Bloomsbury Publishing Share Discussion Threads

[bains123] 30/5/2013 15:32

Just taken a position here as feel it's a solid long term play.

[protean] 29/5/2013 09:47

"And the Mountains Echoed" seems to be selling well.

http://www.amazon.com/gp/bestsellers/books/ref=sv_b_2

http://www.barnesandnoble.com/u/bestseller-books/379003517

[spob] 29/5/2013 08:57

exclusively ?

[spob] 29/5/2013 08:50

does Bloomsbury own the rights to sell harry potter e books ?

[pillion] 28/5/2013 14:51

Cheers Tara

[tara7] 28/5/2013 13:29

Pilion, all I can say for sure is way over what they had in their budget when they bought the rights for it.!!

It would not have been easy to predict just how well sales would go.

BMY picked PCG [part of PTO] to sell it for them.

PTO and BMY been very upbeat the schools contract must run into many millions in my view.

After all the FULL price for all those schools would be £390M, discount that by 97% and its still a heap of cash.

[pillion] 28/5/2013 12:43

Interesting Tara, how much ££££ profit from the Churchill sales I wonder ?

[tara7] 28/5/2013 10:37

FROM A STANDING START UNDER A YEAR AGO, BLOOMSBURY HAS SOLD THE CHURCHILL ARCHIVE AROUND THE WORLD AND TO EVERY SEC SCHOOL IN THE USA CANADA AND THE UK.

SO, ONE CAN SEE THAT WITH NEW PRODUCTS GROWTH RATES CAN HIT 1.000% NOT JUST THE ODD 30% [for digital products]

[britishb] 28/5/2013 10:30

That\'s utter drivel Rainmaker IMVHO.

As e-book sales increase surely one would expect non e-book sales to reduce. Nothing in the forecasts to suggest that rate of growth.

I had some BMY last week just because it looks too cheap but reckon you\'re wildly over-optimistic going forward. 170p looks a fair price to me.

Events may prove you right of course!

[rainmaker] 28/5/2013 10:02

Just thinking about Bloomsbury Publishing and wanted to float some ideas. So currently e-book sales are 9% therefore the remainder of the business must be 91% so applying that to current turnover of £98.50 gives £8.865 of e-book sales and £89.63mln for non e-book sales.

If e-book sales are going to reach 50% of sales in five years then they will form the following percentage of turnover assuming an even or linear progression-

Year
T+1)17.2%
T+2)25.4%
T+3)33.60%
T+4)41.80%
T+5)50.00%

If we assume that the non e-book turnover will grow at the historic rate of 1.90% then we can use that to predict e-book sales and total turnover so turnover on that basis for the next five years will be-

1)£91.33mln+£18.97=£110.30mln
2)£93.06mln+£31.68=£124.74mln
3)£94.83mln+£47.99=£142.82mln
4)£96.63mln+£69.40=£166.03mln
5)£98.47mln+£98.47=£196.94mln

so compound turnover grows at 14.8% a year whereas it historically grown at 1.9% but moreover there is a substantial increase in margins as e-book have a substantially lower costs of sales

AIMHO, DYOR

regards

[rainmaker] 28/5/2013 01:56

I've just checked back over BMY's results and turnover grew from £83.1mln in 2004 to £98.5mln in 2013 so an average compound rate of 1.9%. Turnover in that period has been very volatile eg in 2007 it doubled then dropped by approx 33% the next year. Let me think about this further and try to draw some useful conclusions.

regards

[rainmaker] 27/5/2013 17:12

If assume that Bloomsbury's turnover will grow at 5% a year then e-book sales alone will have to grow at 48% on average to meet that target. In the final results recently they grew at 61%.

regarda

[rainmaker] 27/5/2013 17:03

Thanks Protean and yet Bloomsbury's e-book are just 9% of the total sales. The target of 50% within 5 years is perfectly feasible.

regards

[protean] 25/5/2013 23:58

\"Amazon.co.uk has said that sales of its Kindle ebooks are now outstripping its sales of printed books.

Underlining the speed of change in the publishing industry, Amazon said that two years after introducing the Kindle, customers are now buying more ebooks than all hardcovers and paperbacks combined. According to unaudited figures released by the company on Monday, since the start of 2012, for every 100 hardback and paperback book sold on its site, customers downloaded 114 ebooks.\"

http://www.guardian.co.uk/books/2012/aug/06/amazon-kindle-ebook-sales-overtake-print

Quite something when you realise just how quickly this trend is progressing. BMY definitely seem to have the correct strategy in aligning its efforts with this growth area.

[rainmaker] 25/5/2013 22:29

Kambrook, quite possible but given it's exciting future,a bid for Bloomsbury would very last thing I would want.

regards

[rainmaker] 25/5/2013 22:27

You're absolutely right Jerc but I had some technical problems that prevented me doing that. I'll try again in a moment.When I first started buying BMY, the market obviously knew about the huge publishing sensation of Harry Potter(first launched some 15 years ago, it has sold over 450 million copies-one edition sold 12 million copies in just the first 24 hours)but when the series was ending, it was like "no Harry Potter =no growth" yet they totally overlooked the fact that their windfall profits were being shrewdly reinvested in new earnings enhancing businesses particularly in less price sensitive areas such as reference books etc.

regards

[rainmaker] 25/5/2013 22:17

Thanks Protean, I noticed the dramatic pick in volume, as well. IMHO a very good sign of a prolonged and large increase in the share price. I expect 160p in short order but over the next 5 year, the top end of 500p to 1000p.


Then we have the key or acute reversal on the weekly share price chart-






regards

[rainmaker] 25/5/2013 22:12

Elmfield and Fozzie-Trainess Value Investors- you bought and hung on and you now successfully passed the patience section of the Value Investing syllabus!

