Shares in Reed Elsevier plc (LON:REL) were trading almost two percent lower today after the professional information company said that its expects ‘modest’ underlying revenue growth in some divisions and lower growth rate in others.
Reed Elsevier’s share price had lost 1.93 percent to 1,116.00p as of 12:01 BST in London today, widely underperforming the blue-chip FTSE 100 index which was losing 0.61 percent to 7,020.18 points.
The company, which is in the process of streamlining operations while also carrying out substantial rebranding, said in its first-quarter trading update that its Scientific, Technical & Medical division saw positive key business trends remain stable. For the full year, Reed Elsevier expects the unit to book “modest underlying revenue growth”.
The Risk & Business Information division posted strong revenue in all key segments, the company said, adding that it expects underlying revenue growth trends to continue in this division.
In the Legal division, however, “market conditions continue to limit the scope for underlying revenue growth,” Reed Elsevier said.
The Exhibitions division generated strong underlying revenue growth in the US and Japan and ‘modest’ growth in Europe, with the majority of other markets still strong, “albeit slightly below the high levels achieved in recent years.” The company predicts that the current trends will continue and that cyclical effects would reduce the overall revenue growth rate by three to four percentage points.
In February, Reed Elsevier released results for 2014 which were basically in line with forecasts. The group said at the time that it would change its name to RELX and would simplify its structure in order to “increase share price transparency”.
In today’s trading update, the company said it was on track to complete the changes by July 1, subject to approval by the annual general meeting.
As of 12:35 BST, Wednesday, 22 April, Reed Elsevier plc share price is 1,119.50p.