Judith Newman - Executive Vice President and President of Scholastic Book Clubs and E-Commerce Maureen O’Connell - Chief Administrative Officer, Chief Financial Officer, Principal Accounting Officer and Executive Vice President Richard Robinson - Chairman, Chief Executive Officer, President and Chairman of Executive Committee Margery Mayer - Executive Vice President and President of Scholastic Education Jeffrey Mathews - Investor Relations

Andrew Crum - Stifel, Nicolaus & Co., Inc. Dennis Barrett - Sidoti & Company, LLC Unknown Analyst - Barry Lucas - Gabelli & Company, Inc.

Good day, ladies and gentlemen, and welcome to the Scholastic Fiscal 2011 Year-End Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to introduce your host, Mr. Jeff Matthews, Vice President of Corporate Strategy, Business Development and Investor Relations. Please go ahead.

Thank you, and good morning, everyone. Before we begin, I'd like to point out that the slides for this presentation are available for simultaneous viewing by going to our website, scholastic.com, clicking on Investor Relations and following the links on that page. I’d also like to note that this presentation contains certain forward-looking statements, which are subject to various risks and uncertainties, including the condition of the Children’s Book and educational materials markets and acceptance of the company’s products in those markets and other risks and factors identified from time to time in the company’s filings with the Securities and Exchange Commission. Actual results could differ materially from those currently anticipated. Our comments today also include references to certain non-GAAP financial measures as defined in Regulation G. The reconciliation of these non-GAAP financial measures with the relevant GAAP financial information and other information required by Reg. G is provided in the company's earning release, which is posted on the company's Investor Relations website at investor.scholastic.com. Now I'll introduce Dick Robinson, the Chairman, CEO and President of Scholastic, to begin our presentation.

