After enchanting an entire generation with Harry Potter, Bloomsbury Publishing (BMY) plans to cast its spell on scholars. The storied publisher unveiled Bloomsbury 2020, in a bid to boost growth and widen margins by investing in digital resources aimed at academic libraries. But it didn't lose sight of the golden snitch: solid top-line growth drove operating profits up 8 per cent to £13.1m in the year to 29 February.
Frenzied demand for a new illustrated edition of the first Harry Potter novel propelled children's and educational revenues up 57 per cent to about £42m. Moreover, brisk sales of electronic books and scholarly research meant overall digital sales increased by 28 per cent. But the adult and academic segments faced tough comparative periods, while information sales slumped 18 per cent after a major publishing services contract with the Qatar Foundation came to a close.
Management expects its new digital offerings to generate £15m in annual turnover and £5m in profits within six years. It anticipates that net project costs will peak at £2m in the next financial year. Accordingly, broker Numis lowered its pre-tax profit forecasts to £12m this financial year, giving EPS of 12p (from £13m and 15.2p in FY2016).
| BLOOMSBURY PUBLISHING (BMY) | ||||
|---|---|---|---|---|
| ORD PRICE: | 161.75p | MARKET VALUE: | £121m | |
| TOUCH: | 161-163p | 12-MONTH HIGH: | 185p | LOW: 142p |
| DIVIDEND YIELD: | 4% | PE RATIO: | 12 | |
| NET ASSET VALUE: | 177p* | NET CASH: | £5.2m | |
| Year to 29 Feb | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 97 | 8.5 | 9.8 | 5.20 |
| 2013 | 99 | 9.8 | 10.8 | 5.50 |
| 2014 | 109 | 9.5 | 10.6 | 5.82 |
| 2015 | 111 | 9.6 | 11.9 | 6.10 |
| 2016 | 124 | 10.4 | 13.0 | 6.40 |
| % change | +11 | +8 | +9 | +5 |
Ex-div: 25 Aug Payment: 21 Sep *Includes intangible assets of £64.6m, or 86p a share | ||||
