The Bookseller.com

7th October 2008

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Bloomsbury sees strong first half

18.09.07 Philip Jones

Bloomsbury Publishing saw its revenue rise 36.5% to £51.4m in the first half of 2007, with profit before investment income up 7.6% to £3.3m. The growth was down to export orders of Harry Potter and the Deathly Hallows, with UK orders due to be accounted in the publisher's second-half, and "one of the most sustained periods of publishing bestsellers in its history".

"This is a good set of results which puts us back on track following last year's profit warning," said chairman and chief executive Nigel Newton. "Between April and June, Bloomsbury enjoyed one of the most sustained periods of publishing bestsellers in its history. Four major reference rights deals which had been in the pipeline have now been completed and will provide very important revenue streams going forward."

Newton said that the company was "carrying out a detailed review of the group's overheads" to determine its requirements to continue the organic growth strategy of the business and also to improve the profits on the revenues currently being generated.

Gross profit increased 16.5% to £21.8m (2006, £18.7m), with the gross margin down at 42.4% (2006, 49.7%) due to a combination of royalty costs on Harry Potter and the Deathly Hallows, the high level of returns experienced in the UK, US and Germany for other titles and increased provisions for stock and advances on books published in previous financial years. Newton added: "We have increased the provisions at the half year to account for the likely irrecoverability of some of these investments."

Interest income decreased by 49.6% to £0.62m (2006, £1.23m) primarily as a result of lower average cash balances held during the six month period. Blooomsbury's net cash decreased by £11m in the six months (half the equivalent number last year) reducing its cash assets to £13.3m, compared with £31.1m in the same period last year.

Profit before tax decreased 8.5% to £3.9m (2006, £4.2m) as a result of lower interest receivable in the period.

Newton added: "The publishing programme for the second half of the year is very strong. We are carrying out a detailed review of the group's overheads to determine our requirements to continue the organic growth strategy of the business and also to improve the profits on the revenues currently being generated. We have a strong stable of authors across all three of our major territories. There is also increasing demand for electronic licences to our intellectual property from blue chip clients and Bloomsbury can look forward to high quality long-term repeat revenues from these licences for many years to come."

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