Thank you, Jeff, and good morning, and thank you all for joining our fiscal 2011 year-end analyst and investor conference call. For this morning's prepared comments, I'm joined by Maureen O'Connell, CFO and CAO; other members of the executive team will also be available to answer questions at the end of this call. Last quarter, Scholastic achieved a solid finish for fiscal 2011. Education sales picked up strongly, driven by an enthusiastic response to READ 180 Next Generation, which was launched in May, and by continued growth in our services business. In Children's Books, we expanded our investments in e-commerce and in e-books to position our School Book Club and Fair channels, as well as our best-selling Trade Publishing for long-term digital growth. At the same time, segment revenue and customer metrics held solid. We also generated strong free cash flow, over $120 million for the year. Combined with substantial cash balances, this funded over $175 million in share buybacks and dividends in fiscal 2011. We also continued to pay down debt by almost $50 million. Our plan is to continue investing in digital growth initiatives while achieving higher operating profit in fiscal 2012, as we will discuss a little bit later. Beginning with Education, we achieved strong sales in the last quarter of fiscal 2011, reversing declines in earlier quarters compared to fiscal 2010, when significant federal stimulus funding drove record results. We expect last quarter's momentum to hold, and results in the first 6 weeks of fiscal 2012 support that view. Scholastic Education, the higher-margin Educational Technology and Services division, representing more than half of segment revenue, was up 15% in the fourth quarter versus a year ago and over 40% compared to 2 years ago before the federal stimulus program. The successful May release of READ 180 Next Generation, the new version of Scholastic's market-leading reading intervention program, was a key factor and exceeded our expectations. In fact, May sales were the strongest ever for READ 180. We expect Next Gen to be a significant growth driver in fiscal 2012, both from sales to new customers, as well as upgrades of existing customers. Encouragingly, upgrades are already outpacing our prior experience when we launched the last major version 6 years ago. Sales and Services continued to rise by double digits in the fourth quarter, reaching more than $65 million in net sales in fiscal 2011. Last year, we integrated our growing service portfolio, including the recently acquired Math Solutions, into a single organization, Scholastic Achievement Partners. This has greatly improved our ability to renew, sell and deliver services. In fiscal 2012, we expect an expanding customer base to drive continued growth in the significant and profitable component of the Scholastic Education. Building on the enormous success of READ 180, we continue to develop new reading, math and service programs. In addition to our core reading intervention position, math has been an area of strength for Scholastic Education. With approximately $30 million in math-related sales last year, we are well prepared to roll out major new math intervention programs including MATH 180 over the next 24 months. Our fiscal 2012 plan does not anticipate a significant change in the funding environment for education, which remains tight in most state and local districts. We also don't expect further benefit from federal stimulus funding, but we do anticipate our core federal funding streams, Title I and IDEA, to remain steady. This is consistent with the funding environment last quarter and for much of the past 10 years, during which we have grown Scholastic Education into a leader in educational technology. Turning to Children's Books. As the world's largest publisher and distributor of children's books, Scholastic's teacher, parent and child customers trust us to provide them with quality children's books both in print and, increasingly, as e-books. To take advantage of this opportunity, last year, we made significant commitments in e-books and e-commerce in the Children's Books segment, increasing operating expense for digital spending by $30 million, as well as continued investment in CapEx and prepub [prepublication]. The core of our strategy is the Scholastic eReading app, which provides children with a personalized eReading experience designed to help them learn and love to read. It is free, easily downloaded on PCs and Macs, and later this year, iPhones and iPads, as well as Android devices and tablets. Leveraging Scholastic's expertise in reading technology and children's interactive software, our eReading application augments the rich-reading experience found in children's print books with activities, animations and videos that allow child to engage more deeply with books. These exclusive features, along with audio pronunciations, leveled children's dictionaries and read-throughs support both emerging and fluent readers, especially children age 4 to 12. Inside the eReading app, children have access to their personal bookshelf and to the Scholastic ebookstore, where they and their parents can choose and buy from a carefully curated selection of quality children's titles, including many with added enhancements that leverage the unique features of our eReading app. Last year, we also constructed a digital supply chain that integrates our eReading application with our e-commerce and back-office systems. Accordingly, we are now ready for a soft launch in the School Book Clubs this fall, followed by an extended rollout in schools through clubs and fairs and to all consumers on scholastic.com early in 2012. Both events will be significant strategic milestones for Scholastic as we strengthen our position in the nascent children's digital reading market. In parallel with the development of this children's digital reading platform, last year, we also greatly expanded our e-commerce capabilities and reach, rolling out new COOL, a new online platform in Clubs. New COOL strengthens our deep relationship with teachers and extends them to parents and kids. New COOL has already resulted in the higher levels of engagement overall and significant increases in the online ordering by parents. Last year, nearly 3/4 of all Club orders came in online, up from 2/3 a year ago. E-books and e-commerce represent long-term opportunities to profitably grow Children's Books and continued investment in digital initiatives are a necessary ongoing part of this business. To realize this potential, we expect to expand our investments in marketing to rollout our e-book offerings in schools and to consumers, and as a result, we expect digital and related spending will increase in fiscal 2012. However, we remain committed to improving margins and are taking steps to reduce costs in non-digital areas of the business, by reallocating spending and staff. While we advanced our long-term e-commerce and e-book strategies last year, Children's Books also performed solidly, with revenue growth and strong customer metrics. Harry Potter is in the news again, with a final movie in series breaking box office records. And the announcement several weeks ago, J.K. Rowling's online Harry Potter destination, Pottermore, was made. So let me begin there. Harry Potter continues to be one of the Scholastic's evergreen franchises, with around $20 million in sales last year or 1% of the company's total sales. We are proud to be a partner in Pottermore, J.K. Rowling's new website, which we expect to help bring a whole new generation of readers to the series, complementing our marketing push for Harry Potter in Schools and Trade. This should drive print sales for Scholastic, as well as e-book sales, for which we will receive a royalty. Harry Potter has been a singular phenomenon, but it also illustrates a general relationship between children's books and other media. As we've seen with many Scholastic franchises, Harry Potter, Goosebumps, The Magic School Bus and Clifford, for example, films and TV typically expand the market for children's book, they don't cannibalize it, which is why we're excited by 2 more movie releases of best-selling Scholastic titles in the coming year, that is The Hunger Games and The Invention of Hugo Cabret. The Hunger Games was another best-selling series in fiscal 2011. It was a blockbuster both in print and as an e-book, making Suzanne Collins only the sixth author to sell a million e-books on Amazon's Kindle. The success of the Hunger Games with teens and adults reflects how e-books can expand the market for each crossover children's publishing. Last year, kids also embraced The 39 Clues, our best-selling series that combines print, gaming and online components. This demonstrates the opportunity for innovative transmedia approaches to children's publishing. Together, these titles and others resulted in another strong year for Scholastic Trade Publishing, with higher sales and profits. In fiscal 2012, we're focusing on developing more high-quality, innovative children's properties in print, e-book and online. Highlights include 3 more titles in The 39 Clues series, as well as new Web content; the eagerly awaited Wonderstruck by Brian Selznick, a new Captain Underpants title; and the relaunch of the best-selling Animorphs series. In School Book Fairs last year, successful investments in point-of-sale and online technology helped drive higher profits. Sustained growth and revenue per fair and fair count, even in the challenging