Wolters Kluwer (WKL) H2 2024 earnings summary

Executive summary

• Achieved 6% organic revenue growth and improved adjusted operating profit margin for 2024, with diluted adjusted EPS up 11% in constant currencies and adjusted free cash flow up 9%.

• Recurring revenues grew 7% organically, with cloud software revenues up 16% organically; ROIC improved to 18.1%.

• Returned significant value to shareholders via increased dividends and a €1 billion share buyback, with a further €1 billion planned for 2025.

• Advanced strategic objectives, including expert solutions growth, cloud migration, and ESG initiatives; completed centralization of core functions and reduced scope 1 & 2 emissions by 11%.

• Announced CEO succession, with Stacey Caywood to succeed Nancy McKinstry in February 2026.

Financial highlights

• Full-year revenues reached €5.916 billion, up 6% in constant currencies; adjusted operating profit was €1.6 billion, up 8% in constant currencies; margin rose 70 bps to 27.1%.

• Adjusted net profit was €1.185 billion, up 7% in constant currency; diluted adjusted EPS €4.97, up 11%.

• Adjusted free cash flow was €1.276 billion, up 9% in constant currencies; cash conversion ratio at 102%.

• Return on invested capital increased to 18.1%; net debt to EBITDA ratio at 1.6x; net debt increased to €3,134 million.

• One-time pension gain of €27 million, offset by €28 million in restructuring expenses and write-offs.

Outlook and guidance

• 2025 organic revenue growth expected in line with 2024 (6%), with margin improvement and mid-single-digit EPS growth.

• Adjusted operating profit margin guidance: 27.1%-27.5%; adjusted free cash flow €1,250-1,300 million; ROIC 18-19%.

• Restructuring costs to decrease to €5-15 million.

• By division: Tax & Accounting and Legal & Regulatory to match prior year growth; Health and FCC slightly below; Corporate Performance & ESG above prior year.

• Guidance assumes no major changes in scope; RASI acquisition expected to have immaterial near-term earnings impact.