and use of research
knowledge to help them achieve their goals. Research provides scientific, technical, medical, and scholarly journals, as well as related
content and services, to academic, corporate, and government libraries, learned societies, and individual researchers and other
professionals. Journal publishing areas include the physical sciences and engineering, health sciences, social sciences and humanities,
and life sciences. Research Publishing & Platforms also includes Atypon Systems, Inc. (Atypon), a publishing software and service
provider that enables scholarly and professional societies and publishers to deliver, host, enhance, market, and manage their content on
the web through the Literatum™ platform. Research Publishing & Platforms customers include academic, corporate, government, and
public libraries, funders of research, researchers, scientists, clinicians, engineers and technologists, scholarly and professional
societies, and students and professors. Research Publishing & Platforms products are sold and distributed globally through multiple
channels, including research libraries and library consortia, independent subscription agents, direct sales to professional society
members, and other customers. Publishing centers include Australia, China, Germany, India, the UK, and the US. Research Publishing
& Platforms’ revenue accounted for approximately 53% of our consolidated revenue in the year ended April 30, 2022, with a 35.1%
Adjusted EBITDA margin. Approximately 95% of Research Publishing & Platforms’ revenue is generated by digital and online
products, and services.
Index
5
Research Publishing & Platforms revenue by product type includes Research Publishing and Research Platforms. The graphs below
present revenue by product type for the years ended April 30, 2022, and 2021:
Key growth strategies for the Research Publishing & Platforms segment include evolving and developing new licensing models for
our institutional customers (“pay to read and publish”), developing new open access journals and revenue streams (“pay to publish”),
focusing resources on high-growth and emerging markets, and developing new digital products, services, and workflow solutions to
meet the needs of researchers, authors, societies, and corporate customers.
Research Publishing
Research Publishing generates the majority of its revenue from contracts with its customers in the following revenue streams:
•
Journal Subscriptions (“pay to read”), Open Access (“pay to publish”), and Transformational Models (“pay to read and
publish”); and
• Licensing, Reprints, Backfiles, and Other.
Journal Subscriptions, Open Access, and Transformational Models
As of April 30, 2022, we publish over 1,900 academic research journals. We sell journal subscriptions directly to thousands of
Research institutions worldwide through our sales representatives, indirectly through independent subscription agents, through
promotional campaigns, and through memberships in professional societies for those journals that are sponsored by societies. Journal
subscriptions are primarily licensed through contracts for digital content available online through our Wiley Online Library platform.
Contracts are negotiated by us directly with customers or their subscription agents. Subscription periods typically cover calendar
years. Print journals are generally mailed to subscribers directly from independent printers. We do not own or manage printing
facilities. Subscription revenue is generally collected in advance.
Approximately 53% of Journal Subscription revenue is derived from publishing rights owned by Wiley. Publishing alliances also play
a major role in Research Publishing’s success. Approximately 47% of Journal Subscription revenue is derived from publication rights
that are owned by professional societies and published by us pursuant to long-term contracts or owned jointly with professional
societies. These society alliances bring mutual benefit: The societies gain Wiley’s publishing, marketing, sales, and distribution
expertise, while Wiley benefits from being affiliated with prestigious societies and their members. Societies that sponsor or own such
journals generally receive a royalty and/or other financial consideration. We may procure editorial services from such societies on a
prenegotiated fee basis. We also enter into agreements with outside independent editors of journals that define their editorial duties
and the fees and expenses for their services. Contributors of articles to our journal portfolio transfer publication rights to us or a
professional society, as applicable. We publish the journals of many prestigious societies, including the American Cancer Society, the
American Heart Association, the European Molecular Biology Organization, the American Anthropological Association, the
American Geophysical Union, and the German Chemical Society.
Wiley Online Library, which is delivered through our Literatum platform, provides the user with intuitive navigation, enhanced
discoverability, expanded functionality, and a range of personalization options. Access to abstracts is free and full content is accessible
through licensing agreements or as individual article purchases. Large portions of the content are provided free or at nominal cost to
nations in the developing world through partnerships with certain nonprofit organizations. Our online publishing platforms provide
revenue growth opportunities through new applications and business models, online advertising, deeper market penetration, and
individual sales and pay-per-view options.
Wiley’s performance in the 2020 release of Clarivate Analytics’ Journal Citation Reports (JCR) remains strong, maintaining its top 3
position in terms of the number of titles indexed, articles published, and citations received. Wiley has 10% of titles, 11% of articles,
and 11% of citations.
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6
A total of 1,281 Wiley journals were included in the reports. Wiley journals ranked #1 in 20 categories across 17 titles and achieved
219 top-10 category rankings.
The annual JCR are one of the most widely used sources of citation metrics used to analyze the performance of peer-reviewed
journals. The most famous of these metrics, the Impact Factor, is based on the frequency with which an average article is cited in the
JCR report year. Alongside other metrics, this makes it an important tool for evaluating a journal’s impact on ongoing research.
Under the Open Access business model, accepted research articles are published subject to payment of Article Publication Charges
(APCs) and then all open articles are immediately free to access online. Contributors of open access articles retain many rights and
typically license their work under terms that permit reuse.
Open Access offers authors choices in how to share and disseminate their work, and it serves the needs of researchers who may be
required by their research funder to make articles freely accessible without embargo. APCs are typically paid by the individual author
or by the author’s funder, and payments are often mediated by the author’s institution. We provide specific workflows and
infrastructure to authors, funders, and institutions to support the requirements of Open Access.
We offer two Open Access publishing models. The first of these is Hybrid Open Access where authors publishing in the majority of
our paid subscription journals, after article acceptance, are offered the opportunity to make their individual research article openly
available online.
The second offering of the Open Access model is a growing portfolio of fully open access journals, also known as Gold Open Access
Journals. All Open Access articles are subject to the same rigorous peer-review process applied to our subscription-based journals. As
with our subscription portfolio, a number of the Gold Open Access Journals are published under contract for, or in partnership with,
prestigious societies, including the American Geophysical Union, the American Heart Association, the European Molecular Biology
Organization, and the British Ecological Society. The Open Access portfolio spans life, physical, medical, and social sciences and
includes a choice of high impact journals and broad-scope titles that offer a responsive, author-centered service.
Transformational agreements (“read and publish”), are an innovative model that blends Journal Subscription and Open Access
offerings. Essentially, for a single fee, a national or regional consortium of libraries pays for and receives full read access to our
journal portfolio and the ability to publish under an open access arrangement. Like subscriptions, transformational agreements involve
recurring revenue under multiyear contracts. Transformational models accelerate the transition to open access while maintaining
subscription access.
Licensing, Reprints, Backfiles, and Other
Licensing, Reprints, Backfiles, and Other includes advertising, backfile sales, the licensing of publishing rights, journal and article
reprints, and individual article sales. We generate advertising revenue from print and online journal subscription products, our online
publishing platform, Literatum, online events such as webinars and virtual conferences, community interest websites such as
spectroscopyNOW.com, and other websites. A backfile license provides access to a historical collection of Wiley journals, generally
for a one-time fee. We also engage with international publishers and receive licensing revenue from reproductions, translations, and
other digital uses of our content. Journal and article reprints are primarily used by pharmaceutical companies and other industries for
marketing and promotional purposes. Through the Article Select and PayPerView programs, we provide fee-based access to
nonsubscribed journal articles, content, book chapters, and major reference work articles. The Research Publishing business is also a
provider of content and services in evidence-based medicine (EBM). Through our alliance with The Cochrane Collaboration, we
publish The Cochrane Library, a premier source of high-quality independent evidence to inform healthcare decision-making. EBM
facilitates the effective management of patients through clinical expertise informed by best practice evidence that is derived from
medical literature.
Research Platforms
Research Platforms is principally comprised of Atypon, a publishing software and service provider that enables scholarly and
professional societies and publishers to deliver, host, enhance, market, and manage their content on the web through the Literatum
platform.
Literatum, our online publishing platform for societies and other research publishers, delivers integrated access to more than 10
million articles from approximately 2,800 journals, as well as 26,000 online books and hundreds of multivolume reference works,
laboratory protocols and databases. The Literatum platform hosts more than 46% of the world’s English language journals.
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On November 30, 2021, we acquired the assets of the eJournalPress (EJP) business from Precision Computer Works, Inc. EJP is a
technology platform company with an established journal submission and peer-review management system. On October 1, 2021, we
completed the acquisition of certain assets of J&J Editorial Services, LLC. (J&J). J&J is a publishing services company providing
expert offerings in editorial operations, production, copyediting, system support and consulting. The results of these acquisitions have
been included in Research Platforms.
Fiscal Year 2023 Changes to Revenue by Product Type
In the first quarter of fiscal year 2023, our revenue by product type previously referred to as Research Platforms will be changed to
Research Solutions. Research Solutions will include infrastructure and publishing services that help societies and corporations thrive
in a complex knowledge ecosystem. In addition to Platforms (Atypon), certain product offerings such as corporate sales which
included the recent acquisitions of Madgex Holdings Limited (Madgex), and Bio-Rad Laboratories Inc.’s Informatics products
(Informatics) that were previously included in Research Publishing will be moved to Research Solutions. Research Solutions will also
include product offerings related to certain recent acquisitions such as J&J, and EJP.
Academic & Professional Learning:
Our Academic & Professional Learning segment provides Education Publishing and Professional Learning products and services,
including scientific, professional, and education print and digital books, digital courseware, and test preparation services, to libraries,
corporations, students, professionals, and researchers, as well as learning, development, and assessment services for businesses and
professionals. Communities served include business, finance, accounting, workplace learning, management, leadership, technology,
behavioral health, engineering/architecture, science and medicine, and education. Products are developed for worldwide distribution
through multiple channels, including chain and online booksellers, libraries, colleges and universities, corporations, direct to
consumer, websites, distributor networks, and other online applications. Publishing centers include Australia, Germany, India, the UK,
and the US. Academic & Professional Learning accounted for approximately 31% of our consolidated revenue in the year ended April
30, 2022, with a 28.1% Adjusted EBITDA margin. Approximately 55% of revenue is from digital and online products and services.
Academic & Professional Learning revenue by product type includes Education Publishing and Professional Learning. The graphs
below present revenue by product type for the years ended April 30, 2022, and 2021:
Key strategies for the Academic & Professional Learning business include developing and acquiring products and services to drive
career-connected education, developing leading brands and franchises, executing strategic acquisitions and partnerships, and
innovating digital content and courseware formats while expanding their global discoverability and distribution. We continue to
implement strategies to manage declines in print revenue through cost improvement initiatives and focusing our efforts on growing
our digital lines of business.
Book sales for Education Publishing and Professional Learning are generally made on a returnable basis with certain restrictions. We
provide for estimated future returns on sales made during the year based on historical return experience and current market trends.
Materials for book publications are obtained from authors throughout most of the world, utilizing the efforts of an editorial staff,
outside editorial advisors, and advisory boards. Most materials are originated by the authors themselves or as the result of suggestion
or solicitations by editors and advisors. We enter into agreements with authors that state the terms and conditions under which the
materials will be published, the name in which the copyright will be registered, the basis for any royalties, and other matters. Most of
the authors are compensated with royalties, which vary depending on the nature of the product. We may make advance royalty
payments against future royalties to authors of certain publications. Royalty advances are reviewed for recoverability and a reserve for
loss is maintained, if appropriate.
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8
We continue to add new titles, revise existing titles, and discontinue the sale of others in the normal course of our business, and we
also create adaptations of original content for specific markets based on customer demand. Our general practice is to revise our
textbooks approximately every three years, if warranted, and to revise other titles as appropriate. Subscription-based products are
updated on a more frequent basis.
We generally contract with independent printers and binderies globally for their services. Management believes that adequate printing
and binding facilities and sources of paper and other required materials are available to it, and that it is not dependent upon any single
supplier.
In fiscal year 2016, we entered into an agreement to outsource our US-based book distribution operations to Cengage Learning, with
the continued aim of improving efficiency in our distribution activities and moving to a more variable cost model. As of April 30,
2022, we had one global warehousing and distribution facility remaining, which is in the UK.
Education Publishing
Education Publishing generates the majority of its revenue from contracts with its customers in the following revenue streams:
• Education Publishing
• Digital Courseware
• Test Preparation and Certification
• Licensing and Other
Education Publishing
Education textbooks and related supplementary material and digital products are sold primarily to bookstores and online booksellers
serving both for-profit and nonprofit educational institutions (primarily colleges and universities), and direct-to-students. We employ
sales representatives who call on faculty responsible for selecting books to be used in courses and on the bookstores that serve such
institutions and their students. The textbook business is seasonal, with the majority of textbook sales occurring during the July-
through-October and December-through-January periods. There are active used and rental print textbook markets, which adversely
affect the sale of new textbooks. We are exploring opportunities to expand into the rental print textbook market.
STM books (Reference) are sold and distributed globally in digital and print formats through multiple channels, including research
libraries and library consortia, independent subscription agents, direct sales to professional society members, bookstores, online
booksellers, and other customers.
We develop content in a digital format that can be used for both digital and print products, resulting in productivity and efficiency
savings and enabling print-on-demand delivery. Book content is available online through Wiley Online Library (delivered through our
Literatum platform), WileyPLUS, zyBooks®, alta™, and other proprietary platforms. Digital books are delivered to intermediaries,
including Amazon, Apple, Google, and Ingram/Vital-Source®, for re-sale to individuals in various industry-standard formats, which
are now the preferred deliverable for licensees of all types, including foreign language publishers. Digital books are also licensed to
libraries through aggregators. Specialized formats for digital textbooks go to distributors servicing the academic market, and digital
book collections are sold by subscription through independent third-party aggregators servicing distinct communities. Custom
deliverables are provided to corporations, institutions, and associations to educate their employees, generate leads for their products,
and extend their brands. Content from digital books is also used to create online articles, mobile apps, newsletters, and promotional
collateral. This continual reuse of content improves margins, speeds delivery, and helps satisfy a wide range of customer needs. Our
online presence not only enables us to deliver content online, but also to sell more books. The growth of online booksellers benefits us
because they provide unlimited virtual “shelf space” for our entire backlist. Publishing alliances and franchise products are important
to our strategy. Education and STM publishing (including Test Preparation) alliance partners include the AICPA, the CFA Institute,
ACT (American College Test), IEEE, American Institute of Chemical Engineers, and many others. The ability to join Wiley’s product
development, sales, marketing, distribution, and technology with a partner’s content, technology, and/or brand name has contributed to
our success.
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Digital Courseware
We offer high-quality online learning solutions, including WileyPLUS, a research-based, online environment for effective teaching and
learning that is integrated with a complete digital textbook. WileyPLUS improves student learning through instant feedback,
personalized learning plans, and self-evaluation tools, as well as a full range of course-oriented activities, including online planning,
presentations, study, homework, and testing. In selected courses, WileyPLUS includes a personalized adaptive learning component,
Orion, which is based on cognitive science. Orion helps to build student proficiency on topics while improving the effectiveness of
their study time. It assists educators in identifying areas that need reinforcement and measures student engagement and proficiency
throughout the course.
The highly interactive zyBooks platform enables learners to learn by doing while allowing professors to be more efficient and devote
more time to teaching. The platform maximizes learner engagement and retention through demonstration and hands-on learning
experiences using interactive question sets, animations, tools, and embedded labs. The zyBooks platform will become an essential
component of Wiley’s differentiated digital learning experience and, when combined with the alta adaptive learning technology, will
power lower-cost, higher-impact education across Wiley’s education business.
Test Preparation and Certification
to customers directly
The Test Preparation and Certification business represents learning solutions, training activities, and print and digital formats that are
delivered
through online digital delivery platforms, bookstores, online booksellers, and other
customers. Products include CPAExcel®, a modular, digital platform comprised of online self-study, videos, mobile apps, and
sophisticated planning tools to help professionals prepare for the CPA exam, and test preparation products for the CFA®, CMA®,
CIA®, CMT®, FRM®, FINRA®, Banking, and PMP® exams.
Licensing and Other
Licensing and distribution services are made available to other publishers under agency arrangements. We also engage in co-
publishing titles with international publishers and receive licensing revenue from photocopies, reproductions, translations, and digital
uses of our content and use of the Knewton® adaptive engine.
Professional Learning
Professional Learning generates the majority of its revenue from contracts with its customers in the following revenue streams:
• Professional Publishing
• Licensing and Other
• Corporate Training
• Corporate Learning
Professional Publishing
Professional books, which include business and finance, technology, and other professional categories, as well as the For Dummies®
brand, are sold to bookstores and online booksellers serving the general public, wholesalers who supply such bookstores, warehouse
clubs, college bookstores, individual practitioners, industrial organizations, and government agencies. We employ sales
representatives who call upon independent bookstores, national and regional chain bookstores, and wholesalers. Sales of professional
books also result from direct mail campaigns, telemarketing, online access, advertising, and reviews in periodicals.
We also promote active and growing custom professional and education publishing programs. Our custom professional publications
are used by professional organizations for internal promotional or incentive programs and include digital and print books written
specifically for a customer and customizations of existing publications to include custom cover art, such as imprints, messages, and
slogans. More specific are customized For Dummies publications, which leverage the power of this well-known brand to meet the
specific information needs of a wide range of organizations around the world.
Licensing and Other
Licensing and distribution services are made available to other publishers under agency arrangements. We also engage in co-
publishing titles with international publishers and receive licensing revenue from photocopies, reproductions, translations, and digital
uses of our content. Wiley also realizes advertising revenue from branded websites (e.g., Dummies.com) and online applications.
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Corporate Training
Our corporate training businesses include high-demand soft-skills training solutions that are delivered to organizational clients through
online digital delivery platforms, either directly or through an authorized distributor network of independent consultants, trainers, and
coaches. Wiley’s branded assessment solutions include Everything DiSC®, The Five Behaviors® based on Patrick Lencioni’s
perennial bestseller The Five Dysfunctions of a Team, and Leadership Practices Inventory® from Kouzes and Posner’s bestselling The
Leadership Challenge®, as well as PXT Select™, a prehire selection tool. Our solutions help organizations hire and develop effective
managers, leaders, and teams.
Corporate Learning
The corporate learning business offers online learning and training solutions for global corporations, universities, and small and
medium-sized enterprises, which are sold on a subscription or fee basis. Learning experiences, formats and modules on topics such as
leadership development, value creation, client orientation, change management, and corporate strategy are delivered on a cloud-based
CrossKnowledge Learning Management System (LMS) platform that hosts more than 20,000 content assets (videos, digital learning
modules, written files, etc.) in 18 languages. Its offering includes a collaborative e-learning publishing and program creation
system. Revenue growth is derived from legacy markets, such as France, Germany, UK, and other European markets, and newer
markets, such as the US and Brazil. In addition, learning experiences, content, and LMS offerings are continuously refreshed and
expanded to serve a wider variety of customer needs. These digital learning solutions are either sold directly to corporate customers or
through our global partners’ network.
Education Services:
Our Education Services segment consists of University Services OPM services for higher education institutions and talent
development for professionals and businesses. Key growth strategies include increasing student enrollment in existing OPM programs,
signing new university partners and degree programs, and bridging the IT skills gap through talent development for corporations
around the world. Education Services accounted for approximately 16% of our consolidated revenue in the year ended April 30, 2022,
with a 11.5% Adjusted EBITDA margin. Education Services generated 100% of its revenue from digital and online products and
services.
Education Services revenue by product type includes University Services, previously referred to as Education Services OPM, and
Talent Development Services, previously referred to as mthree. The graphs below present revenue by product type for the years ended
April 30, 2022, and 2021:
University Services
Our Education Services segment engages in the comprehensive management of online degree programs for universities and has grown
to include a broad array of technology-enabled service offerings that address our partner specific pain points. Increasingly, this
includes delivering full stack career credentialing education that advances specific careers with in-demand skills.
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As student demand for online degree and certificate programs continues to increase, traditional institutions are partnering with OPM
providers to develop and support these programs. University Services includes market research, marketing, student recruitment,
enrollment support, proactive retention support, academic services to design courses, faculty support, and access to the Engage
Learning Management System, which facilitates the online education experience. Graduate degree programs include Business
Administration, Finance, Accounting, Healthcare, Engineering, Communications, and others. Revenue is derived from prenegotiated
contracts with institutions that provide for a share of tuition generated from students who enroll in a program. As of April 30, 2022,
the University Services business had 68 university partners under contract. We are also extending the core OPM business and
delivering a broader array of essential university and career credentialing services that the market is demanding and that leverage our
core Wiley skills and assets. This full stack education includes teacher professional development and IT skills training, through which
we develop and deliver professional credits and job placement through our corporate partners. In addition, Education Services OPM
derives revenue from unbundled service offerings.
Talent Development Services
On January 1, 2020, Wiley acquired mthree, a rapidly growing talent placement provider that addresses the IT skills gap by finding,
training, and placing job-ready technology talent in roles with leading corporations worldwide. In late May 2022, Wiley renamed the
mthree talent development solution to Wiley Edge. Talent Development Services sources, trains, and prepares aspiring students and
professionals to meet the skill needs of today’s technology careers, and then places them with some of the world’s largest financial
institutions, technology companies, and government agencies. Talent Development Services also works with its clients to retrain and
retain existing employees so they can continue to meet the changing demands of today’s technology landscape. In fiscal year 2022,
Wiley Edge grew by more than 70%, signed 19 new corporate clients, expanded into new industry verticals beyond financial services,
such as technology and consumer goods, and signed an upskill program for a Fortune 100 company involving hundreds of employees.
Human Capital
As of April 30, 2022, we employed approximately 9,500 persons (including 1,800 Wiley Edge) on a full-time equivalent basis
worldwide.
At Wiley, our people are one of our most significant assets and investments toward achieving our mission to unlock human potential.
The successful acceleration of our strategies and the delivery of innovative impact in research and education depend on our ability to
attract, develop, reward and retain a diverse population of talented, qualified and highly skilled colleagues. Our human capital
management framework includes programs, policies and initiatives that promote diversity, equity and inclusion; talent acquisition;
ongoing employee learning and development; competitive compensation and benefits; safety and health; and emphasis on employee
satisfaction and engagement. Wiley’s Board of Directors, through its Executive Compensation and Development Committee, has
oversight for human capital management.
Our human capital metrics summary (excluding Wiley Edge) as of April 30, 2022:
CATEGORY
EMPLOYEES
By Region
DIVERSITY AND INCLUSION
Global Gender Representation
US Person of Color (POC)
Representation*
METRIC
Americas
APAC
EMEA
% Female Colleagues
% Female Senior Leaders
(Vice President and Above)
% POC
% POC Senior Leaders
(Vice President and Above)
47%
19%
34%
56%
42%
26%
19%
* US POC includes employees who self-identify as Hispanic or Latino, Black or African American, Asian, American Indian or
Alaskan Native, Native Hawaiian or other Pacific Islander, or two or more races.
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Health, Safety & Well-Being
Safeguarding and promoting colleague well-being is central to what we do, as it is critically important we provide the tools and
resources they need to be healthy and at their best. We support our colleagues in maintaining their physical, emotional, social, and
financial well-being through working practices, education and benefit programs.
This became even more critical at the onset of the COVID-19 pandemic, when we acted quickly and with purpose to protect and
support our colleagues. Below are actions Wiley has taken throughout the ongoing pandemic:
• Continued to drive Business Continuity Plans:
• Ensured infrastructure was in place to successfully serve customers with most colleagues working remotely
• Our cross-functional global crisis management team continued to monitor events, reviewed the latest guidance, updated
Company protocols as needed, and kept up to date on issues facing our colleagues around the globe
Provided timely information and communication to colleagues, educational materials, and additional support resources
•
•
Protected the health, safety and well-being of our colleagues and expanded our support over the past year which included:
•
•
Pay continuation for COVID-19 related absences, whether due to personal sickness, sick family member or dependent-
care issues
Increased healthcare coverage to ensure coverage for COVID-19 and direct additional resources locally for other well-
being needs (e.g., oxygen concentrators in India during peak of COVID-19)
• Expanded and enhanced Employee Assistance Program
• Expanded family care benefits in our larger markets to continue to support our colleagues both at work and at home
• A digital well-being approach to meet colleague needs, providing on-demand resources, including a subscription to a
mindfulness, meditation and sleep app at no cost to colleagues
• Developed and implemented flexible work policy and support model for colleagues at home and for those returning to the office:
• Continued to provide work-from-home support, including home office allowance, additional technology supplies,
training and resources to ensure most effective remote team management
• Re-opened offices on a voluntary basis with office procedures to safely welcome colleagues back to the office, with
social distancing, vaccination verification and/or testing protocols, provided personal protective equipment (PPE),
frequent cleaning services and alternated work schedules to maintain safety protocols
Diversity, Equity & Inclusion (DEI)
With the hiring of our Vice President, Diversity, Equity and Inclusion, and Director, DEI Strategy, we are operationalizing critical
priorities within three DEI activators—Inclusive Community, Enhancing our Foundation, and Understanding our People. These
activators reflect our DEI near-term priorities to propel a sustainable, inclusive organization that embodies diversity, and equity
throughout our policies, programs and processes, and fosters an inclusive culture where people feel like they can be themselves.
Our Employee Resource Groups help drive our DEI priorities through learning opportunities and Wiley community events. As a
member of the CEO Action for Diversity and Inclusion, Wiley demonstrates its commitment to sustained, concrete actions that
advance diversity and inclusive thinking, behavior, and business practices in the workplace. We also proudly received a 100% score
from the Human Rights Foundation for LGBTQ workplace equality.
Culture, Engagement & Learning
Investment in colleague development and growth for current and future roles is central to our culture. Wiley provides development
programs, skill development courses and self-paced multi-language resources to help provide ongoing learning offerings for our
people. Leveraging Wiley’s CrossKnowledge platform, we offer interactive development programs which allow colleagues to share
lessons learned, best practices and have interactive opportunities with their peers. We also focus on higher-ed programs and
certifications with our Wiley Beyond platform, which offers access to university programs as well as technical and industry-
recognized certification programs.
We conduct our Talent Review annually, focusing on high performing and high potential talent, diversity, and succession for our most
critical roles. We are committed to identifying, growing, and retaining top talent and ensuring we have the right skills for the future.
We establish key development action planning opportunities for each colleague to build bench strength and review development
progress and mobility regularly.
Our culture differentiates us as an organization and our core values define how we work together. We ask colleagues to embody our
three values—Learning Champion, Needle Mover, and Courageous Teammate. These values define who we are as a company and
what we stand for.
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Our Environmental Responsibility
We strive to make good choices for the environment, our customers and our business. To further our commitment, this year we hired a
VP of Environmental, Social, Governance and Corporate Impact to drive forward our sustainability efforts. We believe environmental
responsibility and business objectives are fundamentally connected and essential to our operations. This is why we are acting now to
limit our impact on the environment—measuring our carbon emissions and advancing sustainability initiatives. Our commitment is
also evidenced by our signing onto the Publishing Declares Climate Action pledge.
In each of our fiscal years beginning in fiscal year 2020, we have conducted a comprehensive independent third-party GHG
assessment for our Global Operations. For fiscal year 2022, we are a CarbonNeutral® certified company across our Global
Operations, in accordance with the CarbonNeutral Protocol. Our locations use 100% renewable energy through green tariffs and
energy attribute certificates (EACs). Most of our global office real estate is leased and, whenever possible, we work with property
owners to optimize sustainability.
We also work with publishing partners, where possible, to reduce print production and consumption, reduce excess inventory through
print-on-demand and encourage digital consumption of our products.
We updated our Paper Selection and Use Policy which supports high environmental standards. In July 2021, we completed our
inaugural Carbon Disclosure Project (CDP) Forests disclosure and plan to expand our disclosures in the coming years.
In a program entitled Go Green, we partnered with Trees for the Future to plant a tree for every copy of a journal we actively stop
printing, up to one million trees. To date, over 230,000 trees have been planted as a result.
We are always seeking opportunities to improve environmental performance. We comply with environmental laws and regulations,
thoughtfully investing resources toward managing environmental affairs and raising awareness of global environmental issues through
education and research.
Financial Information About Business Segments
The information set forth in Part II, Item 8, “Financial Statements and Supplementary Data” in Note 3, “Revenue Recognition,
Contracts with Customers,” and Note 20, “Segment Information,” of the Notes to Consolidated Financial Statements and Item 7,
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K are
incorporated herein by reference.
Available Information
Our Internet address is www.wiley.com. We make available, free of charge, on or through our investors.wiley.com website, our Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports that we file
or furnish pursuant to Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, or the Exchange Act, as soon as reasonably
practicable after we electronically file these materials with, or furnish them to, the SEC. The information contained on, or that may be
accessed through, our website is not incorporated by reference into, and is not a part of, this Annual Report on Form 10-K.
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Item 1A. Risk Factors
Introduction
The risks described below should be carefully considered before making an investment decision. You should carefully consider all the
information set forth in this Annual Report on Form 10-K, including the following risk factors, before deciding to invest in any of our
securities. This Annual Report on Form 10-K also contains, or may incorporate by reference, forward-looking statements that involve
risks and uncertainties. See the “Cautionary Notice Regarding Forward-Looking Statements,” immediately preceding Part I of this
Annual Report on Form 10-K. The risks below are not the only risk factors we face. Additional risks not currently known to us or that
we presently deem insignificant could impact our consolidated financial position and results of operations. Our businesses,
consolidated financial position, and results of operations could be materially adversely affected by any of these risks. The trading price
of our securities could decline due to any of these risks, and investors may lose all or part of their investment.
Strategic Risks
The ongoing COVID-19 pandemic may continue to impact our business, results of operations, and financial condition.
The ongoing COVID-19 pandemic, as well as continuing measures undertaken to contain the spread of COVID-19, could continue to
cause disruptions and have a significant impact on our business, including, but not limited to:
• Declines in print book sales due to closings of retail bookstores;
• Declines in businesses that rely on in-person engagement, primarily test prep and corporate training;
• Delays in signing annual journal subscription agreements in certain parts of Europe and Asia due to challenges of remote
selling and university disruption;
• Declines in subscription revenue due to continued library and academic budget challenges;
• Delays in customer payments due to widespread disruption and pervasive cash conservation behaviors in the face of
uncertainty;
• Lower demand for early career technology talent due to client constraints, including the continuing closure of corporate
offices, staffing uncertainty, internal contractor hiring restrictions, and financial constraints.
The outbreak also continues to present challenges as the majority of our workforce is continuing to work remotely and continuing to
assist new and existing customers who are also generally working remotely.
The COVID-19 pandemic may have the effect of heightening other risks identified in this section of our Annual Report on Form 10-K
for the year ended April 30, 2022, such as those related to technology disruption and the adoption by colleges and universities of
online delivery of their educational offerings. Despite our efforts to manage these risks, it is not possible for us to predict the duration
or magnitude of the adverse impacts of the outbreak and its effects on our business, results of operations, or financial condition at this
time, but such effects may be material. The extent to which our business, results of operations, and financial condition may be
impacted by the COVID-19 pandemic in the future will depend largely on continued developments, which are highly uncertain and
cannot be accurately predicted, including new information which may emerge concerning the severity of the outbreak, including
variants of the virus, and actions taken by government authorities to contain the outbreak or treat its impact, including the
effectiveness and distribution of vaccines.
We may not be able to realize the expected benefits of our growth strategies, which are described in Item 1. Business, including
successfully integrating acquisitions, which could adversely impact our consolidated financial position and results of operations.
Our growth strategy includes business acquisitions, including knowledge-enabled services, which complement our existing businesses.
Acquisitions may have a substantial impact on our consolidated financial position and results of operations. Acquisitions involve risks
and uncertainties, including difficulties in integrating acquired operations and in realizing expected opportunities, cost synergies,
diversions of management resources, loss of key employees, challenges with respect to operating new businesses, and other
uncertainties.
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The demand for digital and lower cost books could impact our sales volumes and pricing in an adverse way.
A common trend facing each of our businesses is the digitization of content and proliferation of distribution channels through the
Internet and other electronic means, which are replacing traditional print formats. This trend towards digital content has also created
contraction in the print book retail market which increases the risk of bankruptcy for certain retail customers, potentially leading to the
disruption of short-term product supply to consumers, as well as potential bad debt write-offs. New distribution channels, such as
digital formats, the Internet, online retailers, and growing delivery platforms (e.g., tablets and e-readers), combined with the
concentration of retailer power, present both risks and opportunities to our traditional publishing models, potentially impacting both
sales volumes and pricing.
As the market has shifted to digital products, customer expectations for lower-priced products have increased due to customer
awareness of reductions in production costs and the availability of free or low-cost digital content and products. As a result, there has
been pressure to sell digital versions of products at prices below their print versions. Increased customer demand for lower prices
could reduce our revenue.
We publish educational content for undergraduate, graduate, and advanced placement students, lifelong learners, and, in Australia, for
secondary school students. Due to growing student demand for less expensive textbooks, many college bookstores, online retailers,
and other entities, offer used or rental textbooks to students at lower prices than new textbooks. The Internet has made the used and
rental textbook markets more efficient and has significantly increased student access to used and rental textbooks. Further expansion
of the used and rental textbook markets could further adversely affect our sales of print textbooks, subsequently affecting our
consolidated financial position and results of operations.
A reduction in enrollment at colleges and universities could adversely affect the demand for our higher education products.
Enrollment in US colleges and universities can be adversely affected by many factors, including changes in government and private
student loan and grant programs, uncertainty about current and future economic conditions, increases in tuition, general decreases in
family income and net worth, and record low unemployment due to an active job market. In addition, enrollment levels at colleges and
universities outside the US are influenced by global and local economic factors, local political conditions, and other factors that make
predicting foreign enrollment levels difficult. Reductions in expected levels of enrollment at colleges and universities both within and
outside the US could adversely affect demand for our higher education offerings, which could adversely impact our consolidated
financial position and results of operations.
If we are unable to retain key employees and other personnel, our consolidated financial condition or results of operations may be
adversely affected.
The Company and industry are highly dependent on the loyal engagement of key management leaders and professional staff. Loss of
staff due to inadequate skills and career path development or maintaining competitive salaries and benefits could have a significant
impact on Company performance.
We are highly dependent on the continued services of key employees who have in-depth market and business knowledge and/or key
relationships with business partners. The loss of the services of key personnel for any reason and our inability to replace them with
suitable candidates quickly or at all, as well as any negative market perception resulting from such loss, could have a material adverse
effect on our business, consolidated financial position, and results of operations.
We have a significant investment in our employees around the world. We offer competitive salaries and benefits in order to attract and
retain the highly skilled workforce needed to sustain and develop new products and services required for growth. Employment costs
are affected by competitive market conditions for qualified individuals and factors such as healthcare and retirement benefit costs.
The competitive pressures we face in our business, as well as our ability to retain our business relationships with our authors and
professional societies, could adversely affect our consolidated financial position and results of operations.
The contribution of authors and their professional societies is one of the more important elements of the highly competitive publishing
business. Success and continued growth depend greatly on developing new products and the means to deliver them in an environment
of rapid technological change. Attracting new authors and professional societies while retaining our existing business relationships is
critical to our success. If we are unable to retain our existing business relationships with authors and professional societies, this could
have an adverse impact on our consolidated financial position and results of operations.
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Information Technology Systems and Cybersecurity Risks
Our company is highly dependent on information technology systems and their business management and customer-facing
capabilities critical for the long-term competitive sustainability of the business. These capabilities include business planning and
transaction information, product development and delivery, marketing and sales information and management, and system
security.
We must continue to invest in technology and other innovations to adapt and add value to our products and services to remain
competitive. This is particularly true in the current environment, where investment in new technology is ongoing and there are rapid
changes in the products competitors are offering, the products our customers are seeking, and our sales and distribution channels. In
some cases, investments will take the form of internal development; in others, they may take the form of an acquisition. There are
uncertainties whenever developing or acquiring new products and services, and it is often possible that such new products and services
may not be launched, or, if launched, may not be profitable or as profitable as existing products and services. If we are unable to
introduce new technologies, products, and services, our ability to be profitable may be adversely affected.
We may be susceptible to information technology risks that may adversely impact our business, consolidated financial position and
results of operations.
Information technology is a key part of our business strategy and operations. As a business strategy, Wiley’s technology enables us to
provide customers with new and enhanced products and services and is critical to our success in migrating from print to digital
business models. Information technology is also a fundamental component of all our business processes, collecting and reporting
business data, and communicating internally and externally with customers, suppliers, employees, and others. We face technological
risks associated with digital products and service delivery in our businesses, including with respect to information technology
capability, reliability, security, enterprise resource planning, system implementations, and upgrades. Across our businesses, we hold
personal data, including that of employees and customers. Failures of our information technology systems and products (including
operational failure, natural disaster, computer virus, or cyberattacks) could interrupt the availability of our digital products and
services, result in corruption or loss of data or breach in security, and result in liability or reputational damage to our brands and/or
adversely impact our consolidated financial position and results of operations.
Management has designed and implemented policies, processes, and controls to mitigate risks of information technology failure and to
provide security from unauthorized access to our systems. In addition, we have disaster recovery plans in place to maintain business
continuity for our key financial systems. While key financial systems have backup and tested disaster recovery systems, other
applications and services have limited backup and recovery procedures which may delay or prevent recovery in case of disaster. The
size and complexity of our information technology and information security systems, and those of our third-party vendors with whom
we contract, make such systems potentially vulnerable to cyberattacks common to most industries from inadvertent or intentional
actions by employees, vendors, or malicious third parties. While we have taken steps to address these risks, there can be no assurance
that a system failure, disruption, or data security breach would not adversely affect our business and could have an adverse impact on
our consolidated financial position and results of operations.
