BOSTON — May 24, 2021 — Today, Cengage, a global education technology company serving more than 12 million digital users annually1, issued preliminary fiscal fourth quarter and full year results for the period ending March 31, 2021. The company’s results highlight strong financial momentum maintained through year-end, driven by successful transition to Cengage’s digital-first offerings, ongoing operating model simplification aligned to its digital transformation and effective Covid mitigation.
Key Highlights:
- Improved revenue momentum in Q4, led by US Higher Ed. Cengage Adjusted Cash Revenue in Q4 FY21 grew +1%, with US Higher Ed up +11% in the quarter
- Resilient FY21 Adjusted Cash Revenue performance. Down -6%; growth in US Higher Ed and rapid growth in Workforce Skills moderated temporary Covid declines in other businesses
- US Higher Ed net sales grew by 4%, driven by 11% digital sales growth and continuing success of Cengage Unlimited which ended the 2021 fiscal year with 4.4 Million subscriptions sold since launch and total student savings of $330M
- Ed2Go leveraged a leading position in the large and growing workforce skills market, growing Adjusted Cash Revenue by 46%
- FY21 Adjusted Cash EBITDA less Prepub broadly flat to prior year. Cost benefits from ongoing digital transformation and mitigation actions offset covid revenue impact
- Strong Cash Position. Cengage ended the fiscal year with $458M cash on hand, an increase of $92M over the prior year. Pro forma net leverage reduced to 5.6x driven by strong cash flow performance.
“The close of the 2021 fiscal year marked an important milestone for Cengage as our results show our digital strategy is driving great momentum,” said Michael Hansen, CEO, Cengage. “Over 73 percent of total net sales are now from digital; our US Higher Education business returned to growth in the year with 83 percent of net sales from digital.
“Fiscal year 2021 presented challenges and opportunities which we responded to with a great sense of purpose and conviction. When Covid began to shut schools, businesses and libraries, our investments in digital and leading customer support capabilities enabled us to meet customers’ needs quickly and effectively, which is driving sustained revenue growth into the future,” said Hansen.
“Looking ahead, we are focused on Education for Employment, aiding the more than 15 million un- and under-employed individuals who seek meaningful work to improve their lives and achieve their dreams. We will further strengthen our US Higher Ed business as core to our portfolio and build upon the rapid acceleration of our workforce skills business,” said Hansen.
For additional preliminary results, visit www.Cengage.com/Investor. Comprehensive fiscal fourth quarter and fiscal year-end presentation and audited financial statements will be issued in June 2021; exact date and timing will be announced on Cengage.com/investor in the coming weeks.
About Cengage
Cengage, a global education technology company serving millions of learners, provides quality digital products and services, equipping students with the skills and competencies needed to advance their careers and improve their lives. We serve the K-12, higher education, professional, library, English language teaching and workforce training markets worldwide. Our industry-leading products and services make education more accessible and affordable, including Cengage Unlimited, the first-of-its-kind all-access digital subscription service. Visit us at www.cengage.com or find us on LinkedIn, Facebook or Twitter.
