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Bloomsbury Publishing progressing to plan

Snapshot

Here we take a closer look at Bloomsbury Publishing

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Quick facts: Bloomsbury Publishing Plc

Price: 294 GBX

LSE:BMY
Market: LSE
Market Cap: £221.47 m
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What the company does

Most people who know of Bloomsbury Publishing Plc (LON:BMY), probably know it as the Harry Potter publisher.

It doesn’t shy from the soar-away success of JK Rowling’s boy wizard but to see Bloomsbury as a one franchise wonder is to miss the point.

Other major authors include Sarah J Maas, Lisa Taddeo and Lara Maiklem

To see it purely as a fiction publisher is also an error.

Top chef Tom Kerridge has been a huge seller for Bloomsbury in recent years, for instance.

It has two arms:

  • Its consumer division consists of Adult and Children's trade publishing
  • The non-consumer operation is made up of Academic & Professional, Special interest and content services

 

The finances

For the six months ended 31 August, Bloomsbury's revenue and pre-tax profit before highlighted items were both lower year-on-year at £71.3mln and £2.5mln, respectively.

Cash at the end of the period was £20.1mln, up 15% compared to last year, and the firm hiked its interim dividend by 6% to 1.28p.

December was a busy month for the publisher, having signed a joint venture agreement with state-backed publisher China Youth Publishing Group to expand its business into the Chinese market.

It also acquired London-based drama and play publisher Oberon Books as an addition to its Academic & Professional division.

 

What the boss says: Nigel Newton, chief executive

"Our strong financial position and good cash generation, with a £3.1 million increase in cash since 31 August 2018, give us significant opportunities for further acquisitions and investment in organic growth."

"With a proposed interim dividend increase of 6%, we are on track to deliver our 25th year of consecutive dividend growth."

 

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What the broker says

Analysts at Peel Hunt, which rate Bloomsbury at a ‘buy’ with a target price of 300p, said that they hoped the new JV will “become a strategically important income stream for the company”.

“China is both a significant and difficult market. Gaining exposure through JV structures is a well-trodden route and seems commercially the most practical way… It will certainly be a way of gaining valuable commercial understanding and experience of this market”, the broker said.

 

Inflexion points 

  • The dividend has risen for twenty-five years running
  • Roster for second half of 2019 is strong 
  • Cash generation leaves it well placed for acquisitions

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Bloomsbury Publishing in a 'very strong and exciting position'

Bloomsbury Publishing PLC (LON:BMY) CEO Nigel Newton tells Proactive Investors performance for the current financial year will be well ahead of previous expectations. The upbeat outlook accompanied the results statement covering the year to the end of February, which showed that revenues...

on 22/5/18

2 min read