We are continually improving and upgrading our computer systems and software. We have implemented a global Enterprise Resource
Planning (ERP) system as part of a multiyear plan to integrate and upgrade our operational and financial systems and processes. We
have also implemented record-to-report, purchase-to-pay, and several other business processes within all locations. We implemented
order-to-cash for certain businesses and have continued to roll out additional processes and functionality of the ERP system in phases.
Implementation of an ERP system involves risks and uncertainties. Any disruptions, delays, or deficiencies in the design or
implementation of a new system could result in increased costs, disruptions in operations, or delays in the collection of cash from our
customers, as well as having an adverse effect on our ability to timely report our financial results, all of which could materially
adversely affect our business, consolidated financial position, and results of operations. We currently use out of support systems for
order management for certain businesses. While we have contingency support available, any major disruptions, while unlikely, may
require longer remediation time. This could impact our ability to process and fulfill orders for those businesses. We currently use a
legacy platform with limited support for order management of the global Academic & Professional Learning business. Any defects
and disruptions in the legacy systems which cannot be addressed in a timely manner could impact our ability to process orders and
reconcile financial statements.
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Cyber risk and the failure to maintain the integrity of our operational or security systems or infrastructure, or those of third parties
with which we do business, could have a material adverse effect on our business, consolidated financial condition, and results of
operations.
The cybersecurity risks we face range from cyberattacks common to most industries, such as the development and deployment of
malicious software to gain access to our networks and attempt to steal confidential information, launch distributed denial of service
attacks, or attempt other coordinated disruptions, to more advanced threats that target us because of our prominence in the global
research and advisory field. As a result of the COVID-19 pandemic, most of our employees are working remotely, which magnifies
the importance of the integrity of our remote access security measures.
Like many multinational corporations, we, and some third parties upon which we rely, have experienced cyberattacks on our computer
systems and networks in the past and may experience them in the future, likely with more frequency and sophistication and involving
a broader range of devices and modes of attack, all of which will increase the difficulty of detecting and successfully defending
against them. To date, none have resulted in any material adverse impact to our business, operations, products, services, or customers.
Wiley has invested heavily in Cybersecurity tools and resources to keep our systems safe. We have implemented various security
controls to meet our security obligations, while also defending against constantly evolving security threats. Our security controls help
intranet, proprietary websites, email and other
to secure our
telecommunications and data networks, and we scrutinize the security of outsourced website and service providers prior to retaining
their services. However, the security measures implemented by us or by our outside service providers may not be effective, and our
systems (and those of our outside service providers) may be vulnerable to theft, loss, damage and interruption from a number of
potential sources and events, including unauthorized access or security breaches, cyber-attacks, computer viruses, power loss, or other
disruptive events.
including our computer systems,
information systems,
The security compliance landscape continues to evolve, requiring us to stay apprised of changes in cybersecurity and privacy laws,
regulations, and security standards required by our clients, such as the European Union General Data Protection Regulation (GDPR),
the California Consumer Privacy Act (CCPA), the Brazilian General Data Protection Law (LGPD), the Chinese Cybersecurity, Data
Security and Personal Information Protection laws (and other new and proposed data protection laws), International Organization for
Standardization (ISO), and National Institute of Standards and Technology (NIST). Recent well-publicized security breaches at other
companies have led to enhanced government and regulatory scrutiny of the measures taken by companies to protect against
cyberattacks and may in the future result in heightened cybersecurity requirements, including additional regulatory expectations for
oversight of vendors and service providers.
A cyberattack could cause delays in initiating or completing sales, impede delivery of our products and services to our clients, disrupt
other critical client-facing or business processes, or dislocate our critical internal functions. Additionally, any material breaches or
other technology-related catastrophe, or media reports of perceived security vulnerabilities to our systems or those of our third parties,
even if no breach has been attempted or has occurred, could cause us to experience reputational harm, loss of customers and revenue,
fines, regulatory actions and scrutiny, sanctions or other statutory penalties, litigation, liability for failure to safeguard our customers
information, or financial losses that are either not insured against or not fully covered through any insurance maintained by us.
Operational Risks
We may not realize the anticipated cost savings and benefits from, or our business may be disrupted by, our business
transformation and restructuring efforts.
We continue to transform our business from a traditional publishing model to a global provider of content-enabled solutions with a
focus on digital products and services. We have made several acquisitions over the past few years that represent examples of strategic
initiatives that were implemented as part of our business transformation. We will continue to explore opportunities to develop new
business models and enhance the efficiency of our organizational structure. The rapid pace and scope of change increases the risk that
not all our strategic initiatives will deliver the expected benefits within the anticipated timeframes. In addition, these efforts may
disrupt our business activities, which could adversely affect our consolidated financial position and results of operations.
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We continue to restructure and realign our cost base with current and anticipated future market conditions. Significant risks associated
with these actions that may impair our ability to achieve the anticipated cost savings or that may disrupt our business, include delays
in the implementation of anticipated workforce reductions in highly regulated locations outside of the US, decreases in employee
morale, the failure to meet operational targets due to the loss of key employees, and disruptions of third parties to whom we have
outsourced business functions. In addition, our ability to achieve the anticipated cost savings and other benefits from these actions
within the expected timeframe is subject to many estimates and assumptions. These estimates and assumptions are subject to
significant economic, competitive, and other uncertainties, some of which are beyond our control. If these estimates and assumptions
are incorrect, if we experience delays, or if other unforeseen events occur, our business and consolidated financial position and results
of operations could be adversely affected.
We may not realize the anticipated cost savings and processing efficiencies associated with the outsourcing of certain business
processes.
We have outsourced certain business functions, principally in technology, content management, printing, warehousing, fulfillment,
distribution, returns processing, and certain other transactional processing functions, to third-party service providers to achieve cost
savings and efficiencies. If these third-party service providers do not perform effectively, we may not be able to achieve the
anticipated cost savings, and depending on the function involved, we may experience business disruption or processing inefficiencies,
all with potential adverse effects on our consolidated financial position and results of operations.
Challenges and uncertainties associated with operating in developing markets has a higher risk due to political instability,
economic volatility, crime, terrorism, corruption, social and ethnic unrest, and other factors, which may adversely impact our
consolidated financial position and results of operations.
We sell our products to customers in certain sanctioned and previously sanctioned developing markets in accordance with such
restrictions. While sales in these markets are not material to our consolidated financial position and results of operations, adverse
developments related to the risks associated with these markets may cause actual results to differ from historical and forecasted future
consolidated operating results.
We have certain technology development operations in Russia and Sri Lanka related to software development and architecture, digital
content production, and system testing services. Due to the political instability within these regions, there is the potential for future
government embargos and sanctions, which could disrupt our operations in these areas. While we have developed business continuity
plans to address these issues, further adverse developments in the region could have a material impact on our consolidated financial
position and results of operations.
In February 2022, the Russian Federation and Belarus commenced a military action with Ukraine. As a result, the United States, as
well as other nations, instituted economic sanctions against Russia and Belarus. The impact of this action and related sanctions on the
world economy is not determinable as of the date of these financial statements.
We have exercised contingency plans in Russia to minimize any disruption if we were to lose access to our staff. If that should occur,
we believe it will not materially impact our overall operations. As of April 30, 2022, the net assets of our Russian operations were not
material to our overall consolidated financial position. We have customers in Russia, primarily for our Research offerings, which are
not material to our overall consolidated results of operations. We do not have operations in Ukraine or Belarus, and the business
conducted in those countries is also not material to our consolidated financial position and results of operations.
In our Research Publishing & Platforms segment, approximately 28% of research journal articles are sourced from authors in China.
Any restrictions on exporting intellectual property could adversely affect our business and consolidated financial position and results
of operations.
In our journal publishing business, we have a trade concentration and credit risk related to subscription agents, and in our book
business the industry has a concentration of customers in national, regional, and online bookstore chains. Changes in the
financial position and liquidity of our subscription agents and customers could adversely impact our consolidated financial
position and results of operations.
In the journal publishing business, subscriptions are primarily sourced through journal subscription agents who, acting as agents for
library customers, facilitate ordering by consolidating the subscription orders/billings of each subscriber with various publishers. Cash
is generally collected in advance from subscribers by the subscription agents and is principally remitted to us between the months of
December and April. Although at fiscal year-end we had minimal credit risk exposure to these agents, future calendar year
subscription receipts from these agents are highly dependent on their financial condition and liquidity.
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Subscription agents account for approximately 15% of total annual consolidated revenue and no one agent accounts for more than
10% of total annual consolidated revenue.
Our book business is not dependent upon a single customer; however, the industry is concentrated in national, regional, and online
bookstore chains. Although no book customer accounts for more than 8% of total consolidated revenue and 10% of accounts
receivable at April 30, 2022, the top 10 book customers account for approximately 12% of total consolidated revenue and
approximately 18% of accounts receivable at April 30, 2022.
Financial Risks
Changes in global economic conditions could impact our ability to borrow funds and meet our future financing needs.
Changes in global financial markets have not had, nor do we anticipate they will have, a significant impact on our liquidity. Due to our
significant operating cash flow, financial assets, access to capital markets, and available lines of credit and revolving credit
agreements, we continue to believe that we have the ability to meet our financing needs for the foreseeable future. As market
conditions change, we will continue to monitor our liquidity position. However, there can be no assurance that our liquidity or our
consolidated financial position and results of operations will not be adversely affected by possible future changes in global financial
markets and global economic conditions. Unprecedented market conditions including illiquid credit markets, volatile equity markets,
dramatic fluctuations in foreign currency rates, and economic recession, could affect future results.
Fluctuations in foreign currency exchange rates and interest rates could materially impact our consolidated financial condition
and results of operations.
Non-US revenues, as well as our substantial non-US net assets, expose our consolidated results to volatility from changes in foreign
currency exchange rates. The percentage of consolidated revenue for the year ended April 30, 2022 recognized in the following
currencies (on an equivalent US dollar basis) were approximately: 56% US dollar, 25% British pound sterling, 10% euro, and 9%
other currencies. In addition, our interest-bearing loans and borrowings are subject to risk from changes in interest rates. These risks
and the measures we have taken to help mitigate them are discussed in Part II, Item 7A, “Quantitative and Qualitative Disclosures
about Market Risk,” of this Annual Report on Form 10-K. We may, from time to time, use derivative instruments to hedge such risks.
Notwithstanding our efforts to foresee and mitigate the effects of changes in external market or fiscal circumstances, we cannot predict
with certainty changes in foreign currency exchange rates and interest rates, inflation, or other related factors affecting our business,
consolidated financial position, and results of operations.
We may not be able to mitigate the impact of inflation and cost increases, which could have an adverse impact on our consolidated
financial position and results of operations.
From time to time, we experience cost increases reflecting, in part, general inflationary factors. There is no guarantee that we can
increase selling prices or reduce costs to fully mitigate the effect of inflation on our costs, which may adversely impact our
consolidated financial position and results of operations.
As a result of acquisitions, we have and may record a significant amount of goodwill and other identifiable intangible assets and
we may never realize the full carrying value of these assets.
As a result of acquisitions, we recorded a significant amount of goodwill and other identifiable intangible assets. At April 30, 2022,
we had $1,302.1 million of goodwill and $931.4 million of intangible assets, of which $118.3 million are indefinite-lived intangible
assets, on our Consolidated Statements of Financial Position. The intangible assets are principally composed of content and publishing
rights, customer relationships, brands and trademarks, and developed technology. Failure to achieve business objectives and financial
projections could result in an asset impairment, which would result in a noncash charge to our consolidated results of operations.
Goodwill and intangible assets with indefinite lives are tested for impairment on an annual basis and when events or changes in
circumstances indicate that impairment may have occurred. Intangible assets with definite lives, which were $813.1 million at April
30, 2022, are tested for impairment only when events or changes in circumstances indicate that an impairment may have occurred.
Determining whether an impairment exists can be difficult as a result of increased uncertainty and current market dynamics and
requires management to make significant estimates and judgments. A noncash intangible asset impairment charge could have a
material adverse effect on our consolidated financial position and results of operations. See Note 11, “Goodwill and Intangible Assets”
for further information related to goodwill and intangible assets, and the impairment charges recorded in the year ended April 30,
2020.
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Changes in pension costs and related funding requirements may impact our consolidated financial position and results of
operations.
We provide defined benefit pension plans for certain employees worldwide. Our Board of Directors approved amendments to the US,
Canada, and UK defined benefit plans that froze the future accumulation of benefits effective June 30, 2013, December 31, 2015, and
April 30, 2015, respectively. The funding requirements and costs of these plans are dependent upon various factors, including the
actual return on plan assets, discount rates, plan participant population demographics, and changes in global pension regulations.
Changes in these factors affect our plan funding, consolidated financial position, and results of operations.
Legal, Regulatory, and Compliance Risks
The uncertainty surrounding the implementation and effect of Brexit may cause increased economic volatility, affecting our
operations and business.
On January 31, 2020, the UK exited the European Union (EU), an action referred to as Brexit. This was followed by an
implementation period, during which EU law continued to apply in the UK and the UK maintained its EU single market access rights
and EU customs union membership. The implementation period expired December 31, 2020. Consequently, the UK has become a
third country vis-à-vis the EU, without access to the single market or membership of the EU customs union.
The UK and the EU have signed an EU-UK Trade and Cooperation Agreement, or TCA, which was formally approved by Parliament
on April 28, 2021. This agreement provides details on how some aspects of the UK’s and EU’s relationship will operate going
forward; however, there are still many uncertainties, and how the TCA will take effect in practice is still largely unknown. This lack of
clarity on future UK laws and regulations and their interaction with the EU laws and regulations may negatively impact foreign direct
investment in the UK, increase costs, depress economic activity, and restrict access to capital.
The uncertainty concerning the UK’s legal, political, and economic relationship with the EU after Brexit may be a source of instability
in the international markets, create significant currency fluctuations, and/or otherwise adversely affect trading agreements or similar
cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or otherwise) beyond the date of Brexit.
Additional Brexit-related impacts on our business could include potential inventory shortages in the UK, increased regulatory burdens
and costs to comply with UK-specific regulations, and higher transportation costs for our products coming into and out of the UK.
Any of these effects, among others, could materially and adversely affect our business and consolidated financial position and results
of operations.
Changes in laws, tariffs, and regulations, including regulations related to open access, could adversely impact our consolidated
financial position and results of operations.
We maintain operations in Asia, Australia, Canada, Europe, South America, the Middle East, and the US. The conduct of our
business, including the sourcing of content, distribution, sales, marketing, and advertising, is subject to various laws and regulations
administered by governments around the world. Changes in laws, regulations, or government policies, including tax regulations and
accounting standards, may adversely affect our future consolidated financial position and results of operations.
The scientific research publishing industry generates much of its revenue from paid customer subscriptions to online and print journal
content. There is debate within government, academic, and library communities whether such journal content should be made
available for free immediately or following a period of embargo after publication, referred to as open access. For instance, certain
governments and privately held funding bodies have implemented mandates that require journal articles derived from government-
funded research to be made available to the public at no cost after an embargo period. Open access can be achieved in two ways:
Green, which enables authors to publish articles in subscription-based journals and self–archive the author accepted version of the
article for free public use after an embargo period; and Gold, which enables authors to publish their articles in journals that provide
immediate free access to the final version of the article on the publisher’s website, and elsewhere under permissive licensing terms,
following payment of an APC. These mandates have the potential to put pressure on subscription-based publications. If such
regulations are widely implemented, our consolidated financial position and results of operations could be adversely affected.
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21
To date, the majority of governments that have taken a position on open access have favored the Green model and have generally
specified embargo periods of twelve months. The publishing community generally takes the view that this period should be sufficient
to protect subscription revenues, provided that publishers’ platforms offer sufficient added value to the article. Governments in Europe
have been more supportive of the Gold model, which thus far is generating incremental revenue for publishers with active open access
programs. Several European administrations have signed on to the business model which combines the purchasing of subscription
content with the purchase of open access publishing for authors in their respective countries. This development removes an element of
risk by fixing revenues from that market, provided that the terms, price, and rate of transition negotiated are acceptable.
Changes in tax laws could have a material impact on our consolidated financial position and results of operations.
We are subject to tax laws in the jurisdictions where we conduct business, including the US and many foreign jurisdictions. In
addition to tax law changes in the US, changes in tax laws and interpretations in other jurisdictions where we do business, such as the
UK and Germany, as well as changes proposed by the Organization for Economic Co-operation and Development (OECD) and
adopted by OECD member countries, could significantly impact the taxation of our earnings. For example, on June 10, 2021, the UK
increased its corporate tax rate from 19% to 25% effective April 2023, resulting in a $21.4 million noncash deferred tax expense from
the re-measurement of our applicable UK net deferred tax liabilities. See Note 13, “Income Taxes.” During our year ended April 30,
2022, more than half of our consolidated pretax income was from the UK. In addition, there are proposals to increase the rate and
otherwise change US tax laws which could significantly increase our tax rate. We are also subject to potential taxes and regulations in
jurisdictions where we have sales even though we do not have a physical presence. These taxes and potential taxes could have a
material impact on our consolidated financial position and results of operations as substantially all our taxable income is earned
outside the US. In addition, we are subject to audit by tax authorities and are regularly audited by various tax authorities. Although we
believe our tax estimates are reasonable, the final determination of tax audits could be materially different from our historical income
tax provisions and accruals and could have a material impact on our consolidated financial position and results of operations.
Our intellectual property rights may not be protected, which could adversely affect our consolidated financial position and results
of operations.
A substantial portion of our publications are protected by copyright, held either in our name, in the name of the author of the work, or
in the name of a sponsoring professional society. Such copyrights protect our exclusive right to publish the work in many countries
abroad for specified periods, in most cases, the author’s life plus 70 years. Our ability to continue to achieve our expected results
depends, in part, upon our ability to protect our intellectual property rights. Our consolidated financial position and results of
operations may be adversely affected by lack of legal and/or technological protections for its intellectual property in some jurisdictions
and markets.
A disruption or loss of data sources could limit our collection and use of certain kinds of information, which could adversely
impact our communication with our customers.
Several of our businesses rely extensively upon content and data from external sources. Data is obtained from public records,
governmental authorities, customers, and other information companies, including competitors. Legal regulations, such as the EU’s
GDPR, relating to Internet communications, privacy and data protection, e-commerce, information governance, and use of public
records, are becoming more prevalent worldwide. The disruption or loss of data sources, either because of changes in the law or
because data suppliers decide not to supply them, may impose limits on our collection and use of certain kinds of information about
individuals and our ability to communicate such information effectively with our customers. In addition, GDPR imposes a strict data
protection compliance regime with severe penalties of up to 4% of worldwide revenue or €20 million, whichever is greater.
If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis
could be impaired.
We are subject to the reporting requirements of the Securities Exchange Act of 1934, the Sarbanes-Oxley Act (Sarbanes-Oxley Act)
and the rules and regulations of the New York Stock Exchange. The Sarbanes-Oxley Act requires, among other things, that we
maintain effective disclosure controls and procedures and internal control over financial reporting. We are required to perform system
and process evaluations and testing of our internal control over financial reporting to allow management to report on the effectiveness
of our internal control over financial reporting in our Annual Report on Form 10-K, as required by Section 404 of the Sarbanes-Oxley
Act. This may require us to incur substantial additional professional fees and internal costs to further expand our accounting and
finance functions and expend significant management efforts.
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We may in the future discover material weaknesses in our system of internal financial and accounting controls and procedures that
could result in a material misstatement of our financial statements. In addition, our internal control over financial reporting will not
prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable,
not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that misstatements due to errors or fraud will not occur, or that all control issues
and instances of fraud will be detected.
If we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if we are unable
to maintain proper and effective internal controls, we may not be able to produce timely and accurate financial statements. If that were
to happen, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC or other
regulatory authorities.
General Risks
The trading price of the shares of our common stock may fluctuate materially, and investors of our common stock could incur
substantial losses.
Our stock price may fluctuate materially. The stock market in general has experienced significant volatility that has often been
unrelated to the operating performance of companies. As a result of this volatility, investors may not be able to sell their common
stock at or above the price paid for the shares. The market price for our common stock may be influenced by many factors, including:
• Actual or anticipated changes in our consolidated operating results;
• Variances between actual consolidated operating results and the expectations of securities analysts, investors, and the
financial community;
• Changes in financial estimates by us or by any securities analysts who might cover our stock;
• Conditions or trends in our industry, the stock market, or the economy;
• The level of demand for our stock, the stock market price, and volume fluctuations of comparable companies;
• Announcements by us or our competitors of new product or service offerings, significant acquisitions, strategic partnerships,
or divestitures;
• Announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us;
• Capital commitments;
•
• Recruitment or departure of key personnel; and
• Sales of our common stock, including sales by our directors and officers or specific stockholders.
Investors’ general perception of the Company and our business;
Adverse publicity could negatively impact our reputation, which could adversely affect our consolidated financial position and
results of operations.
Our professional customers worldwide rely upon many of our publications to perform their jobs. It is imperative that we consistently
demonstrate our ability to maintain the integrity of the information included in our publications. Adverse publicity, whether valid or
not, may reduce demand for our publications and adversely affect our consolidated financial position and results of operations.
Item 1B. Unresolved Staff Comments
None.
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23
Item 2. Properties
We occupy office, warehouse, and distribution facilities in various parts of the world, as listed below (excluding those locations with
less than 10,000 square feet of floor area, none of which is considered material property). All of the buildings and the equipment
owned or leased are believed to be in good operating condition and are suitable for the conduct of our business.
Location
Purpose
Owned or Leased
Approx. Sq. Ft.
United States:
New Jersey
Florida
Kentucky
Indiana
Minnesota
Massachusetts
California
North Carolina
Texas
International:
England
Germany
China
Sri Lanka
India
France
Australia
Russia
Jordan
Singapore
Canada
Brazil
Greece
Corporate Headquarters
Office
Office
Office
Office
Office
Offices
Office
Office
Distribution Centers
Offices
Offices
Office
Office
Offices
Office
Distribution Centers
Office
Offices
Offices
Office
Office
Office
Office
Office
Office
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Owned
Owned
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
294,000
58,000
47,000
42,000
28,000
26,000
21,000
12,000
11,000
298,000
85,000
70,000
104,000
18,000
40,000
38,000
12,000
25,000
36,000
34,000
27,000
24,000
14,000
13,000
12,000
11,000
Item 3. Legal Proceedings
The information set forth in Part II, Item 8, “Financial Statements and Supplementary Data” in Note 16, “Commitment and
Contingencies,” of the Notes to Consolidated Financial Statements is incorporated herein by reference.
We are involved in routine litigation in the ordinary course of our business. In the opinion of management, the ultimate resolution of
all pending litigation will not have a material effect upon our consolidated financial position or results of operations.
Item 4. Mine Safety Disclosures
Not applicable.
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Information About Our Executive Officers
Set forth below are the current executive officers of the Company. Each of the officers listed will serve until the next organizational
meetings of the Board of Directors of the Company, and until each of the respective successors are duly elected and qualified.
Name, Current and Former Positions
BRIAN A. NAPACK
President and Chief Executive Officer and Director
March 2012 – Senior Advisor, Providence Equity Partners LLC
CHRISTINA VAN TASSELL
Executive Vice President and Chief Financial Officer
November 2017 – Chief Financial Officer – Dow Jones & Company, Inc.
DEIRDRE SILVER
Executive Vice President, General Counsel
August 2015 – Associate General Counsel, Senior Vice President of Legal, Research
JAMES FLYNN
Executive Vice President and General Manager, Research
July 2018 – Chief Product Officer, Research, Wiley
May 2015 – Senior Vice President and Managing Director, Research Publishing, Wiley
CHRISTOPHER F. CARIDI
Senior Vice President, Global Corporate Controller, and Chief Accounting Officer
June 2020 – SVP, Chief Accounting Officer and Controller, Teladoc Health, Inc.
March 2017 – SVP, Chief Accounting Officer and Controller, John Wiley & Sons
March 2014 – Vice President, Finance, Thomson Reuters
KEVIN MONACO
Senior Vice President, Treasurer and Tax
October 2009 – SVP, Finance, Treasurer, and Investor Relations, Coty Inc.
AREF MATIN
Executive Vice President, Chief Technology Officer
February 2015 – Executive Vice President, Chief Technology Officer, Ascend Learning
July 2012 – Executive Vice President, Chief Technology Officer, Pearson Learning Technologies &
Pearson Higher Education
MATTHEW LEAVY
Executive Vice President and General Manager, Educational Publishing
September 2018 – SVP, Business Development
January 2018 – Principal Leavy Consulting LLC
August 2013 – Managing Director Global Managed Services, Pearson plc
DANIELLE MCMAHAN
Executive Vice President, Chief People & Operations Officer
June 2017 – Chief Human Resources Officer, York Risk Services Group
July 2014 – VP, Global Talent, American Express
TODD ZIPPER
Executive Vice President and General Manager, Education Services
November 2018 – Co-President, Wiley Education Services
January 2015 – President and CEO, The Learning House, Inc
SHARI HOFFER
Executive Vice President, Chief Marketing Officer
May 2017 – SVP Marketing
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Age
60
First Elected to
Current Position
December 2017
51
October 2021
54
February 2020
51
September 2021
56
October 2020
58
October 2018
63
May 2018
54
September 2019
47
November 2019
45
June 2020
51
December 2021
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Our Class A and Class B shares are listed on the New York Stock Exchange under the symbols WLY and WLYB, respectively.
On a quarterly basis, the Board of Directors considers the payment of cash dividends based upon its review of earnings, our financial
position, and other relevant factors. As of May 31, 2022, the approximate number of holders of our Class A and Class B Common
Stock were 692 and 48, respectively, based on the holders of record.
During the year ended April 30, 2020, our Board of Directors approved an additional share repurchase program of $200 million of
Class A or B Common Stock. This share repurchase program is in addition to the share repurchase program approved by our Board of
Directors during the year ended April 30, 2017 of four million shares of Class A or B Common Stock. As of April 30, 2022, no
additional shares were remaining under this program for purchase.
During the fourth quarter of 2022, we made the following purchases of Class A and Class B Common Stock under these publicly
announced stock repurchase programs.
Total Number
of Shares
Purchased
Average Price
Paid Per
Share
Total Number
of Shares
Purchased
as Part of a
Publicly
Announced
Program
Maximum
Number
of Shares that
May Be
Purchased
Under the
Program
Maximum
Dollar Value
of Shares that
May Yet
Be Purchased
Under
Additional
Plans or
Programs
(Dollars in
Millions)
February 2022
March 2022
April 2022
Total
Item 6. [Reserved]
— $
93,189
2,585
95,774 $
—
53.65
51.56
53.60
—
93,189
2,585
95,774
48,950 $
—
—
— $
200.0
197.6
197.5
197.5
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The information in our Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be
read together with our Consolidated Financial Statements and related notes set forth in Part II, Item 8, as well as the discussion
included in Part I, Item 1, “Business,” “Cautionary Notice Regarding Forward-Looking Statements “Safe Harbor” Statement under the
Private Securities Litigation Reform Act of 1995” and “Non-GAAP Financial Measures,” along with Part I, Item 1A, “Risk Factors,”
of this Annual Report on Form 10-K. All amounts and percentages are approximate due to rounding and all dollars are in thousands,
except per share amounts or where otherwise noted. When we cross-reference to a “Note,” we are referring to our “Notes to
Consolidated Financial Statements,” in Part II, Item 8, “Financial Statements and Supplementary Data” unless the context indicates
otherwise.
Overview
Wiley is a global leader in scientific research and career-connected education, unlocking human potential by enabling discovery,
powering education, and shaping workforces. For over 200 years, Wiley has fueled the world’s knowledge ecosystem. Today, our
high-impact content, platforms, and services help researchers, learners, institutions, and corporations achieve their goals in an ever-
changing world. Wiley is a predominantly digital company with approximately 83% of revenue generated by digital products and
tech-enabled services, and 58% of revenue is recurring which includes revenue that is contractually obligated or set to recur with a
high degree of certainty for the year ended April 30, 2022.
We report financial information for the following segments, as well as a Corporate category, which includes certain costs that are not
allocated to the reportable segments:
• Research Publishing & Platforms
• Academic & Professional Learning
• Education Services
Through the Research Publishing & Platforms segment, we provide peer-reviewed STM publishing, content platforms, and related
services to academic, corporate, and government customers, academic societies, and individual researchers. The Academic &
Professional Learning segment provides Education Publishing and Professional Learning content and courseware, training, and
learning services, to students, professionals, and corporations. The Education Services segment provides University Services (online
program management or OPM services) for academic institutions and Talent Development Services including placement and training
for professionals and businesses.
Wiley’s business strategies are tightly aligned with accelerating growth trends, including open research, career-connected education,
and talent development. Research strategies include driving publishing output to meet the global demand for peer-reviewed research
and expanding platform and service offerings for corporations and societies. Education strategies include expanding online degree
programs and driving online enrollment for university partners, scaling digital content and courseware, and expanding IT talent
placement and reskilling programs for corporate partners.
Wiley has operations in Russia consisting primarily of technology development resources. We have exercised contingency plans to
minimize any disruption if we were to lose access to our staff. If that should occur, we believe it will not materially impact our overall
operations. As of April 30, 2022, the net assets of our Russian operations were not material to our overall financial position. We have
customers in Russia, primarily for our Research offerings, which are not material to our overall financial results. We do not have
operations in Ukraine or Belarus, and the business conducted in those countries is also not material to our overall financial results.
Consolidated Results of Operations
FISCAL YEAR 2022 AS COMPARED TO FISCAL YEAR 2021 SUMMARY RESULTS
Revenue:
Revenue for the year ended April 30, 2022 increased $141.4 million, or 7%, as compared with the prior year on a reported and on a
constant currency basis including contributions from acquisitions. Excluding the contributions from acquisitions, revenue increased
5% on a constant currency basis.
See the “Segment Operating Results” below for additional details on each segment’s revenue and Adjusted EBITDA performance.
Index
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Cost of Sales:
Cost of sales for the year ended April 30, 2022 increased $75.3 million, or 12%, as compared with the prior year. On a constant
currency basis, cost of sales increased 11% as compared with the prior year. This increase was primarily due to higher employee costs
and, to a lesser extent, higher student acquisition costs in Education Services, increased royalty costs in Research Publishing &
Platforms, and increased print product costs in Academic & Professional Learning.
Operating and Administrative Expenses:
Operating and administrative expenses for the year ended April 30, 2022 increased $56.9 million, or 6%, as compared with the prior
year. On a constant currency basis, operating and administrative expenses increased 5% as compared with the prior year primarily
reflecting higher editorial costs due to additional resources to support investments in growth, technology costs to support growth
initiatives, higher advertising and marketing costs and, to a lesser extent, higher employee-related costs.
Restructuring and Related (Credits) Charges:
For the years ended April 30, 2022 and 2021, we recorded pretax restructuring credits of $1.4 million and charges of $33.3 million,
respectively primarily related to our Business Optimization Program. We anticipate $10.0 million in run rate savings from actions
starting in fiscal year 2022.
In November 2020, in response to the COVID-19 pandemic and the Company’s successful transition to a virtual work environment,
we increased use of virtual work arrangements for postpandemic operations. As a result, we expanded the scope of the Business
Optimization Program to include the exit of certain leased office space beginning in the third quarter of fiscal year 2021, and the
reduction of our occupancy at other facilities. We are reducing our real estate square footage occupancy by approximately 12%. These
actions resulted in a pretax restructuring charge of $18.3 million in the year ended April 30, 2021.
In addition, we also incurred ongoing facility-related costs associated with certain properties that resulted in additional restructuring
charges of $1.8 million and $3.7 million in the years ended April 30, 2022 and 2021, respectively.
These actions yielded annualized cost savings of approximately $8.0 million. We anticipate ongoing facility-related costs associated
with certain properties to result in additional restructuring charges in future periods.
These (credits) charges are reflected in Restructuring and related (credits) charges in the Consolidated Statements of Income (Loss).
See Note 7, “Restructuring and Related (Credits) Charges” for more details on these (credits) charges.
For the impact of our restructuring program on diluted earnings per share, see the section below, “Diluted Earnings per Share (EPS).”
In May 2022, the Company initiated a global program to restructure and align our cost base with current and anticipated future market
conditions. This program will include the exit of certain leased office space beginning in the first quarter of fiscal year 2023 and the
reduction of our occupancy at other facilities. In addition, the program will include severance related charges for the elimination of
certain positions. These actions are estimated to result in an initial pretax restructuring charge of approximately $19.0 million to $21.0
million in the first quarter of fiscal year 2023.
These actions are anticipated to yield approximately $30.0 million to $35.0 million in run rate savings. For fiscal year 2023, the cost
savings are expected to be approximately $20.0 million to $25.0 million. We anticipate ongoing facility-related costs associated with
certain properties to result in additional restructuring charges in future periods.
Index
28
Amortization of Intangible Assets:
Amortization of intangible assets was $84.8 million for the year ended April 30, 2022, an increase of $10.2 million, or 14%, as
compared with the prior year. On a constant currency basis, amortization of intangible assets increased 13% as compared with the
prior year primarily due to the intangibles acquired as part of the Hindawi acquisition completed in fiscal year 2021 and, to a lesser
extent, other acquisitions completed in fiscal year 2022, partially offset by the completion of amortization of certain acquired
intangible assets. See Note 4, “Acquisitions” for more details on our acquisitions.
Operating Income, Adjusted Operating Income (OI) and Adjusted EBITDA:
Operating income for the year ended April 30, 2022 increased $33.8 million, or 18% as compared with the prior year on a reported
and on a constant currency basis. The increase was primarily due to the increase in revenue and, to a lesser extent, lower restructuring
charges, partially offset by an increase in cost of sales and operating and administrative expenses.
Adjusted OI on a constant currency basis and excluding restructuring (credits) charges decreased 1% as compared with the prior year
primarily due to an increase in cost of sales, operating and administrative expenses and, to a lesser extent, amortization of intangible
assets, partially offset by higher revenues as described above.
Adjusted EBITDA on a constant currency basis and excluding restructuring (credits) charges, increased 3%, as compared with the
prior year primarily due to revenue performance, partially offset by an increase in operating and administrative expenses, and cost of
sales.
Adjusted OI
Below is a reconciliation of our consolidated US GAAP Operating Income to Non-GAAP Adjusted OI:
US GAAP Operating Income
Adjustments:
Restructuring and related (credits) charges
Non-GAAP Adjusted OI
Adjusted EBITDA
Year Ended
April 30,
2022
2021
219,276
$
185,511
(1,427)
217,849
$
33,310
218,821
$
$
Below is a reconciliation of our consolidated US GAAP Net Income to Non-GAAP EBITDA and Adjusted EBITDA:
Net Income
Interest expense
Provision for income taxes
Depreciation and amortization
Non-GAAP EBITDA
Restructuring and related (credits) charges
Foreign exchange transaction losses
Gain on sale of certain assets
Other income, net
Non-GAAP Adjusted EBITDA
Year Ended
April 30,
2022
2021
148,309
19,802
61,352
215,170
444,633
(1,427)
3,192
(3,694)
(9,685)
433,019
$
$
148,256
18,383
27,656
200,189
394,484
33,310
7,977
—
(16,761)
419,010
$
$
Index
29
Interest Expense:
Interest expense for the year ended April 30, 2022 was $19.8 million compared with the prior year of $18.4 million. This increase was
due to a higher average debt balance outstanding, which included borrowings for the funding of acquisitions and, to a lesser extent,
higher weighted average effective interest rate.
Foreign Exchange Transaction Losses:
Foreign exchange transaction losses were $3.2 million for the year ended April 30, 2022 and were primarily due to losses on our
foreign currency denominated third-party and, to a lesser extent, intercompany accounts receivable and payable balances due to the
impact of the change in average foreign exchange rates as compared to the US dollar.
Foreign exchange transaction losses were $8.0 million for the year ended April 30, 2021 and were due to the unfavorable impact of the
changes in exchange rates on US dollar cash balances held in the UK to fund the acquisition of Hindawi and the net impact of changes
in average foreign exchange rates as compared to the US dollar on our third-party accounts receivable and payable balances.
Gain on Sale of Certain Assets:
The gain on the sale of certain assets is due to the sale of our world languages product portfolio which was included in our Academic
& Professional Learning segment and resulted in a pretax gain of approximately $3.7 million during the year ended April 30, 2022.
Other Income, Net:
Other income, net was $9.7 million for the year ended April 30, 2022, a decrease of $7.1 million, or 42%, as compared with the prior
year. This decrease was primarily due to $3 million in donations and pledges made in the year ended April 30, 2022 to humanitarian
organizations to provide aid to those impacted by the crisis in Ukraine.
