Half Year 2026 Wolters Kluwer NV Earnings Call Transcript
Key Points
- Organic growth of 5% (6% excluding print) in H1 2026, in line with expectations, with strong subscription renewals across the group.
- Adjusted operating profit margin increased by 100 basis points to 29.4%, driven by operational gearing, efficiency programs, and the FRR divestment.
- Strong adoption of AI solutions: over 90% of US Enterprise Edition customers signed up for UpToDate Expert AI, and around 250 accounting firms subscribed to CCH Axcess agentic AI modules.
- Cloud software revenues grew strongly, with 18% growth in North America and 16% in Europe for Tax & Accounting, and double-digit growth in Corporate Performance & ESG.
- Recent acquisitions (Brightflag, Libra Technology, Marosa) are performing well and ahead of plan, contributing to growth and expanding product capabilities.
- Recurring revenues (85% of total) grew 7% organically, providing a stable base and supporting full-year guidance.
- Adjusted free cash flow increased 14% in constant currencies, and the balance sheet remains strong with net-debt-to-EBITDA at 2.0 times.
- Full-year guidance reiterated, including margin increase and high-single-digit EPS growth, with confidence in the outlook.
- Organic growth in Clinical Solutions slowed in Q2 due to a tough comparable from Medi-Span non-recurring revenue in Q1 2025.
- CP & ESG organic growth guidance was lowered to be in line with prior year due to geopolitical uncertainty in the Middle East, impacting Enablon implementation services and sales cycles.
- Non-recurring revenues declined 6% organically, with weak implementation services and a sharp fall in print books, partly due to publication schedule changes.
- Tax & Accounting and Legal & Regulatory margins eased slightly due to increased product development investment and acquisition dilution.
- Financial & Corporate Compliance transactional revenues remain subdued due to lack of interest rate cuts, keeping M&A and lending activity low.
- Product development spending is expected to ramp up in H2, which will pressure margins in the second half, though full-year guidance is maintained.
- Competitive pressure in the individual clinical segment (UpToDate Pro) from free AI chatbots, though this is a small part of the business.
- The absence of an interest rate cut has kept US M&A and lending activity subdued, impacting FCC transactional revenues.
Good day, and thank you for standing by. Welcome to the Wolters Kluwer half-year 2026 results webcast and conference call. (Operator Instructions) Please be advised that today's call is being recorded.
I'd now like to hand the call over to your host, Meg Geldens, Vice President, Investor Relations, to begin today's conference. Please go ahead.
Hello, everyone, and welcome to our half-year 2026 results presentation. Today's earnings release and the presentation slides are available on the Investors section of our website, wolterskluwer.com.
On the call today are Stacey Caywood, our CEO; and Kevin Entricken, our CFO. Stacey and Kevin will present the highlights of the first-half results and provide an update on how we're progressing with our AI strategy. After the presentation, we will take questions.
Before we start, I'll remind you that some statements we make today may be forward looking. We caution that these statements are subject to risks and uncertainties that
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