Guys you buy a £1 coin for 50 pence then you've just got to exercise patience and determination. No one would disagree that Bloomsbury have an exciting future so you just have to wait for the Market to catch up. Just keep the faith.

regards

[rainmaker] 25/5/2013 22:06

Hi Pillion, welcome back.IMHO You've absolutely got to try to ride the E-Book "crest of a wave" for at least five years. There's absolutely no doubt that e-book sales will continue to be very strong for that length of time so why bail out early? IMHO It doesn't make sense.The CEO is aiming for 50% of sales to be digital in 5 years, to take us where the USA are now. Furthermore as e-book sales form an increasing part of the business then margins will improve dramatically, as will Bloomsbury Publishing's share rating which is historically very low.I checked back over 12 years and it's average range is between 9 and 21 so we're very much at the bottom end.I fully expect BMY to trade on a multiple of 20+.

regards

[kambrook] 25/5/2013 17:39

Certainly BMY has been subject to bid rumours in the past.

http://www.thebookseller.com/news/pearson-considering-bloomsbury-bid.html

[kambrook] 25/5/2013 17:29

A few predicting consolidation within the sector in 2013.

http://www.theliteraryplatform.com/2012/12/a-year-in-digital-publishing-and-what-to-expect-in-2013/

\'The Random Penguin merger is a watershed; predictable, but still important. With the merger ice now broken we'll see several more in 2013.\'

\'Further consolidation among publishers following the Penguin/ Random House merger and, if I was a betting woman, I'd back Amazon to buy one or more UK publishers as a foundation for the expansion of its European publishing programme.\'

\'More industry consolidation at all levels: This year's other big event was the Penguin / Random House merger. What could be next? HarperCollins to make a big move?\'

http://www.marketplace.org/topics/business/publishers-may-start-writing-their-own-big-book-mergers

Forrester Research analyst James McQuivey thinks the merger discussion between Random House and Penguin is just the start of a new round of consolidation. "This may be the one that we're hearing about," he says, "but I have a hunch it's not the only one going on."

[pillion] 25/5/2013 10:30

Amen to your enlightening chapter Rainy

I picked up on BMY on Monday after Hang highlighted the chart on the GC thread

Nice chart: good divi and great trade expansion possibilities will keep me here for at least 12 months
Pil

[jerc] 25/5/2013 09:29

Nicely put rainmaker. My one criticism is that it would be more pertinent to only include the chart for the last couple of years -as any newcommers may not understand the reasons for the huge spike (Harry Potter).
In fact,the only relevance to the company as it stands today is how wisely it\'s used the windfall.Carefully targetting niche acquisitions that have given the company a much wider base.The results of which should be very impressive growth,producing a far more sustainable spike in the coming months and years.And sustainability is the key.
Still a very healthy cash balance for further additions too.
And a very sensibly balanced portfolio from huge bestsellers to niche,but very reliable (and profitable) sectors like academic,fashion and the arts. All with the further huge e-book potential you mention.
I spend a lot of time & research looking for such companies as a full time,professional investor. And on the very few ocassions when you do eventually find all the following in one place it actually makes all the effort worthwhile :- a low p.e company that's slipped under the radar with.....
rock solid fundementals + excellent management + cash in the bank + a very healthy spread of product +/AND rapid growth prospects = A holy trinity very seldom found.

[rainmaker] 25/5/2013 01:56

Everybody seems to looking for some magical explanation for the share price rise
but I think the bull case for Bloomsbury is both very straight forward,easy to understand and very compelling that quite simply, it's the dramatic growth prospects for their digital sales(up 61% in last results)yet the Company has a no growth rating. If e-book sales are 9% of current turnover and the Company aims for 50% in five years then IMHO profits and the Company share price are going stratospheric if they can achieve that. Coincidentally I believe that in the States(they say what happens there, happens here 5 years later) e-book already account for more than half of sales so IMHO this isn't pie in the sky (unrealistic)stuff. Then you have research that states that readers buy more books in the digital format than paperback.

E-book sales are beginning to reach critical mass where there're going to have a significant impact on the Company's profitability. Moreover it should be remembered that e-book sales have much higher margins that hardbacks ie no paper, no ink, substantially less distribution costs and frequently no plastic either as the publication is downloaded on line. The Company has no price competition because it obviously owns the copyright ie publishing rights. I'm sure that we will have not just rising profits but that the Company will attract a much higher rating of circa 20 times and more as Investors begin to understand the changes and the impact on it's profitability.

Bloomsburys business model is fast evolving that will make it a more efficient, more productive and more profitable but the market hasn't picked up on this.Aside from e-book sales having higher margins there greater opportunities for selling content and more formats for selling that content ie e-books, collective on line rights ie licensing, access rights on line direct to the Consumer-there are so many opportunities for Bloomsbury to leverage their brand and their intellectual property.

These changes have been known about for some time. This Company reminds me of Pace Microtechnology(PIC) before it rose 50/60 fold.I don't expect that to happen with Bloomsbury but I certainly believe the share price will go to £5, perhaps £10 for reasons already explained.The huge demand for digital set boxes was known and public knowledge at the very depths of the share price and it's the same for Bloomsbury Publishing. The Stockmarket is supposed to be efficient in the semi strong sense that all publicly available information is instanteously and automatically reflected in the share prices of all Companies but I've never subscribed to that view.


That's exactly the way I see it


AIMHO, DYOR

[protean] 24/5/2013 22:50

http://www.bloomberg.com/news/2013-05-24/bloomsbury-gains-on-signs-digital-shift-is-working-london-mover.html