Elsevier profits near £1 billion despite European disputes

Elsevier has shrugged off a breakdown in contracts with German and Swedish universities to swell its profits to nearly £1 billion in 2018, its latest financial results reveal.

The Amsterdam-based publisher reported an all but unchanged profit margin of 37.1 per cent.

It made £942 million in profits on revenues of about £2.5 billion, according to financial results released on 21 February.

Academic publishers’ profit margins have long been a bone of contention for critics, who argue that their control over prestigious journals allows them to charge academics and libraries excessively high prices.

The results, contained in a wider financial report from Elsevier’s parent company RELX, appear to show that the publisher has been all but financially unaffected by a series of often acrimonious disputes with universities across Europe, which have sought to negotiate better deals with the publisher on cost and open access.

Swathes of universities in Germany have been without a contract with the publisher since the beginning of 2017.

Yet Elsevier’s latest results state that “key business trends remained positive in 2018, with underlying revenue growth in line with the prior year, and underlying profit growth matching revenue growth”.

The publisher expects to enjoy “another year of modest underlying revenue growth” in 2019, and an even bigger increase in profits. RELX paid out £796 million in dividends to shareholders in 2018, up from £762 million in 2017. 

The results repeat a warning made last year that a switch to open access publishing, where academics pay to publish rather than to read articles, could be a threat to the business.

“Some of these methods, if widely adopted, could adversely affect our revenue from paid subscriptions,” the financial report says.

In the past, the company has also sought to stress that it is not just an academic publisher but offers data and analytics tools too. “In primary research we continued to enhance customer value by providing broader content sets across our research offering, increasing the sophistication of our analytics, and evolving our technology platforms,” the financial results report.

david.matthews@timeshighereducation.com