Provision for Income Taxes:
Below is a reconciliation of our US GAAP Income Before Taxes to Non-GAAP Adjusted Income Before Taxes:
US GAAP Income Before Taxes
Pretax Impact of Adjustments:
Restructuring and related (credits) charges
Foreign exchange losses (gains) on intercompany transactions
Amortization of acquired intangible assets
Gain on sale of certain assets
Non-GAAP Adjusted Income Before Taxes
Year Ended
April 30,
2022
$
209,661
2021
$ 175,912
33,310
(1,427)
(1,457)
1,513
79,421
89,346
(3,694)
—
295,399 $ 287,186
$
Index
30
Below is a reconciliation of our US GAAP Income Tax Provision to Non-GAAP Adjusted Income Tax Provision, including our US
GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate:
US GAAP Income Tax Provision
Income Tax Impact of Adjustments (1):
Restructuring and related (credits) charges
Foreign exchange losses (gains) on intercompany transactions
Amortization of acquired intangible assets
Gain on sale of certain assets
Income Tax Adjustments:
Impact of increase in UK statutory rate on deferred tax balances(2)
Impact of US CARES Act(3)
Impact of change in certain US state tax rates in 2021(2)
Non-GAAP Adjusted Income Tax Provision
US GAAP Effective Tax Rate
Non-GAAP Adjusted Effective Tax Rate
Year Ended
April 30,
2022
2021
$
61,352
$
27,656
(260)
597
20,816
(922)
(21,415)
—
—
60,168 $
$
29.3%
20.4%
8,065
(363)
18,511
—
(3,511)
13,998
(3,225)
61,131
15.7%
21.3%
(1) For the year ended April 30, 2022, substantially all of the tax impact was from deferred taxes. For the year ended April 30, 2021,
except for the $8.4 million current tax impact from the US CARES Act noted below, substantially all of the tax impact was from
deferred taxes.
(2) These adjustments impacted deferred taxes in the years ended April 30, 2022 and 2021.
(3) The tax impact was $8.4 million from current taxes and $5.6 million from deferred taxes in the year ended April 30, 2021.
The effective tax rate was 29.3% for the year ended April 30, 2022, compared to 15.7% for the year ended April 30, 2021. Our rate for
the year ended April 30, 2022 was increased by $21.4 million from an increase in the UK statutory rate during our three months ended
July 31, 2021. On June 10, 2021, the UK increased its statutory corporate tax rate from 19% to 25% effective April 2023, resulting in
this nonrecurring, noncash US GAAP deferred tax expense. The 15.7% tax expense rate for the year ended April 30, 2021 benefitted
by $14.0 million from the Coronavirus Aid Relief and Economic Security Act (the CARES Act) and certain regulations issued in late
July 2020, which enabled us to carryback certain net operating losses (NOLs) to a year with a higher statutory tax rate.
Excluding the expense from the UK rate change, the Non-GAAP Adjusted Effective Tax Rate for the year ended April 30, 2022 was
20.4%. The Non-GAAP Adjusted Effective Tax Rate for the year ended April 30, 2021, excluding the impact of the UK statutory rate
change, the CARES Act, and state tax expense from rate changes, was 21.3%. The Non-GAAP Adjusted Effective Tax Rate before
these items decreased because the year ended April 30, 2021 included US state tax expenses from our expanded presence from
COVID-19 and employees working in additional locations.
Diluted Earnings Per Share (EPS):
Diluted earnings per share for the year ended April 30, 2022 was $2.62 per share compared to $2.63 per share in the prior year. This
decrease was due to a higher weighted average number of common shares outstanding in the year ended April 30, 2022 as net income
was flat compared to the year ended April 30, 2021. Net income was flat as higher operating income and, to a lesser extent, lower
foreign exchange losses and the gain on sale of certain assets were offset by higher provision for income taxes and, to a lesser extent,
lower other income, net.
Index
31
Below is a reconciliation of our US GAAP EPS to Non-GAAP Adjusted EPS. The amount of the pretax and the related income tax
impact for the adjustments included in the table below are presented in the section above, “Provision for Income Taxes.”
US GAAP EPS
Adjustments:
Restructuring and related (credits) charges
Foreign exchange losses (gains) on intercompany transactions
Amortization of acquired intangible assets
Gain on sale of certain assets
Income tax adjustments
Non-GAAP Adjusted EPS
Year Ended
April 30,
2022
2021
$
2.62 $
2.63
(0.02)
0.02
1.21
(0.05)
0.38
4.16 $
0.44
(0.02)
1.08
—
(0.13)
4.00
$
On a constant currency basis, Adjusted EPS increased 1% primarily due to a lower Non-GAAP Adjusted Effective Tax Rate, partially
offset by lower Other income, net and, to a lesser extent, lower Adjusted OI.
SEGMENT OPERATING RESULTS:
Year Ended
April 30,
% Change
Favorable
Constant
Currency
% Change
Favorable
2022
2021
(Unfavorable) (Unfavorable)
$
1,057,022 $
54,321
1,111,343
972,512
42,837
1,015,349
300,373
468,012
47,731
238
294,989
238
295,227
94,899
390,126 $
35.1%
275,377
429,916
37,033
(36)
273,059
(36)
273,023
83,866
356,889
35.1%
$
9%
27%
9%
(9)%
(9)%
(29)%
#
8%
#
8%
(13)%
9%
8%
27%
9%
(8)%
(9)%
(28)%
#
9%
#
9%
(13)%
10%
RESEARCH PUBLISHING & PLATFORMS:
Revenue:
Research Publishing
Research Platforms
Total Research Publishing & Platforms Revenue
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Restructuring Charges (Credits) (see Note 7)
Contribution to Profit
Restructuring Charges (Credits) (see Note 7)
Adjusted Contribution to Profit
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margin
# Not meaningful
Revenue:
Research Publishing & Platforms revenue for the year ended April 30, 2022 increased $96.0 million, or 9%, as compared with the
prior year on a reported and constant currency basis. Excluding revenue from acquisitions, organic revenue increased 5% on a
constant currency basis. This increase was primarily due to an increase in publishing, corporate solutions and, to a lesser extent, an
increase in Research Platforms. Research Publishing has continued growth due to Transformational Agreements (read and publish).
Excluding the impact from acquisitions, Open Access article output growth was approximately 27% for the year ended April 30, 2022
as compared with the prior year.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA increased 10% as compared with the prior year. This increase was primarily due to
higher revenue, partially offset by higher editorial costs due to additional resources to support investments in growth, which includes
the impact of the acquisition of Hindawi and, to a lesser extent, higher cost of sales including the incremental impact of acquisitions,
technology, and sales-related costs.
Index
32
ACADEMIC & PROFESSIONAL LEARNING:
Revenue:
Education Publishing(1)
Professional Learning
Total Academic & Professional Learning
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Restructuring (Credits) Charges (see Note 7)
Contribution to Profit
Restructuring (Credits) Charges (see Note 7)
Adjusted Contribution to Profit
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margin
# Not meaningful
Year Ended
April 30,
% Change
Favorable
Constant
Currency
% Change
Favorable
2022
2021
(Unfavorable) (Unfavorable)
$
349,992 $
296,831
646,823
361,194
280,667
641,861
180,328
341,136
13,442
(455)
174,950
358,097
16,451
3,503
112,372
(455)
111,917
69,561
181,478 $
28.1%
88,860
3,503
92,363
71,997
164,360
25.6%
$
(3)%
6%
1%
(3)%
5%
18%
#
26%
#
21%
3%
10%
(4)%
6%
1%
(3)%
5%
18%
#
26%
#
20%
3%
10%
(1)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to
Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering
have been included in Education Services – Talent Development Services. The Revenue, Adjusted Contribution to Profit, and
Adjusted EBITDA for WileyNXT was $2.7 million, $(0.7) million, and $(0.7) million, respectively, for the year ended April 30,
2021. There were no changes to our total consolidated financial results.
Revenue:
Academic & Professional Learning revenue increased $5.0 million, or 1%, as compared with the prior year on a reported and constant
currency basis. This increase was primarily driven by strong recovery in Professional Learning from prior year COVID-19 lockdown
impacts primarily due to an increase in corporate training and, to a lesser extent, an increase in professional publishing compared with
the prior year. This more than offset a 4% decline in Education Publishing due to lower US college enrollment and some easing of
prior year COVID-19-related favorability for courseware and content and, to a lesser extent, test preparation.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA increased 10% as compared with the prior year. This increase was due to lower
operating expenses and, to a lesser extent, higher revenues. This was partially offset by higher print product costs.
Index
33
EDUCATION SERVICES:
Revenue:
University Services(1)
Talent Development Services (2)(3)
Total Education Services Revenue
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Restructuring Charges (see Note 7)
Contribution to Profit (Loss)
Restructuring Charges (see Note 7)
Adjusted Contribution to Profit (Loss)
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margin
# Not meaningful
Year Ended
April 30,
% Change
Favorable
Constant
Currency
% Change
Favorable
2022
2021
(Unfavorable) (Unfavorable)
$
$
226,131
98,631
324,762
219,957
77,853
23,663
8
3,281
8
3,289
34,157
37,446
11.5%
$
$
227,700
56,591
284,291
175,008
67,594
21,201
531
19,957
531
20,488
29,654
50,142
17.6%
(1)%
74%
14%
(26)%
(15)%
(12)%
98%
(84)%
98%
(84)%
(15)%
(25)%
(1)%
72%
14%
(25)%
(15)%
(11)%
98%
(84)%
98%
(85)%
(15)%
(26)%
(1) University Services was previously referred to as Education Services OPM.
(2) Talent Development Services was previously referred to as mthree.
(3)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to
Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering
have been included in Education Services – Talent Development Services. The Revenue, Adjusted Contribution to Profit, and
Adjusted EBITDA for WileyNXT was $2.7 million, $(0.7) million, and $(0.7) million, respectively, for the year ended April 30,
2021. There were no changes to our total consolidated financial results.
Revenue:
Education Services revenue increased $40.5 million, or 14%, as compared with the prior year on a reported and a constant currency
basis. Excluding revenue from acquisitions, organic revenue increased 12% on a constant currency basis. This increase was primarily
due to an increase in placements in Talent Development Services, partially offset by a decrease in student enrollments in University
Services. For the year ended April 30, 2022, University Services experienced an 8% decrease in online enrollment. For the year ended
April 30, 2022, we delivered approximately 112% growth in IT talent placements in Talent Development Services.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA decreased 26% as compared with the prior year. This was due to an increase in
employee related costs due to increased investments to accelerate growth in Talent Development Services and, to a lesser extent,
higher student acquisition costs in University Services and sales related costs, partially offset by higher revenue.
CORPORATE EXPENSES:
Corporate expenses for the year ended April 30, 2022 decreased $5.0 million, or 3%, as compared with the prior year. On a constant
currency basis and excluding restructuring (credits) charges, these expenses increased 16% as compared with the prior year. This was
primarily due to higher employee-related costs, marketing costs and, to a lesser extent, technology-related spending.
Index
34
FISCAL YEAR 2021 AS COMPARED TO FISCAL YEAR 2020 SUMMARY RESULTS
Revenue:
Revenue for the year ended April 30, 2021 increased $110.0 million, or 6%, as compared with the prior year. This increase was
mainly driven by the following factors:
• An increase in Research Publishing & Platforms, which included the contributions from Hindawi, which was acquired on
December 31, 2020; and
• An increase in Education Services, due to the contributions from mthree, which was acquired in January 2020, and growth in
online program management services.
These increases were partially offset by a decline in Academic & Professional Learning.
On a constant currency basis, revenue increased 4% as compared with the prior year. Excluding the inorganic impact of acquisitions,
organic revenue on a constant currency basis increased 1%.
See the “Segment Operating Results” below for additional details on each segment’s revenue and Adjusted EBITDA performance.
Cost of Sales:
Cost of sales for the year ended April 30, 2021 increased $34.3 million, or 6%, as compared with the prior year. Gross margin was
consistent with the prior year at approximately 32.2%. On a constant currency basis, cost of sales increased 4% as compared with the
prior year. This increase was primarily due to the impact from the acquisition of mthree and, to a lesser extent, higher royalty costs.
These factors were partially offset by lower marketing costs for our Education Services business.
Operating and Administrative Expenses:
Operating and administrative expenses for the year ended April 30, 2021 increased $25.3 million, or 3%, as compared with the prior
year. On a constant currency basis, operating and administrative expenses increased 1% as compared with the prior year primarily
reflecting the impact of the acquisitions of Hindawi and mthree, higher technology related costs and, to a lesser extent, higher annual
incentive compensation. These factors were partially offset by lower facilities and occupancy-related costs due to the real estate
actions taken as part of our Business Optimization Program as described below, employee benefit and retirement related expenses,
and to a lesser extent, COVID-19-related expense savings and other business optimization gains.
Restructuring and Related Charges:
Business Optimization Program
For the years ended April 30, 2021 and 2020, we recorded pretax restructuring charges of $33.4 million and $32.8 million,
respectively, related to this program.
In November 2020, in response to the COVID-19 pandemic and the Company’s successful transition to a virtual work environment,
we increased use of virtual work arrangements for postpandemic operations. As a result, we expanded the scope of the Business
Optimization Program to include the exit of certain leased office space beginning in the third quarter of fiscal 2021, and the reduction
of our occupancy at other facilities. We are reducing our real estate square footage occupancy by approximately 12%. These actions
resulted in a pretax restructuring charge of $18.3 million in the three months ended January 31, 2021.
In addition, we also incurred ongoing facility-related costs associated with certain properties that resulted in additional restructuring
charges of $3.7 million in the year ended April 30, 2021.
We anticipated ongoing facility-related costs associated with certain properties to result in additional restructuring charges in future
periods.
These charges are reflected in Restructuring and related (credits) charges in the Consolidated Statements of Income (Loss). See Note
7, “Restructuring and Related (Credits) Charges” for more details on these charges.
Index
35
Restructuring and Reinvestment Program
For the years ended April 30, 2021 and 2020, we recorded pretax restructuring credits of $0.1 million and $0.2 million, respectively,
related to this program. These credits are reflected in Restructuring and related charges in the Consolidated Statements of Income
(Loss).
For the impact of our restructuring programs on diluted earnings per share, see the section below, “Diluted Earnings per Share (EPS).”
Amortization of Intangible Assets:
Amortization of intangible assets was $74.7 million for the year ended April 30, 2021, an increase of $12.2 million, or 20%, as
compared with the prior year. On a constant currency basis, amortization of intangible assets increased 18% as compared with the
prior year primarily due to the intangibles acquired as part of the Hindawi and mthree acquisitions completed in fiscal year 2021 and
2020, respectively. See Note 4, “Acquisitions” for more details on our acquisitions.
Operating Income (Loss), Adjusted Operating Income (OI), and Adjusted EBITDA:
Operating income for the year ended April 30, 2021 was $185.5 million compared with the prior year operating loss of $54.3 million.
The increase in operating income was primarily due to the prior year impairment of goodwill and intangibles assets of $202.3 million
as described below and, to a lesser extent, an increase in revenue. This was partially offset by an increase in cost of sales and operating
and administrative expenses and, to a lesser extent, an increase in amortization of intangible assets as described above.
Adjusted OI and Adjusted EBITDA on a constant currency basis and excluding restructuring charges and the impairment of goodwill
and intangible assets increased 20% and 16% respectively, as compared with the prior year. The increase in Adjusted OI and Adjusted
EBITDA was primarily due to revenue performance described above, partially offset by higher cost of sales and, to a lesser extent, an
increase in operating and administrative expenses. In addition, the increase in Adjusted OI was partially offset by higher depreciation
and amortization.
Adjusted OI
Below is a reconciliation of our consolidated US GAAP Operating Income (Loss) to Non-GAAP Adjusted OI:
US GAAP Operating Income (Loss)
Adjustments:
Restructuring and related charges
Impairment of goodwill
Impairment of Blackwell trade name
Impairment of developed technology intangible
Non-GAAP Adjusted OI
Year Ended
April 30,
2021
2020
$
185,511 $
(54,287)
33,310
—
—
—
$
218,821 $
32,607
110,000
89,507
2,841
180,668
Index
36
Adjusted EBITDA
Below is a reconciliation of our consolidated US GAAP Net Income (Loss) to Non-GAAP EBITDA and Adjusted EBITDA:
Net Income (Loss)
Interest expense
Provision for income taxes
Depreciation and amortization
Non-GAAP EBITDA
Impairment of goodwill and intangible assets
Restructuring and related charges
Foreign exchange transaction losses (gains)
Other income
Non-GAAP Adjusted EBITDA
Interest Expense:
Year Ended
April 30,
2021
2020
148,256
18,383
27,656
200,189
394,484
—
33,310
7,977
(16,761)
419,010
$
$
(74,287)
24,959
11,195
175,127
136,994
202,348
32,607
(2,773)
(13,381)
355,795
$
$
Interest expense for the year ended April 30, 2021 was $18.4 million compared with the prior year of $25.0 million. This decrease was
due to a lower weighted average effective borrowing rate, partially offset by higher average debt balances outstanding, which included
borrowings for the funding of acquisitions in fiscal years 2021 and 2020.
Foreign Exchange Transaction (Losses) Gains:
Foreign exchange transaction losses were $8.0 million for the year ended April 30, 2021 and were due to the unfavorable impact of the
changes in exchange rates on US dollar cash balances held in the UK to fund the acquisition of Hindawi, and the net impact of
changes in average foreign exchange rates as compared to the US dollar on our third-party accounts receivable and payable balances.
Foreign exchange transaction gains were $2.8 million for the year ended April 30, 2020 and were primarily due to the net impact of
changes in average foreign exchange rates as compared to the US dollar on our third-party accounts receivable and payable balances.
Provision for Income Taxes:
Below is a reconciliation of our US GAAP Income (Loss) Before Taxes to Non-GAAP Adjusted Income Before Taxes:
US GAAP Income (Loss) Before Taxes
Pretax Impact of Adjustments:
Restructuring and related charges
Foreign exchange (gains) losses on intercompany transactions
Amortization of acquired intangible assets
Impairment of goodwill
Impairment of Blackwell trade name
Impairment of developed technology intangible
Non-GAAP Adjusted Income Before Taxes
Year Ended
April 30,
2021
$
175,912
$
2020
(63,092)
33,310
(1,457)
79,421
—
—
—
32,607
1,256
68,269
110,000
89,507
2,841
287,186 $ 241,388
$
Index
37
Below is a reconciliation of our US GAAP Income Tax Provision to Non-GAAP Adjusted Income Tax Provision, including our US
GAAP Effective Tax Rate and our Non-GAAP Adjusted Effective Tax Rate:
US GAAP Income Tax Provision
Income Tax Impact of Adjustments(1):
Restructuring and related charges
Foreign exchange (gains) losses on intercompany transactions
Amortization of acquired intangible assets
Impairment of Blackwell trade name
Impairment of developed technology intangible
Income Tax Adjustments:
Impact of increase in UK statutory rate on deferred tax balances(2)
Impact of US CARES Act(3)
Impact of change in certain US state tax rates in 2021 and tax rates in France in 2020(2)
Non-GAAP Adjusted Income Tax Provision
US GAAP Effective Tax Rate
Non-GAAP Adjusted Effective Tax Rate
Year Ended
April 30,
2021
2020
$
27,656
$
11,195
8,065
(363)
18,511
—
—
(3,511)
13,998
(3,225)
61,131 $
$
7,949
242
16,820
15,216
686
—
—
1,887
53,995
15.7%
21.3%
(17.7)%
22.4%
(1) For the year ended April 30, 2021, except for the $8.4 million current tax impact from the US CARES Act noted below,
substantially all of the tax impact was from deferred taxes. For the year ended April 30, 2020, the tax impact was $1.5 million
from current taxes and $22.6 million from deferred taxes.
(2) These adjustments impacted deferred taxes in the years ended April 30, 2021 and 2020.
(3) The tax impact was $8.4 million from current taxes and $5.6 million from deferred taxes in the year ended April 30, 2021.
The effective tax rate was 15.7% for the year ended April 30, 2021, compared to a tax expense rate of 17.7% on a pretax loss for the
year ended April 30, 2020. Our rate for the year ended April 30, 2021 benefitted by $14.0 million from the CARES Act and certain
regulations issued in late July 2020, which enabled us to carryback certain US net operating losses (NOLs), to fiscal 2015, a year with
a higher US statutory rate, reducing our tax for the year ended April 30, 2020. We received a $20.7 million refund plus interest in
February 2021. This benefit was partially offset by (a) $3.5 million from an increase in the official UK statutory rate during our three
months ended July 31, 2020 resulting in an increase in our UK deferred tax liabilities and (b) $3.2 million from a noncash deferred
state tax expense due to increasing our deferred tax liabilities in connection with our expanded presence in additional states resulting
from COVID-19. As a result of COVID-19, we adjusted our policies to permit employees to work from home, resulting in an
increased presence in many locations.
The 17.7% tax expense rate on a pretax loss for the year ended April 30, 2020 was primarily due to the $110.0 million non-deductible
impairment of goodwill. Excluding the benefit from the CARES Act and expense from the UK rate change, the change in our state tax
expense from our expanded presence and a lower tax benefit from our restructuring charges, foreign exchange gains and the
amortization of acquired intangible assets, the Non-GAAP Adjusted Effective Tax Rate for the year ended April 30, 2021 was 21.3%.
The Non-GAAP Adjusted Effective Tax Rate for the year ended April 30, 2020, excluding the impact of the $110.0 million
impairment of goodwill and other items included in the table above was 22.4%. The decrease in the Non-GAAP Adjusted Effective
Tax Rate before these items was due to a more favorable mix of earnings for the year ended April 30, 2021.
Index
38
Diluted Earnings (Loss) Per Share (EPS):
Diluted earnings per share for the year ended April 30, 2021 was $2.63 per share compared with loss per share of $1.32 in the prior
year. This increase was due to the higher operating income and, to a lesser extent, lower interest expense. These factors were partially
offset by higher provision for income taxes and foreign exchange transaction losses for the year ended April 30, 2021 as compared to
gains for the year ended April 30, 2020.
Below is a reconciliation of our US GAAP Earnings (Loss) Per Share to Non-GAAP Adjusted EPS. The amount of the pretax and the
related income tax impact for the adjustments included in the table below are presented in the section above, “Provision for Income
Taxes.”
US GAAP EARNINGS (LOSS) PER SHARE
Adjustments:
Restructuring and related charges
Foreign exchange (gains) losses on intercompany transactions
Amortization of acquired intangible assets
Income tax adjustments
Impairment of goodwill
Impairment of Blackwell trade name
Impairment of developed technology intangible
EPS impact of using weighted-average dilutive shares for adjusted EPS calculation(1)
Non-GAAP Adjusted EPS
Year Ended
April 30,
2021
2020
$
2.63 $
0.44
(0.02)
1.08
(0.13)
—
—
—
—
4.00 $
$
(1.32)
0.43
0.02
0.90
(0.03)
1.94
1.31
0.04
0.01
3.30
(1) Represents the impact of using diluted weighted-average number of common shares outstanding (56.7 million shares for the year
ended April 30, 2020) included in the Non-GAAP Adjusted EPS calculation in order to apply the dilutive impact on adjusted net
income due to the effect of unvested restricted stock units and other stock awards. This impact occurs when a US GAAP net loss
is reported and the effect of using dilutive shares is antidilutive.
On a constant currency basis, Adjusted EPS increased 25% primarily due to an increase in Adjusted CTP and, to a lesser extent, a
lower Non-GAAP Adjusted Effective Tax Rate and a decrease in interest expense. These factors were partially offset by foreign
exchange transaction losses for the year ended April 30, 2021 as compared with gains for the year ended April 30, 2020.
Index
39
SEGMENT OPERATING RESULTS:
RESEARCH PUBLISHING & PLATFORMS:
Revenue:
Research Publishing
Research Platforms
Total Research Publishing & Platforms Revenue
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Impairment of Intangible Assets (see Note 11)
Restructuring (Credits) Charges (see Note 7)
Contribution to Profit
Impairment of Intangible Assets (see Note 11)
Restructuring (Credits) Charges (see Note 7)
Adjusted Contribution to Profit
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margin
# Not meaningful
Revenue:
Year Ended
April 30,
2021
2020
% Change
Favorable
(Unfavorable)
Constant
Currency
% Change
Favorable
(Unfavorable)
$
972,512 $
42,837
1,015,349
908,952
39,887
948,839
275,377
429,916
37,033
—
(36)
273,059
—
(36)
273,023
83,866
$
356,889 $
35.1%
255,696
398,514
29,276
92,348
3,886
169,119
92,348
3,886
265,353
69,495
334,848
35.3%
7%
7%
7%
(8)%
(8)%
(26)%
100%
#
61%
100%
#
3%
(21)%
7%
5%
7%
5%
(5)%
(6)%
(24)%
100%
#
60%
100%
#
2%
(20)%
6%
Research Publishing & Platforms revenue for the year ended April 30, 2021 increased $66.5 million, or 7%, as compared with the
prior year on a reported basis. On a constant currency basis, revenue increased 5% as compared with the prior year. Excluding revenue
from acquisitions, organic revenue increased 3% on a constant currency basis. This increase was primarily due to continued growth in
Open Access in Research Publishing due to continued growth in transformational “read and publish” agreements. In fiscal year 2021,
we experienced a 15% increase in article output, which resulted in a 38% increase in Open Access revenue as compared to prior year.
This was partially offset by a decline in subscriptions revenue partially attributable to those “read and publish” agreements and, to a
lesser extent, previously anticipated libraries and academic budget challenges as a result of COVID-19.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA increased 6% as compared with the prior year. This increase was primarily due to
higher revenue, and COVID-19-related expense savings. These factors were partially offset by higher royalty costs, higher annual
incentive compensation and employee related costs, and to a lesser extent, the impact of the acquisition of Hindawi.
Index
40
ACADEMIC & PROFESSIONAL LEARNING:
Revenue:
Education Publishing(1)
Professional Learning
Total Academic & Professional Learning
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Restructuring Charges (see Note 7)
Contribution to Profit
Restructuring Charges (see Note 7)
Adjusted Contribution to Profit
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margin
# Not meaningful
Year Ended
April 30,
2021
2020
% Change
Favorable
(Unfavorable)
Constant
Currency
% Change
Favorable
(Unfavorable)
$
$
361,194
280,667
641,861
174,950
358,097
16,451
3,503
88,860
3,503
92,363
71,997
164,360
25.6%
$
$
351,514
298,601
650,115
178,721
369,230
16,649
10,470
75,045
10,470
85,515
69,807
155,322
23.9%
3%
(6)%
(1)%
2%
3%
1%
67%
18%
67%
8%
(3)%
6%
2%
(8)%
(3)%
4%
4%
3%
67%
16%
67%
6%
(2)%
4%
(1)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to
Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering
have been included in Education Services – Talent Development Services. The Revenue, Adjusted Contribution to Profit, and
Adjusted EBITDA for WileyNXT was $2.7 million, $(0.7) million, and $(0.7) million, respectively, for the year ended April 30,
2021, and $0.7 million, $(0.9) million, and $(0.9) million, respectively, for the year ended April 30, 2020. There were no changes
to our total consolidated financial results.
Revenue:
Academic & Professional Learning revenue decreased $8.3 million, or 1%, as compared with the prior year on a reported basis. On a
constant currency basis, revenue decreased 3% as compared with the prior year. This decrease was primarily due to the COVID-19
impact on Professional Learning revenue due to the continued adverse impact on classroom dependent corporate training due to the
continued office closures and cancellations of in-person engagements, and the decline in trade print book publishing, partially offset
by growth in digital content. In Education Publishing, growth in digital content and courseware offerings, which continued to benefit
due to the COVID-19 driven shift to remote learning, were partially offset by declines in print textbooks and test preparation product
offerings. In fiscal year 2021, digital content revenue increased 21% and digital courseware activations increased 23% as compared to
prior year.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA increased 4% as compared with the prior year. This increase reflects business
optimization gains and COVID-19-related expense savings, partially offset by lower revenues and, to a lesser extent, higher annual
incentive compensation.
Index
41
EDUCATION SERVICES:
Revenue:
University Services(1)
Talent Development Services(2)(3)
Total Education Services Revenue
Cost of Sales
Operating Expenses
Amortization of Intangible Assets
Impairment of Goodwill (see Note 11)
Restructuring Charges (see Note 7)
Contribution to Profit (Loss)
Impairment of Goodwill (see Note 11)
Restructuring Charges (see Note 7)
Adjusted Contribution to Profit (Loss)
Depreciation and Amortization
Adjusted EBITDA
Adjusted EBITDA Margins
# Not meaningful
Year Ended
April 30,
2021
2020
% Change
Favorable
(Unfavorable)
Constant
Currency
% Change
Favorable
(Unfavorable)
$
$
227,700
56,591
284,291
175,008
67,594
21,201
—
531
19,957
—
531
20,488
29,654
50,142
17.6%
$
210,882
21,647
232,529
156,607
64,124
16,511
110,000
3,671
(118,384)
110,000
3,671
(4,713)
24,131
19,418
8.4%
$
8%
#
22%
(12)%
(5)%
(28)%
100%
86%
#
100%
86%
#
(23)%
#
8%
#
21%
(11)%
(5)%
(28)%
100%
86%
#
100%
86%
#
(22)%
#
(1) University Services was previously referred to as Education Services OPM.
(2) Talent Development Services was previously referred to as mthree.
(3)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to
Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering
have been included in Education Services – Talent Development Services. The Revenue, Adjusted Contribution to Profit, and
Adjusted EBITDA for WileyNXT was $2.7 million, $(0.7) million, and $(0.7) million, respectively, for the year ended April 30,
2021, and $0.7 million, $(0.9) million, and $(0.9) million, respectively, for the year ended April 30, 2020. There were no changes
to our total consolidated financial results.
Revenue:
Education Services revenue increased $51.8 million, or 22%, as compared with the prior year on a reported basis. On a constant
currency basis, revenue increased 21% as compared with the prior year. Excluding revenue from our mthree acquisition, organic
revenue increased 7% on a constant currency basis, mainly driven by an increase in enrollments and new student starts and, to a lesser
extent, new university partnerships and programs in our OPM services. In fiscal year 2021, we experienced a 14% increase in online
enrollment and a 20% increase in new student starts as compared to prior year.
Adjusted EBITDA:
On a constant currency basis, Adjusted EBITDA increased $30.7 million as compared with the prior year. This was due to higher
revenue, lower marketing costs, and business optimization initiatives, including lower occupancy-related costs due to certain actions
taken as part of our Business Optimization Program. These factors were partially offset by the impact from the acquisition of mthree.
CORPORATE EXPENSES:
Corporate Expenses for the year ended April 30, 2021 increased $16.3 million, or 9%, as compared with the prior year. On a constant
currency basis and excluding restructuring charges, these expenses increased 1% as compared with the prior year. This was primarily
due to higher annual incentive compensation, partially offset by lower employee benefit and retirement related expenses and
professional fees.
Index
42
FISCAL YEAR 2023 OUTLOOK
• Revenue: The Company anticipates mid-single digit revenue growth at constant currency driven by Research and Education
Services.
• Earnings: Wiley expects gains from revenue growth to be offset by wage inflation and growth investments in Research and
Corporate Talent Development. Adjusted EPS performance is expected to be adversely impacted by 35-cents of non-
operational items such as higher interest expense, higher tax expense, and lower pension income. Wiley’s adjusted effective tax
rate is expected to be 22-23% in fiscal year 2023, up from 20% in fiscal year 2022. This is primarily due to an anticipated less
favorable mix of earnings by country and an increase in the UK statutory rate. Fiscal year 2022 also benefitted from certain
non-recurring tax benefits.
• Free Cash Flow: Wiley expects positive cash earnings and lower incentive payouts for fiscal year 2022 performance compared
to prior year to be offset by higher cash taxes, interest and capital expenditures (Fiscal year 2023 Outlook of $115 to $125
million compared to $116 million in fiscal year 2022).
• Foreign Exchange Impact: With Wiley generating 47% of its revenue from outside the US, the Company’s reported results
are adversely impacted by a strengthening US dollar, particularly in relation to the euro and the British pound. Given volatility
in exchange rates, there is now a material foreign currency impact to our fiscal year 2023 outlook relative to our outlook at
constant currency.
(amounts in millions, except Adjusted EPS)
Metric
Revenue
Adjusted EBITDA
Adjusted EPS
Free Cash Flow
Fiscal Year 2022
Actual (1)
$2,083
$433
$4.16
$223
Fiscal Year 2023
Outlook (1)
At constant currency
$2,175 to $2,215
$425 to $450
$3.70 to $4.05
$210 to $235
FX Impact (2)
$(75)
$(25)
$(0.30)
$(25)
Fiscal Year 2023
Outlook (3)
At spot rates
$2,100 to $2,140
$400 to $425
$3.40 to $3.75
$185 to $210
(1) Based on fiscal year 2022 average rates of 1.15 euro and 1.36 British pound.
(2) Variance between fiscal year 2022 average rates and spot rates as of June 10, 2022: 1.06 euro and 1.24 British pound.
(3) Fiscal year 2023 outlook at spot rates as of June 10, 2022.
LIQUIDITY AND CAPITAL RESOURCES:
Principal Sources of Liquidity
We believe that our operating cash flow, together with our revolving credit facilities and other available debt financing, will be
adequate to meet our operating, investing, and financing needs in the foreseeable future. There can be no assurance that continued or
increased volatility in the global capital and credit markets will not impair our ability to access these markets on terms commercially
acceptable in the future. We do not have any off-balance-sheet debt. We will continue to pursue attractive opportunities to add scale
and provide enhanced technology-enabled services in research and online education.
As of April 30, 2022, we had cash and cash equivalents of $100.4 million, of which approximately $93.2 million, or 93%, was located
outside the US. Maintenance of these cash and cash equivalent balances outside the US does not have a material impact on the
liquidity or capital resources of our operations. Notwithstanding the Tax Cuts and Jobs Act of 2017 (the Tax Act), which generally
eliminated federal income tax on future cash repatriation to the US, cash repatriation may be subject to state and local taxes or
withholding or similar taxes. In addition, as a result of Brexit, certain tax benefits applicable to distributions from subsidiaries of our
UK companies were eliminated or reduced effective January 1, 2021. Since April 30, 2018, we no longer intend to permanently
reinvest earnings outside the US. We have a $2.7 million liability related to the estimated taxes that would be incurred upon
repatriating certain non-US earnings.
Index
43
On May 30, 2019, we entered into a credit agreement that amended and restated our existing revolving credit agreement, which was
then amended on December 22, 2021 (collectively, the Amended and Restated RCA). See Note 14, “Debt and Available Credit
Facilities” for more details on the amendment. The Amended and Restated RCA provides for senior unsecured credit facilities
comprised of a (i) five-year revolving credit facility in an aggregate principal amount up to $1.25 billion, and (ii) a five-year term loan
A facility consisting of $250 million. The agreement contains customary affirmative and negative covenants, including a financial
covenant in the form of a consolidated net leverage ratio and consolidated interest coverage ratio.
As of April 30, 2022, we had approximately $787.0 million of debt outstanding, net of unamortized issuance costs of $0.3 million, and
approximately $0.7 billion of unused borrowing capacity under our Amended and Restated RCA and other facilities. Our Amended
and Restated RCA contains certain restrictive covenants related to our consolidated leverage ratio and interest coverage ratio, which
we were in compliance with as of April 30, 2022.
Contractual Obligations and Commercial Commitments
A summary of contractual obligations and commercial commitments, excluding unrecognized tax benefits further described in Note
13, “Income Taxes,” of the Notes to Consolidated Financial Statements, as of April 30, 2022 is as follows:
Total debt(1)
Interest on debt(2)
Non-cancellable leases
Minimum royalty obligations
Other operating commitments
Total
Payments Due by Period
Total
Within
Year 1
2–3
Years
4–5
Years
After 5
Years
$
$
787.4 $
28.4
197.0
444.1
68.0
1,524.9 $
18.8 $
15.3
28.1
108.6
41.4
212.2 $
768.6 $
13.1
51.0
163.3
26.4
1,022.4 $
— $
—
40.4
102.1
0.2
142.7 $
—
—
77.5
70.1
—
147.6
(1) Total debt is exclusive of unamortized issuance costs of $0.3 million.
(2)
Interest on Debt includes the effect of our interest rate swap agreements and the estimated future interest payments on our
unhedged variable rate debt, assuming that the interest rates as of April 30, 2022 remain constant until the maturity of the debt.
Analysis of Historical Cash Flow
The following table shows the changes in our Consolidated Statements of Cash Flows:
Net cash provided by operating activities
Net cash used in investing activities
Net cash (used in) provided by financing activities
Effect of foreign currency exchange rate changes on cash, cash equivalents, and
restricted cash
Years Ended April 30,
2021
2022
$
339,100 $
(194,024)
(131,638)
359,923 $
(433,154)
(47,086)
2020
288,435
(346,670)
172,677
$
(7,070) $
11,629
$
(4,943)
Cash flow from operations is seasonally a use of cash in the first half of Wiley’s fiscal year principally due to the timing of collections
for annual journal subscriptions, which typically occurs in the beginning of the second half of our fiscal year.
Free cash flow less product development spending helps assess our ability, over the long term, to create value for our shareholders, as
it represents cash available to repay debt, pay common dividends, and fund share repurchases, and acquisitions. Below are the details
of Free cash flow less product development spending.
Free Cash Flow Less Product Development Spending:
Net cash provided by operating activities
Less: Additions to technology, property and equipment
Less: Product development spending
Free cash flow less product development spending
Index
44
Years Ended April 30,
2021
2022
339,100 $
(88,843)
(27,015)
223,242 $
359,923 $
(77,407)
(25,954)
256,562 $
$
$
2020
288,435
(88,593)
(26,608)
173,234
Net Cash Provided By Operating Activities
2022 compared to 2021
The following is a summary of the $20.8 million change in Net cash provided by operating activities for the year ended April 30, 2022
as compared with the year ended April 30, 2021 (amounts in millions).
