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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Bloomsbury Publishing Plc | LSE:BMY | London | Ordinary Share | GB0033147751 | ORD 1.25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 2.00 | 0.38% | 522.00 | 520.00 | 526.00 | 530.00 | 518.00 | 520.00 | 152,089 | 12:37:32 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Books: Pubg, Pubg & Printing | 264.1M | 20.24M | 0.2497 | 20.91 | 423.13M |
From May 2022 to May 2024
TIDMBMY
RNS Number : 0997E
Bloomsbury Publishing PLC
26 October 2022
BLOOMSBURY PUBLISHING PLC
("Bloomsbury" or "the Company")
Unaudited Interim Results for the six months ended 31 August 2022
Record first half earnings
Interim dividend increased
Bloomsbury, the leading independent publisher, today announces unaudited results for the six months ended 31 August 2022.
Commenting on the results, Nigel Newton, Chief Executive, said:
"Bloomsbury achieved very strong results in the first half with year-on-year revenue growth of 22% to GBP122.9 million and profit growth of 23% to GBP15.9 million. These are our highest ever first half sales and profits. These results demonstrate the strength and resilience of our strategy of publishing for both the consumer and academic markets, our growth of digital revenues and our global diversification.
Throughout this cost of living crisis, books remain an affordable treat. Reading offers a form of escapism and an ideal - and inexpensive - therapy for dealing with the stresses and strains of day-to-day life.
The success of Bloomsbury Digital Resources ("BDR") accelerated, with revenue growth of 69% driven by organic and acquired assets. This drove the Non-Consumer division's revenue growth of 24% and a 54% increase in profit before tax and highlighted items(1) to GBP7.1 million. Resilient demand saw the Consumer division revenue grow by 21%, achieving a 6% increase in profit before tax and highlighted items(1) to GBP8.9 million.
Our financial position is strong, with net cash of GBP41.5 million. This gives us significant opportunities for further acquisitions and investment in organic growth.
In recognition of our performance and in line with our dividend policy, we are announcing a 5% increase in our interim dividend to 1.41 pence per share.
The strong first half performance means that we are confident of achieving the Board's expectations for the year ending 28 February 2023.* The strength and resilience of Bloomsbury's strategy and financial position means the Board is confident in its ability to achieve continued success. Bloomsbury plans to invest in further acquisitions and organic growth."
* The Board considers current consensus market expectation for the year ending 28 February 2023 to be revenue of GBP242.6 million and profit before taxation and highlighted items of GBP26.9 million.
Financial Highlights
Hot Features
Premium
2022 2021 2020 Growth Growth
2022 2022
vs 2021 vs 2020
GBP122.9 GBP100.7 GBP78.3
Revenue million million million 22% 57%
----------------- ------------- ---------------- --------- ---------
GBP108.1 GBP96.3 GBP78.3
Organic revenue(2) million million million 12% 38%
----------------- ------------- ---------------- --------- ---------
Profit before taxation
and highlighted items GBP12.9
(1) GBP15.9 million million GBP4.0 million 23% 295%
----------------- ------------- ---------------- --------- ---------
GBP11.1
Profit before taxation GBP12.9 million million GBP3.0 million 17% 327%
----------------- ------------- ---------------- --------- ---------
Diluted earnings per
share, excluding highlighted
items(1) 15.30 pence 12.82 pence 4.13 pence 19% 270%
----------------- ------------- ---------------- --------- ---------
Diluted earnings per
share 12.30 pence 10.41 pence 2.87 pence 18% 329%
----------------- ------------- ---------------- --------- ---------
GBP43.7 GBP44.1
Net cash GBP41.5 million million million (5)% (6)%
----------------- ------------- ---------------- --------- ---------
