Sale still preferred option as profits slip almost 40% at RBI

LONDON - Reed Elsevier has reported operating profits at its magazine publishing business, which it tried and failed to sell last year, down almost 40%.

Operating profits fell to £55m to £91m at Reed Business Information while revenues slipped 1%, according to Reed Elsevier's preliminary results.

Reed Elsevier, in a statement, said: "We were disappointed not to be able to sell Reed Business Information but the macro-economic environment and poor credit market conditions made it too difficult to structure a transaction on acceptable terms.

"While the short term outlook for RBI is very challenging, RBI is a high quality business, with a strong management team and a record of success in developing online services.

"It remains our intention to divest RBI in the medium term when conditions are more favourable."

Overall Reed Elsevier reported a 16% rise in 2008 revenues to £5.3bn most of which come from scientific and legal professional products.

The rise in revenues and a 15% rise in adjusted earnings per share as Reed's low exposure to advertising helped it weather the early days of the economic down turn.

Reed Elsevier said its $290m restructuring and cost saving programme was on track and had been expanded to RBI, publisher of New Scientist and Farmers Weekly.

In January RBI made 35 of its UK staff redundant and reduced its US workforce -- the team behind titles such as Publishers Weekly, Variety, and Broadcasting & Cable.

Reed Elsevier announced its intention to sell RBI in February 2008 saying that its ad revenue model no longer fit the subscription-based model of Reed Elsevier.

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