environment for retail book sales, also reflect Scholastic Book Fair's unique positioning as community literacy events that bring together students, parents and teachers around reading, which is a top priority for schools. Based on continued deployment of point-of-sale technology in Scholastic Book Fairs, which has benefited merchandising and customer experience and our strong marketing to schools and families, we expect these positive trends to continue in fiscal 2012. In School Book Clubs, the continued rise of online ordering has changed our business and marketing model, driving higher order volumes with lower revenue per order. By adjusting our promotion strategy in the fourth quarter, we achieved an increase in average price per item sold, improving profitability. We believe these trends will continue in fiscal 2012. Turning now to International. Our International footprint includes the established markets of Canada, the U.K., Australia and New Zealand, as well as the higher-growth developing markets in Asia and through export. In fiscal 2011, we achieved higher revenues and profits in International segment, driven in part by Australia and Asia. In fiscal 2012, we expect continued revenue growth and higher margins. In Canada, Australia and the U.K., mature subsidiaries with opportunities similar to our core U.S. Children's Book business, we are targeting modest growth and improved efficiencies. In Scholastic's Asian subsidiaries, we expect fiscal 2011 double-digit profitable revenue growth to hold in fiscal 2012 and beyond. Asia is a key opportunity for Scholastic, given the strong emphasis on education and English language learning among the growing middle class. For more than 40 years, we have sold educational books and products directly to families, traditionally door-to-door, but largely in malls today. This unique direct-to-customer business is a well-established and profitable platform, which continues to grow in Thailand, Malaysia, the Philippines and Indonesia. In addition, we have introduced our school-based clubs and fairs and are achieving growing revenues and reach amongst schools, teachers and parents, largely in private schools throughout Southeast Asia and India. We are building our Educational Publishing for the region and are creating an editorial team and operations in Singapore, whose educational system is widely admired throughout Southeast Asia and developing countries worldwide. This gives us an opportunity to both target local needs with original publishing, as well as to adapt our U.S. education products. And we continue to build out our English language learning business in China and throughout the region. Four years ago, we launched a number of after-school centers in Shanghai. This has been a success and provided deep market knowledge. To scale this model, we have introduced an interactive visual whiteboard curriculum for kids aged 4 to 8. It's unique because it enables non-native English speakers to effectively teach the language. We're now rolling this program out with franchisees in China and are developing distribution partnerships in other regions. Our current revenue in Asia is only about $100 million. This profitable business is growing at a double-digit clip. Maureen O'Connell will now review our financial results for the fourth quarter and full year and lay out our financial goals for fiscal 2012. Maureen O’Connell: Thank you, Dick, and good morning, everyone. Before I review our financial results, I'd like to address the mostly noncash onetime items incurred in fiscal 2011 and 2010. The majority of onetime items have been non-cash impairments and write-downs of investments. These accounted for $7 million in fiscal 2011 and $45 million in fiscal 2010. In addition, there were onetime items related to restructuring in the U.K. of approximately $3 million in fiscal 2011 and $5 million in fiscal 2010. We also incurred $3.5 million in bad debt expense related to Borders' bankruptcy in fiscal 2011, and $7.5 million of expenses associated with a sales tax settlement in fiscal 2010. Although these onetime items have impacted our GAAP earnings, the ongoing operating results of the business are strong, as evidenced by our sustained free cash flow. Now I'd like to review the income statement adjusted to exclude the onetime items I just described. For the full year, revenues were approximately level with the prior year, as strong results in Trade and International were offset by lower sales in Educational Publishing. Compared to that segment, fiscal 2010 results, which benefited significantly from federal stimulus funding. Cost of goods sold as a percent of sales increased by 1.6 percentage points, primarily due to increased promotion and shipping costs in book clubs. Selling, general and administrative expense increased by 5%, primarily due to increased spending on digital initiatives and higher promotion spending on Book Clubs. Lower operating income primarily reflects lower sales of higher-margin educational technology relative to a year ago, as well as increased strategic spending on digital initiatives in the Children's Books business in the current fiscal year. Earnings per diluted share from continuing operations, excluding onetime items, was $1.57 compared to $2.60 a year ago. The tender offer was accretive to fiscal 2011 adjusted earnings per diluted share by $0.13. This exceeds the company's revised guidance of $1.25 to $1.40 per diluted share. Better-than-expected earnings for the year and for the quarter reflect a pickup in sales of education services and technology products, including the new version of READ 180 released in May. This slide provides segment results on adjusted basis, excluding onetime items. In Children's Books, lower adjusted operating income for the year primarily reflects increased spending on digital initiatives and higher promotion spending in Clubs. This was partially offset by higher profits in Book Fairs and Trade. In Educational Publishing, adjusted operating income declined for the full year, primarily due to lower technology product sales, partially offset by an increase in lower margin service sales to an extended customer base. Lower adjusted fourth quarter results reflect product mix and a $2 million inventory write-off related to the conclusion of a significant contract for classroom libraries. Adjusted operating income in the International segment increased for the year due to improved results in Australia and Asia, though it declined in the fourth quarter because of lower results in the U.K. Adjusted operating loss for Media, Licensing and Advertising segment was approximately leveled for the year. Corporate overhead declined for the year, reflecting cost savings initiatives, as well as lower bonus and severance, offsetting higher benefit cost. In fiscal 2011, we generated strong free cash flow due to continued working capital discipline. A key focus in 2011 was on inventories, and inventories were down by $6 million. Better inventory management and reduced purchasing in Book Fairs and Educational Publishing contribute to a lower year-end balance. Accounts receivable improved primarily due to higher collections in Book Fairs due to our new POS systems. We also returned significant cash to our shareholders in fiscal 2011. We repurchased approximately 5.2 million shares for $156 million through a successful tender offer. During fiscal 2011, we additionally acquired approximately 388,000 shares of common stock for $9.7 million under a previously announced open market share repurchase authorization. Last year, we also raised our regular dividend by 33%. In total, last year, we returned $176.4 million to shareholders in the form of share buybacks and dividends. As a result, cash and cash equivalents declined to $105.3 million from $244.1 million a year ago. Total debt declined as well, to $203.4 million from $252.8 million a year earlier as we repaid a portion of the amortizing term loan. At year end, net debt was a modest $98.1 million, and our balance sheet was strong. Now I'd like to turn to our outlook for 2012. In the Children's Book business, improved operating results in Clubs and Book Fairs is expected to offset additional digital spending and marketing costs associated with the school and consumer rollout of the company's e-book offering. In Education, we expect solid growth across the Education segment to also drive higher profits. In International, our plans for continued revenue growth and higher margins driven by strong results in Asia. In Media, Licensing and Advertising, we expect higher profits as we exit Back to Basics Toys, the company's small direct-to-consumer toy catalog business. Overhead is forecasted to be up modestly based on this plan reflecting higher bonus, budgeted bonus expense. On a consolidated basis, we expect total revenues of approximately $1.9 billion and earnings per diluted share from continuing operations of $1.75 to $2.10. This outlook corresponds to operating income of $120 million to $140 million. Our outlook for EPS and operating income excludes the impacts of severance and other onetime expenses associated with restructuring actions, as well as noncash nonoperating items. We expect free cash flow of $90 million to $100 million into fiscal 2012. Capital expenditures are forecasted to be between $55 million and $65 million. And prepublication and production spending is forecasted to be between $65 million and $75 million. With that, I'll turn the call back over to Dick.