Net cash provided by operating activities – Year ended April 30, 2021
Net income adjusted for items to reconcile net income to net cash provided by operating activities, which would
$
include such noncash items as depreciation and amortization and the change in deferred taxes
Working capital changes:
Accounts payable and accrued royalties
Accounts receivable, net and contract liabilities
Changes in other assets and liabilities
Net cash provided by operating activities – Year ended April 30, 2022
$
The favorable change in accounts payable and accrued royalties was due to the timing of payments.
359.9
(16.3)
47.5
(23.3)
(28.7)
339.1
The unfavorable change in accounts receivable, net and contract liabilities was primarily the result of sales growth, as well as the
timing of billings and collections with customers.
The unfavorable changes in other assets and liabilities noted in the table above was primarily due to an increase in employee-related
costs, including payments due to higher annual incentive compensation payments in fiscal year 2022, partially offset by a favorable
change in income taxes, and a decrease in restructuring payments.
Our negative working capital (current assets less current liabilities) was $418.6 million and $462.7 million as of April 30, 2022 and
April 30, 2021, respectively. The primary driver of the negative working capital is the benefit realized from unearned contract
liabilities related to subscriptions for which cash has been collected in advance. The contract liabilities will be recognized as income
when the products are shipped or made available online to the customers over the term of the subscription. Current liabilities as of
April 30, 2022 and as of April 30, 2021 include contract liabilities of $538.1 million and $545.4 million, respectively, primarily
related to deferred subscription revenue for which cash was collected in advance.
Cash collected in advance for subscriptions is used by us for a number of purposes, including funding operations, capital expenditures,
acquisitions, debt repayments, dividend payments, and share repurchases.
2021 compared to 2020
The following is a summary of the $71.5 million change in Net cash provided by operating activities for the year ended April 30, 2021
as compared with the year ended April 30, 2020 (amounts in millions).
Net cash provided by operating activities – Year ended April 30, 2020
Higher net income adjusted for items to reconcile net income to net cash provided by operating activities, which
would include such noncash items as depreciation and amortization, impairment of goodwill and intangible assets
in 2020, and the change in deferred taxes
$
Working capital changes:
Accounts payable and accrued royalties
Other accrued liabilities
Inventories
Accounts receivable, net and contract liabilities
Changes in other assets and liabilities
Net cash provided by operating activities –Year ended April 30, 2021
$
288.4
88.9
(45.7)
49.4
10.6
10.0
(41.7)
359.9
The changes in accounts payable and accrued royalties and accounts receivable, net of contract liabilities, were primarily due to
timing. Change in inventories was primarily due to lower purchases and the lower cost of inventory. The change in other accrued
liabilities noted in the table above was primarily due to an increase in annual incentive compensation and, to a lesser extent, an
increase in employee-related costs, including the deferral of employer tax withholding payments in connection with the CARES Act in
the year ended April 30, 2021.
Index
45
The change in other assets and liabilities noted in the table above was primarily due to an increase in cash used for prepayments,
employee benefit and retirement-related costs, including retirement plan contributions, certain tax-related payments, and restructuring
payments in the year ended April 30, 2021.
Our negative working capital (current assets less current liabilities) was $462.7 million and $312.3 million as of April 30, 2021 and
April 30, 2020, respectively. The primary driver of the negative working capital is the benefit realized from unearned contract
liabilities related to subscriptions for which cash has been collected in advance. The contract liabilities will be recognized as income
when the products are shipped or made available online to the customers over the term of the subscription. Current liabilities as of
April 30, 2021 and as of April 30, 2020 include contract liabilities of $545.4 million and $520.2 million, respectively, primarily
related to deferred subscription revenue for which cash was collected in advance.
Cash collected in advance for subscriptions is used by us for a number of purposes, including funding operations, capital expenditures,
acquisitions, debt repayments, dividend payments, and share repurchases. Due to the adverse impact of COVID-19 on the global
economy during this period, we estimated that approximately $30 million of customer payments were delayed into fiscal year 2021.
Our accounts receivable collections were in line with our expectations. Although, in certain situations, the timing of collections may
be extended, we did not experience any material issues with customer collections. Many of our customers had been adversely
impacted by COVID-19, and we expected some continued delays in payments due to widespread disruption and pervasive cash
conservation behaviors in the face of uncertainty. We recorded provisions for bad debt where appropriate.
Net Cash Used In Investing Activities
2022 Compared to 2021
Net cash used in investing activities in the year ended April 30, 2022 was $194.0 million compared to $433.2 million in the prior year.
The decrease in cash used in investing activities was due to a decrease of $224.2 million in cash used to acquire businesses. See Note
4, “Acquisitions” for more information related to the acquisitions that occurred in the years ended April 30, 2022 and 2021.
Additionally, cash outflows for the acquisitions of publication rights and other activities decreased $24.0 million. This was partially
offset by an increase of $11.4 million for additions of technology, property, and equipment.
2021 Compared to 2020
Net cash used in investing activities in the year ended April 30, 2021 was $433.2 million compared to $346.7 million in the prior year.
The increase in cash used in investing activities was due to an increase of $70.3 million in cash used to acquire businesses and, to a
lesser extent, an increase of $28.0 million for the acquisition of publication rights and other activities. This was partially offset by a
decrease of $11.2 million for additions of technology, property, and equipment. See Note 4, “Acquisitions,” for further details of the
acquisition activity in fiscal year 2021 and 2020.
Net Cash Used In Financing Activities
2022 Compared to 2021
Net cash used in financing activities was $131.6 million in the year ended April 30, 2022 compared to net cash used of $47.1 million
in the year ended April 30, 2021. This change was primarily due to net debt repayments of $11.0 million in the year ended April 30,
2022 compared with net debt borrowings of $30.7 million in the year ended April 30, 2021 and, to a lesser extent, a $24.7 million
change from book overdrafts, and a $14.2 million increase in cash used for purchases of treasury shares.
2021 Compared to 2020
Net cash used in financing activities was $47.1 million in the year ended April 30, 2021 compared to net cash provided by financing
activities of $172.7 million in the year ended April 30, 2020. This change was due to lower net borrowings of $273.1 million, which
was primarily due to lower borrowings in the year ended April 30, 2021 and, to a lesser extent, a reduction of $30.8 million for the
purchase of treasury shares and an increase in cash provided by book overdrafts of $18.4 million compared to the prior year.
Dividends and Share Repurchases
In the year ended April 30, 2022, we increased our quarterly dividend to shareholders to $1.38 per share annualized versus $1.37 per
share annualized in the prior year.
Index
46
In the year ended April 30, 2021, we increased our quarterly dividend to shareholders to $1.37 per share annualized versus $1.36 per
share annualized in the prior year.
During the year ended April 30, 2020, our Board of Directors approved an additional share repurchase program of $200 million of
Class A or B Common Stock. As of April 30, 2022, we had authorization from our Board of Directors to purchase up to $197.5
million that was remaining under this program. During the year ended April 30, 2022, we purchased $2.5 million under this program.
No share repurchases were made under this program during the years ended April 30, 2021 and 2020.
The share repurchase program described above is in addition to the share repurchase program approved by our Board of Directors
during the year ended April 30, 2017 of four million shares of Class A or B Common Stock. As of April 30, 2022, no additional shares
were remaining under this program for purchase.
The following table summarizes the shares repurchased of Class A and B Common Stock (shares in thousands):
Shares repurchased – Class A
Shares repurchased – Class B
Average Price – Class A and Class B
Years Ended April 30,
2021
2022
2020
542
2
55.14 $
308
2
50.93 $
1,080
2
43.05
$
RECENTLY ISSUED STATEMENTS OF FINANCIAL ACCOUNTING STANDARDS, ACCOUNTING GUIDANCE, AND
DISCLOSURE REQUIREMENTS
We are subject to numerous recently issued statements of financial accounting standards, accounting guidance, and disclosure
requirements. The information set forth in Part II, Item 8, “Financial Statements and Supplementary Data” in Note 2, “Summary of
Significant Accounting Policies, Recently Issued and Recently Adopted Accounting Standards,” of the Notes to Consolidated
Financial Statements of this Annual Report on Form 10-K is incorporated by reference and describes these new accounting standards.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES:
The preparation of our Consolidated Financial Statements and related disclosures in conformity with US GAAP requires our
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities as of the date of the financial statements, and revenue and expenses during the reporting period. These estimates
include, among other items, sales return reserves, allocation of acquisition purchase price to assets acquired and liabilities assumed,
goodwill and indefinite-lived intangible assets, intangible assets with definite lives and other long-lived assets, and retirement plans.
We review these estimates and assumptions periodically using historical experience and other factors and reflect the effects of any
revisions on the Consolidated Financial Statements in the period we determine any revisions to be necessary. Actual results could
differ from those estimates, which could affect the reported results. In Part II, Item 8, “Financial Statements and Supplementary Data”
in Note 2, “Summary of Significant Accounting Policies, Recently Issued and Recently Adopted Accounting Standards” of the Notes
to Consolidated Financial Statements includes a summary of the significant accounting policies and methods used in preparation of
our Consolidated Financial Statements. Set forth below is a discussion of our more critical accounting policies and methods.
Revenue Recognition:
In Part II, Item 8, “Financial Statements and Supplementary Data,” see Note 3, “Revenue Recognition, Contracts with Customers,” of
the Notes to Consolidated Financial Statements for details of our revenue recognition policy.
Sales Return Reserves:
In Part II, Item 8, “Financial Statements and Supplementary Data,” see Note 2, “Summary of Significant Accounting Policies,
Recently Issued, and Recently Adopted Accounting Standards” in the section “Summary of Significant Accounting Policies” of the
Notes to Consolidated Financial Statements for details of our sales return reserves.
A one percent change in the estimated sales return rate could affect net income by approximately $1.7 million. A change in the pattern
or trends in returns could also affect the estimated allowance.
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Allocation of Acquisition Purchase Price to Assets Acquired and Liabilities Assumed:
In connection with acquisitions, we allocate the cost of the acquisition to the assets acquired and the liabilities assumed based on the
estimates of fair value for such items, including intangible assets. The excess of the purchase consideration over the fair value of
assets acquired and liabilities assumed is recorded as goodwill. The determination of the acquisition date fair value of the assets
acquired, and liabilities assumed, requires us to make significant estimates and assumptions, such as, if applicable, forecasted revenue
growth rates and operating cash flows, royalty rates, customer attrition rates, obsolescence rates of developed technology, and
discount rates. We may use a third-party valuation consultant to assist in the determination of such estimates.
In Part II, Item 8, “Financial Statements and Supplementary Data,” see Note 4, “Acquisitions,” of the Notes to Consolidated Financial
Statements for details of our acquisitions.
Goodwill and Indefinite-lived Intangible Assets:
Goodwill is reviewed for possible impairment at least annually on a reporting unit level during the fourth quarter of each year. Our
annual impairment assessment date is February 1. A review of goodwill may be initiated before or after conducting the annual analysis
if events or changes in circumstances indicate the carrying value of goodwill may no longer be recoverable.
A reporting unit is the operating segment unless, at businesses one level below that operating segment– the “component” level,
discrete financial information is prepared and regularly reviewed by management, and the component has economic characteristics
that are different from the economic characteristics of the other components of the operating segment, in which case the component is
the reporting unit.
As part of the annual impairment test, we may elect to first assess qualitative factors to determine whether it is more likely than not
that the fair value of a reporting unit is less than its carrying amount. In a qualitative assessment, we would consider the
macroeconomic conditions, including any deterioration of general conditions and industry and market conditions, including any
deterioration in the environment where the reporting unit operates, increased competition, changes in the products/services and
regulatory and political developments, cost of doing business, overall financial performance, including any declining cash flows and
performance in relation to planned revenues and earnings in past periods, other relevant reporting unit specific facts, such as changes
in management or key personnel or pending litigation, and events affecting the reporting unit, including changes in the carrying value
of net assets.
If the results of our qualitative assessment indicate it is more likely than not that the fair value of a reporting unit is less than its
carrying amount, we are required to perform a quantitative assessment to determine the fair value of the reporting unit.
Alternatively, if an optional qualitative goodwill impairment assessment is not performed, we may perform a quantitative assessment.
Under the quantitative assessment, we compare the fair value of each reporting unit to its carrying value, including the goodwill
allocated to the reporting unit. If the fair value of the reporting unit exceeded its carrying value, there would be no indication of
impairment. If the fair value of the reporting unit were less than the carrying value, an impairment charge would be recognized for the
difference.
We derive an estimate of fair values for each of our reporting units using a combination of an income approach and a market
approach, each based on an applicable weighting. We assess the applicable weighting based on such factors as current market
conditions and the quality and reliability of the data. Absent an indication of fair value from a potential buyer or similar specific
transactions, we believe that the use of these methods provides a reasonable estimate of a reporting unit’s fair value.
Fair value computed by these methods is arrived at using a number of key assumptions including forecasted revenues and related
growth rates, forecasted operating cash flows, the discount rate, and the selection of relevant market multiples of comparable publicly-
traded companies with similar characteristics to the reporting unit. There are inherent uncertainties, however, related to these factors
and to our judgment in applying them to this analysis. We believe that the combination of these methods provides a reasonable
approach to estimate the fair value of our reporting units. Assumptions for sales, net earnings, and cash flows for each reporting unit
were consistent among these methods.
Fiscal Year 2022 and 2021 Annual Goodwill Impairment Test
As of February 1, 2022 and 2021, we completed our annual goodwill impairment test for our reporting units. We concluded that the
fair values of our reporting units were above their carrying values and, therefore, there was no indication of impairment.
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Income Approach Used to Determine Fair Values
The income approach is based upon the present value of expected cash flows. Expected cash flows are converted to present value
using factors that consider the timing and risk of the future cash flows. The estimate of cash flows used is prepared on an unleveraged
debt-free basis. We use a discount rate that reflects a market-derived weighted average cost of capital. We believe that this approach is
appropriate because it provides a fair value estimate based upon the reporting unit’s expected long-term operating and cash flow
performance. The projections are based upon our best estimates of forecasted economic and market conditions over the related period
including growth rates, expected changes in forecasted operating cash flows, and cash expenditures. Other estimates and assumptions
include terminal value long-term growth rates, provisions for income taxes, future capital expenditures, and changes in future cashless,
debt-free working capital.
Changes in any of these assumptions could materially impact the estimated fair value of our reporting units. Our forecasts take into
account the near and long-term expected business performance, considering the long-term market conditions and business trends
within the reporting units. For example, each reporting unit includes an assumption regarding any continued impact of COVID-19
from both a current and long-term perspective. However, changes in this assumption may impact our ability to recover the allocated
goodwill in the future. For further discussion of the factors that could result in a change in our assumptions, see “Risk Factors” in this
Annual Report on Form 10-K.
Market Approach Used to Determine Fair Values
The market approach estimates the fair value of the reporting unit by applying multiples of operating performance measures to the
reporting unit’s operating performance (the Guideline Public Company Method). These multiples are derived from comparable
publicly-traded companies with similar investment characteristics to the reporting unit, and such comparable data are reviewed and
updated as needed annually. We believe that this approach is appropriate because it provides a fair value estimate using multiples from
entities with operations and economic characteristics comparable to our reporting units and Wiley.
The key estimates and assumptions that are used to determine fair value under this market approach include current and forward 12-
month revenue and EBITDA results, as applicable, and the selection of the relevant multiples to be applied. Under the Guideline
Public Company Method, a control premium, or an amount that a buyer is usually willing to pay over the current market price of a
publicly traded company is considered, and applied to the calculated equity values to adjust the public trading value upward for a
100% ownership interest, where applicable.
In order to assess the reasonableness of the calculated fair values of our reporting units, we also compare the sum of the reporting
units’ fair values to our market capitalization and calculate an implied control premium (the excess of the sum of the reporting units’
fair values over the market capitalization). We evaluate the control premium by comparing it to control premiums of recent
comparable market transactions. If the implied control premium is not reasonable in light of these recent transactions, we will
reevaluate our fair value estimates of the reporting units by adjusting the discount rates and/or other assumptions.
If our assumptions and related estimates change in the future, or if we change our reporting unit structure or other events and
circumstances change (such as a sustained decrease in the price of our common stock, a decline in current market multiples, a
significant adverse change in legal factors or business climates, an adverse action or assessment by a regulator, heightened
competition, strategic decisions made in response to economic or competitive conditions, or a more-likely-than-not expectation that a
reporting unit or a significant portion of a reporting unit will be sold or disposed of), we may be required to record impairment charges
in future periods. Any impairment charges that we may take in the future could be material to our consolidated results of operations
and financial condition.
Fiscal Year 2020 Annual Goodwill Impairment Test
As of February 1, 2020, we completed our annual goodwill impairment test for our reporting units. We concluded that the fair values
of our Research Publishing & Platforms and Academic & Professional Learning reporting units were above their carrying values and,
therefore, there was no indication of impairment.
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During our annual goodwill impairment test initiated on February 1, 2020, we identified indicators that the goodwill of the Education
Services business was impaired due to underperformance, as compared with our acquisition case projections for revenue growth and
operating cash flow. Subsequently, during the fourth quarter of fiscal year 2020, we determined that our updated revenue and
operating cash flow projections would be further impacted by anticipated near-term headwinds due to COVID-19, including adverse
impacts on new student starts and student reenrollment. Therefore, we updated the impairment test as of March 31, 2020 to reflect this
change in circumstances. As a result, we concluded that the carrying value was above the fair value, resulting in a noncash goodwill
impairment of $110.0 million. This charge is reflected in Impairment of goodwill and intangible assets in the Consolidated Statements
of Income (Loss).
The material assumptions underlying the estimate of the fair value of the Education Services reporting unit included the following:
• Future cash flow assumptions – the projections for future cash flows utilized in the model were derived from historical
experience and assumptions regarding future growth and profitability of the reporting unit. These projections are consistent
with our operating budget and strategic plan. We applied a compounded annual growth rate of approximately 6.8% for
forecasted sales in our projected cash flows through fiscal year 2028. Beyond the forecasted period, a terminal value was
determined using a perpetuity growth rate of 3.0% to reflect our estimate of stable and perpetual growth.
• Weighted average cost of capital (WACC) – the WACC is the rate used to discount the reporting unit’s estimated future cash
flows. The WACC is calculated based on a proportionate weighting of the cost of debt and equity. The cost of equity is based
on a capital asset pricing model and includes a company-specific risk premium to capture the perceived risks and
uncertainties associated with the reporting unit’s projected cash flows. The cost of debt component is calculated based on the
after-tax cost of debt of Moody’s Baa-rated corporate bonds. The cost of debt and equity is weighted based on the debt to
market capitalization ratio of publicly traded companies with similarities to the Education Services reporting unit. The
WACC applied to the Education Services reporting unit was 11.0%.
• Valuation Multiples – for the Guideline Public Company Method, we applied relevant current and forward 12-month revenue
multiples based on an evaluation of multiples of publicly-traded companies with similarities to the Education Services
reporting unit. The multiples applied ranged from 1.3 to 1.4x revenue.
• Equal weighting was applied to the income and market approach when determining the overall fair value calculation for the
Education Services reporting unit.
The following hypothetical changes in the valuation of the Education Services reporting unit would have impacted the goodwill
impairment as follows:
• A hypothetical 1% increase to revenue growth and EBITDA margins would have reduced the impairment charge by
approximately $16.0 million.
• A hypothetical 1% decrease to revenue growth and EBITDA margins would have increased the impairment charge by
approximately $19.0 million.
• A hypothetical change to the weightings by applying a weighting of 25% to the income approach and 75% to the market
approach would have increased the impairment charge by approximately $2.0 million.
Prior to performing the goodwill impairment test for Education Services, we also evaluated the recoverability of long-lived assets of
the reporting unit. The carrying value of the long-lived assets that were tested for impairment was $434.0 million. When indicators of
impairment are present, we test definite lived and long-lived assets for recoverability by comparing the carrying value of an asset
group to an estimate of the future undiscounted cash flows expected to result from the use and eventual disposition of the asset group.
We considered the lower-than-expected revenue and operating cash flows over a sustained period of time and downward revisions to
our cash flow forecasts for this reporting unit to be indicators of impairment for their long-lived assets. Based on the results of the
recoverability test, we determined that the undiscounted cash flows of the asset group of the Education Services reporting unit
exceeded the carrying value. Therefore, there was no impairment.
Fiscal Year 2022 and 2021 Annual Indefinite-lived Intangible Impairment Test
We also review our indefinite-lived intangible assets for impairment annually, which consists of brands and trademarks and certain
acquired publishing rights. As of February 1, 2022 and 2021, we completed our annual impairment test related to the indefinite-lived
intangible assets. We concluded that the fair values of these indefinite-lived intangible assets were above their carrying values and,
therefore, there was no indication of impairment.
We estimate the fair value of these assets using a relief from royalty method under an income approach. The key assumptions for this
method are revenue projections, a royalty rate as determined by management in consultation with valuation experts, and a discount
rate.
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Fiscal Year 2020 Annual Indefinite-lived Intangible Impairment Test
We recorded a pretax noncash impairment charge of $89.5 million for our Blackwell trademark, which was acquired in 2007 and
carried as an indefinite-lived intangible asset primarily related to our Research Publishing & Platforms segment. The impairment
reflected our decision to simplify Wiley’s brand portfolio and unify our research journal content under one Wiley brand, which
sharply limited the use of the Blackwell trade name. This impairment resulted in writing off substantially all of the carrying value of
the intangible trademark asset. This charge is reflected in Impairment of goodwill and intangible assets in the Consolidated Statements
of Income (Loss). The resulting noncash impairment charge is entirely unrelated to COVID-19 or the expected future financial
performance of the Research Publishing & Platforms segment.
See Note 11, “Goodwill and Intangible Assets,” of the Notes to Consolidated Financial Statements for details of our goodwill and
indefinite-lived intangible balances, and the review performed in the year ended April 30, 2022 and other related information.
Intangible Assets with Definite Lives and Other Long-Lived Assets:
See Note 2, “Summary of Significant Accounting Policies, Recently Issued, and Recently Adopted Accounting Standards,” in the
section “Summary of Significant Accounting Policies” of the Notes to Consolidated Financial Statements for details of definite lived
intangible assets and other long-lived assets.
Retirement Plans:
We provide defined benefit pension plans for certain employees worldwide. Our Board of Directors approved amendments to the US,
Canada, and UK defined benefit plans that froze the future accumulation of benefits effective June 30, 2013, December 31, 2015, and
April 30, 2015, respectively. Under the amendments, no new employees will be permitted to enter these plans and no additional
benefits for current participants for future services will be accrued after the effective dates of the amendments.
The accounting for benefit plans is highly dependent on assumptions concerning the outcome of future events and circumstances,
including discount rates, long-term return rates on pension plan assets, healthcare cost trends, compensation increases, and other
factors. In determining such assumptions, we consult with outside actuaries and other advisors.
The discount rates for the US, Canada, and UK pension plans are based on the derivation of a single-equivalent discount rate using a
standard spot rate curve and the timing of expected benefit payments as of the balance sheet date. The spot rate curves are based upon
portfolios of corporate bonds rated at Aa or above by a respected rating agency. The discount rate for Germany is based on the
expected benefit payments for the sample mixed population plan. The expected long-term rates of return on pension plan assets are
estimated using forecasted returns for equities and bonds applied to each plan’s target asset allocation. The expected long-term rates
are then compared to the historic investment performance of the plan assets and established by asset class, including an anticipated
inflation rate. The expected long-term rates are then compared to the historic investment performance of the plan assets as well as
future expectations, and estimated through consultation with investment advisors and actuaries. Salary growth and healthcare cost
trend assumptions are based on our historical experience and future outlook. While we believe that the assumptions used in these
calculations are reasonable, differences in actual experience or changes in assumptions could materially affect the expense and
liabilities related to our defined benefit pension plans. A hypothetical one percent increase in the discount rate would increase net
income and decrease the accrued pension liability by approximately $0.9 million and $111.0 million, respectively. A one percent
decrease in the discount rate would increase net income and increase the accrued pension liability by approximately $0.4 million and
$133.8 million, respectively. A one percent change in the expected long-term rate of return would affect net income by approximately
$5.9 million.
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk
We are exposed to market risk primarily related to interest rates, foreign exchange, and credit risk. It is our policy to monitor these exposures,
and to use derivative financial investments and/or insurance contracts from time to time to reduce fluctuations in earnings and cash flows
when it is deemed appropriate to do so. We do not use derivative financial instruments for trading or speculative purposes.
Interest Rates:
From time to time, we may use interest rate swaps, collars, or options to manage our exposure to fluctuations in interest rates. It is
management’s intention that the notional amount of interest rate swaps be less than the variable rate loans outstanding during the life of the
derivatives.
The information set forth in Note 15, “Derivative Instruments and Activities,” of the Notes to Consolidated Financial Statements under the
caption “Interest Rate Contracts,” is incorporated herein by reference.
On an annual basis, a hypothetical 1% change in interest rates for the $287.0 million of unhedged variable rate debt as of April 30, 2022
would affect net income and cash flow by approximately $2.3 million.
Foreign Exchange Rates:
Fluctuations in the currencies of countries where we operate outside the US may have a significant impact on financial results. We are
primarily exposed to movements in British pound sterling, euros, Canadian and Australian dollars, and certain currencies in Asia. The
statements of financial position of non-US business units are translated into US dollars using period-end exchange rates for assets and
liabilities and the Statements of Income are translated into US dollars using weighted-average exchange rates for revenues and expenses. The
percentage of consolidated revenue for the year ended April 30, 2022 recognized in the following currencies (on an equivalent US dollar
basis) were approximately: 56% US dollar, 25% British pound sterling, 10% euro, and 9% other currencies.
Our significant investments in non-US businesses are exposed to foreign currency risk. Adjustments resulting from translating assets and
liabilities are reported as a separate component of Total Accumulated Other Comprehensive Loss, Net of Tax within Shareholders’ Equity
under the caption Foreign currency translation adjustment. During the year ended April 30, 2022, we recorded foreign currency translation
losses in Total accumulated other comprehensive loss, net of tax of approximately $71.6 million primarily as a result of the fluctuations of the
US dollar relative to the British pound sterling and, to a lesser extent, the euro. During the year ended April 30, 2021, we recorded foreign
currency translation gains in Total accumulated other comprehensive loss, net of tax of approximately $82.8 million primarily as a result of
the fluctuations of the US dollar relative to the British pound sterling and, to a lesser extent, the euro. During the year ended April 30, 2020,
we recorded foreign currency translation losses in Accumulated other comprehensive loss, net of tax of approximately $28.6 million,
primarily as a result of the fluctuations of the US dollar relative to the British pound sterling and, to a lesser extent, the euro.
Exchange rate gains or losses related to foreign currency transactions are recognized as transaction gains or losses on the Consolidated
Statements of Income (Loss) as incurred. Under certain circumstances, we may enter into derivative financial instruments in the form of
foreign currency forward contracts to hedge against specific transactions, including intercompany purchases and loans.
The information set forth in Note 15, “Derivative Instruments and Activities,” of the Notes to Consolidated Financial Statements under the
caption “Foreign Currency Contracts,” is incorporated herein by reference.
Customer Credit Risk:
In the journal publishing business, subscriptions are primarily sourced through journal subscription agents who, acting as agents for library
customers, facilitate ordering by consolidating the subscription orders/billings of each subscriber with various publishers. Cash is generally
collected in advance from subscribers by the subscription agents and is principally remitted to us between the months of December and April.
Although at fiscal yearend we had minimal credit risk exposure to these agents, future calendar year subscription receipts from these agents
are highly dependent on their financial condition and liquidity. Subscription agents account for approximately 15% of total annual
consolidated revenue, and no one agent accounts for more than 10% of total annual consolidated revenue.
Our book business is not dependent upon a single customer; however, the industry is concentrated in national, regional, and online bookstore
chains. Although no book customer accounts for more than 8% of total consolidated revenue and 10% of accounts receivable at April 30,
2022, the top 10 book customers account for approximately 12% of total consolidated revenue and approximately 18% of accounts receivable
at April 30, 2022.
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Item 8. Financial Statements and Supplementary Data
The following Consolidated Financial Statements and Notes are filed as part of this report.
John Wiley & Sons, Inc. and Subsidiaries
Reports of Independent Registered Public Accounting Firm
Financial Statements
Consolidated Statements of Financial Position April 30, 2022 and 2021
Consolidated Statements of Income (Loss) for the years ended April 30, 2022, 2021, and 2020
Consolidated Statements of Comprehensive Income (Loss) for the years ended April 30, 2022, 2021, and 2020
Consolidated Statements of Cash Flows for the years ended April 30, 2022, 2021, and 2020
Consolidated Statements of Shareholders’ Equity for the years ended April 30, 2022, 2021, and 2020
Notes to Consolidated Financial Statements
Note 1. Description of Business
Note 2. Summary of Significant Accounting Policies, Recently Issued, and Recently Adopted Accounting Standards
Note 3. Revenue Recognition, Contracts with Customers
Note 4. Acquisitions
Note 5. Reconciliation of Weighted Average Shares Outstanding
Note 6. Accumulated Other Comprehensive Loss
Note 7. Restructuring and Related (Credits) Charges
Note 8. Inventories
Note 9. Product Development Assets
Note 10. Technology, Property, and Equipment
Note 11. Goodwill and Intangible Assets
Note 12. Operating Leases
Note 13. Income Taxes
Note 14. Debt and Available Credit Facilities
Note 15. Derivative Instruments and Activities
Note 16. Commitment and Contingencies
Note 17. Retirement Plans
Note 18. Stock-Based Compensation
Note 19. Capital Stock and Changes in Capital Accounts
Note 20. Segment Information
Note 21. Subsequent Events
Financial Statement Schedule
Schedule II – Valuation and Qualifying Accounts for the years ended April 30, 2022, 2021, and 2020
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63
63
69
75
79
79
80
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81
82
82
85
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89
91
92
92
96
99
101
103
110
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MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
To our Shareholders
John Wiley & Sons, Inc.:
The management of John Wiley & Sons, Inc. and subsidiaries is responsible for establishing and maintaining adequate internal control
over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f).
Under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of our internal
control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under the framework in Internal Control
– Integrated Framework issued by COSO, our management concluded that our internal control over financial reporting was effective
as of April 30, 2022.
There were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting during fiscal year 2022.
The effectiveness of our internal control over financial reporting as of April 30, 2022 has been audited by KPMG LLP, an independent
registered public accounting firm, as stated in their report which is included herein.
The Company’s Corporate Governance Principles, Committee Charters, Business Conduct and Ethics Policy and the Code of Ethics
for Senior Financial Officers are published on our web site at www.wiley.com under the “About Wiley—Corporate Governance”
captions. Copies are also available free of charge to shareholders on request to the Corporate Secretary, John Wiley & Sons, Inc., 111
River Street, Hoboken, NJ 07030-5774.
/s/ Brian A. Napack
Brian A. Napack
President and Chief Executive Officer
/s/ Christina Van Tassell
Christina Van Tassell
Executive Vice President and Chief Financial Officer
/s/ Christopher F. Caridi
Christopher F. Caridi
Senior Vice President, Global Corporate Controller, and
Chief Accounting Officer
June 24, 2022
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Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors
John Wiley & Sons, Inc.:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated statements of financial position of John Wiley & Sons, Inc. and subsidiaries (the
Company) as of April 30, 2022 and 2021, the related consolidated statements of income (loss), comprehensive income (loss), cash
flows, and shareholders’ equity for each of the years in the three-year period ended April 30, 2022, and the related notes and financial
statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present
fairly, in all material respects, the financial position of the Company as of April 30, 2022 and 2021, and the results of its operations
and its cash flows for each of the years in the three-year period ended April 30, 2022, in conformity with U.S. generally accepted
accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting as of April 30, 2022, based on criteria established in Internal
Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our
report dated June 24, 2022 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial
reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining,
on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial
statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or
disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial
statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the
critical audit matters or on the accounts or disclosures to which they relate.
Evaluation of the sufficiency of audit evidence over certain subscriber and publishing revenue
As discussed in Note 3 to the consolidated financial statements, the Company generated revenue of $1,057.0 million from
Research Publishing Products, including Journal Subscriptions, $350.0 million from Education Publishing Products,
including Education (print and digital) Publishing, and $296.8 million from Professional Learning Products, including
Professional Publishing, for the year ended April 30, 2022. The Company’s uses multiple information technology (IT)
systems to record revenue.
We identified the evaluation of the sufficiency of audit evidence over revenue from Journal Subscriptions, Education (print
and digital) Publishing, and Professional Publishing as a critical audit matter. Evaluating the sufficiency of audit evidence
obtained involved IT professionals with specialized skills and knowledge and required especially subjective auditor judgment
because of the multiple revenue recognition processes, IT applications, and data interfaces.
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The following are the primary procedures we performed to address this critical audit matter. We performed risk assessment
procedures and applied auditor judgment to determine the nature and extent of procedures to be performed over Journal
Subscriptions, Education (print and digital) Publishing, and Professional Publishing revenue, including the determination of
the IT systems where those procedures were to be performed based on the nature of the information processed by those
systems. We evaluated the design and tested the operating effectiveness of certain internal controls over the related revenue
recognition processes. We involved IT professionals with specialized skills and knowledge, who assisted in testing 1) certain
general IT controls, and 2) certain application controls within those revenue recognition process, including the interface of
relevant revenue data between different IT systems used therein. On a sample basis, we also tested certain Journal
Subscriptions, Education (print and digital) Publishing, and Professional Publishing revenue by tracing the recorded amounts
for specific transactions back to underlying documentation. We evaluated the sufficiency of audit evidence obtained over
revenue by assessing the results of procedures performed.
/s/ KPMG LLP
We have served as the Company’s auditor since 2002.
New York, New York
June 24, 2022
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Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors
John Wiley & Sons, Inc.:
Opinion on Internal Control Over Financial Reporting
We have audited John Wiley & Sons, Inc. and subsidiaries’ (the Company) internal control over financial reporting as of April 30, 2022,
based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the
Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as
of April 30, 2022, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
consolidated statements of financial position of the Company as of April 30, 2022 and 2021, and the related consolidated statements of
income (loss), comprehensive income (loss), cash flows, and shareholders’ equity for each of the years in the three-year period ended April
30, 2022, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated
June 24, 2022 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Management’s Report On Internal Control Over
Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our
audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our
audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing
the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our
audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
New York, New York
June 24, 2022
Index
57
John Wiley & Sons, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
In thousands
Assets:
Current assets
Cash and cash equivalents
Accounts receivable, net
Inventories, net
Prepaid expenses and other current assets
Total current assets
Technology, property, and equipment, net
Intangible assets, net
Goodwill
Operating lease right-of-use assets
Other non-current assets
Total assets
Liabilities and shareholders’ equity:
Current liabilities
Accounts payable
Accrued royalties
Short-term portion of long-term debt
Contract liabilities
Accrued employment costs
Short-term portion of operating lease liabilities
Other accrued liabilities
Total current liabilities
Long-term debt
Accrued pension liability
Deferred income tax liabilities
Operating lease liabilities
Other long-term liabilities
Total liabilities
Shareholders’ equity
$
$
$
April 30,
2022
2021
100,397 $
331,960
36,585
81,924
550,866
271,572
931,429
1,302,142
111,719
193,967
3,361,695 $
77,438 $
101,596
18,750
538,126
117,121
20,576
95,812
969,419
768,277
78,622
180,065
132,541
90,502
2,219,426
93,795
311,571
42,538
78,393
526,297
282,270
1,015,302
1,304,340
121,430
196,800
3,446,439
95,791
78,582
12,500
545,425
144,744
22,440
89,490
988,972
809,088
146,247
172,903
145,832
92,106
2,355,148
Preferred stock, $1 par value: Authorized – 2 million, Issued – 0
Class A common stock, $1 par value: Authorized – 180 million, Issued – 70,226 and 70,208 as of April
30, 2022 and 2021, respectively
Class B common stock, $1 par value: Authorized – 72 million, Issued – 12,956 and 12,974 as of April
—
—
70,226
70,208
30, 2022 and 2021, respectively
Additional paid-in capital
Retained earnings
Accumulated other comprehensive loss:
Foreign currency translation adjustment
Unamortized retirement costs, net of tax
Unrealized gain (loss) on interest rate swaps, net of tax
Total accumulated other comprehensive loss, net of tax
Less: treasury shares at cost (Class A – 23,515 and 23,419 as of April 30, 2022 and 2021, respectively,
Class B – 3,924 and 3,922 as of April 30, 2022 and 2021, respectively)
Total shareholders’ equity
Total liabilities and shareholders’ equity
See accompanying Notes to Consolidated Financial Statements.