1.41 pence 1.34 pence 1.28 pence
Interim dividend per share per share per share 5% 10%
----------------- ------------- ---------------- --------- ---------
Operational Highlights
Non-Consumer Division
-- Non-Consumer revenue growth of 24% to GBP46.6 million (2021:
GBP37.8 million). Organic revenue growth was 2%
-- Non-Consumer profit before taxation and highlighted items(1)
increased by 54% to GBP7.1 million (2021: GBP4.6 million)
-- Academic & Professional revenue growth of 38% to GBP36.5
million (2021: GBP26.4 million) and profit before taxation
and highlighted items(1) up 85% to GBP7.3 million (2021:
GBP3.9 million)
-- Bloomsbury Digital Resources ("BDR") revenue growth of 69%
to GBP13.6 million (2021: GBP8.0 million) and profit of
GBP6.6 million (2021: GBP2.8 million)
-- On track for our new BDR target of 50% organic growth and
30% margin over the next five years
-- ABC-CLIO LLC ("ABC-CLIO") and Red Globe Press ("RGP") contributed
GBP9.9 million revenue (2021: GBP1.7 million) to Academic
& Professional
Consumer Division
-- Strong Consumer revenue growth of 21% to GBP76.3 million
(2021: GBP62.9 million). Organic revenue growth was 19%
-- Consumer profit before taxation and highlighted items (1)
increased by 6% to GBP8.9 million (2021: GBP8.4 million)
-- Adult Trade revenue up 7% to GBP25.7 million (2021: GBP23.9
million) and profit before taxation and highlighted items(1)
was GBP0.2 million (2021: GBP1.3 million)
-- Children's Trade revenue growth of 30% to GBP50.6 million
(2021: GBP39.0 million) and profit before taxation and highlighted
items (1) up 23% to GBP8.7 million (2021: GBP7.1 million)
-- Sales growth of Sarah J. Maas' titles of 45%; Harry Potter
sales increased by 35% during the 25(th) anniversary year
-- Head of Zeus Limited ("HoZ"), acquired in June 2021, contributed
GBP4.9 million revenue (2021: GBP2.7 million) to Adult Trade
Notes
(1) Highlighted items comprise amortisation of acquired intangible assets and legal and other professional costs relating to ongoing and completed acquisitions and restructuring costs.
(2) Organic revenue for the half year is defined as total revenue of GBP122.9m (2021: GBP100.7m) less revenue attributable to the acquisitions of HoZ, RGP and ABC-CLIO.
For further information, please contact:
Bloomsbury Publishing Plc Nigel Newton, Chief Executive nigel.newton@bloomsbury.com Penny Scott-Bayfield, Group penny.scott-bayfield@bloomsbury.com Finance Director Hudson Sandler +44 (0) 20 7796 4133 Dan de Belder / Amelia Craddock bloomsbury@hudsonsandler.com / Emily Brooker
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.
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 had a very strong first half. Revenue grew by 22% to GBP122.9 million (2021: GBP100.7 million), and profit before taxation and highlighted items increased by 23% to GBP15.9 million (2021: GBP12.9 million). Profit before taxation was GBP12.9 million (2021: GBP11.1 million).
Growth in organic revenue was 12%, with the three strategic acquisitions completed during 2021/22, ABC-CLIO, RGP and HoZ, contributing revenue of GBP14.8 million (2021: GBP4.4 million).
The strength and resilience of demand for Bloomsbury titles and the excellent sales of our digital products demonstrate the strength of our long-term growth strategy, the publishing judgement of our editors and the strength of our sales and marketing.
Bloomsbury Digital Resources ("BDR") was the stand-out performer during the period, with 69% revenue growth year-on-year and profit of GBP6.6 million, an increase of 134%. We continue to demonstrate the strength of our digital strategy of building high margin, quality revenues, accelerating our growth with the acquisitions of RGP and ABC-CLIO. Our strategy enables us to continue to deliver growth from the ongoing shift to digital learning, accelerating the breadth and depth of our excellent digital products and the quality of platforms and infrastructure, with a 12% increase in the number of organic customers year-on-year.