Thanks, Maureen. Of course, we're pleased to conclude fiscal 2011 on a positive note, and we are confident that our ongoing investments in e-commerce and e-book operations will pave the way for a continued strong presence for Scholastic in digital and print sales of children's book. At the same time, we're developing strong and profitable Educational Technology and International business platforms. Now I will moderate a question-and-answer period. In addition to Maureen, I'm joined by Margery Mayer, President of Scholastic Education; Judy Newman, President of School Book Clubs and E-Commerce; Deborah Forte of Scholastic Media and the eReader; and Hugh Roome of Consumer and Professional Publishing. With that, let's open the call to questions.

[Operator Instructions] Our first question is from Drew Crum of Stifel, Nicolaus. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Maureen, could you quantify for us the increase to digital investments for fiscal '12 you're assuming in your guidance? And the other question is, you guys talked about reducing costs in non-digital areas in fiscal '12. Can you expound upon that and perhaps quantify what you're looking for in terms of savings? Maureen O’Connell: Well, both questions are obviously related. So our digital investment now, we consider as part of our ongoing operating cost of the business. It's really what we're going to need to invest in the business on an ongoing basis, so we expect digital books to be 30% of our business in 2015. And just like we make investments in warehouses, in our distribution systems and in our customer service, et cetera, this is now going to be an ongoing part of our business. And so we are reducing those hard costs, the physical structure costs and staffing in the non-digital areas to really see the ability to make these investments. So we're no longer going to break those numbers out because we see them as really part of the base business. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Okay. And I guess, just continuing with the theme on digital, I think the Pottermore initiative that was announced a couple weeks ago highlighted I guess a potential risk as a book publisher not gaining access to digital rights. I know J.K. Rowling is the exception to the rule here. But just looking at your portfolio and the content that you sell through your proprietary channels that is not owned, how are you positioned as far as digital rights going forward? And how do you intend to manage that piece of the business?