12,956
459,297
1,921,160
(329,566)
(182,226)
3,646
(508,146)
(813,224)
1,142,269
3,361,695 $
$
12,974
444,358
1,850,058
(257,941)
(228,146)
(4,703)
(490,790)
(795,517)
1,091,291
3,446,439
Index
58
John Wiley & Sons, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Dollars in thousands, except per share information
Revenue, net
Costs and expenses
Cost of sales
Operating and administrative expenses
Impairment of goodwill and intangible assets
Restructuring and related (credits) charges
Amortization of intangible assets
Total costs and expenses
Operating income (loss)
Interest expense
Foreign exchange transaction (losses) gains
Gain on sale of certain assets
Other income, net
Income (loss) before taxes
Provision for income taxes
Net income (loss)
Earnings (loss) per share:
Basic
Diluted
Weighted average number of common shares outstanding:
Basic
Diluted
$
$
$
$
2022
For the Years Ended April 30,
2021
1,941,501 $
2,082,928 $
2020
1,831,483
700,658
1,079,585
—
(1,427)
84,836
1,863,652
625,335
1,022,660
—
33,310
74,685
1,755,990
591,024
997,355
202,348
32,607
62,436
1,885,770
219,276
185,511
(54,287)
(19,802)
(3,192)
3,694
9,685
(18,383)
(7,977)
—
16,761
209,661
61,352
175,912
27,656
(24,959)
2,773
—
13,381
(63,092)
11,195
148,309 $
148,256 $
(74,287)
2.66 $
2.62 $
2.65 $
2.63 $
(1.32)
(1.32)
55,759
56,598
55,930
56,461
56,209
56,209
See accompanying Notes to Consolidated Financial Statements.
Index
59
John Wiley & Sons, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Dollars in thousands
For the Years Ended April 30,
2021
2022
2020
Net income (loss)
$
148,309 $
148,256 $
(74,287)
Other comprehensive income (loss):
Foreign currency translation adjustment
Unamortized retirement costs, net of tax (expense) benefit of $(13,440),
$(2,103), and $10,137, respectively
Unrealized gain (loss) on interest rate swaps, net of tax (expense) benefit of
$(2,787), $(657), and $2,114, respectively
Total other comprehensive income (loss)
(71,625)
82,762
(28,596)
45,920
(226)
(31,863)
8,349
(17,356)
2,171
84,707
(6,300)
(66,759)
Comprehensive income (loss)
$
130,953 $
232,963 $
(141,046)
See accompanying Notes to Consolidated Financial Statements.
Index
60
John Wiley & Sons, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
Dollars in thousands
For the Years Ended April 30,
2021
2020
2022
Operating activities
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
$
148,309 $
148,256 $
(74,287)
Impairment of goodwill and intangible assets
Amortization of intangible assets
Amortization of product development assets
Depreciation and amortization of technology, property, and equipment
Restructuring and related (credits) charges
Stock-based compensation expense
Employee retirement plan expense
Foreign exchange transaction losses (gains)
Gain on sale of certain assets
Other noncash charges
Changes in operating assets and liabilities
Accounts receivable, net
Inventories, net
Accounts payable and accrued royalties
Contract liabilities
Restructuring payments
Other accrued liabilities
Employee retirement plan contributions
Operating lease liabilities
Other
Net cash provided by operating activities
Investing activities
Product development spending
Additions to technology, property, and equipment
Businesses acquired in purchase transactions, net of cash acquired
Proceeds related to the sale of certain assets
Acquisitions of publication rights and other
Net cash used in investing activities
Financing activities
Repayments of long-term debt
Borrowings of long-term debt
Payment of debt issuance costs
Purchases of treasury shares
Change in book overdrafts
Cash dividends
Impact of tax withholding on stock-based compensation and other
Net cash (used in) provided by financing activities
Effects of exchange rate changes on cash, cash equivalents, and restricted cash
Cash reconciliation:
Cash and cash equivalents
Restricted cash included in Prepaid expenses and other current assets
Balance at beginning of year
Increase/(decrease) for year
Cash and cash equivalents
Restricted cash included in Prepaid expenses and other current assets
Balance at end of year
Cash paid during the year for:
Interest
Income taxes, net of refunds
Noncash items:
Shares issued in connection with the acquisition of a business
—
84,836
35,162
95,172
(1,427)
25,705
19,146
3,192
(3,694)
37,128
(26,318)
2,311
16,373
9,973
(5,911)
(13,476)
(46,729)
(29,737)
(10,915)
339,100
(27,015)
(88,843)
(75,703)
3,375
(5,838)
(194,024)
(661,873)
650,877
—
(30,000)
(6,327)
(77,205)
(7,110)
(131,638)
(7,070)
—
74,685
34,365
91,139
33,310
21,982
12,975
7,977
—
35,138
(7,263)
7,842
(31,121)
14,164
(19,667)
28,142
(40,676)
(32,344)
(18,981)
359,923
(25,954)
(77,407)
(299,942)
—
(29,851)
(433,154)
(562,752)
593,405
—
(15,765)
18,398
(76,938)
(3,434)
(47,086)
11,629
93,795
564
94,359
6,368
100,397
330
100,727 $
202,464
583
203,047
(108,688)
93,795
564
94,359 $
17,834 $
48,887 $
17,171 $
41,064 $
7,363 $
— $
$
$
$
$
202,348
62,436
35,975
76,716
32,607
20,009
10,832
(2,773)
—
7,115
(2,962)
(2,714)
14,588
(118)
(12,563)
(13,779)
(33,729)
(28,243)
(3,023)
288,435
(26,608)
(88,593)
(229,629)
—
(1,840)
(346,670)
(630,551)
934,323
(4,006)
(46,589)
(48)
(76,658)
(3,794)
172,677
(4,943)
92,890
658
93,548
109,499
202,464
583
203,047
23,622
41,537
—
See accompanying Notes to Consolidated Financial Statements.
Index
61
John Wiley & Sons, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
Dollars in thousands
Class A
common
stock
Class B
common
stock
Additional
paid-in
capital
Retained
earnings
Accumulated
other
comprehensive
loss, net of tax
Treasury
stock
Total
shareholders’
equity
1,181,347
Balance at April 30, 2019
$
70,127 $
13,055 $
422,305 $ 1,931,074 $
(508,738) $ (746,476) $
Restricted shares issued under stock-based
compensation plans
Impact of tax withholding on stock-based
compensation and other
Stock-based compensation expense
Purchases of treasury shares
Class A common stock dividends ($1.36 per
share)
Class B common stock dividends ($1.36 per
—
—
—
—
—
—
(10,992)
358
20,009
—
—
—
—
—
—
—
—
—
— 11,347
355
— (4,152)
—
—
— (46,589)
(3,794)
20,009
(46,589)
—
(64,264)
—
—
(64,264)
share)
Common stock class conversions
Comprehensive loss, net of tax
Balance at April 30, 2020
—
39
—
70,166 $
—
(39)
—
13,016 $
—
—
—
(12,394)
—
(74,287)
431,680 $ 1,780,129 $
—
—
(66,759)
—
—
—
(575,497) $ (785,870) $
(12,394)
—
(141,046)
933,624
$
Cumulative effect of change in accounting
principle, net of tax
Restricted shares issued under stock-based
compensation plans
Impact of tax withholding on stock-based
compensation and other
Stock-based compensation expense
Purchases of treasury shares
Class A common stock dividends ($1.37 per
share)
Class B common stock dividends ($1.37 per
—
—
—
—
—
—
—
—
(1,390)
—
—
(1,390)
—
(10,206)
902
21,982
—
—
—
—
—
1
—
—
—
— 10,454
249
— (4,336)
—
—
— (15,765)
(3,434)
21,982
(15,765)
—
(67,614)
—
—
(67,614)
share)
Common stock class conversions
Comprehensive income, net of tax
Balance at April 30, 2021
—
42
—
70,208 $
—
(42)
—
12,974 $
—
—
—
(9,324)
—
148,256
444,358 $ 1,850,058 $
—
—
84,707
—
—
—
(490,790) $ (795,517) $
(9,324)
—
232,963
1,091,291
$
Restricted shares issued under stock-based
compensation plans
Issuance of Class A common stock related to
the acquisition of a business
Impact of tax withholding on stock-based
compensation and other
Stock-based compensation expense
Purchases of treasury shares
Class A common stock dividends ($1.38 per
share)
Class B common stock dividends ($1.38 per
—
—
—
—
—
—
—
(12,578)
(2)
— 12,854
274
—
—
—
—
—
—
814
26,703
—
—
—
—
—
—
7,363
7,363
— (7,924)
—
—
— (30,000)
(7,110)
26,703
(30,000)
—
(64,724)
—
—
(64,724)
share)
Common stock class conversions
Comprehensive income, net of tax
Balance at April 30, 2022
—
18
—
70,226 $
—
(18)
—
12,956 $
—
—
—
(12,481)
—
148,309
459,297 $ 1,921,160 $
—
—
(17,356)
—
—
—
(508,146) $ (813,224) $
(12,481)
—
130,953
1,142,269
$
See accompanying Notes to Consolidated Financial Statements.
Index
62
Note 1 – Description of Business
John Wiley & Sons, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
The Company, founded in 1807, was incorporated in the state of New York on January 15, 1904. Throughout this report, when we
refer to “Wiley,” the “Company,” “we,” “our,” or “us,” we are referring to John Wiley & Sons, Inc. and all our subsidiaries, except
where the context indicates otherwise.
Wiley is a global leader in scientific research and career-connected education, unlocking human potential by enabling discovery,
powering education, and shaping workforces. We report financial information in three segments, as well as a Corporate category.
Through the Research Publishing & Platforms segment, we provide peer-reviewed scientific, technical, and medical (STM)
publishing, content platforms, and related services to academic, corporate, and government customers, academic societies, and
individual researchers. The Academic & Professional Learning segment provides Education Publishing and Professional Learning
content and courseware, training and learning services, to students, professionals, and corporations. The Education Services segment
provides University Services, including online program management (OPM) services for academic institutions, and Talent
Development Services, including placement and training, for professionals and businesses. We have operations primarily located in
the United States (US), United Kingdom (UK), India, Sri Lanka, and Germany.
Note 2 – Summary of Significant Accounting Policies, Recently Issued, and Recently Adopted Accounting Standards
Summary of Significant Accounting Policies
Basis of Presentation:
Our Consolidated Financial Statements include all the accounts of the Company and our subsidiaries. We have eliminated all
intercompany transactions and balances in consolidation. All amounts are in thousands, except per share amounts, and approximate
due to rounding.
In the fourth quarter of fiscal year 2021, a UK entity acquired in connection with the acquisition of mthree, which was acquired on
January 1, 2020 was erroneously dissolved by the Company in accordance with UK Companies Act regulations while still holding
assets. This entity, along with its subsidiaries, (the Entity) had various net intercompany receivables owed to them from other Wiley
companies of approximately $188.8 million as of April 30, 2021, which upon a dissolution technically would revert to the British
Crown (Crown). Wiley petitioned to Companies House to reinstate the Entity without prejudice, which was completed in March 2022.
When these events occurred, the Company evaluated whether it was appropriate to consolidate the assets, liabilities, and operations of
the Entity as part of its Consolidated Financial Statements as of April 30, 2021, and for each reporting period from the Entity being
dissolved until its reinstatement in March 2022. The Company evaluated whether there was a liability to the Crown and a related loss
associated with the dissolution of the Entity under US GAAP in fiscal year 2021 and through to reinstatement in March 2022.
The Company evaluated the criteria in Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC)
Topic 810, “Consolidations,” to determine if consolidating the Entity was appropriate under US GAAP. Based on that evaluation and
the administrative nature of the process to restore, the Company concluded that although the Entity was dissolved, we maintained
control of the assets of the Entity and, therefore, appropriately consolidated the assets, liabilities, and operations of the Entity in our
Consolidated Financial Statements as of April 30, 2021 and through to reinstatement in March 2022.
Reclassifications:
Certain prior year amounts have been reclassified to conform to the current year’s presentation.
Index
63
Use of Estimates:
The preparation of our Consolidated Financial Statements and related disclosures in conformity with US GAAP requires our
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities as of the date of the financial statements, and revenue and expenses during the reporting period. These estimates
include, among other items, sales return reserves, allocation of acquisition purchase price to assets acquired and liabilities assumed,
goodwill and indefinite-lived intangible assets, intangible assets with definite lives and other long-lived assets, and retirement plans.
We review these estimates and assumptions periodically using historical experience and other factors and reflect the effects of any
revisions on the Consolidated Financial Statements in the period we determine any revisions to be necessary. Actual results could
differ from those estimates, which could affect the reported results.
Book Overdrafts:
Under our cash management system, a book overdraft balance exists for our primary disbursement accounts. This overdraft represents
uncleared checks in excess of cash balances in individual bank accounts. Our funds are transferred from other existing bank account
balances or from lines of credit as needed to fund checks presented for payment. As of April 30, 2022 and 2021, book overdrafts of
$19.4 million and $25.8 million, respectively, were included in Accounts payable on the Consolidated Statements of Financial
Position.
Revenue Recognition:
Revenue from contracts with customers is recognized using a five-step model consisting of the following: (1) identify the contract
with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the
transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) we satisfy a performance
obligation. Performance obligations are satisfied when we transfer control of a good or service to a customer, which can occur over
time or at a point in time. The amount of revenue recognized is based on the consideration to which we expect to be entitled in
exchange for those goods or services, including the expected value of variable consideration. The customer’s ability and intent to pay
the transaction price is assessed in determining whether a contract exists with the customer. If collectability of substantially all the
consideration in a contract is not probable, consideration received is not recognized as revenue unless the consideration is
nonrefundable, and we no longer have an obligation to transfer additional goods or services to the customer, or collectability becomes
probable.
See Note 3, “Revenue Recognition, Contracts with Customers,” for further details of our revenue recognition policy.
Cash and Cash Equivalents:
Cash and cash equivalents consist of highly liquid investments with an original maturity of three months or less at the time of purchase
and are stated at cost, which approximates market value, because of the short-term maturity of the instruments.
Allowance for Credit Losses:
We are exposed to credit losses through our accounts receivable with customers. Accounts receivable, net, is stated at amortized cost
net of provision for credit losses. Our methodology to measure the provision for credit losses requires an estimation of loss rates based
upon historical loss experience adjusted for factors that are relevant to determining the expected collectability of accounts receivable
such as, delinquency trends, aging behavior of receivables, credit and liquidity indicators for industry groups, customer classes or
individual customers, and reasonable and supportable forecasts of the economic and geopolitical conditions that may exist through the
contractual life of the asset. Our provision for credit losses is reviewed and revised periodically. Our accounts receivable is evaluated
on a pool basis that is based on customer groups with similar risk characteristics. This includes consideration of the following factors
to develop these pools: size of the customer, industry, geographical location, historical risk, and types of services or products sold.
Our customers’ ability to pay is assessed through our internal credit review processes. Based on the value of credit extended, we
assess our customers’ credit by reviewing the total expected receivable exposure, expected timing of payments, and the customers’
established credit rating. In determining customer creditworthiness, we assess our customers’ credit utilizing different resources
including third-party validations and/or our own assessment through analysis of the customers’ financial statements and review of
trade/bank references. We also consider contract terms and conditions, country and geopolitical risk, and the customers’ mix of
products purchased in our evaluation. A credit limit is established for each customer based on the outcome of this review. Credit limits
are periodically reviewed for existing customers and whenever an increase in the credit limit is being considered. When necessary, we
utilize collection agencies and legal counsel to pursue recovery of defaulted receivables. We write off receivables only when deemed
no longer collectible.
Index
64
The following table presents the change in provision for credit losses, which is presented net in Accounts receivable on our
Consolidated Statements of Financial Position for the period indicated:
Balance as of April 30, 2021
Current period provision
Amounts written off, less recoveries
Foreign exchange translation adjustments and other
Balance as of April 30, 2022
Sales Return Reserves:
Provision for
Credit Losses
$
$
21,474
4,029
(3,754)
(528)
21,221
The process that we use to determine our sales returns and the related reserve provision charged against revenue, is based on applying
an estimated return rate to current year returnable print book sales. This rate is based upon an analysis of actual historical return
experience in the various markets and geographic regions in which we do business. We collect, maintain, and analyze significant
amounts of sales returns data for large volumes of homogeneous transactions. This allows us to make reasonable estimates of the
amount of future returns. All available data is utilized to identify the returns by market and to which fiscal year the sales returns apply.
This enables management to track the returns in detail and identify and react to trends occurring in the marketplace, with the objective
of being able to make the most informed judgments possible in setting reserve rates. Associated with the estimated sales return
reserves, we also include a related increase to inventory and a reduction to accrued royalties as a result of the expected returns. Print
book sales return reserves amounted to a net liability balance of $19.4 million and $22.2 million as of April 30, 2022 and 2021,
respectively.
The reserves are reflected in the following accounts of the Consolidated Statements of Financial Position as of April 30:
Increase in Inventories, net
Decrease in Accrued royalties
Increase in Contract liabilities
Print book sales return reserve net liability balance
Inventories:
2022
2021
7,820 $
(3,893)
31,135
(19,422) $
10,886
(4,949)
38,034
(22,199)
$
$
Inventories are carried at the lower of cost or net realizable value. US book inventories aggregating $20.6 million and $20.4 million at
April 30, 2022 and 2021, respectively, are valued using the last-in, first-out (LIFO) method. All other inventories are valued using the
first-in, first-out (FIFO) method. Finished goods not recorded at LIFO have been recorded at the lower of cost or net realizable value.
Product Development Assets:
Product development assets consist of book composition costs and other product development costs and were included in Other non-
current assets on the Consolidated Statements of Financial Position. Costs associated with developing a book for publication are
expensed until the product is determined to be commercially viable. Book composition costs represent the costs incurred to bring an
edited commercial manuscript to publication, which include typesetting, proofreading, design, illustration costs, and digital formatting.
Book composition costs are capitalized and are generally amortized on a double-declining basis over their estimated useful lives,
ranging from 1 to 3 years. Other product development costs represent the costs incurred in developing software, platforms, and digital
content to be sold and licensed to third parties. Other product development costs are capitalized and amortized on a straight-line basis
over their estimated useful lives. As of April 30, 2022, the weighted average estimated useful life of other product development costs
was approximately 6 years.
Royalty Advances:
Royalty advances are capitalized and, upon publication, are expensed as royalties earned based on sales of the published works.
Royalty advances are reviewed for recoverability and a reserve for loss is maintained, if appropriate.
Index
65
Shipping and Handling Costs:
Costs incurred for third party shipping and handling are primarily reflected in Operating and administrative expenses on the
Consolidated Statements of Income (Loss). We incurred $29.0 million, $27.8 million, and $28.8 million in shipping and handling
costs in the years ended April 30, 2022, 2021, and 2020, respectively.
Advertising and Marketing Costs:
Advertising and marketing costs are expensed as incurred. These costs are reflected in the Consolidated Statements of Income (Loss)
as follows:
For the Years Ended April 30,
2021
2020
2022
Advertising and marketing costs
Cost of sales(1)
Operating and administrative expenses
$
$
100.6
62.9
37.7
$
93.6
57.0
36.6
103.1
65.8
37.3
(1) This includes certain advertising and marketing costs incurred by our Education Services business to fulfill performance
obligations from contracts with educational institutions.
Technology, Property, and Equipment:
Technology, property, and equipment is recorded at cost, except for property and equipment that have been impaired, for which we
reduce the carrying amount to the estimated fair value at the impairment date. Major renewals and improvements are capitalized,
while maintenance and repairs are expensed as incurred.
Technology, property, and equipment is depreciated using the straight-line method based upon the following estimated useful lives:
Computer Software – 3 to 10 years; Computer Hardware – 3 to 5 years; Buildings and Leasehold Improvements – the lesser of the
estimated useful life of the asset up to 40 years or the duration of the lease; Furniture, Fixtures, and Warehouse Equipment – 5 to 10
years.
Costs incurred for computer software internally developed or obtained for internal use are capitalized during the application
development stage and expensed as incurred during the preliminary project and postimplementation stages. Costs incurred during the
application development stage include costs of materials, services, and payroll and payroll-related costs for employees who are
directly associated with the software project. Such costs are amortized over the expected useful life of the related software, which is
generally 3 to 5 years. Costs related to the investment in our Enterprise Resource Planning and related systems are amortized over an
expected useful life of 10 years. Maintenance, training, and upgrade costs that do not result in additional functionality are expensed as
incurred.
Allocation of Acquisition Purchase Price to Assets Acquired and Liabilities Assumed:
In connection with acquisitions, we allocate the cost of the acquisition to the assets acquired and the liabilities assumed based on the
estimates of fair value for such items, including intangible assets and technology acquired. The excess of the purchase consideration
over the fair value of assets acquired and liabilities assumed is recorded as goodwill. The determination of the acquisition date fair
value of the assets acquired and liabilities assumed requires us to make significant estimates and assumptions, such as forecasted
revenue growth rates and operating cash flows, royalty rates, customer attrition rates, obsolescence rates of developed technology, and
discount rates. We may use a third-party valuation consultant to assist in the determination of such estimates.
Goodwill and Indefinite-lived Intangible Assets:
Goodwill represents the excess of the aggregate of the following: (1) consideration transferred, (2) the fair value of any noncontrolling
interest in the acquiree, and (3) if the business combination is achieved in stages, the acquisition-date fair value of our previously held
equity interest in the acquiree over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities
assumed.
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Indefinite-lived intangible assets primarily consist of brands and trademarks, and publishing rights, and are typically characterized by
intellectual property with a long and well-established revenue stream resulting from strong and well-established imprint/brand
recognition in the market.
We use the acquisition method of accounting for all business combinations and do not amortize goodwill or intangible assets with
indefinite useful lives. Goodwill and intangible assets with indefinite useful lives are tested for possible impairment annually during
the fourth quarter of each fiscal year, or more frequently if events or changes in circumstances indicate that the asset might be
impaired.
Intangible Assets with Definite Lives and Other Long-Lived Assets:
Definite-lived intangible assets principally consist of content and publishing rights, customer relationships, developed technology,
brands and trademarks, and covenants not to compete agreements, and are amortized over their estimated useful lives. The most
significant factors in determining the estimated lives of these intangibles are the history and longevity, combined with the strength and
pattern of projected cash flows.
Intangible assets with definite lives as of April 30, 2022, are amortized on a straight-line basis over the following weighted average
estimated useful lives: content and publishing rights – 26 years, customer relationships – 16 years, developed technology – 7 years,
brands and trademarks – 11 years, and covenants not to compete agreements – 5 years.
Assets with definite lives are evaluated for impairment upon a significant change in the operating or macroeconomic environment. In
these circumstances, if an evaluation of the projected undiscounted cash flows indicates impairment, the asset is written down to its
estimated fair value based on the discounted future cash flows.
Derivative Financial Instruments:
From time to time, we enter into foreign exchange forward and interest rate swap contracts as a hedge against foreign currency asset
and liability commitments, changes in interest rates, and anticipated transaction exposures, including intercompany purchases. All
derivatives are recognized as assets or liabilities and measured at fair value. Derivatives that are not determined to be effective hedges
are adjusted to fair value with a corresponding adjustment to earnings. We do not use financial instruments for trading or speculative
purposes.
Foreign Currency Gains/Losses:
We maintain operations in many non-US locations. Assets and liabilities are translated into US dollars using end-of-period exchange
rates and revenues, and expenses are translated into US dollars using weighted average rates. Our significant investments in non-US
businesses are exposed to foreign currency risk. Foreign currency translation adjustments are reported as a separate component of
Accumulated Other Comprehensive Loss within Shareholders’ Equity. Foreign currency transaction gains or losses are recognized on
the Consolidated Statements of Income (Loss) as incurred.
Stock-Based Compensation:
We recognize stock-based compensation expense based on the fair value of the stock-based awards on the grant date, reduced by an
estimate for future forfeited awards. As such, stock-based compensation expense is only recognized for those awards that are expected
to ultimately vest. The fair value of stock-based awards is recognized in net income generally on a straight-line basis over the requisite
service period. Stock-based compensation expense associated with performance-based stock awards is based on actual financial results
for targets established up to three years in advance, or less. The cumulative effect on current and prior periods of a change in the
estimated number of performance share awards, or estimated forfeiture rate, is recognized as an adjustment to earnings in the period of
the revision. If actual results differ significantly from estimates, our stock-based compensation expense and Consolidated Statements
of Income (Loss) could be impacted. The grant date fair value for stock options is estimated using the Black-Scholes option-pricing
model. The determination of the assumptions used in the Black-Scholes model include the expected life of an option, the expected
volatility of our common stock over the estimated life of the option, a risk-free interest rate, and the expected dividend yield.
Judgment was also required in estimating the amount of stock-based awards that may be forfeited.
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Recently Adopted Accounting Standards
Reference Rate Reform
In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate
Reform on Financial Reporting.” In January 2021, the FASB clarified the scope of that guidance with the issuance of ASU 2021-01,
“Reference Rate Reform: Scope.” These ASUs provide optional guidance for a limited period of time to ease the burden in accounting
for (or recognizing the effects of) reference rate reform on financial reporting. This would apply to companies meeting certain criteria
that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be
discontinued because of reference rate reform. This standard was effective for us immediately and may be applied prospectively to
contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. On December 22,
2021, we amended the Amended and Restated RCA (as defined in Note 14, “Debt and Available Credit Facilities”) to change the rates
for Sterling and euro denominated borrowings from LIBOR-based rates to alternative rates. We applied ASU 2020-04 at the time of
this modification, and there was no impact on our Consolidated Financial Statements. Refer to Note 14, “Debt and Available Credit
Facilities,” for more information. The future impact of this ASU on our Consolidated Financial Statements will be based on any future
contract modifications.
Simplifying the Accounting for Income Taxes
In December 2019, the FASB issued Accounting Standards Update (ASU) 2019-12, “Income Taxes (Topic 740): Simplifying the
Accounting for Income Taxes.” This ASU is intended to simplify various aspects related to accounting for income taxes, eliminates
certain exceptions within Topic 740, “Income Taxes,” and clarifies certain aspects of the current guidance to promote consistent
application. We adopted ASU 2019-12 on May 1, 2021. The adoption did not have a material impact on our Consolidated Financial
Statements at the time of adoption. The impact in the future would depend on any changes in tax laws and the applicable enactment
dates. In accordance with ASU 2019-12, the enactment date is when any effects are recognized in the consolidated financial
statements.
Measurement of Credit Losses on Financial Instruments
In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on
Financial Instruments,” and issued subsequent amendments to the initial guidance thereafter. ASU 2016-13 requires entities to
measure all expected credit losses for most financial assets held at the reporting date based on an expected loss model which includes
historical experience, current conditions, and reasonable and supportable forecasts. Entities will now use forward-looking information
to better form their credit loss estimates. ASU 2016-13 also required enhanced disclosures to help financial statement users better
understand significant estimates and judgments used in estimating credit losses.
We adopted the new standard on May 1, 2020, with a cumulative effect adjustment to retained earnings as of the beginning of the year
of adoption. The adoption of ASU 2016-13 primarily impacted our trade receivables, specifically our allowance for doubtful
accounts. The adoption of the standard did not have an impact on our Consolidated Statements of Income (Loss), or our Consolidated
Statements of Cash Flows. See above under the caption “Allowance for Credit Losses” for a discussion of our policy.
Intangibles-Goodwill and Other-Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud
Computing Arrangement That is a Service Contract
In August 2018, the FASB issued ASU 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40):
Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract.” ASU
2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with
the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. We adopted ASU 2018-15
on May 1, 2020 on a prospective basis. There was no impact to our Consolidated Financial Statements at the date of adoption.
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Recently Issued Accounting Standards
Accounting for Contract Assets and Contract Liabilities from Contracts with Customers
In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract
Liabilities from Contracts with Customers.” This ASU requires that an acquirer recognize, and measure, contract assets and contract
liabilities acquired in a business combination in accordance with ASC 606 “Revenue from Contracts with Customers” (Topic 606) as
if it had originated the contracts. Generally, this would result in an acquirer recognizing and measuring the acquired contract assets
and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements if the acquiree
prepared financial statements in accordance with US GAAP. This standard is effective for us on May 1, 2023, including interim
periods within the fiscal year. Early adoption is permitted. The standard is applied prospectively to business combinations occurring
on or after the effective date of the amendments. The impact will be based on future business combinations after we adopt the
standard.
Convertible Debt Instruments, Derivatives, and EPS
In August 2020, the FASB issued ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives
and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)”. This ASU reduces the number of accounting models for
convertible debt instruments and convertible preferred stock, as well as amend the guidance for the derivatives scope exception for
contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and
amends the related EPS guidance. This standard is effective for us on May 1, 2022, including interim periods within those fiscal
years. Adoption is either a modified retrospective method or a fully retrospective method of transition. There was no impact to our
Consolidated Financial Statements at the date of adoption.
Note 3 — Revenue Recognition, Contracts with Customers
Disaggregation of Revenue
The following tables present our revenue from contracts with customers disaggregated by segment and product type.
For the Years Ended April 30,
2021
2020
2022
Research Publishing & Platforms:
Research Publishing
Research Platforms
Total Research Publishing & Platforms
Academic & Professional Learning:
Education Publishing(1)
Professional Learning
Total Academic & Professional Learning
Education Services:
University Services(2)
Talent Development Services(1)(3)
Total Education Services
$
$
1,057,022
54,321
1,111,343
$
972,512
42,837
1,015,349
349,992
296,831
646,823
226,131
98,631
324,762
361,194
280,667
641,861
227,700
56,591
284,291
908,952
39,887
948,839
351,514
298,601
650,115
210,882
21,647
232,529
Total Revenue
$
2,082,928
$
1,941,501
$
1,831,483
(1)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning – Education Publishing to
Education Services – Talent Development Services. As a result, the prior period results related to the WileyNXT product offering
have been included in Education Services – Talent Development Services. The Revenue was $2.7 million and $0.7 million for the
years ended April 30, 2021 and April 30, 2020, respectively. There were no changes to our total consolidated financial results.
(2) University Services was previously referred to as Education Services OPM.
(3) Talent Development Services was previously referred to as mthree.
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The following information describes our disaggregation of revenue by segment and product type. Overall, the majority of our revenue
is recognized over time.
Research Publishing & Platforms
Research Publishing & Platforms customers include academic, corporate, government, and public libraries, funders of research,
researchers, scientists, clinicians, engineers and technologists, scholarly and professional societies, and students and professors.
Research Publishing & Platforms products are sold and distributed globally through multiple channels, including research libraries and
library consortia, independent subscription agents, direct sales to professional society members, and other customers. Publishing
centers include Australia, China, Germany, India, the UK, and the US. The majority of revenue generated from Research Publishing &
Platforms products is recognized over time. Total Research Publishing & Platforms revenue was $1,111.3 million in the year ended
April 30, 2022.
We disaggregated revenue by Research Publishing and Research Platforms to reflect the different type of products and services
provided.
Research Publishing Products
Research Publishing products provide scientific, technical, medical, and scholarly journals, as well as related content and services, to
academic, corporate, and government libraries, learned societies, and individual researchers and other professionals. Research
Publishing revenue was $1,057.0 million in the year ended April 30, 2022, and the majority is recognized over time.
Research Publishing products generate approximately 79% of its revenue from contracts with its customers from Journal Subscriptions
(pay to read), Open Access (pay to publish), and Transformational Agreements (read and publish), and the remainder from Licensing,
Reprints, Backfiles, and Other.
Journal Subscriptions, Open Access, and Transformational Models
Journal subscription contracts are negotiated by us directly with customers or their subscription agents. Subscription periods typically
cover calendar years. In a typical journal subscription sale, there is a written agreement between us and our customer that covers
multiple years. However, we typically account for these agreements as one-year contracts because our enforceable rights under the
agreements are subject to an annual confirmation and negotiation process with the customer.
In journal subscriptions, there are generally two performance obligations: a functional intellectual property license with a stand-ready
promise to provide access to new content for one year, which includes online hosting of the content, and a functional intellectual
property perpetual license for access to historical journal content, which also includes online hosting of the content. The transaction
price consists of fixed consideration. Journal subscription revenue is generally collected in advance when the annual license is granted
and no significant financing component exists.
The total transaction price is allocated to each performance obligation based on its relative standalone selling price. We allocate
revenue to the stand-ready promise to provide access to new content for one year based on its observable standalone selling price
which is generally the contractually stated price, and the revenue for new content is recognized over one year as we have a continuous
stand-ready obligation to provide the right of access to additional intellectual property. The allocation of revenue to the perpetual
licenses for access to historical journal content is done using the expected cost plus a margin approach as permitted by the revenue
standard. Revenue is recognized at the point in time when access to historical content is initially granted.
Under the Open Access business model, we have a signed contract with the customer that contains enforceable rights. The Open
Access business model in a typical model includes an over-time single performance obligation that combines a promise to host the
customer’s content on our open access platform, and a promise to provide an Article Publication Charge (APC) at a discount to
eligible users who are defined in the contract, in exchange for an upfront payment. Enforceable right to payment occurs over time as
we fulfill our obligation to provide a discount to eligible users, as defined, on future APCs. Therefore, the upfront payment is recorded
as a contract liability and revenue is recognized over time.
Transformational agreements (read and publish) are the innovative new model that blends journal subscription and open access
offerings. Essentially, for a single fee, a national or regional consortium of libraries pays for and receives full read access to our
journal portfolio and the ability to publish under an open access arrangement. Like subscriptions, transformational deals involve
recurring revenue under multiyear contracts. Unlike subscriptions, some transformational agreements also allow for further upside
depending on how much publishing volume we generate. Transformational models accelerate the transition to open access while
maintaining subscription access.
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Starting in calendar year 2022, we have signed transformational agreements that generally include three performance obligations: (1) a
functional intellectual property license with a stand-ready promise to provide access to new content for one year, which includes
online hosting of the content, (2) a functional intellectual property perpetual license for access to historical journal content, which also
includes online hosting of the content, and (3) a publishing entitlement that allows for a fixed number of articles to be published in
hybrid open access journals each contract year. The transaction price consists of fixed consideration and is allocated to the publishing
entitlement performance obligation based on its observable standalone selling price, the residual approach for the license to access
new content, and the expected cost plus a margin approach for the perpetual license. The revenue for the publishing entitlement and
the license to access new content is generally recognized straight-line over the contract year due to the stand-ready promises. The
revenue for the perpetual license is recognized at the point in time when access to historical content is initially granted. Cash is
generally collected in advance. In addition, some of these transitional agreements also include another performance obligation that
includes the promise to provide an APC at a discount in gold open access journals and is recognized over time.
In January 2019, Wiley announced a contractual arrangement in support of open access, a countrywide partnership agreement with
Projekt DEAL, a representative of nearly 700 academic institutions in Germany. This three-year agreement, which was extended for
one year, provides all Projekt DEAL institutions with access to read Wiley’s academic journals back to the year 1997, and researchers
at Projekt DEAL institutions can publish articles open access in Wiley’s journals. The partnership will better support institutions and
researchers in advancing open science, driving discovery, and developing and disseminating knowledge. Projekt DEAL includes
multiple performance obligations, which include a stand-ready promise to provide access to new content, perpetual license for access
to historical journal content, and accepting articles to be hosted on our open access platform. We are compensated primarily through a
fee per article published and a consolidated access fee. The consideration for Projekt DEAL consists of fixed and variable
consideration. We allocated the total consideration to the fixed and variable components based on its relative standalone selling prices
for each performance obligation.
Licensing, Reprints, Backfiles, and Other
Within licensing, the revenue derived from these contracts is primarily comprised of advance payments, including minimum
guarantees and sales- or usage-based royalty agreements. Our intellectual property is considered to be functional intellectual property.
Due to the stand-ready promise to provide updates during the subscription period, which is generally an annual period, revenue for the
minimum guarantee is recognized on a straight-line basis over the term of the agreement. For our sales-or usage-based royalty
agreements, we recognize revenue in the period of usage based on the amounts earned. We record revenue under these arrangements
for the amounts due and not yet reported to us based on estimates of the sales or usage of these customers and pursuant to the terms of
the contracts. We also have certain licenses whereby we receive a non-refundable minimum guarantee against a volume-based royalty
throughout the term of the agreement. We recognize volume-based royalty income only when cumulative consideration exceeds the
minimum guarantee.
Reprints contracts generally contain a single performance obligation which is the delivery of printed articles. Revenue is recognized at
the time of delivery of the printed articles.
For Backfiles, the performance obligation is the granting of a functional intellectual property license. Revenue is recognized at the
time the functional intellectual property license is granted.
Other includes our Article Select offering, whereby we have a single performance obligation to our customers to give access to an
article through the purchase of a token. The customer redeems the token for access to the article for a 24-hour period. The customer
purchases the tokens with an upfront cash payment. Revenue is recognized when access to the article is provided.
Research Platforms Services
Research Platforms is principally comprised of Atypon, a publishing software and service provider that enables scholarly and
professional societies and publishers to deliver, host, enhance, market, and manage their content on the web through the Literatum
platform. Research Platforms revenue was $54.3 million in the year ended April 30, 2022 and the majority is recognized over time.
Research Platforms services primarily includes a single performance obligation for the implementation and hosting of subscription
services. The transaction price is fixed which may include price escalators that are fixed increases per year, and therefore, revenue is
recognized upon the initiation of the subscription period and recognized on a straight-line basis over the time of the contractual period.
The duration of these contracts is generally multiyear ranging from 2 to 5 years.
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Academic & Professional Learning
Academic & Professional Learning provides Education Publishing and Professional Learning products and services including
scientific, professional, and education print and digital books, digital courseware, and test preparation services, to libraries,
corporations, students, professionals, and researchers, as well as learning, development, and assessment services for businesses and
professionals. Communities served include business, finance, accounting, workplace learning, management, leadership, technology,
behavioral health, engineering/ architecture, science and medicine, and education. Products are developed for worldwide distribution
through multiple channels, including chain and online booksellers, libraries, colleges and universities, corporations, direct to
consumer, web sites, distributor networks, and other online applications. Publishing centers include Australia, Germany, India, the
UK, and the US. Total Academic & Professional Learning revenue was $646.8 million in the year ended April 30, 2022.
