Latest results

Unaudited Interim Results for the six months ended 31 August 2020

Record first half earnings performance
Interim dividend declared

Bloomsbury, the leading independent publisher, today announces unaudited results for the six months ended 31 August 2020, in line with expectations.

Commenting on the results, Nigel Newton, Chief Executive, said:

“Bloomsbury experienced excellent trading in the first half with year-on-year profit growth of 60% to £4.0 million. This has delivered our highest first half earnings since 2008 and exceeded the Board’s expectations.

Online book sales and e-book revenues were significantly higher.

The Consumer division had an excellent performance with 17% revenue growth and a £2.1 million increase in profit before tax and highlighted items to £2.7 million. Stand-out bestsellers during the period included Why I’m No Longer Talking to White People about Race, Crescent City: House of Earth and Blood, White Rage, Humankind and Such A Fun Age.

In the Non-Consumer division, our strategy of developing online academic resources, conceived five years ago, meant we were well placed to benefit from the accelerated shift by academic institutions to digital products to support remote learning. We saw 47% growth in sales of Bloomsbury Digital Resources as a result.

Bloomsbury is in a strong financial position, with net cash of £44.1 million at 31 August 2020, as a result of excellent trading in the first half and the swift measures taken by the Board to control costs and strengthen Bloomsbury’s balance sheet. The strength of our financial position meant that we continued to operate effectively, invest in new content, and build a strong pipeline of authors and titles. Bloomsbury is well positioned for the future, with sufficient working capital and significant headroom for acquisitions opportunities.

In light of our strong financial position and the importance of our dividend policy, we are resuming an interim dividend of 1.28 pence per share, in line with last year.

Financial Highlights

• Revenues increased by 10% to £78.3 million (2019: £71.3 million)
• Profit before taxation and highlighted items¹ grew by 60% to £4.0 million (2019: £2.5 million)
• Profit before taxation grew by £1.7 million to £3.0 million (2019: £1.3 million)
• Diluted earnings per share, excluding highlighted items¹, grew by 55% to 4.13 pence (2019: 2.66 pence)²
• Diluted earnings per share grew by 131% to 2.87 pence (2019: 1.24 pence)²
• Net cash of £44.1 million at 31 August 2020, up £24.0 million from last year (2019: £20.1 million)
• Interim dividend of 1.28 pence per share (2019: 1.28 pence per share)

Operational Highlights

• Consumer Division
  • Consumer revenue growth of 17% to £48.6 million (2019: £41.5 million)
  • Consumer profit before taxation and highlighted items¹ increase of £2.1 million to £2.7 million (2019: £0.6 million)
  • Excellent Adult Trade performance, with revenue up 16% to £18.8 million (2019: £16.2 million) and profit before taxation and highlighted items¹ of £1.1 million (2019: £0.1 million loss)
  • Excellent Children’s Trade performance, with revenue up 18% to £29.8 million (2019: £25.3 million) and profit before taxation and highlighted items¹ of £1.7 million (2019: £0.8 million)
  • Strong sales of Sarah J. Maas front and backlist titles; Harry Potter sales were robust; encouraging growth in other Children’s titles
• Non-Consumer Division
  • Non-Consumer revenues of £29.7 million (2019: £29.9 million)
  • Resilient Academic & Professional performance, with Non-Consumer revenue within 1% of 2019 and profit before taxation and highlighted items¹ of £1.4 million (2019: £1.8 million)
  • Bloomsbury Digital Resources (“BDR”) revenues up 47% to £5.6 million
  • Strong growth in BDR products and Academic e-books, offset by an expected reduction in print sales

Notes

¹ Highlighted items comprise amortisation of acquired intangible assets and legal and other professional costs and restructuring costs relating to ongoing and completed acquisitions.

²Restatement of earnings per share due to bonus issue of shares in the period.

The information in this announcement has not been audited or otherwise independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. None of the Company or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss whatsoever arising from any use of this announcement, or its contents, or otherwise arising in connection with this announcement.

This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any shares in the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or investment decisions relating thereto, nor does it constitute a recommendation regarding the shares of the Company.