Well, except for Jo Rowling and Harry Potter, we have e-book and digital rights to virtually all of the children's books that we publish. In respect to those that we have -- we work with other publishers to sell their versions of their books in our market, that's an ongoing and developing issue. Right now we're -- we would simply acquire from some of the publishers of the e-book rights just as in Amazon or somebody else would do. But we're really developing a great deal of new digital publishing, working with our own trade authors and other authors to create new forms of digital publishing, and we certainly are doing expanded and extended e-books. So we're -- when we have a stronger value proposition for authors and digital creators because we can sell books in a whole -- digital books in a whole variety of ways. So we would look for a lot more original publishing in this area. We will continue -- we also think that it's going to be interesting -- a digital book to be interesting is in the children's area, it's going to have to move, it's going to have to have audio, it's going to have to have voice and so forth. It's going to look more like a video/audio combination rather than a static PDF file of the print book. So it's an evolving area, Drew, and we're -- we will expect to expand our original publishing there while working with authors and -- our own authors and the authors of the others and the rights of other publishers to offer a wide variety of children's titles in this area. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Okay. And just kind of shifting gears to the Clubs business, I think you mentioned in your prepared remarks that you saw the average price per item increased during the quarter and you expected those trends to continue, yet the guidance for fiscal '12 is for -- the revenue in Clubs to hold level. Just wondered if you could just explain that in greater detail.

I'll ask Judy to talk about that. But I think as we move our model online, we're experiencing the changing response from our customers. So we're obviously iterating with our customers to determine what's the best way to reach them online, to sell them online. We find that they're able to look better through our list for more titles and different kinds of pricing, so we have -- I think if the flat revenue projection is really a matter of more of adjusting our promotion spend and working with our model to improve our marketing online. So let me ask Judy to enhance on that question.

Yes, as Dick said, and as Maureen said, we are looking to focus on reducing our promotion expense, which really means that we're going to be targeting our better customers, all of whom we brought in this year, and focusing on those people who have potentially more opportunity to spend. And so then when they do go online, we're really working on our product mix to make sure that there aren't too many low-priced items that they can pick and choose from, and so we're expecting higher revenue per order. Similarly, we've invested promotion this year in getting a lot of parents online to use Parent COOL, and we are seeing that, that revenue in Parents work with us. Through the Parent COOL channel, we get much higher revenue. So we're expecting higher revenue per order from a more targeted group of fewer, slightly smaller group of teachers. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Okay. And then on the Educational Publishing business, if Margery could discuss what you're seeing on the funding environment both at the federal and state and local level? What you're anticipating in fiscal '12? And also, what is contemplated in terms of adoption revenue? I know you guys are participating in a couple of adoptions in fiscal '12. That'd be great.

Okay, so let's see the funding environment. Well, as Dick said, that we expect federal funding to stay pretty stable going forward and especially in the categories that we tap into, which are Title I and IDEA. There is some tightness going on at the state and local level, and sometimes that actually works to our advantage. Like we have districts where they've decided to stick with what they have, and I think that's contributing to the -- some of the excitement around Next Gen. So right now, we're seeing that funding is okay. Now stimulus ends in September. Schools have to spend their stimulus money by September, and there is some action out there around schools spending their final stimulus money. But there's no -- we see no major stimulus benefit in 2012. In terms of adoptions, I think you know that we don't participate in very many adoptions. We are in the Texas early childhood adoption, and we expect about $8 million of revenue coming out of Texas in the first quarter. We're still seeing good sales out of California from the adoption that was 2 or 3 years ago, and we expect to have a good summer in California this summer despite all the dire talk out there about the world coming to an end. We still seem to have districts that are interested in buying our materials. So otherwise, there's really no big adoption news with our business. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Okay, that's helpful. And Margery, can you -- just on the mathematics products. Are you guys on schedule with that or has that been pushed back? I think Dick's comment was that you're expecting something over the next 24 months.