We disaggregated revenue by type of products provided. Academic & Professional Learning products are Education Publishing and
Professional Learning. Academic & Professional Learning revenues are mainly recognized at a point in time.
Education Publishing Products
Education Publishing products revenue was $350.0 million in the year ended April 30, 2022. Education Publishing products generate
approximately 63% of its revenue from contracts with its customers from Education (print and digital) Publishing, which is recognized
at a point in time, and 23% from Digital Courseware, which is recognized over time. The remainder of its revenues were from Test
Preparation and Certification and Licensing and Other, which has a mix of revenue recognized at a point in time and over time.
Education Publishing and Professional Publishing (included within Professional Learning below)
Our performance obligations as they relate to Education and Professional Publishing are primarily book products delivered in both
print and digital form which could include single or multiple performance obligations based on the number of print or digital books
purchased. Each is represented by an International Standard Book Number (ISBN), with each ISBN representing a performance
obligation. Each ISBN has an observable stand-alone selling price as Wiley sells the books separately.
This revenue stream also includes variable consideration as it relates to discounts and returns for both print and digital books.
Discounts are identifiable by performance obligation and therefore are applied at the point of sale by performance obligation. The
process that we use to determine our sales returns and the related reserve provision charged against revenue, is based on applying an
estimated return rate to current year returnable print book sales. This rate is based upon an analysis of actual historical return
experience in the various markets and geographic regions in which we do business. We collect, maintain, and analyze significant
amounts of sales returns data for large volumes of homogeneous transactions. This allows us to make reasonable estimates of the
amount of future returns. All available data is utilized to identify the returns by market and to which fiscal year the sales returns apply.
This enables management to track the returns in detail and identify and react to trends occurring in the marketplace, with the objective
of being able to make the most informed judgments possible in setting reserve rates. Associated with the estimated sales return
reserves, we also include a related increase to inventory and reduction to accrued royalties as a result of the expected returns.
As it relates to print and digital books within Education Publishing and Professional Publishing, revenue is recognized at the point
when control of product transfers, which for print is upon shipment or for digital when fulfillment of the products has been rendered.
Digital Courseware Products
Courseware customers purchase access codes to utilize the product. This could include single or multiple performance obligations
based on the number of course ISBNs purchased. Revenue is recognized over time in the period from when the access codes are
activated over the applicable semester term to which such product relates.
Test Preparation and Certification Products
Test Preparation and Certification contracts are generally three-year agreements. This revenue stream includes multiple performance
obligations as it relates to the online and printed course materials, including such items as textbooks, ebooks, video lectures,
flashcards, study guides, and test banks. The transaction price is fixed; however, discounts are offered and returns of certain products
are allowed. We allocate revenue to each performance obligation based on its relative standalone selling price. This standalone selling
price is generally based upon the observable selling prices where the product is sold separately to customers. Depending on the
performance obligation, revenue is recognized at the time the product is delivered and control has passed to the customer or over time
due to our stand-ready obligation to provide updates to the customer.
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Licensing and Other
Revenue derived from our licensing contracts is primarily comprised of advance payments and sales- or usage-based royalties.
Revenue for advance payments is recognized at the point in time that the functional intellectual property license is granted. For sales-
or usage- based royalties, we record revenue under these arrangements for the amounts due and not yet reported to us based on
estimates of the sales or usage of these customers and pursuant to the terms of the contracts.
Professional Learning Products
Professional Learning products revenue was $296.8 million in the year ended April 30, 2022. Professional Learning (print and digital)
products generate approximately 61% of revenue from contracts with its customers from Professional Publishing and Licensing and
Other, both of which are described above, and both are mainly recognized at a point in time. Approximately 39% of Professional
Learning products revenue is from contracts with its customers from Corporate Training and Corporate Learning, which is recognized
mainly over time.
Corporate Training
Corporate Training through our authorized distributor network includes multiple performance obligations. This includes a
performance obligation that includes an annual membership which includes the right to purchase products and services, access to the
platform, support, and training. This performance obligation is recognized over time as we have an obligation to stand-ready for the
customer’s use of the services. In addition, there are performance obligations for the assessments and related products or services
which are recognized at a point in time when the assessment, product, or service is provided or delivered. The transaction price is
allocated to each performance obligation based on its observable standalone selling price which is generally the contractually stated
price for the performance obligation related to the annual membership, and for the other performance obligations based on its relative
observable selling price when sold separately.
In addition, as it relates to Corporate Training customers’ unexercised rights for situations where we have received a nonrefundable
payment for a customer to receive an assessment and the customer is not expected to exercise such right, we will recognize such
“breakage” amounts as revenue in proportion to the pattern of rights exercised by the customer, which is generally one year.
Corporate Learning
The transaction price consists of fixed consideration that is determined at the beginning of each year and received at the same time.
Within Corporate Learning there are multiple performance obligations, which include the licenses to learning content and the learning
application. Revenue is recognized over time as we have a continuous obligation to provide the right of access to the intellectual
property which includes the licenses and learning applications.
Education Services
Education Services revenue was $324.8 million in the year ended April 30, 2022, and the majority is recognized over time. We
disaggregated revenue by type of services provided, which are University Services (previously referred to as Education Services
OPM) and Talent Development Services (previously referred to as mthree).
University Services
University Services revenue was $226.1 million in the year ended April 30, 2022 and is mainly recognized over time. University
Services primarily engages in the comprehensive management of online degree programs for universities and has grown to include a
broad array of technology enabled service offerings that address our partner specific pain points. Increasingly, this includes delivering
career credentialing education that advances specific careers with in-demand skills.
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University Services includes market research, marketing, student recruitment, enrollment support, proactive retention support,
academic services to design courses, faculty support, and access to the Engage Learning Management System, which facilitates the
online education experience. Graduate degree programs include Business Administration, Finance, Accounting, Healthcare,
Engineering, Communications, and others. As of April 30, 2022, the University Services business had 68 university partners under
contract. We are also extending the core OPM business, as well as delivering a broader array of essential university and career
credentialing services that the market is demanding and which leverage our core Wiley skills and assets. This full stack education
includes teacher professional development and IT skills training, through which we develop and deliver professional credits and job
placement through our corporate partners. In addition, University Services derives revenue from unbundled service offerings.
University Services revenue is primarily derived from prenegotiated contracts with institutions that provide for a share of tuition
generated from students who enroll in a program. The duration of University Services contracts are generally multiyear agreements
ranging from a period of 7 to 10 years, with some having optional renewal periods. These optional renewal periods are not a material
right and are not considered a separate performance obligation.
University Services includes a single performance obligation for the services provided because of the integrated technology and
services our institutional clients need to attract, enroll, educate, and support students. Consideration is variable since it is based on the
number of students enrolled in a program. We begin to recognize revenue at the start of the delivery of the class within a semester
overtime, which is also when the variable consideration contingency is resolved.
Talent Development Services
Talent Development Services revenue was $98.6 million in the year ended April 30, 2022 and is recognized at the point in time the
services are provided to its customers. Talent Development Services is a talent placement provider that finds, trains, and places job-
ready technology talent in roles with leading corporations worldwide.
Accounts Receivable, net and Contract Liability Balances
When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services
to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue when, or as,
control of the products or services are transferred to the customer and all revenue recognition criteria have been met.
The following table provides information about accounts receivable, net and contract liabilities from contracts with customers.
Balances from contracts with customers:
Accounts receivable, net
Contract liabilities(1)
Contract liabilities (included in Other long-term liabilities)
April 30,
2022
April 30,
2021
Increase/
(Decrease)
$
$
331,960 $
538,126
19,072 $
311,571 $
545,425
19,560 $
20,389
(7,299)
(488)
(1) The sales return reserve recorded in Contract liabilities is $31.1 million and $38.0 million as of April 30, 2022 and April 30, 2021,
respectively. See Note 2, “Summary of Significant Accounting Policies, Recently Issued, and Recently Adopted Accounting
Standards” for further details of the sales return reserve.
For the year ended April 30, 2022, we estimate that we recognized as revenue substantially all of the current contract liability balance
at April 30, 2021.
The decrease in contract liabilities, excluding the sales return reserve, was primarily driven by revenue earned on journal subscription
agreements, transformational agreements, and open access and, to a lesser extent, the impact of foreign exchange. This was partially
offset by an increase due to renewals of journal subscription agreements, transformational agreements, and open access.
Remaining Performance Obligations included in Contract Liability
As of April 30, 2022, the aggregate amount of the transaction price allocated to the remaining performance obligations is
approximately $557.2 million, which includes the sales return reserve of $31.1 million. Excluding the sales return reserve, we expect
that approximately $507.0 million will be recognized in the next twelve months with the remaining $19.1 million to be recognized
thereafter.
Index
74
Assets Recognized for the Costs to Fulfill a Contract
Costs to fulfill a contract are directly related to a contract that will be used to satisfy a performance obligation in the future and are
expected to be recovered. These costs are amortized on a systematic basis that is consistent with the transfer to the customer of the
goods or services to which the asset relates. These types of costs are incurred in the following product types: (1) Research Platforms
services, which includes customer specific implementation costs per the terms of the contract and (2) University Services, which
includes customer specific costs to develop courses per the terms of the contract.
Our assets associated with incremental costs to fulfill a contract were $10.9 million and $12.1 million at April 30, 2022 and 2021,
respectively, and are included within Other non-current assets on our Consolidated Statements of Financial Position. We recorded
amortization expense of $5.2 million, $5.1 million, and $4.2 million in the years ended April 30, 2022, 2021, and 2020, respectively,
related to these assets within Cost of sales on the Consolidated Statements of Income (Loss).
Sales and value-added taxes are excluded from revenues. Shipping and handling costs, which are primarily incurred within the
Academic & Professional Learning segment, occur before the transfer of control of the related goods. Therefore, in accordance with
the revenue standard, it is not considered a promised service to the customer and would be considered a cost to fulfill our promise to
transfer the goods. Costs incurred for third-party shipping and handling are primarily reflected in Operating and administrative
expenses on the Consolidated Statements of Income (Loss). We incurred $29.0 million, $27.8 million, and $28.8 million in shipping
and handling costs in the years ended April 30, 2022, 2021, and 2020, respectively.
Note 4 – Acquisitions
Pro forma financial information related to these acquisitions has not been provided as it is not material to our consolidated results of
operations.
Fiscal Year 2022
XYZ Media
On December 29, 2021, we completed the acquisition of certain assets of XYZ Media Inc. (XYZ Media). XYZ Media is a company
that generates leads for higher education institutions. The results of XYZ Media are included in our Education Services segment
results. The fair value of consideration transferred at the date of acquisition was $45.4 million, which included $38.0 million of cash
and approximately 129 thousand shares of Wiley Class A common stock, or approximately $7.4 million. We financed the payment of
the cash consideration with a combination of cash on hand and borrowings under our Amended and Restated RCA (as defined below
in Note 14, “Debt and Available Credit Facilities”).
The XYZ Media acquisition was accounted for using the acquisition method of accounting. The preliminary excess purchase price
over identifiable net tangible and intangible assets acquired, and liabilities assumed, has been recorded to Goodwill in our
Consolidated Statements of Financial Position. Goodwill represents synergies and economies of scale expected from the combination
of services. We recorded the preliminary fair value of the assets acquired and liabilities assumed on the acquisition date. The goodwill
will be deductible for tax purposes. The acquisition related costs to acquire XYZ Media were expensed when incurred and were
approximately $0.1 million for the year ended April 30, 2022. Such costs were allocated to the Education Services segment and are
reflected in Operating and administrative expenses on the Consolidated Statements of Net Income (Loss) for the year ended April 30,
2022.
XYZ Media’s revenue and operating loss included in our Education Services segment results for the year ended April 30, 2022 was
$3.6 million and $(1.5) million, respectively.
Index
75
The following table summarizes the consideration transferred to acquire XYZ Media and the preliminary allocation of the purchase
price among the assets acquired and liabilities assumed.
Total consideration transferred
Assets:
Current assets
Intangible assets, net
Goodwill
Other non-current assets
Total assets
Liabilities:
Current liabilities
Total liabilities
Preliminary
Allocation
$
45,363
913
22,711
22,226
46
45,896
533
533
$
$
The following table summarizes the identifiable intangible assets acquired and their weighted-average useful life at the date of
acquisition.
Developed technology
Customer relationships
Covenants not to compete
Tradename
Total
Estimated Fair
Value
Weighted-Average
Useful Life (in
Years)
$
$
20,930
1,340
323
118
22,711
7
6
5
1
The allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, and the liabilities
assumed is preliminary and could be revised as a result of additional information obtained due to the finalization of the third-party
valuation report, leases and related commitments, tax related matters and contingencies and certain assets and liabilities, including
receivables and payables, but such amounts will be finalized within the measurement period, which will not exceed one year from the
acquisition date.
Other Acquisitions in Fiscal Year 2022
On November 30, 2021, we acquired the assets of the eJournalPress (EJP) business from Precision Computer Works, Inc. EJP is a
technology platform company with an established journal submission and peer review management system. The results of EJP are
included in our Research Publishing & Platforms segment results.
On October 1, 2021, we completed the acquisition of certain assets of J&J Editorial Services, LLC. (J&J). J&J is a publishing services
company providing expert offerings in editorial operations, production, copyediting, system support, and consulting. The results of
J&J are included in our Research Publishing & Platforms segment results.
We also completed in the year ended April 30, 2022 the acquisition of two immaterial businesses included in our Research Publishing
& Platforms segment and the acquisition of one immaterial business in our Education Services segment.
The aggregate preliminary fair value of consideration transferred for these other acquisitions was approximately $41.2 million during
the year ended April 30, 2022, which included $36.2 million of cash paid at the acquisition dates and $5.0 million of additional cash to
be paid after the acquisition dates. The fair value of the cash consideration transferred, net of $1.2 million of cash acquired was
approximately $34.9 million. These other acquisitions were accounted for using the acquisition method of accounting as of their
respective acquisition dates.
Index
76
Associated with these other acquisitions, the preliminary aggregate excess purchase price over identifiable net tangible and intangible
assets acquired, and liabilities assumed of $24.8 million has been recorded to Goodwill on our Consolidated Statements of Financial
Position as of April 30, 2022 and $15.6 million of intangible assets subject to amortization have been recorded, including developed
technology, customer relationships, trademarks, covenants not to compete, and content that is being amortized over preliminary
estimated weighted-average useful lives of 4, 8, 2, 4, and 4 years, respectively. The fair value assessed for the majority of the tangible
assets acquired and liabilities assumed approximated their carrying value. Goodwill represents synergies and economies of scale
expected from the combination of services. Goodwill of $24.8 million has been allocated to the Research Publishing & Platforms
segment and none has been allocated to the Education Services segment. Approximately $18.7 million of the goodwill will be
deductible for tax purposes, and $6.1 million will not be deductible for tax purposes. The incremental revenue for the year ended April
30, 2022 related to these other acquisitions was approximately $8.1 million. The aggregate acquisition related costs to acquire these
other acquisitions was expensed when incurred and was approximately $0.5 million for the year ended April 30, 2022.
The allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, and the liabilities
assumed is preliminary, and could be revised as a result of additional information obtained due to the finalization of the third-party
valuation reports, leases and related commitments, tax related matters and contingencies, and certain assets and liabilities, including
receivables and payables, but such amounts will be finalized within the measurement period, which will not exceed one year from the
acquisition date.
Fiscal Year 2021
Hindawi
On December 31, 2020, we completed the acquisition of 100% of the outstanding stock of Hindawi Limited (Hindawi). Hindawi is a
scientific research publisher and an innovator in open access publishing. Its results of operations are included in our Research
Publishing & Platforms segment.
The fair value of the consideration transferred at the acquisition date was $300.1 million, which included $299.3 million of cash and
$0.8 million related to the settlement of a preexisting relationship. We financed the payment of the cash consideration primarily
through borrowings under our Amended and Restated RCA (as defined below in Note 14, “Debt and Available Credit Facilities”) and
using cash on hand. The fair value of the cash consideration transferred, net of $1.0 million of cash acquired was approximately
$298.3 million.
The Hindawi acquisition was accounted for using the acquisition method of accounting. The excess purchase price over identifiable
net tangible and intangible assets acquired, and liabilities assumed, has been recorded to Goodwill in our Consolidated Statements of
Financial Position. Goodwill represents synergies and economies of scale expected from the combination of services. We recorded the
fair value of the assets acquired and liabilities assumed on the acquisition date. None of the goodwill will be deductible for tax
purposes. The acquisition related costs to acquire Hindawi were expensed when incurred and were approximately $2.4 million for the
year ended April 30, 2021. Such costs were allocated to the Research Publishing & Platforms segment and are reflected in Operating
and administrative expenses on the Consolidated Statements of Income (Loss) for the year ended April 30, 2021.
Hindawi’s incremental revenue and operating income included in our Research Publishing & Platforms segment results for the year
ended April 30, 2022 was $34.6 million and $8.0 million, respectively. Hindawi’s revenue and operating loss included in our Research
Publishing & Platforms segment results for the year ended April 30, 2021 was $12.0 million and $(2.1) million, respectively.
Index
77
During the year ended April 20, 2022, no revisions were made to the allocation of the consideration transferred to the assets acquired
and liabilities assumed. The following table summarizes the consideration transferred to acquire Hindawi and the final allocation of
the purchase price among the assets acquired and liabilities assumed.
Total consideration transferred
Assets:
Current assets
Technology, property and equipment, net
Intangible assets, net
Goodwill
Operating lease right-of-use assets
Other non-current assets
Total assets
Liabilities:
Current liabilities
Deferred income tax liabilities
Operating lease liabilities
Other long-term liabilities
Total liabilities
Final
Allocation
$
300,086
2,812
844
194,900
147,388
3,762
69
349,775
3,594
37,031
3,150
5,914
49,689
$
$
The following table summarizes the identifiable intangible assets acquired and their weighted-average useful life at the date of
acquisition.
Content and publishing rights
Developed technology
Trademarks
Customer relationships
Total
Fair Value
Weighted-Average
Useful Life (in
Years)
$
$
188,500
5,000
1,000
400
194,900
15
6
2
10
The allocation of the consideration transferred to the assets acquired and the liabilities assumed was finalized during the three months
ended January 31, 2022.
Index
78
Note 5 – Reconciliation of Weighted Average Shares Outstanding
A reconciliation of the shares used in the computation of earnings (loss) per share follows (shares in thousands):
For the Years Ended April 30,
2021
2020
2022
Weighted average shares outstanding
Less: Unvested restricted shares
Shares used for basic earnings (loss) per share
Dilutive effect of unvested restricted stock units and other stock awards
Shares used for diluted earnings (loss) per share
Antidilutive options to purchase Class A common shares, restricted shares, warrants
to purchase Class A common shares and contingently issuable restricted stock
which are excluded from the table above
55,759
—
55,759
839
56,598
55,931
(1)
55,930
531
56,461
56,224
(15)
56,209
—
56,209
772
982
1,677
In calculating diluted net loss per common share for the year ended April 30, 2020, our diluted weighted average number of common
shares outstanding excludes the effect of unvested restricted stock units and other stock awards as the effect was anti-dilutive. This
occurs when a US GAAP net loss is reported and the effect of using dilutive shares is antidilutive.
The shares associated with performance-based stock awards are considered contingently issuable shares and will be included in the
diluted weighted average number of common shares outstanding when they have met the performance conditions and when their
effect is dilutive.
Note 6 – Accumulated Other Comprehensive Loss
Changes in Accumulated other comprehensive loss by component, net of tax, for the years ended April 30, 2022, 2021, and 2020 were
as follows:
Balance at April 30, 2019
Other comprehensive loss before reclassifications
Amounts reclassified from Accumulated other comprehensive loss
Total other comprehensive loss
Balance at April 30, 2020
Other comprehensive income (loss) before reclassifications
Amounts reclassified from Accumulated other comprehensive loss
Total other comprehensive income (loss)
Balance at April 30, 2021
Other comprehensive (loss) income before reclassifications
Amounts reclassified from Accumulated other comprehensive loss
Total other comprehensive (loss) income
Balance at April 30, 2022
Foreign
Currency
Translation
$
Unamortized
Retirement
Costs
(196,057) $
(36,965)
5,102
(31,863)
(227,920) $
(6,273)
6,047
(226)
(228,146) $
40,247
5,673
45,920
(182,226) $
(312,107) $
(28,596)
—
(28,596)
(340,703) $
82,762
—
82,762
(257,941) $
(71,625)
—
(71,625)
(329,566) $
$
$
$
Interest
Rate Swaps Total
(574) $ (508,738)
(71,549)
(5,988)
4,790
(312)
(6,300)
(66,759)
(6,874) $ (575,497)
75,850
8,857
84,707
(4,703) $ (490,790)
5,165
(26,213)
3,184
8,857
(17,356)
8,349
3,646 $ (508,146)
(639)
2,810
2,171
For the years ended April 30, 2022, 2021, and 2020, pretax actuarial losses included in Unamortized Retirement Costs of
approximately $7.2 million, $7.8 million, and $6.4 million, respectively, were amortized from Accumulated other comprehensive loss
and recognized as pension and post-retirement benefit (expense) primarily in Operating and administrative expenses and Other
income, net on our Consolidated Statements of Income (Loss).
Our policy for releasing the income tax effects from accumulated other comprehensive (loss) income is to release when the
corresponding pretax accumulated other comprehensive (loss) income items are reclassified to earnings.
Index
79
Note 7 – Restructuring and Related (Credits) Charges
Beginning in fiscal year 2020, we initiated a multiyear Business Optimization Program (the Business Optimization Program) to drive
efficiency improvement and operating savings.
The following tables summarize the pretax restructuring (credits) charges related to this program:
(Credits) Charges by Segment:
Research Publishing & Platforms
Academic & Professional Learning
Education Services
Corporate Expenses
Total Restructuring and Related (Credits) Charges
For the Years Ended April 30,
2022
2021
2020
Total Charges
Incurred to Date
$
$
237 $
(454)
8
(1,218)
(1,427) $
99 $
3,229
531
29,590
33,449 $
3,546 $
10,475
3,774
15,018
32,813 $
3,882
13,250
4,313
43,390
64,835
(Credits) Charges by Activity:
Severance and termination benefits
Impairment of operating lease ROU assets and property and
$
equipment
Acceleration of expense related to operating lease ROU
assets and property and equipment
Facility related charges, net
Other activities
Total Restructuring and Related (Credits) Charges
$
(3,276) $
11,531 $
26,864 $
35,119
—
14,918
161
—
1,849
—
(1,427) $
3,378
3,684
(62)
33,449 $
—
3,986
1,802
32,813 $
15,079
3,378
9,519
1,740
64,835
The credits in severance and termination benefits activities for the year ended April 30, 2022, primarily reflects changes in the number
of headcount reductions and estimates for previously accrued costs.
In November 2020, in response to the COVID-19 pandemic and the Company’s successful transition to a virtual work environment,
we increased use of virtual work arrangements for post-pandemic operations. As a result, we expanded the scope of the Business
Optimization Program to include the exit of certain leased office space beginning in the three months ended January 31, 2021, and the
reduction of our occupancy at other facilities. We are reducing our real estate square footage occupancy by approximately 12%. These
actions resulted in a pretax restructuring charge of $18.3 million in the three months ended January 31, 2021. This restructuring charge
primarily reflects the following noncash charges:
•
Impairment charges of $14.9 million recorded in our corporate category, which included the impairment of operating lease
ROU assets of $10.6 million related to certain leases that will be subleased, and the related property and equipment of
$4.3 million described further below, and
• Acceleration of expense of $3.4 million, which included the acceleration of rent expense associated with operating lease
ROU assets of $2.9 million related to certain leases that will be abandoned or terminated and the related depreciation and
amortization of property and equipment of $0.5 million.
Due to the actions taken above, we tested the operating lease ROU assets and the related property and equipment for those being
subleased for recoverability by comparing the carrying value of the asset group to an estimate of the future undiscounted cash flows
expected to result from the use and eventual disposition of the asset group. Based on the results of the recoverability test, we
determined that the undiscounted cash flows of the asset groups were below the carrying values. Therefore, there was an indication of
impairment. We then determined the fair value of the asset groups by utilizing the present value of the estimated future cash flows
attributable to the assets. The fair value of these operating lease ROU assets and the property and equipment immediately subsequent
to the impairment was $7.5 million and was categorized as Level 3 within the FASB ASC Topic 820, “Fair Value Measurements” fair
value hierarchy.
In addition, we also incurred ongoing facility-related costs associated with certain properties that resulted in additional restructuring
charges of $1.8 million and $3.7 million in the years ended April 30, 2022 and 2021, respectively. Facilities related charges, net
include sublease income related to those operating leases we had identified in the year ended April 30, 2021 as part of our Business
Optimization Program that would be subleased.
Index
80
Other activities for the year ended April 30, 2020 primarily relate to reserves and costs associated with the cessation of certain
offerings, and, to a lesser extent, a pension settlement and the impairment of certain software licenses.
The following table summarizes the activity for the Business Optimization Program liability for the year ended April 30, 2022:
Severance and termination benefits
Total
April 30, 2021
(Credits)
Payments
Adjustments April 30, 2022
$
$
11,465 $
11,465 $
(3,276) $
(3,276) $
(5,831) $
(5,831) $
(279) $
(279) $
2,079
2,079
The restructuring liability for accrued severance and termination benefits is reflected in Accrued employment costs in the
Consolidated Statement of Financial Position as of April 30, 2022.
Foreign
Translation &
Other
Note 8 – Inventories
Inventories, net consisted of the following at April 30:
Finished goods
Work-in-process
Paper and other materials
Total inventories before estimated sales returns and LIFO reserve
Inventory value of estimated sales returns
LIFO reserve
Inventories, net
2022
2021
31,270 $
1,729
275
33,274
7,820
(4,509)
36,585 $
31,704
2,060
331
34,095
10,886
(2,443)
42,538
$
$
See Note 2, “Summary of Significant Accounting Policies, Recently Issued and Recently Adopted Accounting Standards,” under the
caption “Sales Return Reserves,” for a discussion of the Inventory value of estimated sales returns.
Finished goods not recorded at LIFO have been recorded at the lower of cost or net realizable value, which resulted in a reduction of
$11.2 million and $14.0 million as of April 30, 2022 and 2021, respectively.
Note 9 – Product Development Assets
Product development assets, net consisted of the following at April 30:
Book composition costs
Software costs
Content development costs
Product development assets, net
2022
2021
20,574 $
17,479
3,405
41,458 $
20,474
23,262
5,781
49,517
$
$
Product development assets include $4.4 million and $6.3 million of work-in-process as of April 30, 2022 and 2021, respectively. As
of April 30, 2022 this is primarily for book composition costs. As of April 30, 2021, this is primarily for book composition costs and,
to a lesser extent, software costs.
Product development assets are net of accumulated amortization of $269.7 million and $269.0 million as of April 30, 2022 and 2021,
respectively.
Index
81
Note 10 – Technology, Property, and Equipment
Technology, property, and equipment, net consisted of the following at April 30:
Capitalized software
Computer hardware
Buildings and leasehold improvements
Furniture, fixtures, and warehouse equipment
Land and land improvements
Technology, property, and equipment, gross
Accumulated depreciation and amortization
Technology, property, and equipment, net
2022
2021
605,503 $
55,386
94,861
38,816
3,283
797,849
(526,277)
271,572 $
536,878
50,714
99,636
42,674
3,656
733,558
(451,288)
282,270
$
$
The following table details our depreciation and amortization expense for technology, property, and equipment, net:
For the Years Ended April 30,
2021
2020
2022
Capitalized software amortization expense
Depreciation and amortization expense, excluding capitalized software
$
73,847 $
21,325
69,184 $
21,955
Total depreciation and amortization expense for technology, property and equipment
$
95,172 $
91,139 $
55,685
21,031
76,716
Technology, property, and equipment includes $7.2 million and $0.6 million of work-in-process as of April 30, 2022 and 2021,
respectively, for capitalized software.
The net book value of capitalized software costs was $201.5 million and $202.8 million as of April 30, 2022 and 2021, respectively.
Note 11 – Goodwill and Intangible Assets
Goodwill
The following table summarizes the activity in goodwill by segment as of April 30:
2021 (1)
Acquisitions(2)
Foreign
Translation
Adjustment
Research Publishing & Platforms
Academic & Professional Learning
Education Services
Total
$
$
619,203 $
512,512
172,625
1,304,340 $
24,806 $
—
22,226
47,032 $
(33,593) $
(14,376)
(1,261)
(49,230) $
2022
610,416
498,136
193,590
1,302,142
(1) The Education Services goodwill balance as of April 30, 2021 includes a cumulative pretax noncash goodwill impairment of
$110.0 million.
(2) Refer to Note 4, “Acquisitions,” for more information related to the acquisitions that occurred in the year ended April 30, 2022.
Annual Goodwill Impairment Test as of February 1, 2022 and 2021
As of February 1, 2022 and 2021, we completed step one of our annual goodwill impairment test for our reporting units. We
concluded that the fair values of our reporting units were above their carrying values and, therefore, there was no indication of
impairment.
We estimated the fair value of these reporting units using a weighting of fair values derived from an income and a market approach.
Under the income approach, we determined the fair value of a reporting unit based on the present value of estimated future cash flows.
Cash flow projections are based on our best estimates of forecasted economic and market conditions over the period including growth
rates, expected changes in operating cash flows, and cash expenditures. The discount rate used is based on a weighted average cost of
capital adjusted for the relevant risk associated with the characteristics of the business and the projected cash flows. The market
approach estimates fair value based on market multiples of current and forward 12-month revenue or EBITDA, as applicable, derived
from comparable publicly traded companies with similar operating and investment characteristics as the reporting unit.
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82
As noted above, the fair value determined as part of the annual goodwill impairment test completed in the fourth quarter exceeded the
carrying value for all of our reporting units. Therefore, there was no impairment of goodwill. However, if the fair value of these
reporting units decreases in future periods, we could potentially have an impairment. The future occurrence of a potential indicator of
impairment, such as a decrease in expected net earnings, changes in assumptions, adverse equity market conditions, a decline in
current market multiples, a decline in our common stock price, a significant adverse change in legal factors or business climates, an
adverse action or assessment by a regulator, unanticipated competition, strategic decisions made in response to economic or
competitive conditions, or a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be
sold or disposed of, could require an interim assessment for some or all of the reporting units before the next required annual
assessment.
Annual Goodwill Impairment Test as of February 1, 2020
As of February 1, 2020, we completed our annual goodwill impairment test for our reporting units. We concluded that the fair values
of our Research Publishing & Platforms and Academic & Professional Learning reporting units were above their carrying values and,
therefore, there was no indication of impairment.
During our annual goodwill impairment test initiated on February 1, 2020, we identified indicators that the goodwill of the Education
Services business was impaired due to underperformance as compared with our acquisition case projections for revenue growth and
operating cash flow. Subsequently, during the fourth quarter of fiscal year 2020, we determined that our updated revenue and
operating cash flow projections would be further impacted by anticipated near-term headwinds due to COVID-19, including adverse
impacts on new student starts and student reenrollment. Therefore, we updated the impairment test as of March 31, 2020 to reflect this
change in circumstances. As a result, we concluded that the carrying value was above the fair value which resulted in a pretax noncash
goodwill impairment of $110.0 million. This charge is reflected in Impairment of goodwill and intangible assets in the Consolidated
Statements of Income (Loss).
Prior to performing the goodwill impairment test for Education Services, we also evaluated the recoverability of long-lived assets of
the reporting unit. The carrying value of the long-lived assets that were tested for impairment was $434.0 million. When indicators of
impairment are present, we test definite lived and long-lived assets for recoverability by comparing the carrying value of an asset
group to an estimate of the future undiscounted cash flows expected to result from the use and eventual disposition of the asset group.
We considered the lower-than-expected revenue and forecasted operating cash flows over a sustained period of time, and downward
revisions to our cash flow forecasts for this reporting unit to be indicators of impairment for their long-lived assets. Based on the
results of the recoverability test, we determined that the undiscounted cash flows of the asset group of the Education Services
reporting unit exceeded the carrying value. Therefore, there was no impairment.
Index
83
Intangible Assets
Intangible assets, net as of April 30 were as follows:
Intangible assets with definite
lives, net(1) :
Content and publishing rights
Customer relationships
Developed technology(2)
Brands and trademarks
Covenants not to compete
Total intangible assets with
definite lives, net
Intangible assets with indefinite
lives:
Brands and trademarks(2)
Publishing rights
Total intangible assets with
indefinite lives
Total intangible assets, net
$
2022
Accumulated
Amortization
Cost
Net
Cost
2021
Accumulated
Amortization
Net
$
1,099,778 $
409,097
72,398
47,533
1,655
(599,841) $
(167,039)
(17,677)
(31,512)
(1,262)
499,937 $ 1,062,072 $
242,058
54,721
16,021
393
384,462
42,785
45,630
1,250
(497,843) $
(117,985)
(7,824)
(26,094)
(1,192)
564,229
266,477
34,961
19,536
58
1,630,461
(817,331)
813,130
1,536,199
(650,938)
885,261
37,000
81,299
—
—
37,000
81,299
37,000
93,041
—
—
37,000
93,041
118,299
1,748,760 $
—
(817,331) $
118,299
130,041
931,429 $ 1,666,240 $
—
(650,938) $
130,041
1,015,302
(1) Refer to Note 4, “Acquisitions,” for more information related to the acquisitions that occurred in years ended April 30, 2022 and
2021.
(2) The developed technology balance as of April 30, 2022 and 2021 is presented net of accumulated impairments and write-offs of
$2.8 million. The indefinite-lived brands and trademarks balance as of April 30, 2022 and 2021 is net of accumulated
impairments of $93.1 million.
Based on the current amount of intangible assets subject to amortization and assuming current foreign exchange rates, the estimated
amortization expense for the following years are as follows:
Fiscal Year
2023
2024
2025
2026
2027
Thereafter
Total
Amount
$
$
81,375
76,193
69,556
67,044
62,422
456,540
813,130
Annual Indefinite-lived Intangible Impairment Test as of February 1, 2022 and 2021
We also review our indefinite-lived intangible assets for impairment annually, which consists of brands and trademarks and certain
acquired publishing rights. As of February 1, 2022 and 2021, we completed our annual impairment test related to the indefinite-lived
intangible assets. We concluded that the fair values of these indefinite-lived intangible assets were above their carrying values and,
therefore, there was no indication of impairment.
Fiscal Year 2020 Impairment
Annual Indefinite-Lived Intangibles Impairment Test as of February 1, 2020
During the fourth quarter of 2020, we completed our annual impairment test related to the indefinite-lived intangible assets. We
concluded that the fair values of these indefinite-lived intangible assets were above their carrying values and, therefore, there was no
indication of impairment, except for the Blackwell indefinite-lived trademark.
Index
84
For the year ended April 30, 2020, we recorded a pretax noncash impairment charge of $89.5 million for our Blackwell trademark,
which was acquired in 2007 and carried as an indefinite-lived intangible asset primarily related to our Research Publishing &
Platforms segment. The impairment reflected our decision to simplify Wiley’s brand portfolio and unify our research journal content
under one Wiley brand, which sharply limited the use of the Blackwell trade name. This impairment resulted in writing off
substantially all of the carrying value of the intangible trademark asset. This charge is reflected in Impairment of goodwill and
intangible assets in the Consolidated Statements of Income (Loss). The resulting noncash impairment charge was entirely unrelated to
COVID-19 or the expected future financial performance of the Research Publishing & Platforms segment.
Intangible Assets with Definite Lives
As a result of our decision to discontinue the use of certain technology offerings within the Research Publishing & Platforms segment,
we recorded a pretax noncash impairment charge of $2.8 million related to a certain developed technology intangible. This charge was
included in Impairment of goodwill and intangible assets on the Consolidated Statements of Income (Loss).
Note 12 — Operating Leases
We have contractual obligations as a lessee with respect to offices, warehouses and distribution centers, automobiles, and office
equipment.
We determine if an arrangement is a lease at inception of the contract in accordance with guidance detailed in the lease standard and
we perform the lease classification test as of the lease commencement date. ROU assets represent our right to use an underlying asset
for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU
assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.
The present value of the lease payments is calculated using an incremental borrowing rate, which was determined based on the rate of
interest that we would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. We
use an unsecured borrowing rate and risk-adjust that rate to approximate a collateralized rate.
Under the leasing standard, leases that are more than one year in duration are capitalized and recorded on our Consolidated Statements
of Financial Position. Some of our leases offer an option to extend the term of such leases. We utilize the reasonably certain threshold
criteria in determining which options we will exercise. Furthermore, some of our lease payments are based on index rates with
minimum annual increases. These represent fixed payments and are captured in the future minimum lease payments calculation.
For operating leases, the ROU assets and liabilities as of April 30 are presented in our Consolidated Statements of Financial Position
as follows:
Operating lease ROU assets
Short-term portion of operating lease liabilities
Operating lease liabilities, non-current
$
$
2022
2021
111,719
20,576
132,541
$
$
121,430
22,440
145,832
During the year ended April 30, 2022, we added $10.4 million to the ROU assets and $10.3 million to the operating lease liabilities
due to new leases, including due to acquisitions, as well as modifications and remeasurements to our existing operating leases.