Certain statements, statistics and projections in this announcement are or may be forward looking. By their nature, forward‑looking statements involve a number of risks, uncertainties or assumptions that may or may not occur and actual results or events may differ materially from those expressed or implied by the forward-looking statements. Accordingly, no assurance can be given that any particular expectation will be met and reliance should not be placed on any forward-looking statement. Accordingly, forward-looking statements contained in this announcement regarding past trends or activities should not be taken as representation that such trends or activities will continue in the future. You should not place undue reliance on forward-looking statements, which are based on the knowledge and information available only at the date of this announcement’s preparation.

The Company does not undertake any obligation to update or keep current the information contained in this announcement, including any forward‑looking statements, or to correct any inaccuracies which may become apparent and any opinions expressed in it are subject to change without notice.

References in this announcement to other reports or materials, such as a website address, have been provided to direct the reader to other sources of information on Bloomsbury Publishing Plc which may be of interest. Neither the content of Bloomsbury’s website nor any website accessible by hyperlinks from Bloomsbury’s website nor any additional materials contained or accessible thereon, are incorporated in, or form part of, this announcement.

Chief Executive's statement

Overview

Bloomsbury has had an excellent first half of the year. Revenue grew by 10% to £78.3 million (2019: £71.3 million), and profit before taxation and highlighted items increased by 60% to £4.0 million (2019: £2.5 million). Profit before taxation was £3.0 million (2019: £1.3 million).

The strength of demand for our titles, in print and e-book, and the surge in sales of our digital products demonstrates the strength of our long-term growth strategy.

Bloomsbury Digital Resources (“BDR”) is performing very well, with 47% revenue growth year-on-year. This has positioned us well to deliver growth from the accelerated shift to digital learning, with a threefold increase in the number of new customers in the first half. The combination of excellent digital products and the strength and range of our partnerships enable us to continue to deliver growth from the high quality platforms and infrastructure we have built.

The highlighted items of £1.0 million (2019: £1.2 million) consist of the amortisation of acquired intangible assets of £0.9 million (2019: £0.9 million) and legal and other professional fees relating to acquisitions of £0.1 million (2019: £0.3 million). The effective rate of tax for the period was 23.6% (2019: 25.6%). The effective rate of tax, excluding highlighted items, was 17.3% (2019: 17.7%). Diluted earnings per share for the period, excluding highlighted items, was 4.13 pence (2019: 2.66 pence).  Including highlighted items, profit before taxation was £3.0 million (2019: £1.3 million) and diluted earnings per share was 2.87 pence (2019: 1.24 pence).

Balance sheet and liquidity

The Board believes our strong balance sheet ensures we have sufficient working capital to fulfil our long-term goals and deliver on our growth strategy.

At 31 August 2020, Bloomsbury held net cash of £44.1 million (2019: £20.1 million). During the first half, our cash generation was stronger than expected, due to the combination of better than anticipated trading, reduced costs, continued focus on working capital with a £3.7 million (14%) reduction in inventory and good cash collection. We also received a £1.3 million loan from the US Government under the Paycheck Protection Program (“PPP”). This resulted in a net cash inflow, excluding the equity placing, dividends, PPP loan and acquisitions, of £4.8 million (2019: net outflow of £2.1 million). In addition, the net equity placing was £8.0 million (2019: nil) and the final dividend was settled by way of a bonus issue (2019: final dividend of £5.1 million).

Dividend

The Group’s dividend policy is supported by strong cash cover. The Board has declared an interim dividend of 1.28 pence per share, in line with the interim dividend for the six months ended 31 August 2019. The dividend will be paid on 4 December 2020 to Shareholders on the register on the record date of 6 November 2020.

Acquisitions

With trading having been stronger than expected, the Board expects to be able to use the proceeds of the equity placing for future growth opportunities. We are actively considering acquisition opportunities in line with our long-term growth strategy of growing our Non-Consumer portfolio.

During the period we successfully completed the integration of Oberon Books Limited, acquired in December 2019, and the assets of Zed Books Limited, acquired in March 2020. Bloomsbury has a successful track record in strategic acquisitions, with 16 acquisitions completed since 2008.