We're targeting 2014 for the first stage of MATH 180 and we have other things coming out on our math line between now and then. But most of our activities around MATH 180 -- I just want to say that we haven't talked much about our acquisition of Math Solutions, which is about -- going to be about $10 million in revenues this year. We think that's a really key strategic move for us in math. They're far and away the most respected math PD group in the country. And when we're seeing good work between our Education, READ 180 people and Math Solutions, and they're going to be a critical part of our math rollout as we go forward. Andrew Crum - Stifel, Nicolaus & Co., Inc.: Okay. Last question for Maureen on the U.K. business, the guidance is for improved results. Is the expectation there still that you get close to breakeven? Or have things changed on that front? Maureen O’Connell: That's what we're working towards. And these results don't include any restructuring efforts. There will be another restructuring effort ongoing in the U.K. to make sure that we achieve that result. So that is what our plan is.

[Operator Instructions] Our next question is from Barry Lucas of Gabelli & Company. Barry Lucas - Gabelli & Company, Inc.: I've got some housekeeping items first, Dick, for Maureen.

Sure. Barry Lucas - Gabelli & Company, Inc.: Starting with the -- if you could provide the comps, Maureen, for cap spend in the year just ended and prepublication expense so to just see where they were and where they're going. Maureen O’Connell: They're both up slightly versus this year. Let me just pull the exact numbers. We want to answer your questions while I'm looking for it. It looks like we're up in prepub about $16 million from where we actually ended this year; and in capital, up $5 million. So our guidance includes being up in those 2 areas about $21 million. Barry Lucas - Gabelli & Company, Inc.: Okay. And you continue to do a great job on the working capital side. What's left in terms of squeezing working cap? Maureen O’Connell: Well, I think inventory is a tremendous story this year. Last year, our Book Fair business -- last year being 2 years ago, our Book Fair business was able to take its inventory position down substantially. And we kept working at it and we're able to again do it this year. So I think over the last 2 years, inventory position has gone down over $20 million just in our Fair business alone. So we continue to look at inventory turns. We continue to look at can we purchase closer to just in time. We continue to look at smaller orders upfront with our vendors, able to sort of refill our orders as quick as possible. And so that's an area that we continue to see as an opportunity. And we put it in a new accounts payable system this year that allows us to really get inventory invoices scanned in immediately so we can manage our payables better, and that really provided a significant benefit this year. And then our POS investment is not only improving our sales profile and cost of products, allowing us to see what's selling and replenish quickly, but it's also improved our cash position because we're collecting the cash faster. So I think we just continue to look at those types of efficiencies. Barry Lucas - Gabelli & Company, Inc.: Share repurchases, anything in the fourth quarter? And if not, why not? Maureen O’Connell: Well, as we said, we bought -- between dividends and share repurchases, we spent $160 million returning cash to our investors this year, and we just felt it was time to make that digest in the market, let the market absorb that before we go back in aggressively. So we still have an open to buy of about $44 million in share repurchases, and I think you'll see us continuing to be very shareholder-favorable and doing activities to enhance shareholder values and return cash to our investors. Barry Lucas - Gabelli & Company, Inc.: Right. Let me throw one maybe to Margery. Drew asked earlier on the progress in math, whether it's on time. Just for my own edification, Margery, the difference between Math Solutions and what would be MATH 180?

Yes, so Math Solutions is a professional development company that's headquartered in South Toledo. It's founded by Marilyn Burns, who is the math guru without equal in American education. We have over 150 very, very, very strong math consultants around the country, and they're doing in-depth math work that is helping school districts get ready for the Common Core, improve math teaching, and those people have been doing this work and they will continue doing this work. One of the challenges in bracing math scores is going to be having teachers who are good math teachers in place with good programs. So it's part of our equation to use a math-y metaphor there to -- for success to have great training for teachers, along with a great program. And just, Barry, just want to comment on our service business overall, because as Dick mentioned, it's over $65 million in the last year. It's going to be well above that in this coming year. Last year, we delivered 16,000 days of consulting services to schools using READ 180 and our other products. I think that, that whole business model of selling product and selling service to schools to help their teachers be better teachers, to help their math and reading coaches be better coaches, that's a very important element of our strategy going forward. And it's really, it's completely coupled with our product strategy. Barry Lucas - Gabelli & Company, Inc.: Great. I didn't mean to cut you off, Margery.