As a result of expanding the scope of the Business Optimization Program to include the exit of certain leased office space beginning in
the third quarter of fiscal 2021, we incurred a pretax restructuring charge of $18.3 million in the three months ended January 31,
2021. This charge included impairment charges and acceleration of expense associated with certain operating lease ROU
assets. See Note 7, “Restructuring and Related (Credits) Charges” for more information on this program and the charges incurred.
Index
85
Our total net lease costs were as follows:
Operating lease cost
Variable lease cost
Short-term lease cost
Sublease income
Total net lease cost(1)
For the Years Ended April 30,
2021
2022
2020
$
$
24,180 $
1,496
187
(945)
24,918 $
24,862 $
2,135
248
(722)
26,523 $
26,027
3,856
86
(691)
29,278
(1) Total net lease cost does not include those costs and sublease income included in Restructuring and related charges on our
Consolidated Statements of Income (Loss). This includes those operating leases we had identified in the year ended April 30,
2021 as part of our Business Optimization Program that would be subleased. See Note 7, “Restructuring and Related (Credits)
Charges” for more information on this program.
Other supplemental information includes the following:
Weighted-average remaining contractual lease term (years)
Weighted-average discount rate
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
For the Years Ended April 30,
2022
2021
2020
9
5.84%
9
5.89%
10
5.89%
$
29,737 $
32,344 $
28,243
The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease
liabilities recorded in the Consolidated Statement of Financial Position as of April 30, 2022:
Fiscal Year
2023
2024
2025
2026
2027
Thereafter
Total future undiscounted minimum lease payments
Less: Imputed interest
Present value of minimum lease payments
Less: Current portion
Noncurrent portion
Operating Lease
Liabilities
28,128
26,183
24,783
22,443
17,972
77,521
197,030
43,913
153,117
20,576
132,541
$
$
Index
86
Note 13 –Income Taxes
The provisions for income taxes were as follows:
Current Provision
US – Federal
International
State and local
Total current provision
Deferred provision (benefit)
US – Federal
International
State and local
Total deferred provision (benefit)
Total provision
International and United States pretax income (loss) were as follows:
International
United States
Total
$
$
$
$
$
$
$
For the Years Ended April 30,
2021
2020
2022
(324) $
57,905
221
57,802 $
(9,793) $
15,882
(2,539)
3,550 $
61,352 $
(6,631) $
43,269
1,359
37,997 $
1,145
37,494
172
38,811
(11,996) $
1,175
480
(10,341) $
27,656 $
(8,476)
(15,022)
(4,118)
(27,616)
11,195
For the Years Ended April 30,
2021
2022
256,456 $
(46,795)
209,661 $
202,490 $
(26,578)
175,912 $
2020
104,185
(167,277)
(63,092)
Our effective income tax rate as a percentage of pretax income differed from the US federal statutory rate as shown below:
For the Years Ended April 30,
2021
2022
2020
US federal statutory rate
Cost of higher taxes on non-US income
Foreign tax credits related to CARES Act carryback and audit
Change in valuation allowance
State income taxes, net of US federal tax benefit
US NOL carryback under CARES Act
Tax credits and related net benefits
Impairment of goodwill and intangibles
Other
Effective income tax rate (benefit)
21.0%
9.7%
(11.9)%
11.9%
(1.0)%
—
(0.5)%
—
0.1%
29.3%
21.0%
1.1%
12.3%
(12.3)%
0.8%
(8.0)%
(0.5)%
—
1.3%
15.7%
21.0%
4.8%
—
—
3.3%
—
(1.1)%
(42.3)%
(3.4)%
(17.7)%
The effective tax rate was 29.3% for the year ended April 30, 2022, compared to 15.7% for the year ended April 30, 2021. Our rate for
the year ended April 30, 2022 was higher primarily due to an increase in the UK statutory rate from 19% to 25% enacted during our
three months ended July 31, 2021, which resulted in a $21.4 million noncash deferred tax expense from the re-measurement of our
applicable UK net deferred tax liabilities. In addition, our rate for the year ended April 30, 2021 benefitted by $14 million from the
Coronavirus Aid Relief and Economic Security Act (the CARES Act) and certain regulations issued in late July 2020, which enabled
us to carryback certain net operating losses (NOLs) to a year with a higher statutory tax rate.
Accounting for Uncertainty in Income Taxes:
As of April 30, 2022 and April 30, 2021, the total amount of unrecognized tax benefits were $8.6 million and $9.1 million,
respectively, of which $0.6 million and $0.7 million represented accruals for interest and penalties recorded as additional tax expense
in accordance with our accounting policy. We recorded net interest expense on reserves for unrecognized and recognized tax benefits
of $0.2 million in each of the years ended April 30, 2022 and 2021. As of April 30, 2022 and April 30, 2021, the total amounts of
unrecognized tax benefits that would reduce our income tax provision, if recognized, were approximately $6.9 million and $7.4
million, respectively. We do not expect any significant changes to the unrecognized tax benefits within the next twelve months.
Index
87
A reconciliation of the unrecognized tax benefits included within the Other long-term liabilities line item on the Consolidated
Statements of Financial Position is as follows:
Balance at May 1
Additions for current year tax positions
Additions for prior year tax positions
Reductions for prior year tax positions
Foreign translation adjustment
Payments and settlements
Reductions for lapse of statute of limitations
Balance at April 30
Tax Audits:
2022
2021
9,144 $
947
16
—
(55)
—
(1,460)
8,592 $
6,194
3,626
511
(163)
57
(215)
(866)
9,144
$
$
We file income tax returns in the US and various states and non-US tax jurisdictions. Our major taxing jurisdictions are the United
States, United Kingdom, and Germany. Except for one immaterial item, we are no longer subject to income tax examinations for years
prior to fiscal year 2014 in the major jurisdictions in which we are subject to tax.
Deferred Taxes:
Deferred taxes result from temporary differences in the recognition of revenue and expense for tax and financial reporting purposes.
We believe that it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net
deferred tax assets. The significant components of deferred tax assets and liabilities at April 30 were as follows:
Net operating losses
Reserve for sales returns and doubtful accounts
Accrued employee compensation
Foreign and federal credits
Other accrued expenses
Retirement and post-employment benefits
Total gross deferred tax assets
Less valuation allowance
Total deferred tax assets
Prepaid expenses and other current assets
Unremitted foreign earnings
Intangible and fixed assets
Total deferred tax liabilities
Net deferred tax liabilities
Reported As
Deferred tax assets
Deferred tax liabilities
Net Deferred Tax Liabilities
2022
2021
20,847 $
3,771
26,722
34,537
11,636
15,769
113,282 $
(30,000)
83,282 $
19,433
3,838
32,835
5,129
16,092
30,039
107,366
(4,855)
102,511
(2,684) $
(2,685)
(249,215)
(254,584) $
(171,302) $
(459)
(2,485)
(260,559)
(263,503)
(160,992)
8,763 $
(180,065)
(171,302) $
11,911
(172,903)
(160,992)
$
$
$
$
$
$
$
$
Index
88
The increase in net deferred tax liabilities was due to the decrease in net deferred tax assets, which was primarily attributable to a
decrease in our retirement and post-employment benefits, partially offset by an increase in our Net operating losses and foreign and
federal credits net of applicable valuation allowances. The increase in our deferred tax liabilities from the revaluation of our deferred
tax liabilities related to the UK rate change from 19% to 25% was largely offset by a decrease in our deferred tax liabilities for
intangibles and fixed assets. We have concluded that after valuation allowances, it is more likely than not that we will realize
substantially all of the net deferred tax assets at April 30, 2022. In assessing the need for a valuation allowance, we take into account
related deferred tax liabilities and estimated future reversals of existing temporary differences, future taxable earnings and tax
planning strategies to determine which deferred tax assets are more likely than not to be realized in the future. Changes to tax laws,
statutory tax rates and future taxable earnings can have an impact on our valuation allowances.
We have provided a $30.0 million valuation allowance based primarily on the uncertainty of utilizing the tax benefits related to our
deferred tax assets for foreign tax credits. As of April 30, 2022, we have apportioned state net operating loss carryforwards totaling
approximately $129 million, with a tax effected value of $7.1 million net of federal benefits. Our state and federal NOLs and credits,
to the extent they expire, expire in various amounts over 2 to 20 years.
Since April 30, 2018, we no longer intend to permanently reinvest earnings outside the US. We have recorded a $2.7 million liability
related to the estimated taxes that would be incurred upon repatriating certain non-US earnings.
Note 14 – Debt and Available Credit Facilities
Our total debt outstanding as of April 30 consisted of the amounts set forth in the following table:
Short-term portion of long-term debt(1)
Term loan A - Amended and Restated RCA(2)
Revolving credit facility - Amended and Restated RCA
Total long-term debt, less current portion
2022
2021
$
18,750 $
12,500
204,343
563,934
768,277
222,928
586,160
809,088
Total debt
$
787,027 $
821,588
(1) Relates to our term loan A under the Amended and Restated RCA.
(2) Amounts are shown net of unamortized issuance costs of $0.3 million as of April 30, 2022 and $0.5 million as of April 30, 2021.
The following table summarizes the scheduled annual maturities for the next three years of our long-term debt, including the short-
term portion of long-term debt. This schedule represents the principal portion amount of debt outstanding and therefore excludes
unamortized issuance costs.
Fiscal Year
2023
2024
2025
Total
Amended and Restated RCA
Amount
18,750
204,688
563,934
787,372
$
$
On May 30, 2019, we entered into a credit agreement that amended and restated our existing revolving credit agreement, which was
then amended on December 22, 2021 as described below (collectively, the Amended and Restated RCA). The Amended and Restated
RCA provides for senior unsecured credit facilities comprised of (i) a five year revolving credit facility in an aggregate principal
amount up to $1.25 billion, and (ii) a five year term loan A facility consisting of $250 million.
Index
89
Under the terms of the Amended and Restated RCA, which can be drawn in multiple currencies, we have the option of borrowing at
the following floating interest rates: (i) at a rate based on the London Interbank Offered Rate (LIBOR) plus an applicable margin
ranging from 0.98% to 1.50%, depending on our consolidated net leverage ratio, as defined, or (ii) at the lender’s base rate plus an
applicable margin ranging from zero to 0.50%, depending on our consolidated net leverage ratio. The lender’s base rate is defined as
the highest of (i) the US federal funds effective rate plus a 0.50% margin, (ii) the Eurocurrency rate, as defined, plus a 1.00% margin,
or (iii) the Bank of America prime lending rate. In addition, we pay a facility fee for the revolving credit facility ranging from 0.15%
to 0.25% depending on our consolidated net leverage ratio. We also have the option to request an increase in the revolving credit
facility by an amount not to exceed $500 million, in minimum increments of $50 million, subject to the approval of the lenders.
On December 22, 2021, we entered into the first amendment (the “First Amendment”) to the Amended and Restated RCA. The First
Amendment, among other things, (i) changes the rate under the Amended and Restated RCA for borrowings denominated in Sterling
from a LIBOR-based rate to a daily simple Sterling Overnight Index Average (SONIA) subject to certain adjustments specified in the
Amended and Restated RCA, (ii) changes the rate under the Amended and Restated RCA for borrowings denominated in euro from a
LIBOR-based rate to a EURIBOR-based rate or a Euro Short Term Rate subject to certain adjustments specified in the Amended and
Restated RCA, and (iii) updates certain other provisions regarding successor interest rates to LIBOR.
The Amended and Restated RCA contains certain customary affirmative and negative covenants, including a financial covenant in the
form of a consolidated net leverage ratio and consolidated interest coverage ratio, which we were in compliance with as of April 30,
2022.
In the three months ended July 31, 2019, we incurred an immaterial loss on the write-off of unamortized deferred costs in connection
with the refinancing of our revolving credit agreement at that time, which is reflected in Other income, net on the Consolidated
Statements of Income (Loss) for the year ended April 30, 2020.
In the three months ended July 31, 2019, we incurred $4.0 million of costs related to the Amended and Restated RCA which resulted
in total costs capitalized of $5.2 million. The amount related to the term loan A facility was $0.9 million, consisting of $0.8 million of
lender fees and recorded as a reduction to Long-term debt, and $0.1 million of non-lender fees included in Other non-current assets on
the Consolidated Statements of Financial Position. The amount related to the five-year revolving credit facility was $4.3 million, all of
which was included in Other non-current assets on the Consolidated Statements of Financial Position.
The amortization expense of the costs incurred related to the Amended and Restated RCA related to the lender and non-lender fees is
recognized over the five-year term of the Amended and Restated RCA. Total amortization expense for the years ended April 30, 2022,
2021 and 2020 was $1.1 million, $1.1 million and $1.0 million, respectively, and is included in Interest expense on our Consolidated
Statements of Income (Loss).
Lines of Credit
We have other lines of credit aggregating $1.0 million at various interest rates. There were no outstanding borrowings under these
credit lines at April 30, 2022, and 2021.
Our total available lines of credit as of April 30, 2022 were approximately $1.5 billion, of which approximately $0.7 billion was
unused. The weighted average interest rates on total debt outstanding during the years ended April 30, 2022 and 2021 were 2.02% and
2.03%, respectively. As of April 30, 2022 and 2021, the weighted average interest rates for total debt were 2.55% and 1.98%,
respectively.
Based on estimates of interest rates currently available to us for loans with similar terms and maturities, the fair value of our debt
approximates its carrying value.
Index
90
Note 15 – Derivative Instruments and Activities
From time to time, we enter into forward exchange and interest rate swap contracts as a hedge against foreign currency asset and
liability commitments, changes in interest rates, and anticipated transaction exposures, including intercompany sales and purchases.
All derivatives are recognized as assets or liabilities and measured at fair value. Derivatives that are not determined to be effective
hedges are adjusted to fair value with a corresponding adjustment to earnings. We do not use financial instruments for trading or
speculative purposes.
Interest Rate Contracts
As of April 30, 2022, we had total debt outstanding of $787.0 million, net of unamortized issuance costs of $0.3 million, of which
$787.3 million are variable rate loans outstanding under the Amended and Restated RCA, which approximated fair value.
As of April 30, 2022 and 2021, the interest rate swap agreements we maintained were designated as fully effective cash flow hedges
as defined under FASB ASC Topic 815, “Derivatives and Hedging” (ASC Topic 815). As a result, there was no impact on our
Consolidated Statements of Income (Loss) from changes in the fair value of the interest rate swaps, as they were fully offset by
changes in the interest expense on the underlying variable rate debt instruments. Under ASC Topic 815, derivative instruments that are
designated as cash flow hedges have changes in their fair value recorded initially within Accumulated other comprehensive loss on the
Consolidated Statements of Financial Position. As interest expense is recognized based on the variable rate loan agreements, the
corresponding deferred gain or loss on the interest rate swaps is reclassified from Accumulated other comprehensive loss to Interest
Expense on the Consolidated Statements of Income (Loss). It is management’s intention that the notional amount of interest rate
swaps be less than the variable rate loans outstanding during the life of the derivatives.
The following table summarizes our interest rate swaps designated as cash flow hedges:
Hedged Item
Amended and
Restated RCA
Amended and
Restated RCA
Amended and
Restated RCA
Amended and
Restated RCA
Amended and
Date entered
into
April 7, 2022
April 12,
2021
February 26,
2020
August 7,
2019
Restated RCA
June 24, 2019
Nature of Swap
Pay fixed/receive
variable
Pay fixed/receive
variable
Pay fixed/receive
variable
Pay fixed/receive
variable
Pay fixed/receive
variable
Notional Amount
As of April 30,
2022
2021
Fixed
Interest
Rate
$
100 $
— 2.646%
100
100 0.500%
100
100 1.150%
100
100 1.400%
100
500 $
$
100 1.650%
400
Variable Interest Rate
1-month LIBOR reset every month for a
2-year period ending April 15, 2024
1-month LIBOR reset every month for a
3-year period ending April 15, 2024
1-month LIBOR reset every month for a
3-year period ending March 15, 2023
1-month LIBOR reset every month for a
3-year period ending August 15, 2022
1-month LIBOR reset every month for a
3-year period ending July 15, 2022
On April 4, 2016, we entered into a forward starting interest rate swap agreement which fixed a portion of the variable interest due on
a variable rate debt renewal on May 16, 2016. Under the terms of the agreement, which expired on May 15, 2019, we paid a fixed rate
of 0.920% and received a variable rate of interest based on one-month LIBOR from the counterparty which was reset every month for
a three-year period ending May 15, 2019. Prior to expiration, the notional amount of the interest rate swap was $350.0 million.
We record the fair value of our interest rate swaps on a recurring basis using Level 2 inputs of quoted prices for similar assets or
liabilities in active markets. The fair value of the interest rate swaps as of April 30, 2022 was a deferred loss of $0.2 million and a
deferred gain of $5.8 million. Based on the maturity dates of the contracts, the entire deferred loss as of April 30, 2022 was recorded
within Other accrued liabilities, $0.9 million of the deferred gain was recorded within Prepaid expenses and other current assets, and
$4.9 million was recorded within Other non-current assets.
The fair value of the interest rate swaps as of April 30, 2021 was a deferred loss of $5.6 million. Based on the maturity dates of the
contracts, the entire deferred loss as of April 30, 2021 was recorded within Other long-term liabilities.
Index
91
The pretax (losses) gains that were reclassified from Accumulated other comprehensive loss into Interest expense for the years ended
April 30, 2022, 2021, and 2020 were $(4.2) million, $(3.7) million, and $0.4 million, respectively. Based on the amount in
Accumulated other comprehensive loss at April 30, 2022, approximately $1.6 million, net of tax, would be reclassified into Net
income in the next twelve months.
Foreign Currency Contracts
We may enter into forward exchange contracts to manage our exposure on certain foreign currency denominated assets and liabilities.
The forward exchange contracts are marked to market through Foreign exchange transaction (losses) gains on our Consolidated
Statements of Income (Loss) and carried at fair value on our Consolidated Statements of Financial Position. Foreign currency
denominated assets and liabilities are remeasured at spot rates in effect on the balance sheet date, with the affects of changes in spot
rates reported in Foreign exchange transaction (losses) gains on our Consolidated Statements of Income (Loss).
As of April 30, 2022 and 2021, we did not maintain any open forward exchange contracts. In addition, we did not maintain any open
forward contracts during the years ended April 30, 2022 and 2020.
During the year ended April 30, 2021, to manage foreign currency exposures on an intercompany loan, we entered into one forward
exchange contract to sell €32 million and buy $38.8 million. This forward contract expired on April 15, 2021. We did not designate
this forward exchange contract as a hedge under the applicable sections of ASC Topic 815 as the benefits of doing so were not
material due to the short-term nature of the contract. The fair value changes in the forward exchange contract substantially mitigated
the changes in the value of the applicable foreign currency denominated liability. The fair value of the open forward exchange contract
was measured on a recurring basis using Level 2 inputs of quoted prices for similar assets or liabilities in active markets. For the year
ended April 30, 2021, the loss recognized on this forward contract was $0.8 million and included in Foreign exchange transaction
(losses) gains on our Consolidated Statement of Income (Loss).
Note 16 – Commitment and Contingencies
We are involved in routine litigation in the ordinary course of our business. A provision for litigation is accrued when information
available to us indicates that it is probable a liability has been incurred and the amount of loss can be reasonably estimated. Significant
judgment may be required to determine both the probability and estimates of loss. When the amount of the loss can only be estimated
within a range, the most likely outcome within that range is accrued. If no amount within the range is a better estimate than any other
amount, the minimum amount within the range is accrued. When uncertainties exist related to the probable outcome of litigation
and/or the amount or range of loss, we do not record a liability, but disclose facts related to the nature of the contingency and possible
losses if management considers the information to be material. Reserves for legal defense costs are recognized when incurred. The
accruals for loss contingencies and legal costs are reviewed regularly and may be adjusted to reflect updated information on the status
of litigation and advice of legal counsel. In the opinion of management, the ultimate resolution of all pending litigation as of April 30,
2022, will not have a material effect upon our consolidated financial condition or results of operations.
Note 17 – Retirement Plans
We have retirement plans that cover substantially all employees. The plans generally provide for employee retirement between the
ages 60 and 65, and benefits based on length of service and compensation, as defined.
Our Board of Directors approved plan amendments that froze the following retirement plans:
• Retirement Plan for the Employees of John Wiley & Sons, Canada was frozen effective December 31, 2015;
• Retirement Plan for the Employees of John Wiley & Sons, Ltd., a UK plan was frozen effective April 30, 2015 and;
• U.S. Employees’ Retirement Plan, Supplemental Benefit Plan, and Supplemental Executive Retirement Plan, were frozen
effective June 30, 2013.
We maintain the Supplemental Executive Retirement Plan for certain officers and senior management which provides for the payment
of supplemental retirement benefits after the termination of employment for 10 years, or in a lifetime annuity. Under certain
circumstances, including a change of control as defined, the payment of such amounts could be accelerated on a present value basis.
Future accrued benefits to this plan have been discontinued as noted above.
Index
92
The components of net pension expense (income) for the defined benefit plans and the weighted average assumptions were as follows:
2022
For the Years Ended April 30,
2021
2020
US
Non-US
US
Non-US
US
Non-US
Service cost
Interest cost
Expected return on plan assets
Amortization of prior service cost
Amortization of net actuarial loss
Curtailment (credit)/settlement loss
Net pension (income) expense
$
$
— $
9,451
(12,144)
(154)
2,617
—
(230) $
1,196 $
11,148
(28,118)
67
4,846
(39)
(10,900) $
— $
9,504
1,396 $
8,901
(11,969) (26,971)
58
4,516
—
(154)
3,501
—
882 $ (12,100) $
— $
11,247
(14,038)
(154)
2,403
—
(542) $
1,851
12,652
(26,116)
73
3,993
291
(7,256)
Discount rate
Rate of compensation increase
Expected return on plan assets
3.2%
N/A
5.3%
1.9%
3.0%
5.5%
3.1%
N/A
5.8%
1.6%
3.0%
5.7%
4.1%
N/A
6.8%
2.4%
3.0%
6.5%
In the year ended April 30, 2022, because of a reduction in force, there was a curtailment credit of less than $0.1 million related to the
Retirement Indemnity Plan for the Employees of Cross Knowledge which is reflected in Restructuring and related (credits) charges in
the Consolidated Statements of Income (Loss).
In the year ended April 30, 2020, there was a settlement charge of $0.3 million related to the Retirement Plan for the Employees of
John Wiley & Sons, Canada which is reflected in Restructuring and related (credits) charges in the Consolidated Statements of Income
(Loss).
The service cost component of net pension expense (income) is reflected in Operating and administrative expenses on our
Consolidated Statements of Income (Loss). The other components of net pension expense (income) are reported separately from the
service cost component and below Operating income (loss). Such amounts are reflected in Other income, net on our Consolidated
Statements of Income (Loss).
The Recognized Net Actuarial Loss for each fiscal year is calculated using the “corridor method,” which reflects the amortization of
the net loss at the beginning of the fiscal year in excess of 10% of the greater of the market value of plan assets or the projected benefit
obligation. The amortization period is based on the average expected life of plan participants for plans with all or almost all inactive
participants and frozen plans, and on the average remaining working lifetime of active plan participants for all other plans.
We recognize the overfunded or underfunded status of defined benefit postretirement plans, measured as the difference between the
fair value of plan assets and the projected benefit obligation, on the Consolidated Statements of Financial Position. The change in the
funded status of the plan is recognized in Accumulated other comprehensive loss on the Consolidated Statements of Financial
Position. Plan assets and obligations are measured at fair value as of our Consolidated Statements of Financial Position date.
Index
93
The following table sets forth the changes in and the status of, our defined benefit plans’ assets and benefit obligations:
2022
2021
US
Non-US
US
Non-US
CHANGE IN PLAN ASSETS
Fair value of plan assets, beginning of year
Actual return on plan assets
Employer contributions
Employee contributions
Settlements
Benefits paid
Foreign currency rate changes
Fair value, end of year
CHANGE IN PROJECTED BENEFIT OBLIGATION
Benefit obligation, beginning of year
Service cost
Interest cost
Actuarial gains (losses)
Benefits paid
Foreign currency rate changes
Settlements and other
Benefit obligation, end of year
Underfunded status, end of year
AMOUNTS RECOGNIZED ON THE STATEMENT OF FINANCIAL
POSITION
Noncurrent assets
Current pension liability
Noncurrent pension liability
Net amount recognized in statement of financial position
AMOUNTS RECOGNIZED IN ACCUMULATED OTHER
COMPREHENSIVE LOSS (BEFORE TAX) CONSIST OF
$
$
$
$
$
$
237,129 $
(21,257)
3,812
—
—
(15,229)
—
204,455 $
(302,632) $
—
(9,451)
47,284
15,229
—
—
(249,570) $
(45,115) $
523,886 $
(37,543)
12,595
—
—
(10,703)
(45,976)
442,259 $
(609,614) $
(1,196)
(11,148)
84,746
10,703
51,660
47
(474,802) $
(32,543) $
213,946 $
34,560
5,599
—
—
(16,976)
—
237,129 $
445,480
27,971
12,203
—
—
(11,921)
50,153
523,886
—
(9,504)
8,863
16,976
—
—
(318,967) $ (534,303)
(1,396)
(8,901)
(17,739)
11,921
(59,046)
(150)
(302,632) $ (609,614)
(85,728)
(65,503) $
—
(3,545)
(41,570)
(45,115) $
5,855
(1,346)
(37,052)
(32,543) $
—
(3,576)
(61,927)
(65,503) $
6
(1,414)
(84,320)
(85,728)
Net actuarial (losses) gains
Prior service cost gains (losses)
Total accumulated other comprehensive loss
Change in accumulated other comprehensive loss
INFORMATION FOR PENSION PLANS WITH AN ACCUMULATED
$
$
$
(80,114) $
1,946
(78,168) $
16,345 $
(171,274) $
(1,165)
(172,439) $
42,818 $
2,100
(96,613) $ (213,958)
(1,299)
(94,513) $ (215,257)
(32,803)
34,802 $
BENEFIT OBLIGATION IN EXCESS OF PLAN ASSETS
Accumulated benefit obligation
Fair value of plan assets
INFORMATION FOR PENSION PLANS WITH A PROJECTED
BENEFIT OBLIGATION IN EXCESS OF PLAN ASSETS
Projected benefit obligation
Fair value of plan assets
WEIGHTED AVERAGE ASSUMPTIONS USED IN DETERMINING
ASSETS AND LIABILITIES
Discount rate
Rate of compensation increase
Accumulated benefit obligations
$
$
$
$
$
249,570 $
204,455 $
37,801 $
475 $
302,632 $
237,129 $
566,998
513,279
249,570 $
204,455 $
38,871 $
475 $
302,632 $
237,129 $
599,011
513,279
4.6%
N/A
(249,570) $
3.0%
3.1%
(450,037) $
3.2%
N/A
1.9%
3.0%
(302,632) $ (577,600)
Actuarial gains in the US resulting in a decrease to our projected benefit obligation for the year ended April 30, 2022 were primarily
due to an increase in the discount rate. Actuarial gains in non-US countries resulting in a decrease to our projected benefit obligation
for the year ended April 30, 2022 were primarily due to an increase in the discount rate partially offset by an increase in the UK
inflation rate.
Actuarial gains in the US resulting in a decrease to our projected benefit obligation for the year ended April 30, 2021 were primarily
due to an increase in the discount rate and updated census data. Actuarial losses in non-US countries resulting in an increase to our
projected benefit obligation for the year ended April 30, 2021 were primarily due to an increase in the UK inflation rate, offset by an
increase in the discount rate.
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94
Actuarial losses in the US and non-US countries resulting in an increase in our projected benefit obligation for the year ended April
30, 2020 were primarily due to a reduction in discount rates and changes to other assumptions.
Pension plan assets/investments:
The investment guidelines for the defined benefit pension plans are established based upon an evaluation of market conditions, plan
liabilities, cash requirements for benefit payments, and tolerance for risk. Investment guidelines include the use of actively and
passively managed securities. The investment objective is to ensure that funds are available to meet the plans benefit obligations when
they are due. The investment strategy is to invest in high quality and diversified equity and debt securities to achieve our long-term
expectation. The plans’ risk management practices provide guidance to the investment managers, including guidelines for asset
concentration, credit rating, and liquidity. For those plan assets measured at NAV as defined below, a redemption request can be
executed within a 7-day notice. Asset allocation favors a balanced portfolio, with a global aggregated target allocation of
approximately 48% equity securities and 52% fixed income securities and cash. Due to volatility in the market, the target allocation is
not always desirable and asset allocations will fluctuate between acceptable ranges of plus or minus 5%. We regularly review the
investment allocations and periodically rebalance investments to the target allocations. We categorize our pension assets into three
levels based upon the assumptions (inputs) used to price the assets. Level 1 provides the most reliable measure of fair value, whereas
Level 3 generally requires significant management judgment. The three levels are defined as follows:
● Level 1: Unadjusted quoted prices in active markets for identical assets.
● Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets in active
markets or quoted prices for identical assets in inactive markets.
● Level 3: Unobservable inputs reflecting assumptions about the inputs used in pricing the asset.
We did not maintain any level 3 assets during the years ended April 30, 2022 and 2021. In accordance with ASU 2015-07, “Fair Value
Measurement (Topic 820), Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its
Equivalent),” certain investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent) practical
expedient do not have to be classified in the fair value hierarchy. The fair value amounts presented in the following tables are intended
to permit reconciliation of the fair value hierarchy to the amounts presented for the total pension benefit plan assets.
The following tables set forth, by level within the fair value hierarchy, pension plan assets at their fair value as of April 30:
2022
2021
Level 1
Level 2
NAV
Total
Level 1 Level 2
NAV
Total
US Plan Assets
Global Equity Securities: Limited
Partnership
$
Fixed Income Securities: Commingled
Trust Funds
Total Assets
Non-US Plan Assets
Equity securities:
US equities
Non-US equities
Balanced managed funds
Fixed income securities: Commingled
funds
Other:
Real estate/other
Cash and cash equivalents
Total Non-US plan assets
Total plan assets
$
$
$
$
7,477
$ 77,849 $ 85,326
$ 121,569 $ 121,569
7,477
119,129
$ 196,978
119,129
204,455
115,560 115,560
$ 237,129 $ 237,129
— $
48,443
— 112,162
— 94,623
$ 48,443 $
112,162
94,623
— $
51,882
— 124,496
— 103,717
$
— 185,192
185,192
1,444 236,583
$ 51,882
124,496
103,717
238,027
475
475
—
1,364
1,338
26
1,338 $ 440,921 $
— $ 442,259 $
8,815 $ 440,921 $ 196,978 $ 646,714 $
543
543
—
5,221
5,221
—
6,665 $ 517,221 $
— $ 523,886
6,665 $ 517,221 $ 237,129 $ 761,015
Expected employer contributions to the defined benefit pension plans in the year ended April 30, 2023 will be approximately $15.6
million, including $12.0 million of minimum amounts required for our non-US plans. From time to time, we may elect to make
voluntary contributions to our defined benefit plans to improve their funded status.
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95
Benefit payments to retirees from all defined benefit plans are expected to be the following in the fiscal year indicated:
Fiscal Year
2023
2024
2025
2026
2027
2028–2032
Total
Retiree Health Benefits
US
Non-US
Total
$
$
15,533
15,666
15,315
15,125
15,200
76,222
153,061
$
$
11,864
12,307
14,845
13,419
14,292
86,389
153,116
$
$
27,397
27,973
30,160
28,544
29,492
162,611
306,177
We provide contributory life insurance and health care benefits, subject to certain dollar limitations, for substantially all of our eligible
retired US employees. The retiree health benefit is no longer available for any employee who retires after December 31, 2017. The
cost of such benefits is expensed over the years the employee renders service and is not funded in advance. The accumulated post-
retirement benefit obligation recognized on the Consolidated Statements of Financial Position as of April 30, 2022 and 2021, was $1.3
and $1.5 million, respectively. Annual credits for these plans were $(0.1) million for each of the years ended April 30, 2022, 2021, and
2020.
Defined Contribution Savings Plans
We have defined contribution savings plans. Our contribution is based on employee contributions and the level of our match. We may
make discretionary contributions to all employees as a group. The expense recorded for these plans was approximately $30.3 million,
$24.3 million, and $19.0 million in the years ended April 30, 2022, 2021, and 2020, respectively.
Note 18 – Stock-Based Compensation
All equity compensation plans have been approved by shareholders. Under the 2014 Key Employee Stock Plan, (the Plan), qualified
employees are eligible to receive awards that may include stock options, performance-based stock awards, and other restricted stock
awards. Under the Plan, a maximum number of 6.5 million shares of our Class A stock may be issued. As of April 30, 2022, there
were approximately 1,390,492 securities remaining available for future issuance under the Plan. We issue treasury shares to fund
awards issued under the Plan.
Stock Option Activity
Under the terms of our stock option plan, the exercise price of stock options granted may not be less than 100% of the fair market
value of the stock at the date of grant. Options are exercisable over a maximum period of ten years from the date of grant.
Options Granted in Fiscal Year 2022
During the year ended April 30, 2022, we granted 300,000 stock option awards. This included 260,000 stock options to our executive
leadership team, at a grant price of $63.07, which was generally 10% above the fair market value at the time of grant, and 40,000
stock options granted to other leaders at fair market value on date of grant. For the options granted in the year ended April 30, 2022,
such options generally vest 10%, 20%, 30%, and 40% on April 30, or on each anniversary date after the award is granted.
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96
The following table provides the estimated weighted average fair value for options granted during the year ended April 30, 2022 using
the Black-Scholes option-pricing model, and the significant weighted average assumptions used in their determination.
Weighted average fair value of options on grant date
$
11.75
Weighted average assumptions:
Expected life of options (years)
Risk-free interest rate
Expected volatility
Expected dividend yield
Fair value of common stock on grant date
Exercise price of stock option grant
6.3
1.2%
30.7%
2.4%
56.51
61.84
$
$
As of April 30, 2022, there was $2.3 million of unrecognized share-based compensation cost related to options, which is expected to
be recognized over a period up to 4 years, or 3.1 years on a weighted average basis.
Options Granted Prior to Fiscal Year 2022
Prior to the stock options granted in the year ended April 30, 2022, we did not grant any stock option awards since the year ended
April 30, 2016. As of April 30, 2019, all outstanding options vested, allowing the participant the right to exercise their awards, and
there was no unrecognized share-based compensation expense remaining related to these stock options.
For the years ended April 30, 2015 and prior, options generally vest 50% on the fourth and fifth anniversary date after the award is
granted. For the year ended April 30, 2016, options vest 25% per year on April 30.
The fair value of the options granted in the year ended April 30, 2016 was $14.77 using the Black-Scholes option-pricing model. The
significant weighted average assumptions used in the fair value determination was the expected life, which represented an estimate of
the period of time stock options will be outstanding based on the historical exercise behavior of option recipients. The risk-free
interest rate was based on the corresponding US Treasury yield curve in effect at the time of the grant. The expected volatility was
based on the historical volatility of our Common Stock price over the estimated life of the option, while the dividend yield was based
on the expected dividend payments to be made by us.
A summary of the activity and status of our stock option plans follows:
2022
2021
2020
Number
of
Options
(in 000’s)
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Term
(in years)
Aggregate
Intrinsic
Value
(in
millions)
Outstanding at beginning of year
Granted
Exercised
Expired or forfeited
Outstanding at end of year
Exercisable at end of year
Vested and expected to vest in the
future at April 30
141 $
300 $
(49) $
(82) $
310 $
72 $
51.17
61.84
45.85
60.36
59.89
54.53
306 $
60.55
8.1 $
4.2 $
9.1 $
0.2
7.6
—
Number
of
Options
(in 000’s)
Weighted
Average
Exercise
Price
Number
of
Options
(in 000’s)
Weighted
Average
Exercise
Price
286 $
— $
(60) $
(85) $
141 $
141 $
50.14
—
43.91
52.78
51.17
51.17
372 $
— $
(34) $
(52) $
286 $
286 $
49.70
—
38.32
54.57
50.14
50.14
141 $
51.17
286 $
50.14
The intrinsic value is the difference between our common stock price and the option grant price. The total intrinsic value of options
exercised during the years ended April 30, 2022, 2021, and 2020 was $0.4 million, $0.2 million, and $0.3 million, respectively. The
total grant date fair value of stock options vested during the year ended April 30, 2022 was $1.3 million. As noted above, as of April
30, 2019, all outstanding stock options, prior to those granted in the year ended April 30, 2022 vested allowing the participant the right
to exercise their awards.
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97
The following table summarizes information about stock options outstanding and exercisable at April 30, 2022:
Range of Exercise Prices
$39.53
$48.06 to $49.55
$55.62 to $63.07
Total/average
Options Outstanding
Options Exercisable
Weighted
Average
Remaining
Term
(in years)
Weighted
Average
Exercise
Price
Number
of Options
(in 000’s)
Weighted
Average
Exercise
Price
1.2 $
0.2 $
5.4 $
8.1 $
39.53
52.69
62.17
59.89
17 $
3 $
52 $
72 $
39.53
48.06
59.98
54.53
Number
of Options
(in 000’s)
17
33
260
310
Performance-Based and Other Restricted Stock Activity
Under the terms of our long-term incentive plans, performance-based restricted unit awards are payable in restricted shares of our
Class A Common Stock upon the achievement of certain three-year or less financial performance-based targets. During each three-
year period or less, we adjust compensation expense based upon our best estimate of expected performance. For the year ended April
30, 2017, restricted performance shares vest 50% on June 30 following the end of the three-year performance cycle and 50% on April
30 of the following year. Beginning in the year ended April 30, 2018, restricted performance share units vest 100% on June 30
following the end of the three-year performance cycle.