Long-term growth strategy

Bloomsbury’s long-term growth strategy is aimed at diversifying into digital channels and building quality revenues, increasing earnings and building on the success of the last five years. This has meant that we have been well placed to benefit from recent changes, including the accelerated shift to digital products to support remote learning and consumer demand for titles across multiple platforms.

Our long-term objectives include:

Non-Consumer

• Growing Bloomsbury’s portfolio in Non-Consumer publishing. These are characterised by higher, more predictable margins and greater digital and global opportunities: 2020/21 H1 Progress: delivered 47% growth in Non-Consumer digital revenues
• Achieve BDR revenue of £15 million and profit of £5 million for 2021/22: 2020/21 H1 Progress: delivered £5.6 million revenue, up 47%, and £1.2m profit, up £1.1m

Consumer

• Discover, nurture, champion and retain high quality authors and illustrators in our Consumer division, while looking at new ways to leverage our backlist. 2020/21 H1 Progress: UK and US bestsellers included Why I’m No Longer Talking to White People about Race by Reni Eddo-Lodge, White Rage by Carol Anderson, Humankind by Rutger Bregman and Such a Fun Age by Kiley Reid
• Grow our key authors through effective publishing across all formats alongside strategic sales and marketing. 2020/21 H1 Progress: Sales of Sarah J. Maas’ titles increased by 131%
• As the originating publisher of J.K. Rowling’s Harry Potter, to ensure that new children discover and read it for pleasure every year. 2020/21 H1 Progress: Sales of Harry Potter titles were robust and the paperback edition of Harry Potter and the Philosopher’s Stone was the fifth bestselling children’s book of the year to date on UK Nielsen Bookscan, twenty-three years after it was first published

International Expansion

• Expand international revenues and reduce reliance on UK market: 2020/21 H1 Progress: delivered overseas revenue of 67% of Group revenue; 70% of Academic BDR revenue is international

Employee Experience and Engagement, Diversity and Inclusion

Our success is driven by our colleagues’ expertise, passion and commitment. We understand the importance of attracting, supporting and engaging colleagues wherever they work.

• To be an attractive employer for all individuals seeking a career in publishing regardless of background or identity;
• Focus on targeted initiatives to create an environment that nurtures talent, stimulates creativity and collaboration, is respectful of difference and supports well-being; and
• Bloomsbury is committed to equality, diversity and inclusion. We condemn systemic racism in society in all its forms. We are dedicated to finding ways to improve our industry’s practices and our own company.
• 2020/21 H1 Progress:
• We have expanded our Diversity and Inclusion networks globally, to ensure engagement with our staff on these vital topics;
• Working in partnership with the Black Writers’ Guild to increase diversity in staff and authors;
• With our staff, we are working on recruitment, staff engagement, training and our networks;
• With our publishing, we seek to publish diverse voices. We continue to look for books that will ensure our lists represent the societies we live in. We intend to monitor our publishing so we can ensure that our list balance is representative of those societies; and partner with organisations that can help us achieve these aims; and
• Increased our focus on employee engagement, with more frequent communication across Bloomsbury, including Town Hall meetings, and continued employee voice meetings. Having transitioned to remote working we have designed our long-term strategy for flexible working.

Sustainability

Continue to switch to renewable energy across all sites, with the goal of Net Zero emissions in line with the Paris Agreement

• 2020/21 H1 Progress: We appointed a Head of Sustainability, working with the Executive Committee Sponsor, to oversee green initiatives across Bloomsbury worldwide. Our focus in H2 is to establish our targets to reduce Scope 1, 2 and 3 emissions.  Scope 1 and 2 emissions are already being measured and we have appointed Trucost to further measure Scope 3 emissions.  Furthermore, we have introduced our long-term flexible working policy to reduce emissions from staff travel; and
  
• Supporting the Woodland Trust and Reforest’Action for three years.

