Wolters Kluwer 2022 Half-Year Results Page 1 of 35 Wolters Kluwer 2022 Half-Year Report

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Algemeen advies 03/08/2022 09:49
Alphen aan den Rijn, August 3, 2022 – Wolters Kluwer, a global leader in professional information,
software solutions and services, today releases its half-year 2022 results.
? Revenues €2,600 million, up 7% in constant currencies and up 7% organically.
Recurring revenues (81% of total revenues) up 7% organically; non-recurring up 6% organically.
Digital & services revenues (93% of total revenues) grew 8% organically.
Expert solutions (56% of total revenues) grew 9% organically.
? Adjusted operating profit €734 million, up 10% in constant currencies.
Adjusted operating profit margin up 130 basis points to 28.2%.
Margin benefitted from operational gearing and favorable currency mix.
Slower than expected ramp-up in spending and hiring.
? Diluted adjusted EPS €2.04, up 23% overall and up 11% in constant currencies.
? Adjusted free cash flow €497 million, down 4% in constant currencies.
Cash conversion declined and tax paid increased, as expected.
? Balance sheet remains strong with net-debt-to-EBITDA of 1.3x.
? Interim dividend €0.63 per share, set at 40% of prior year total dividend.
? Share buyback program for 2022 increased to €1 billion of which €356 million completed to date.
? Guidance for 2022 increased. (See page 2).
Half-Year Report of the Executive Board
Nancy McKinstry, CEO and Chair of the Executive Board, commented: “The first half of the year saw strong,
better-than-anticipated organic growth which, along with currency movements, benefitted our margins.
Growth in expert solutions and strong customer retention was delivered across all divisions. We have
upgraded our outlook for the full year and are confident we are well-positioned to address the challenges associated with growing economic and geopolitical headwinds.”

Key Figures – Six months ended June 30
€ million (unless otherwise stated) 2022 2021 ? ? CC ? OG
Business performance – benchmark figures
Revenues 2,600 2,280 +14% +7% +7%
Adjusted operating profit 734 613 +20% +10% +11%
Adjusted operating profit margin 28.2% 26.9%
Adjusted net profit 527 437 +21% +10%
Diluted adjusted EPS (€) 2.04 1.66 +23% +11%
Adjusted free cash flow 497 476 +4% -4%
Net debt 2,203 2,417 -9%
ROIC 14.8% 12.8%
IFRS reported results
Revenues 2,600 2,280 +14%
Operating profit 640 519 +23%
Profit for the period 455 360 +26%
Diluted EPS (€) 1.76 1.37 +29%
Net cash from operating activities 666 613 +9%
?: % Change; ? CC: % Change in constant currencies (€/$ 1.18); ? OG: % Organic growth. Benchmark figures are performance
measures used by management. ROIC is based on twelve-months rolling figures.

See Note 4 for a reconciliation from IFRS to
benchmark figures

Wolters Kluwer 2022 Half-Year Results Page 2 of 35
Full-Year 2022 Outlook
We are increasing our guidance for adjusted operating profit margin and ROIC in reporting currency and
for adjusted EPS growth in constant currencies. We reaffirm our outlook for adjusted free cash flow in
constant currencies. While first half organic growth was better than expected, we expect organic
momentum to slow in the remainder of the year, largely due to challenging comparables. We expect
second half margins to reflect increased hiring and investments. Growth in diluted adjusted EPS will be
dampened by a return to our historical tax rate. Revenues from Russia, Belarus, and Ukraine (mainly in
Governance, Risk & Compliance) represented less than 0.5% of group revenues in 2021 and HY 2022.
Full-Year 2022 Outlook
Performance indicators 2022 Guidance Previous 2022 Guidance 2021 Actual
Adjusted operating profit margin* 26.0%-26.5% 25.5%-26.0% 25.3%
Adjusted free cash flow €1,025-€1,075 million €1,025-€1,075 million €1,010 million
ROIC* 14%-15% Around 14% 13.7%
Diluted adjusted EPS growth Mid- to high-single-digit Mid-single-digit €3.38
*Guidance for adjusted operating profit margin and ROIC is in reporting currency and assumes an average EUR/USD rate in 2022 of
€/$1.07. Guidance for adjusted free cash flow and diluted adjusted EPS is in constant currencies (€/$ 1.18). Guidance reflects share
repurchases of €1 billion in 2022.
If current exchange rates persist, the U.S. dollar rate will have a positive effect on 2022 results reported
in euros. In 2021, Wolters Kluwer generated more than 60% of its revenues and adjusted operating profit
in North America. As a rule of thumb, based on our 2021 currency profile, each 1 U.S. cent move in the
average €/$ exchange rate for the year causes an opposite change of approximately 2 euro cents in
diluted adjusted EPS1. Also, if current rates persist, we expect to incur a (non-cash) foreign exchange loss
on intercompany balances at year-end.
We include restructuring costs in adjusted operating profit. We currently expect that restructuring costs
will increase to within our normal range of €10-€15 million (FY 2021: €6 million). Due to higher interest
rates on cash balances, we now expect adjusted net financing costs2 in constant currencies to be
approximately €55 million. We expect the benchmark tax rate on adjusted pre-tax profits to be in the
range of 23.0%-24.0% (FY 2021: 21.5%). Capital expenditure is expected to increase but to remain within
our normal range of 5.0%-6.0% of total revenues (FY 2021: 5.0%). We continue to expect the full-year cash
conversion ratio to be in the range of 100%-105% (FY 2021: 112%).
Our guidance assumes no additional significant change to the scope of operations. We may make further
acquisitions or disposals which can be dilutive to margins, earnings, and ROIC in the near term.
2022 Outlook by Division
Health: we continue to expect organic growth to slow from 2021 levels (mainly due to the absence of a
contract win of the size of the 2021 ASCO deal) and the adjusted operating profit margin to improve.
Tax & Accounting: we expect organic growth to accelerate from 2021 levels and the adjusted operating
profit margin to improve.
Governance, Risk & Compliance: we continue to expect organic growth to slow from 2021 levels, mainly
due to an expected decline in transactional revenues in the second half. We expect the adjusted
operating profit margin to improve for the full year.
Legal & Regulatory: we now expect organic growth to improve on 2021 levels. We expect the adjusted
operating profit margin to decline modestly for the full year due to the absence of a one-off pension
amendment recorded in 2021.
1 This rule of thumb excludes the impact of exchange rate movements on intercompany balances, which is accounted for in
adjusted net financing costs in reported currencies and determined based on period-end spot rates and balances.
2 Adjusted net financing costs include lease interest charges. Guidance for adjusted net financing costs in constant currencies
excludes the impact of exchange rate movements on currency hedging and intercompany balances.

see &

tijd 10.32
Wolters Kluwer EUR 109,40 +4,10 vol. 113.000

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