No, no, no. I think -- and then I was just going to say a little bit about MATH 180. MATH 180 is going to share some -- a lot of characteristics with READ 180. It's going to be highly adaptive. It's going to be data-driven. It's going to be an intervention program. So the program will look a lot like READ 180. And then, we're going to use the capacity of Math Solutions to provide that human capital development that we're going to need to provide to schools to be truly successful in math. Barry Lucas - Gabelli & Company, Inc.: Great. Very helpful. Last area, now I can get to Dick. Looking at the -- and I'll throw just a real softball for you. But looking at the closure of Borders, and maybe you could even touch on what the sales through the real retail channel are and the shift over to digital, how do you see this evolving, putting a fair amount of money into digital and I like to some extent, what Margery said, it's part of the business now. So how does this evolve? How quickly 30% of sales in 2000 -- of those Children's Books sales maybe in 2015 are through electronic means. What moves that quicker? What slows it down? I mean, just looking at iPad flying off the shelf and that sort of thing. So how are you thinking about the transition in general?

A good and broad question, I'm not sure it's a softball, though. But obviously, we have multiple personalities in the children's book world. We are a large -- most of our revenues come from distribution, as you know. And our Clubs and Fairs are channels that go direct through the schools but to parents, and parents buy the books with checks and credit cards, which they give us through the teacher in respect to Clubs and through the school in respect to Fairs. And so as people want to buy digital books, we have to provide capacity for them to buy those digital books both through our Club channels and through our Fair channels, and also direct to the consumer through scholastic.com. So we're preparing to do that, Barry. And as we look forward to, at least, to calendar 2015, we do expect that there'll be an increase in digital book sales, and it could be as much as 30% of our total revenues then. Now children's books have not -- there's not as much sale of children's books right now in the digital form as there is in adult books, and so we're launching during the current fiscal year, the upcoming fiscal year, the one we're in now, our digital direct-selling to parents and teachers. And the key to this strategy is our -- what we're calling our eReading app, which is a download. It can be downloaded as a piece of software that gives you both a bookshelf and a bookstore and can be downloaded to any device: iPhones, iPads, et cetera. And now obviously we -- our key marketing issue there is getting people to download that application to their devices. And that's what we're beginning to do during this coming fiscal year. And that's going to be the key to our strategies, this wonderful eReading app that we've developed, which we think is unique and it's going to be able to present eReading to children in a way that nobody else is doing, which is going to give them access to lots of moving image books and more like an iPad app experience in some ways than a static page of a print children's book sold on a PDF file. So our personality as a distributor is the first thing to think about. And our success there is going to be getting people to download that application onto their devices. And of course, we have our School Club and Fair channels, where we're reaching millions and millions of parents to enable us to do that. Then as a publisher, we're currently selling our mainly textbooks -- that is text-heavy books such as The Hunger Games -- to Amazon and to NOOK and through those devices, so that people are ordering those through our Trade channel, just as they would order a print book and buy it through a bookstore. And the third issue is our character as a media provider to kids. We have a wonderful backlist of videos based on children's books and audio based on children's books, and the capacity to create television programs such as Clifford The Big Red Dog and The Magic School Bus and Goosebumps and so forth. And the people who are good at that are also good at making moving image e-books. And so we're rapidly expanding our original supply of e-books that are going to give us a unique position in the especially ages 4 to 9 or 4 to 10 market, where kids are going to be looking at digital books that are -- that move rather than static books or text and print-heavy books. So that gives you 3 personalities that we're pursuing: our distribution personality, our trade personality, and the key to it all is our eReader download application that's going to help people download books right to their devices and buy them through our ebookstore and eReading app. Does that help at all, Barry? Barry Lucas - Gabelli & Company, Inc.: Yes, it helps a lot. I just want to follow up, John (sic) on that list, Dick, and that's the -- to the extent you can, the relationship with Apple, are they an impediment? I mean that seems to be -- have been in the news with other publishers, more in magazine publishers. But how cooperative are they in this situation? And so are they a help or hindrance?

Well, we're working with all these platforms. The iPad and iPhone platform, just the regular PC and Mac platform, the Android platform. So we're planning to deliver books in a whole variety of different ways, including through iOS or through iPad and iPhone.

