Reader's Digest Association Announces Higher 2Q Fiscal 2007 Revenues, Operating Profits, EPS and Cash Flow Versus Fiscal 2006PLEASANTVILLE, N.Y., Jan. 25 /PRNewswire-FirstCall/ -- The Reader's Digest Association, Inc. (NYSE: RDA - News) today reported higher revenues, operating profits, Earnings Per Share and cash flow for the second quarter of Fiscal 2007 ended December 31, 2006, versus the second quarter of Fiscal 2006, reflecting stronger operating results at RD North America and RD International. Following are company-wide results for the Fiscal 2007 quarter compared with Fiscal 2006:
-- Revenues were $802 million, versus $765 million.
-- Operating Profits were $114 million, versus a loss of $(76) million.
-- Net Income was $62 million, versus a loss of $(122) million.
-- EPS was $0.65, versus a loss of $(1.27).
-- Free Cash Flow was $133 million, versus $120 million.
For Fiscal 2007, reported results for the quarter included a loss on the sale of American Woodworker of $(6) million, and costs related to the pending merger with an entity formed by an investor group led by Ripplewood Holdings L.L.C. totaling $(5) million, which included higher stock-based compensation expenses as a result of increases in the company's stock price and non-operating transaction costs (see chart, below). Excluding these items, Adjusted Operating Profits were $122 million and Adjusted EPS was $0.72. For Fiscal 2006, reported results included a non-cash charge of $(188) million, or $(1.94) per share, in connection with the write-down of goodwill associated with Books Are Fun and a gain on an asset sale of $1 million. Excluding these items, Fiscal 2006 Adjusted Operating Profits were $111 million, and Adjusted EPS was $0.67.
