Scholastic Corp. continues to experience fallout from its recent business woes.
The New York City-based publisher of children's books, educational publications, and multimedia announced late last month that it would cut 400 jobs, or about 7 percent of its workforce, in an effort to improve its profitability.
Among other cost-cutting measures, the company said it would close or sell five of its magazines. It plans to shut down Agenda, a magazine aimed at education policymakers that recently has been published only about twice a year. The company will also close two of its children's magazines--Superscience Red and Math Power.
Scholastic has hired an investment firm to find buyers for two other magazines, Home Office Computing and Small Business Computing, aimed at the consumer market.
The company will close its operations in France and cut jobs at its headquarters and other U.S. operations. The moves will reduce its costs by $25 million a year and result in "significantly improved earnings," the company said.
Scholastic's stock declined more than 40 percent in value in a single day in February after the company announced that sales of its popular Goosebumps children's books had turned sluggish. Wall Street analysts said Scholastic was slow to report the bad news about weak book sales, which was part of the reason the stock dropped so sharply. ("Scholastic Stock Tumbles After Sluggish Sales," March 12, 1997.)
Meanwhile, Philadelphia's Board of Pensions and Retirement, which invested in Scholastic, sued the company in federal district court in New York, alleging that it issued false statements about its financial health and internal controls before the February stock plunge. Scholastic has said the suit has no merit.
Scholastic is putting more emphasis on core instructional materials, such as its Literacy Place series, which has been adopted by several school districts in California and elsewhere.
Sylvan Learning Systems Inc., the Baltimore-based operator of private tutoring and testing centers, has established a charitable foundation that will focus on education.
Doug Becker, the president and co-chief executive officer of the company, said in a statement this month that the Sylvan Learning Foundation would have initial assets of Sylvan stock currently valued at about $7 million.
The foundation will focus on supporting nonprofit educational programs that support "best educational practices" and incorporate community service into their goals, the company said.
--MARK WALSH [email protected]