Our next question is from Andrea Beneventi of Cheuvreux. Unknown Analyst -: I have 3 of them, if I may. The first one is on supplemental. You mentioned some growth in the last quarter. I was wondering if you expect this trend to continue into 2012. And secondly, how do you see federal and state funding evolving on the specific -- for the specific item of educational technology? And finally, we're seeing several initiatives in the textbook rental space recently, especially Amazon, and we're now seeing the rental of Kindle books. I was wondering if this is a reason of concern or an opportunity for you and how you're addressing this issue, please.

Thank you very much for those 3 questions. We'll split them up here a little bit. On the textbook rental, I think this is primarily an issue for higher education as we don't see very much activity in textbook rental, digital textbook rental or textbook rental in the elementary K-12 business where we have all of our business. In terms of supplemental, we are a significant publisher of supplemental curriculum materials. Much of these are in print and they're through our classroom books group. And we're selling a significant amount of guided reading, which is a supplemental reading program that complements textbooks and has over $20 million in annual revenues. We also sell paperback books to the schools for classroom libraries and supplemental use. And we're expanding our supplemental curriculum publishing, and our sales force for that area is continuing to move ahead with top-down selling of supplemental materials and larger classroom packages and classroom libraries. So that's the source of a lot of our growth here. We also have a significant amount of digital curriculum in that area. Our Grolier Online materials, our BookFlix, our TrueFlix, which are sold to digital subscription programs, sold to libraries and schools. And we're substantially expanding our effort to create interactive whiteboard supplementary curriculum programs that will be sold on a digital subscription business. We also have converted our professional teaching resource books -- that is books that help teachers, that bought by teachers to help them with classroom. We now offer those in digital format and we've had very, very rapid growth in that particular area, with teachers ordering right off of our Teachers Store, digital applications of their professional books. Now in respect to federal and state funding for educational technology, I'm going to ask Margery to talk a little bit more about that.

Well, most of the funding that's used for our products comes from Title I, which is a federal fund supporting children of -- who are within the poverty zone; and also IDEA, which is for children with special needs. There are -- there have been some pockets for technology funding that have been used to buy our materials in the past. It's not a big source of funding right now. There is some talk about some new funding buckets around technology and innovation, but we're not counting on them. We find that our programs align so well with Title I and IDEA. The other federal bucket that we do -- that schools do tap into to purchase our materials is for bilingual education, and we do get some bilingual funds as well.

[Operator Instructions] Our next question is from Dennis Barrett of Sidoti & Company. Dennis Barrett - Sidoti & Company, LLC: I was just curious regarding the product mix, specifically within the classroom instructional materials. I guess, I'm thinking about the rollout, the recent rollout of the whiteboard classroom magazine and whether you see the digital products also being that 30% of the business within the Educational Publishing section.

Yes, absolutely. We think that the whiteboard subscriptions could become more of the business than 30% and the schools are moving rapidly to use -- they've got -- there's a big installed base of interactive whiteboards in the schools, and more than 60% or 70% of schools have interactive whiteboards. And there still is a dearth of material to be found for interactive whiteboards. Now if you look at our Education segment, we -- about half of them, more than half of that segment is in Educational Technology. So that -- at this point, 50% of our Education is already digital through Educational Technology and READ 180 and complementary products. Dennis Barrett - Sidoti & Company, LLC: Okay, great. And also my other question was just on -- if you can possibly expand on where the margin improvements will come from internationally?

The margin improvement will come from growth in our International segments, as we talked on the call. Asia is growing at double digits, and so we expect improved profitability there. And across all our regions, we had strong results this year in Australia, New Zealand, Canada, and so we expect improving margins and profitability there. In our U.K. business, which has been weaker, as we mentioned, we'll have a restructuring effort underway that will help improve profitability there. So really virtually every international location that we are in, we're expecting a profitability improvement in the coming year.

Ladies and gentlemen, that does conclude our question-and-answer session for today. I would now like to turn the conference back over to Dick Robinson for any further remarks.

Well, thank you all for attending our fiscal 2011 year-end call and for talking with us about our digital investments, our expanding educational technology business, our Children's Book, e-commerce and the variety of ways that we're transforming the company to continue our leadership position in children's books and expand our leadership position in educational technology by providing digital solutions to reading, teaching and learning. Thank you very much, and we appreciate your attention and support.

Ladies and gentlemen, thank you for your participation. That concludes the conference. You may disconnect and have a wonderful day.