Consumer Division

The Consumer division consists of Adult and Children’s trade publishing. The division delivered excellent revenue growth of 17% to £48.6 million (2019: £41.5 million). Profit before taxation and highlighted items increased by £2.1 million to £2.7 million (2019: £0.6 million). These very strong results reflect robust demand across both print and digital for front and backlist titles, and the growth and effectiveness of online sales channels. Frontlist highlights included Sarah J. Maas’ bestselling Crescent City: House of Earth and Blood and the Sunday Times bestseller, Humankind by Rutger Bregman. Reni Eddo-Lodge’s Why I’m No Longer Talking to White People about Race was the number one paperback Sunday Times bestseller for seven weeks and White Rage by Carol Anderson reached number eight on the New York Times bestseller list.

Our excellent publishing has been recognised with a number of awards, with Such a Fun Age by Kiley Reid and Apeirogon by Colum McCann being longlisted for the Booker Prize. Kate Summerscale’s The Haunting of Alma Fielding: A True Ghost Story was shortlisted for the Baillie Gifford Prize. The Raven Books crime and thriller imprint was shortlisted for the second year in a row for best Crime and Mystery Publisher by the Crime Writers Association (‘CWA’), and Between Two Evils by Eva Dolan and The Anarchists’ Club by Alex Reeve shortlisted for the prestigious CWA Dagger awards. In addition, we have been shortlisted for the Books Are My Bag Reader Awards with The Devil and the Dark Water by Stuart Turton, Humankind by Rutger Bregman, Cinderella is Dead by Kalynn Bayron, and Kiley Reid, the author of Such a Fun Age.  Harry Potter and the Philosopher's Stone won the Best Book of the last 30 years at the British Book Awards in July. In addition, Bloomsbury won the IPG Award for Education Publisher of the Year for the second year in a row in September 2020.

Our excellent bestseller list performance in the last six months has continued to build the positive profile and momentum of our consumer publishing, positioning us well with a strong pipeline of authors and titles in the future.

Adult Trade

The Adult team delivered growth with a 16% increase in revenue to £18.8 million and a £1.2 million increase in profit before taxation and highlighted items to £1.1 million (2019: loss of £0.1 million).

Sunday Times bestsellers in the period included Humankind by Rutger Bregman and Kiley Reid’s Such a Fun Age. Reni Eddo-Lodge’s Why I’m No Longer Talking to White People about Race was the number one paperback Sunday Times bestseller for seven weeks and White Rage by Carol Anderson reached number eight on the New York Times bestseller list. Cookery success on the front and backlist included A Table for Friends, by Skye McAlpine, Dishoom, and Tom Kerridge’s Lose Weight for Good.

Children’s Trade

Children’s sales increased by 18% to £29.8 million (2019: £25.3 million). There was strong demand for our classic titles, led by J.K. Rowling’s Harry Potter series, as well as Sarah J. Maas’ latest bestseller, Crescent City: House of Earth and Blood.

Sales of Harry Potter titles were robust. Harry Potter and the Philosopher’s Stone was the UK’s fifth bestselling children’s book of the year to date, twenty-three years after it was first published. We are delighted that every year these classics reach a new generation of readers. UK print sales of Harry Potter books increased by 8% between mid-July and the end of September, according to Nielsen Bookscan.

Sarah J. Maas revenues grew by 131%, reflecting her new bestselling hardback title, Crescent City: House of Earth and Blood and strong sales of her backlist titles. Last year there were no new titles in the first half. We will publish two new titles this financial year: Crescent City: House of Earth and Blood, published in March 2020, and one in the second half: A Court of Silver Flames, publishing in February 2021.

Revenues for the rest of the Children’s division grew by 6% year-on-year. Highlights in the Children’s list included The Wild Way Home by Sophie Kirtley, The Great Godden by Meg Rosoff and the fourth in the bestselling series, Kid Normal and the Final Five by Greg James and Chris Smith, illustrated by Erica Salcedo.

Non-Consumer Division

The Non-Consumer division consists of Academic & Professional and Special Interest. Revenues in the division were within 1% of last year at £29.7 million (2019: £29.9 million). Profit before taxation and highlighted items for the Non-Consumer division was £1.4 million (2019: £1.8 million).

Academic & Professional revenues increased by 1% to £20.1 million (2019: £19.6 million) and profit was £1.8 million (2019: £1.8 million). The accelerated demand for digital products and swift adoption of digital learning by academic institutions helped drive the excellent performance of BDR and accelerated demand for e-books, which offset reduced print sales.

