Scholastic Q3 Revenue Slides 2%; Board Greenlights $200M Dutch Auction Offer
Scholastic reported fiscal third-quarter revenue of $329.1 million, down 2%, with GAAP net income of $62.5 million (EPS $2.55) and an adjusted loss of $0.15 per share. The board authorized a $200 million Dutch auction tender offer in a $300 million repurchase program and set a 2.0–2.5× net leverage target.
1. Fiscal Third-Quarter Financial Results
Scholastic generated $329.1 million in revenue for the quarter ended February 28, a 2% year-over-year decline. The company recorded GAAP net income of $62.5 million, or $2.55 per share, while excluding non-recurring gains resulted in an adjusted loss of $0.15 per share.
2. $300 Million Repurchase Authorization and Tender Offer
The board expanded its repurchase authorization to $300 million, launching a $200 million modified Dutch auction tender offer at $36.00–$40.00 per share. This initiative follows $147 million returned to shareholders via open-market buybacks since December.
3. Balance Sheet Optimization and Outlook
Scholastic has deployed over $400 million in net proceeds from sale-leaseback transactions to strengthen its balance sheet and targets a net leverage ratio of 2.0–2.5× adjusted EBITDA. The company reaffirmed full-year adjusted EBITDA guidance of $146–$156 million and free cash flow above $430 million.