We may also grant individual restricted unit awards payable in restricted shares of our Class A Common Stock to key employees in
connection with their employment. Starting with the year ended April 30, 2016 grants, restricted shares generally vest ratably 25% per
year.
Under certain circumstances relating to a change of control or termination, as defined, the restrictions would lapse and shares would
vest earlier.
Activity for performance-based and other restricted stock awards during the years ended April 30, was as follows (shares in
thousands):
Nonvested shares at beginning of year
Granted
Change in shares due to performance
Vested and issued
Forfeited
Nonvested shares at end of year
2022
2021
2020
Weighted
Average
Grant Date
Value
Restricted
Shares
Restricted
Shares
Restricted
Shares
1,280 $
658 $
(3) $
(432) $
(229) $
1,274 $
45.73
56.53
30.41
50.87
48.23
49.17
943
706
118
(362)
(125)
1,280
756
759
(70)
(329)
(173)
943
For the years ended April 30, 2022, 2021 and 2020, we recognized stock-based compensation expense (including stock options), on a
pretax basis, of $25.7 million, $22.0 million and $20.0 million, respectively.
As of April 30, 2022, there was $39.2 million of unrecognized share-based compensation cost related to performance-based and other
restricted stock awards, which is expected to be recognized over a period up to 4 years, or 2.4 years on a weighted average basis.
Compensation expense for restricted stock awards is measured using the closing market price of our Class A Common Stock at the
date of grant. The total grant date value of shares vested during the years ended April 30, 2022, 2021, and 2020 was $22.0 million,
$17.6 million, and $17.5 million, respectively.
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98
President and CEO New Hire Equity Awards
On October 17, 2017, we announced Brian A. Napack as the new President and Chief Executive Officer of Wiley effective December
4, 2017 (the Commencement Date). Upon the Commencement Date, Mr. Napack also became a member of our Board of Directors
(the Board). In connection with his appointment, Wiley and Mr. Napack entered into an employment offer letter (the Employment
Agreement).
The Employment Agreement provides that beginning with the year ended April 30, 2018–2020 performance cycle, eligibility to
participate in annual grants under our Executive Long-Term Incentive Program (ELTIP). Targeted long-term incentive for this cycle
was equal to 300% of base salary, or $2.7 million. Sixty percent of the ELTIP value was delivered in the form of target performance
share units and forty percent in restricted share units. The grant date fair value for restricted share units was $59.15 per share and
included 20,611 restricted share units, which vested 25% each year starting on April 30, 2018 to April 30, 2021. In addition, there was
a performance share unit award with a target of 30,916 units and a grant date fair value of $59.15. The performance metrics were
based on cumulative EBITDA for the year ended April 30, 2018–2020 and cumulative normalized free cash flow for the year ended
April 30, 2018–2020.
In addition, the Employment Agreement provided for a sign-on grant of restricted share units, with a grant value of $4.0 million,
converted to shares using our Class A closing stock price as of the Commencement Date, and vesting in two equal installments on the
first and second anniversaries of the employment date. The grant date fair value for this award was $59.15 per share and included
67,625 units at the date of grant. Grants were subject to forfeiture in the case of voluntary termination prior to vesting and accelerated
vesting in the case of earlier termination of employment without Cause, due to death or Disability or Constructive Discharge, or upon
a Change in Control (as such terms are defined in the Employment Agreement).
Director Stock Awards
Under the terms of our 2018 Director Stock Plan (the Director Plan), each nonemployee director, other than the Chairman of the
Board, receives an annual award of restricted shares of our Class A Common Stock equal in value to 100% of the annual director
stock retainer fee, based on the stock price at the close of the New York Stock Exchange on the date of grant. Such restricted shares
will vest on the earliest of (i) the day before the next Annual Meeting following the grant, (ii) the nonemployee director’s death or
disability (as determined by the Governance Committee), or (iii) a change in control (as defined in the 2014 Key Employee Stock
Plan). The granted shares may not be sold or transferred during the time the nonemployee director remains a director. There were
18,384, 28,360, and 20,048 restricted shares awarded under the Director Plan for the years ended April 30, 2022, 2021, and 2020,
respectively. In addition, pursuant to the John Wiley & Sons, Inc. Deferred Compensation Plan for Directors’ 2005 & After
Compensation, as amended through December 15, 2021, each nonemployee director has the option of receiving all or part of the
annual retainer in the form of deferred stock and shall be subject to the same vesting terms as specified therein.
Note 19 – Capital Stock and Changes in Capital Accounts
Each share of our Class B Common Stock is convertible into one share of Class A Common Stock. The holders of Class A stock are
entitled to elect 30% of the entire Board of Directors and the holders of Class B stock are entitled to elect the remainder. On all other
matters, each share of Class A stock is entitled to one tenth of one vote and each share of Class B stock is entitled to one vote.
Share Repurchases
During the year ended April 30, 2020, our Board of Directors approved an additional share repurchase program of $200 million of
Class A or B Common Stock. As of April 30, 2022, we had authorization from our Board of Directors to purchase up to $197.5
million that was remaining under this program.
The share repurchase program described above is in addition to the share repurchase program approved by our Board of Directors
during the year ended April 30, 2017 of four million shares of Class A or B Common Stock. As of April 30, 2022, no additional shares
were remaining under this program for purchase.
The following table summarizes the share repurchases of Class A and B Common Stock during the years ended April 30 (shares in
thousands):
Shares repurchased – Class A
Shares repurchased – Class B
Average price – Class A and Class B
Index
99
2022
2021
2020
542
2
55.14 $
308
2
50.93 $
1,080
2
43.05
$
Dividends
The following table summarizes the cash dividends paid during the year ended April 30, 2022:
Date of Declaration by
Board of Directors
June 22, 2021
September 29, 2021
December 15, 2021
March 23, 2022
Quarterly Cash
Dividend
$0.3450 per common
share
$0.3450 per common
share
$0.3450 per common
share
$0.3450 per common
share
Total
Dividend
$19.3
million
$19.2
million
$19.2
million
$19.2
million
Class of Common
Stock
Class A and
Class B
Class A and
Class B
Class A and
Class B
Class A and
Class B
Dividend Paid Date
Shareholders of
Record as of Date
July 21, 2021
July 6, 2021
October 27, 2021
October 12, 2021
January 12, 2022
December 28, 2021
April 20, 2022
April 5, 2022
Changes in Common Stock
The following is a summary of changes during the years ended April 30, in shares of our common stock and common stock in treasury
(shares in thousands).
Changes in Class A Common Stock:
Number of shares, beginning of year
Common stock class conversions
Number of shares issued, end of year
Changes in Class A Common Stock in treasury:
Number of shares held, beginning of year
Purchases of treasury shares
Restricted shares issued under stock-based compensation plans – non-PSU Awards
Restricted shares issued under stock-based compensation plans – PSU Awards
Shares issued under the Director Plan to Directors
Restricted shares, forfeited
Restricted shares issued from exercise of stock options
Shares issued related to the acquisition of a business
Shares withheld for taxes
Other
Number of shares held, end of year
Number of Class A Common Stock outstanding, end of year
Changes in Class B Common Stock:
Number of shares, beginning of year
Common stock class conversions
Number of shares issued, end of year
Changes in Class B Common Stock in treasury:
Number of shares held, beginning of year
Purchase of treasury shares
Number of shares held, end of year
Number of Class B Common Stock outstanding, end of year
Warrants
2022
2021
2020
70,208
18
70,226
70,166
42
70,208
70,127
39
70,166
23,419
542
(323)
(108)
(2)
—
(49)
(129)
167
(2)
23,515
46,711
23,405
308
(268)
(88)
(6)
—
(60)
—
129
(1)
23,419
46,789
22,634
1,080
(232)
(68)
(97)
1
(34)
—
122
(1)
23,405
46,761
2022
2021
2020
12,974
(18)
12,956
13,016
(42)
12,974
13,055
(39)
13,016
3,922
2
3,924
9,032
3,920
2
3,922
9,052
3,918
2
3,920
9,096
In connection with the acquisition of The Learning House, Inc. on November 1, 2018, a portion of the fair value of the consideration
transferred was $0.6 million of warrants. The warrants were classified as equity and allowed the holder to purchase 400,000 shares of
our Class A Common Stock at an exercise price of $90.00, subject to adjustments. The term of the warrants was three years and
expired on November 1, 2021. The fair value of the warrants was determined using the Black-Scholes option pricing model.
Index
100
Note 20 – Segment Information
We report our segment information in accordance with the provisions of FASB ASC Topic 280, “Segment Reporting.” These
segments reflect the way our chief operating decision maker evaluates our business performance and manages the operations. The
performance metric used by our chief operating decision maker to evaluate performance of our reportable segments is Adjusted
Contribution to Profit. Our segment reporting structure consists of three reportable segments, which are listed below, as well as a
Corporate category, which includes certain costs that are not allocated to the reportable segments:
• Research Publishing & Platforms
• Academic & Professional Learning
• Education Services
Segment information is as follows:
Revenue:
Research Publishing & Platforms
Academic & Professional Learning(1)
Education Services(1)
Total revenue
Adjusted Contribution to Profit:
Research Publishing & Platforms
Academic & Professional Learning(1)
Education Services(1)
Total adjusted contribution to profit
Adjusted corporate contribution to profit
Total adjusted operating income
Depreciation and Amortization:
Research Publishing & Platforms
Academic & Professional Learning(1)
Education Services(1)
Total depreciation and amortization
Corporate depreciation and amortization
Total depreciation and amortization
For the Years Ended April 30,
2021
2022
2020
1,111,343 $
646,823
324,762
2,082,928 $
1,015,349 $
641,861
284,291
1,941,501 $
948,839
650,115
232,529
1,831,483
295,227 $
111,917
3,289
410,433 $
273,023 $
92,363
20,488
385,874 $
(192,584)
(167,053)
217,849 $
218,821 $
94,899 $
69,561
34,157
198,617 $
16,553
215,170 $
83,866 $
71,997
29,654
185,517 $
14,672
200,189 $
265,353
85,515
(4,713)
346,155
(165,487)
180,668
69,495
69,807
24,131
163,433
11,694
175,127
$
$
$
$
$
$
$
$
(1)
In May 2021, we moved the WileyNXT product offering from Academic & Professional Learning to Education Services. As a
result, the prior period results related to the WileyNXT product offering have been included in Education Services. The Revenue,
Adjusted Contribution to Profit and Depreciation and Amortization for WileyNXT was $2.7 million, $(0.7) million, and none,
respectively, for the year ended April 30, 2021, and $0.7 million, $(0.9) million, and none, respectively, for the year ended April
30, 2020. There were no changes to our total consolidated financial results.
Index
101
The following table shows a reconciliation of our consolidated US GAAP Operating Income (Loss) to Non-GAAP Adjusted
Operating Income:
US GAAP Operating Income (Loss)
Adjustments:
Restructuring and related (credits) charges(1)
Impairment of goodwill(1)
Impairment of Blackwell trade name(1)
Impairment of developed technology intangible(1)
Non-GAAP Adjusted Operating Income
For the Years Ended April 30,
2022
2021
2020
$
219,276 $
185,511 $
(54,287)
(1,427)
—
—
—
$
217,849 $
33,310
—
—
—
218,821 $
32,607
110,000
89,507
2,841
180,668
(1) See Note 7, “Restructuring and Related (Credits) Charges” and Note 11, “Goodwill and Intangible Assets” for these charges by
segment.
See Note 3, “Revenue Recognition, Contracts with Customers,” for revenue from contracts with customers disaggregated by segment
and product type for the years ended April 30, 2022, 2021, and 2020.
The following tables shows assets allocated by reportable segment and by the corporate category as of April 30 as follows:
Research Publishing & Platforms
Academic & Professional Learning
Education Services
Corporate
Total
2022
2021
2020
$
$
1,593,297 $
894,516
542,508
331,374
3,361,695 $
1,692,366 $
946,760
472,814
334,499
3,446,439 $
1,225,313
924,924
486,316
532,241
3,168,794
The following table shows product development spending and additions to technology, property, and equipment by reportable segment
and by the corporate category:
Research Publishing & Platforms
Academic & Professional Learning
Education Services
Corporate
Total
For the Years Ended April 30,
2021
2022
2020
$
$
(30,139) $
(44,082)
(7,308)
(34,329)
(115,858) $
(24,284) $
(41,897)
(3,449)
(33,731)
(103,361) $
(16,329)
(38,229)
(613)
(60,030)
(115,201)
Revenue for the years ended April 30 from external customers is based on the location of the customer, and technology, property and
equipment, net by geographic area as of April 30 were as follows:
United States
United Kingdom
China
Japan
Australia
Canada
Germany
France
India
Other Countries
Total
Index
2022
1,011,716 $
164,205
140,323
94,040
80,993
80,640
75,805
43,007
38,279
353,920
Revenue, net
2021
990,499 $
145,806
92,305
91,957
57,569
67,635
78,035
45,681
32,228
339,786
2,082,928 $ 1,941,501 $
$
$
102
2020
Technology, Property, and Equipment, Net
2021
2022
2020
944,075 $
174,567
58,870
75,104
73,718
56,370
113,664
45,033
27,691
262,391
1,831,483 $
232,824 $
19,260
2,609
807
476
194
7,267
3,284
984
3,867
271,572 $
241,217 $
19,436
567
234
890
1,067
8,459
4,329
1,012
5,059
282,270 $
261,296
18,076
492
112
1,051
1,734
8,059
1,358
1,066
4,761
298,005
Note 21 – Subsequent Events
Restructuring
In May 2022, the Company initiated a global program to restructure and align our cost base with current and anticipated future market
conditions. This program will include the exit of certain leased office space beginning in the first quarter of fiscal year 2023 and the
reduction of our occupancy at other facilities. In addition, the program will include severance related charges for the elimination of
certain positions. These actions are estimated to result in an initial pretax restructuring charge of approximately $19.0 million to $21.0
million in the first quarter of fiscal year 2023.
Dividend
On June 22, 2022, our Board of Directors declared a quarterly dividend of $0.3475 per share, or approximately $19.4 million, on our
Class A and Class B Common Stock. The dividend is payable on July 20, 2022 to shareholders of record on July 6, 2022.
Index
103
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None
Item 9A. Controls and Procedures
Disclosure Controls and Procedures: The Company’s Chief Executive Officer and Chief Financial Officer, together with the Chief
Accounting Officer and other members of the Company’s management, have conducted an evaluation of the Company’s disclosure
controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the Exchange Act) as
of the end of the period covered by this report. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have
concluded that the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed by
the Company in reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time
periods specified by the Securities and Exchange Commission’s rules and forms and (ii) accumulated and communicated to the
Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions
regarding required disclosure.
Management’s Report on Internal Control over Financial Reporting: Our Management is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act. Under the
supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we
conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the framework in Internal
Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based
on their evaluation, our management concluded that our internal control over financial reporting is effective as of April 30, 2022.
KPMG LLP, an independent registered public accounting firm, has audited the consolidated financial statements included in this
Annual Report on Form 10-K and, as part of their audit, has issued their report, included herein, on the effectiveness of our internal
control over financial reporting.
There were no changes in our internal control over financial reporting in the fourth quarter of fiscal year 2022 that have materially
affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
None
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
Index
104
PART III
Item 10. Directors, Executive Officers and Corporate Governance
For information with respect to Executive Officers of the Company, see “Information About Our Executive Officers” as set forth in
Part I of this Annual Report on Form 10-K.
The name, age, and background of each of the directors nominated for election are contained under the caption “Election of Directors”
in the Proxy Statement for our 2022 Annual Meeting of Shareholders (2022 Proxy Statement) and are incorporated herein by
reference.
Information on the audit committee financial experts is contained in the 2022 Proxy Statement under the caption “Report of the Audit
Committee” and is incorporated herein by reference.
Information on the Audit Committee Charter is contained in the 2022 Proxy Statement under the caption “Committees of the Board of
Directors and Certain Other Information concerning the Board.”
Information with respect to the Company’s Corporate Governance principles is publicly available on the Company’s Corporate
Governance website at https://www.wiley.com/en-us/corporategovernance.
Item 11. Executive Compensation
Information on compensation of the directors and executive officers is contained in the 2022 Proxy Statement under the captions
“Directors’ Compensation” and “Executive Compensation,” respectively, and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Information on the beneficial ownership reporting for the directors and executive officers is contained under the caption “Section
16(a) Beneficial Ownership Reporting Compliance” within the “Beneficial Ownership of Directors and Management” section of the
2022 Proxy Statement and is incorporated herein by reference. Information on the beneficial ownership reporting for all other
shareholders that own 5% or more of the Company’s Class A or Class B Common Stock is contained under the caption “Voting
Securities, Record Date, Principal Holders” in the 2022 Proxy Statement and is incorporated herein by reference.
The following table summarizes the Company’s equity compensation plan information as of April 30, 2022:
Plan Category
Equity compensation plans approved by shareholders
Number of
Securities to Be
Issued Upon Exercise
of Outstanding Options,
Warrants and Rights (1)
1,582,784 $
Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights
59.89
Number of
Securities Remaining
Available for Future
Issuance Under Equity
Compensation Plans (2)
1,390,492
(1)
This amount includes the following awards issued under the 2014 Key Employee Stock Plan:
●
●
310,409 shares issuable upon the exercise of outstanding stock options with a weighted average exercise price of $59.89.
1,272,375 non-vested performance-based and other restricted stock awards. Since these awards have no exercise price, they
are not included in the weighted average exercise price calculation.
(2)
Per the terms of the 2014 Key Employee Stock Plan (Plan), a total of 6,500,000 shares shall be authorized for awards granted
under the Plan, less one (1) share for every one (1) share that was subject to an option or stock appreciation right granted after
April 30, 2014 under the 2009 Key Employee Stock Plan and 1.76 shares for every one (1) share that was subject to an award
other than an option or stock appreciation right granted after April 30, 2014 under the 2009 Key Employee Stock Plan. Any
shares that are subject to options or stock appreciation rights shall be counted against this limit as one (1) share for every one
(1) share granted, and any shares that are subject to awards other than options or stock appreciation rights shall be counted
against this limit as 1.76 shares for every one (1) share granted. After the Effective Date of the Plan, no awards may be granted
under the 2009 Key Employee Stock Plan.
All of the Company’s equity compensation plans are approved by shareholders.
Index
105
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information on related party transactions and the policies and procedures for reviewing and approving related party transactions are
contained under the caption “Transactions with Related Persons” within the “Board and Committee Oversight of Risk” section of the
2022 Proxy Statement and are incorporated herein by reference.
Information on director independence is contained under the caption “Director Independence” within the “Board of Directors and
Corporate Governance” section of the 2022 Proxy Statement.
Item 14. Principal Accountant Fees and Services
Our independent registered public accounting firm is KPMG LLP, New York, NY, Auditor ID: 185
Information required by this item is contained in the 2022 Proxy Statement under the caption “Report of the Audit Committee” and is
incorporated herein by reference.
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a) Documents filed as a part of this Annual Report on Form 10-K:
(1) Financial Statements
See Index to Consolidated Financial Statements and Schedule of this Annual Report on Form 10-K in Part II Item 8.
(2) Financial Statement Schedule
See Schedule II - Valuation and Qualifying Accounts and Reserves - Years Ended April 30, 2022, 2021, and 2020 of this Annual
Report on Form 10-K. The other schedules are omitted as they are not applicable, or the amounts involved are not material.
(3) Exhibits
Articles of Incorporation and By-Laws
3.1
Restated Certificate of Incorporation (incorporated by reference to the Company’s Annual Report on Form 10-K for
the year ended April 30, 1992).
3.2
3.3
3.4
3.5
Certificate of Amendment of the Certificate of Incorporation dated October 13, 1995 (incorporated by reference to
the Company’s Annual Report on Form 10-K for the year ended April 30, 1996).
Certificate of Amendment of the Certificate of Incorporation dated as of September 1998 (incorporated by reference
to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended October 31, 1998).
Certificate of Amendment of the Certificate of Incorporation dated as of September 1999 (incorporated by reference
to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended October 31, 1999).
Amended and Restated By-Laws dated as of September 2007 (incorporated by reference to the Company’s Annual
Report on Form 10-K for the year ended April 30, 2018).
Instruments Defining the Rights of Security Holders, Including Indentures
4.1
Description of Securities Registered under Section 12 of the Securities Exchange Act of 1934, as amended
(incorporated by reference to the Company’s Annual Report on Form 10-K/A (Amendment No. 1) for the year ended
April 30, 2020).
Material Contracts
10.1
Index
Amended and Restated Credit Agreement dated May 30, 2019, among the Company and Bank of America, N.A., as
Administrative Agent, Swing Line Lender, and L/C Issuer, and the lenders and other agents party thereto
(incorporated by reference to the Company’s Current Report on Form 8-K filed on June 5, 2019).
106
10.2
10.3
10.4
10.5
10.6
10.7
10.8
10.9
10.10
10.11
10.12
10.13
10.14
10.15
10.16
10.17
10.18
Index
First Amendment to the Third Amended and Restated Credit Agreement (incorporated by reference to the Company’s
Current Report on Form 8-K dated as of December 23, 2021).
Agreement of the Lease dated as of July 14, 2014 between Hub Properties Trust as Landlord, an independent third
party, and John Wiley and Sons, Inc as Tenant (incorporated by reference to the Company’s Quarterly Report on
Form 10-Q for the quarterly period ended July 31, 2014).
2018 Director Stock Plan (incorporated by reference to the Company’s Annual Report on Form 10-K for the year
ended April 30, 2019).
2014 Executive Annual Incentive Plan (incorporated by reference to the Company’s Quarterly Report on Form 10-Q
for the quarterly period ended October 31, 2014).
Amended 2014 Key Employee Stock Plan (incorporated by reference to the Company’s Quarterly Report on Form
10-Q for the quarterly period ended October 31, 2014).
Deferred Compensation Plan for Directors’ 2005 & After Compensation (incorporated by reference to the Company’s
Current Report on Form 8-K, filed December 21, 2005).
Amendment to the Deferred Compensation Plan for Directors' 2005 & After Compensation effective December 15,
2021 (incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended
January 31, 2022).
Form of the Fiscal Year 2022 Executive Annual Incentive Plan (incorporated by reference to the Company’s Annual
Report on Form 10-K for the year ended April 30, 2021).
Form of the Fiscal Year 2022 Executive Long Term Incentive Plan (incorporated by reference to the Company’s
Annual Report on Form 10-K for the year ended April 30, 2021).
Form of the Fiscal Year 2022 Restricted Share Unit Grant Agreement under the Executive Long-Term Incentive Plan,
under the Business Officer Equity Program, Pursuant to the 2014 Key Employee Stock Plan (incorporated by
reference to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 31, 2021).
Form of the Fiscal Year 2022 Performance Share Unit Grant Agreement, under the Executive Long-Term Incentive
Plan, Under the Business Officer Equity Program Pursuant to the 2014 Key Employee Stock Plan (incorporated by
reference to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 31, 2021).
Form of the Fiscal Year 2022 Non-Qualified Premium Stock Option Grant Agreement Pursuant to the 2014 Key
Employee Stock Plan (incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarterly
period ended July 31, 2021).
Form of the Fiscal Year 2021 Executive Long Term Incentive Plan (incorporated by reference to the Company’s
Quarterly Report on Form 10-Q for the period ended January 31, 2021).
Form of the Fiscal Year 2021 Restricted Share Unit Grant Agreement under the Executive Long-Term Incentive Plan,
under the Business Officer Equity Program, Pursuant to the 2014 Key Employee Stock Plan (incorporated by
reference to the Company’s Quarterly Report on Form 10-Q for the period ended July 31, 2020).
Form of the Fiscal Year 2021 Performance Share Unit Grant Agreement, Under the Executive Long-Term Incentive
Plan, Under the Business Officer Equity Program Pursuant to the 2014 Key Employee Stock Plan (incorporated by
reference to the Company’s Quarterly Report on Form 10-Q for the period ended January 31, 2021).
Form of the Fiscal Year 2020 Qualified Executive Long Term Incentive Plan (incorporated by reference to the
Company’s Annual Report on Form 10-K for the year ended April 30, 2019).
Employment Letter dated October 12, 2017 between Brian A. Napack, President and Chief Executive Officer, and the
Company (incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the period ended October
31, 2017).
107
10.19
10.20
10.21
10.22
10.23
10.24
10.25
10.26
10.27
10.28
10.29
10.30
10.31
10.32
10.33
10.34
Index
Employment Letter dated February 5, 2019 between Matthew Kissner, Group Executive, and the Company
(incorporated by reference to the Company’s Current Report on Form 8-K filed on February 7, 2019).
Form of the Fiscal 2021 Restricted Share Unit Grant Agreement with Matthew S. Kissner under the Executive Long-
Term Incentive Plan, under the Business Officer Equity Program, pursuant to the 2014 Key Employee Stock Plan
(incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the period ended July 31, 2020).
Separation and Release Agreement, dated June 11, 2021 between Matthew S. Kissner, Group Executive Vice
President, and the Company (incorporated by reference to the Company’s Current Report on Form 8-K filed on June
17, 2021).
Transition and Consulting Agreement, dated June 15, 2021 between Matthew S. Kissner, Group Executive Vice
President, and the Company (incorporated by reference to the Company’s Current Report on Form 8-K filed on June
17, 2021).
Employment Letter dated April 20, 2018 between Aref Matin, Executive Vice President and Chief Technology
Officer, and the Company (incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the
period ended July 31, 2020).
Senior Executive Employment Agreement dated as of October 25, 2021 between Christina Van Tassell and the
Company (incorporated by reference to the Company’s Current Report on Form 8-K dated as of October 28, 2021).
Employment Agreement dated August 7, 2020 between Todd Zipper, Executive Vice President & General Manager,
Education Services and the Company (incorporated by reference to the Company’s Quarterly Report on Form 10-Q
for the quarterly period ended October 31, 2021).
John Wiley & Sons, Inc. Supplemental Executive Retirement Plan as Amended and Restated effective as of January
1, 2014 (incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended April 30,
2021).
John Wiley & Sons, Inc. Supplemental Benefit Plan Amended and Restated as of January 1, 2014 (incorporated by
reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Deferred Compensation Plan of John Wiley & Sons, Inc. as Amended and Restated Effective as of January 1, 2016
including amendments through December 31, 2016 (incorporated by reference to the Company’s Annual Report on
Form 10-K for the year ended April 30, 2021).
Amendment to the Deferred Compensation Plan of John Wiley & Sons, Inc. effective January 1, 2020 (incorporated
by reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the Deferred Compensation Plan of John Wiley & Sons, Inc. effective January 1, 2022 (incorporated
by reference to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended January 31, 2022).
Employees’ Retirement Plan of John Wiley & Sons, Inc. Amended and Restated June 30, 2013 with amendments
through January 1, 2014 (incorporated by reference to the Company’s Annual Report on Form 10-K for the year
ended April 30, 2021).
Amendment to the Employees’ Retirement Plan of John Wiley & Sons, Inc. effective October 1, 2016 (incorporated
by reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the Employees’ Retirement Plan of John Wiley & Sons, Inc. (IRS model 436 provisions)
(incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
John Wiley & Sons, Inc. Employees’ Savings Plan Amended and Restated Effective July 1, 2013 including
amendments through January 1, 2014 (incorporated by reference to the Company’s Annual Report on Form 10-K for
the year ended April 30, 2021).
108
10.35
10.36
10.37
10.38
10.39
Amendment to the John Wiley & Sons, Inc. Employees’ Savings Plan approved December 19, 2018 (incorporated by
reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the John Wiley & Sons, Inc. Employees’ Savings Plan approved September 26, 2019 (incorporated by
reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the John Wiley & Sons, inc. Employees’ Savings Plan effective January 1, 2020 (incorporated by
reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the John Wiley & Sons, Inc. Employees’ Savings Plan effective September 1, 2020 and January 1,
2021 (incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended April 30, 2021).
Amendment to the John Wiley & Sons, Inc. Employees' Savings Plan effective January 1, 2022 (incorporated by
reference to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended January 31, 2022).
Subsidiaries
21*
List of Subsidiaries of the Company.
Consent of Independent Registered Public Accounting Firm
23*
Consent of KPMG LLP.
Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.1*
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Certifications Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.1*
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
32.2*
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
Inline XBRL
101.INS*
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its
XBRL tags are embedded within the Inline XBRL document).
101.SCH*
Inline XBRL Taxonomy Extension Schema Document.
101.CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).
*
Filed herewith
Index
109
Item 16. Form 10-K Summary
Not applicable.
(2) Financial Statement Schedule
JOHN WILEY & SONS, INC. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED APRIL 30, 2022, 2021, AND 2020
(Dollars in thousands)
Schedule II
Year Ended April 30, 2022
Description
Allowance for sales returns(4)
Allowance for doubtful accounts
Allowance for inventory obsolescence
Valuation allowance on deferred tax assets
Year Ended April 30, 2021
Allowance for sales returns(4)
Allowance for doubtful accounts
Allowance for inventory obsolescence
Valuation allowance on deferred tax assets
Year Ended April 30, 2020
Allowance for sales returns(4)
Allowance for doubtful accounts
Allowance for inventory obsolescence
Valuation allowance on deferred tax assets
$
$
$
$
$
$
$
$
$
$
$
$
Balance at
Beginning
of Period
Cumulative
Effect of
Change in
Accounting
Principle(1)
Charged to
Expenses
Deductions
From Reserves
and Other(2)
Balance at
End of
Period(3)
22,199 $
21,474 $
13,970 $
4,855 $
19,642 $
18,335 $
16,067 $
23,287 $
18,542 $
14,307 $
15,825 $
21,179 $
— $
— $
— $
— $
— $
1,776 $
— $
— $
— $
— $
— $
— $
29,191 $
4,029 $
6,786 $
230 $
36,997 $
6,957 $
9,236 $
3,213 $
48,829 $
5,470 $
8,699 $
2,108 $
31,968 $
4,282 $
9,537 $
(24,915) $
34,440 $
5,594 $
11,333 $
21,645 $
47,729 $
1,442 $
8,457 $
— $
19,422
21,221
11,219
30,000
22,199
21,474
13,970
4,855
19,642
18,335
16,067
23,287
(1) See Note 2, “Summary of Significant Accounting Policies, Recently Issued, and Recently Adopted Accounting Standards” of the
Notes to Consolidated Financial Statements of this Annual Report on Form 10-K regarding the adoption of ASU 2016-13,
“Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments”. We adopted the
new standard on May 1, 2020, with a cumulative effect adjustment to retained earnings as of the beginning of the year of
adoption.
(2) Deductions From Reserves and Other for the years ended April 30, 2022, 2021, and 2020 include foreign exchange translation
adjustments. Included in Allowance for doubtful accounts are accounts written off, less recoveries. Included in Allowance for
inventory obsolescence are items removed from inventory.
Included in Valuation allowance on deferred tax assets for the years ended April 30, 2022 and 2020 are valuation allowances
related to, and required with respect to foreign tax credits generated by the Tax Act. In connection with a 5-year loss carryback
and a subsequent audit, certain foreign tax credits requiring a valuation allowance were reinstated.
(3)
(4) Allowance for sales returns represents anticipated returns net of a recovery of inventory and royalty costs. The provision is
reported as a reduction of gross sales to arrive at revenue and the reserve balance is reported as an increase in Contract liabilities
with a corresponding increase in Inventories, net and a reduction in Accrued royalties for the years ended April 30, 2022, 2021,
and 2020.
Index
110
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
SIGNATURES
Dated: June 24, 2022
JOHN WILEY & SONS, INC.
(Company)
By: /s/ Brian A. Napack
Brian A. Napack
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on
behalf of the Company and in the capacities and on the dates indicated.
Signatures
/s/ Brian A. Napack
Brian A. Napack
/s/ Christina Van Tassell
Christina Van Tassell
President and Chief Executive Officer and
Director
Titles
Dated
June 24, 2022
Executive Vice President and Chief Financial Officer
June 24, 2022
/s/ Christopher F. Caridi
Christopher F. Caridi
Senior Vice President, Global Corporate Controller and
Chief Accounting Officer
/s/ Jesse C. Wiley
Jesse C. Wiley
/s/ Mari J. Baker
Mari J. Baker
/s/ George D. Bell
George D. Bell
/s/ Beth A. Birnbaum
Beth A. Birnbaum
/s/ David C. Dobson
David C. Dobson
/s/ Mariana Garavaglia
Mariana Garavaglia
/s/ Laurie A. Leshin
Laurie A. Leshin
Chairman of the Board
Director
Director
Director
Director
Director
Director
/s/ Raymond W. McDaniel, Jr.
Raymond W. McDaniel, Jr.
Director
/s/ William J. Pesce
William J. Pesce
/s/ Inder Singh
Inder Singh
Director
Director
Index
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June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
June 24, 2022
SUBSIDIARIES OF JOHN WILEY & SONS, INC. (1)
As of April 30, 2022
Exhibit 21
Jurisdiction In Which Incorporated
Wiley edu, LLC
Wiley Periodicals LLC
Inscape Publishing LLC
Atypon Systems LLC
Madgex Inc.
Profiles International, LLC
PIIEU Ltd
Zyante Inc.
John Wiley & Sons Canada Ltd
Consultants M Trois Inc
Wiley Publishing LLC
Wiley India Private Ltd.
Wiley APAC Services LLP
WWL LLC
Wiley Global Technology (Private) Limited
John Wiley & Sons Rus LLC
Wiley International LLC
John Wiley & Sons (HK) Limited
Wiley HK2 Limited
Wiley Europe Investment Holdings, Ltd.
Wiley Europe Ltd.
Wiley Heyden Ltd.
John Wiley & Sons, Ltd.
E-Learning SAS
mThree Corporate Consulting Limited
mThree Corporate Consulting Limited
Atypon Systems Ltd UK
John Wiley & Sons Singapore Pte. Ltd.
John Wiley & Sons Commercial Service (Beijing) Co., Ltd.
Madgex Holdings Ltd
Hindawi Limited
Wiley-VCH GmbH
Blackwell Science (Overseas Holdings)
Atypon GmbH
Ernst & Sohn GmbH
Wiley-VHCA AG
John Wiley & Sons A/S
Wiley Publishing Japan KK
Wiley Publishing Australia Pty Ltd.
John Wiley and Sons Australia, Ltd.
J Wiley Ltd.
CrossKnowledge Group Limited
Delaware
Delaware
Delaware
Delaware
Delaware
Texas
United Kingdom
Delaware
Canada
Canada
Delaware
India
India
Delaware
Sri Lanka
Russia
Delaware
Hong Kong
Hong Kong
United Kingdom
United Kingdom
United Kingdom
United Kingdom
France
United States
United Kingdom
United Kingdom
Singapore
China
United Kingdom
United Kingdom
United Kingdom
Germany
Germany
Germany
Switzerland
Denmark
Japan
Australia
Australia
United Kingdom
United Kingdom
(1) The names of other subsidiaries that would not constitute a significant subsidiary in the aggregate have been omitted.
Index
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Exhibit 23
The Board of Directors
John Wiley & Sons, Inc.:
We consent to the incorporation by reference in the registration statements (No. 33-62605, 333-93691, 333-123359, 333-167697, and
333-265700) on Form S-8 of our reports dated June 24, 2022, with respect to the consolidated financial statements and financial
statement schedule II of John Wiley & Sons, Inc. and the effectiveness of internal control over financial reporting.
/s/ KPMG LLP
New York, New York
June 24, 2022
Index
CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 31.1
I, Brian A. Napack, certify that:
1.
I have reviewed this annual report on Form 10-K of John Wiley & Sons, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the
registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has
materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting;
and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant’s internal control over financial reporting.
By:
/s/ Brian A. Napack
Brian A. Napack
President and Chief Executive Officer
Dated: June 24, 2022
Index
CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 31.2
I, Christina Van Tassell, certify that:
1.
I have reviewed this annual report on Form 10-K of John Wiley & Sons, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the
registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal controls over financial
reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report
financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant’s internal control over financial reporting
By:
/s/ Christina Van Tassell
Christina Van Tassell
Executive Vice President and Chief Financial Officer
Dated: June 24, 2022
Index
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.1
In connection with the Annual Report of John Wiley & Sons, Inc. (the “Company”) on Form 10-K for the year ended April 30, 2022
as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Brian A. Napack, President and Chief
Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002, that based on my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
By:
/s/ Brian A. Napack
Brian A. Napack
President and Chief Executive Officer
Dated: June 24, 2022
Index
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.2
In connection with the Annual Report of John Wiley & Sons, Inc. (the “Company”) on Form 10-K for the year ended April 30, 2022
as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christina Van Tassell, Executive Vice
President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002, that based on my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
By:
/s/ Christina Van Tassell
Christina Van Tassell
Executive Vice President and Chief Financial Officer
Dated: June 24, 2022
Index