We are focused on delivering growth from accelerating our established and most successful products, including the award-winning Drama Online, building partnerships and launching new products. We delivered a 297% increase in the number of new customers year-on-year, and maintained our existing customer retention rate at over 90%. With Taylor & Francis we have delivered two modules and with Human Kinetics, we delivered the new product and a further module will be launched in the second half. New partnerships include the Yale University Press, the Liverpool University Press and the Stratford Festival. In total, we delivered two new products and two new modules in the first half and are on track to launch a further four new modules in the second half as planned.

Special Interest generated revenues of £9.6 million (2019: £10.0 million), with resilient demand for wildlife titles, Wisden and Osprey games during the period. The result was a £0.3 million loss (2019: breakeven).

Social initiatives

As part of Bloomsbury’s ongoing commitment to the wider community, we have undertaken further charitable initiatives. We published The Book of Hopes: Words and Pictures to Comfort, Inspire and Entertain Children, edited by Katherine Rundell, with contributions from more than 110 children’s writers and illustrators. Free to read online, this collection of short stories, poems, essays and pictures is also published as a hardback gift edition, with a donation from the sale of each book going to NHS Charities Together. During Waterstones’ Book of the Month promotion, we donated 10% of their sales of Reni Eddo-Lodge’s Why I’m No Longer Talking to White People About Race between BTEG and Inquest. These new initiatives are in addition to our three-year partnership with the National Literacy Trust with a particular focus on Hastings, one of the UK’s most deprived local authority areas. We gave many copies of Harry Potter and the Philosopher’s Stone through the National Literacy Trust in Hastings. In addition, for every copy of Dishoom: From Bombay with Love sold, we donate towards the price of a meal for a hungry child to both of Dishoom’s chosen charities, Magic Breakfast and The Akshaya Patra Foundation.

Recent trading and outlook

Our results for the first half were excellent and demonstrate the strength of our long-term strategy and resilient demand for our titles, in both print and digital formats.

Bloomsbury is in a strong financial position, with net cash of £44.1 million, thanks to the support of our shareholders, robust cash generation and stronger than anticipated trading in the first half. We are actively considering acquisition opportunities, in line with our long-term growth strategy.

We have continued to trade well during the first six weeks of the second half. In previous years, our revenue and earnings have been weighted towards the second half, with sales of trade titles rising for Christmas and sales of academic titles being strongest at the beginning of the academic year in the Autumn.

Our strong Consumer book list for the second half includes Quidditch Through the Ages by J.K. Rowling, illustrated by Emily Gravett, Fantastic Beasts and the Wonder of Nature in association with the Natural History Museum exhibition, Sarah J. Maas’ A Court of Silver Flames, the fourth in the Court of Thorns and Roses series and GCHQ: Behind the Enigma – The Authorised History of GCHQ by John Ferris. Front and backlist Sunday Times bestsellers in the second half to date include Piranesi by Susanna Clarke – also a Washington Post bestseller - and the paperback editions of Why I’m No Longer Talking to White People about Race by Reni Eddo-Lodge, Three Women by Lisa Taddeo, The Madness of Crowds by Douglas Murray and The Anarchy by William Dalrymple. Highlights in Children’s include the third in Brigid Kemmerer’s Cursebreaker series, A Vow so Bold and Deadly.

We are confident about the future of publishing. The short-term is difficult to predict because of the pandemic.                                                               

Condensed Consolidated Interim Income Statement
For the six months ended 31 August 2020

The accompanying notes form an integral part of this condensed consolidated interim financial report. 

Condensed Consolidated Interim Statement of Comprehensive Income
For the six months ended 31 August 2020

Items in the statement above are disclosed net of tax.

Condensed Consolidated Interim Statement of Financial Position
As at 31 August 2020

Condensed Consolidated Interim Statement of Changes in Equity
As at 31 August 2020

Condensed Consolidated Interim Statement of Cash Flows
For the six months ended 31 August 2020

Notes

Notes to the Financial Statements are available in the printable PDF version