After less than a year in the top executive role, Ian Smith is stepping down as CEO at London-based Reed Elsevier, the parent company of Reed Business Information. He will be replaced by Erik Engstrom, who has served as CEO of the Elsevier division.
According to chairman Anthony Habgood, Smith “has had the difficult task of leading Reed Elsevier during unprecedently turbulent economic times.” Although the circumstances surrounding Smith’s departure were not immediately clear, the company called it a “mutual agreement.”
Smith replaced longtime CEO Sir Crispin Davis, who left the company in March.
The announcement comes as Reed Elsevier released an interim management statement, saying the majority of the company’s business is “proving more resilient than most but not immune from late cycle pressures given the subscription nature of much of the revenue.” The continued drop in advertising has impacted RBI while other revenue sources, like data services, are showing some growth.
This summer, Reed put many of its U.S. magazines—including Broadcasting & Cable, Mutichannel News, Professional Builder, Publishers Weekly and Tradeshow Week—back on the block following a previous auction that ended late last year after bids were said to have fallen from approximately $2 billion to $1 billion. Sources tell FOLIO: buyers have shown interest in some of the RBI properties but that the entire group is unlikely to sell to one buyer.
Reed said it will retain its Reed Construction Data, RSMeans, Variety, MarketCast, LA411 and BuyerZone properties.
Through the first half, Reed reported $1.07 billion in adjusted profit (before tax), up about 17 percent from the same period last year. That was driven mostly by a 14 percent profit gain by Elsevier and a 36 percent gain by LexisNexis. RBI, meanwhile, saw profits plunge 43 percent. Profits declined 26 percent at its events arm, Reed Exhibitions.
In July, the company raised more than $1 billion in an effort to pay down debt from its $4.17 billion acquisition of data provider ChoicePoint late last year. The company said business trends in the second half of 2009 are likely to continue into 2010.