The highlighted items of GBP3.0 million (2021: GBP1.8 million) consist of the amortisation of acquired intangible assets of GBP2.7 million (2021: GBP1.0 million), one-off legal and other professional fees relating to ongoing and completed acquisitions and restructuring costs of GBP0.3 million (2021: GBP0.8 million). The effective rate of tax for the period was 22% (2021: 23%). The adjusted effective rate of tax, excluding highlighted items, was 21% (2021: 18%). Diluted earnings per share for the period, excluding highlighted items, grew by 19% to 15.30 pence (2021: 12.82 pence). Including highlighted items, profit before taxation grew by 17% to GBP12.9 million (2021: GBP11.1 million) and diluted earnings per share grew by 18% to 12.30 pence (2021: 10.41 pence).
Strategy
Bloomsbury's long-term growth strategy is aimed at continuing our success in building digital channels, increasing quality revenues and earnings. To achieve this, we are focused on the following long-term strategic objectives:
-- Non-Consumer Publishing and BDR
o Goal: Grow Bloomsbury's portfolio in Non-Consumer publishing. Non-Consumer publishing is characterised by higher, more predictable margins and greater digital and global opportunities.
Achieved - H1 2022/23: delivered 24% growth in Non-Consumer revenue.
o Goal: BDR: Further 50% organic revenue growth and 30% margin over the five years from 2022/23.
Achieved - H1 2022/23: delivered 41% organic growth and 45% margin.
-- Consumer
o Goal: Discover, nurture, champion and retain high quality authors and illustrators, while looking at new ways to leverage existing title rights.
Achieved - H1 2022/23: UK and US bestsellers included Stolen Focus by Johan Hari, BAKE by Paul Hollywood, Dirtbag, Massachusetts by Isaac Fitzgerald and Outdoor Cooking by Tom Kerridge.
o Goal: Grow our key authors through effective publishing across all formats alongside strategic sales and marketing.
Achieved - H1 2022/23: 45% growth in Sarah J. Maas' title sales.
o Goal: As the originating publisher of J.K. Rowling's Harry Potter, to ensure that new children discover and read it for pleasure every year.
Achieved - H1 2022/23: Sales of Harry Potter titles were strong, up 35%, and the paperback edition of Harry Potter and the Philosopher's Stone was the 2(nd) bestselling children's book of the year to date on UK Nielsen Bookscan, 25 years after it was first published.
-- International Expansion
o Goal: Expand international revenues and reduce reliance on UK market. Continuing our international growth in order to take advantage of the biggest academic market in the USA.
Achieved - H1 2022/23: increased overseas revenues to 73% of Group revenue (2021/22 H1: 65%); 70% of Academic BDR sales are international. US revenues increased to 36% of Group revenue.
-- Employee Experience and Engagement; Diversity, Equity and Inclusion
Our success is driven by the expertise, passion and commitment of our employees, highlighting the importance of attracting, supporting and engaging our colleagues. We value diversity of thought, perspectives and experience in shaping our culture, and strategy, driving our long-term success and informing the ways in which we fulfil our social purpose.
o Goal: Be an attractive employer for individuals seeking a career in publishing, regardless of background or identity, adding cultural value to our business operations and performance.
o Goal: Focus on initiatives to create an environment that promotes diversity, nurtures talent, stimulates creativity and collaboration, supports well-being and is inclusive and respectful of difference.
o Goal: Implement Bloomsbury's Diversity, Equity and Inclusion Action Plan ("DEIAP").
Achieved - H1 2022/23:
o All employees at Bloomsbury received a permanent salary increase of GBP1,000 per annum effective from 1 October to help with cost of living;
o First cohort of senior managers successfully completed their Diploma in Leadership and Management, and our second cohort have started their programme;
o Rollout of new next stage of employee voice programme;
o Focusing on increasing our diversity through expanding our reach, including through Creative Access, Diversify.io, and The Dots;
o Increasing our commitment as an official partner of The Runnymede Trust's Lit in Colour initiative, supporting the increase in students' access to books by writers of colour and those from minority ethnic backgrounds, drawing on our world-leading drama list from Methuen Drama.
-- Sustainability
o Goal: Maximise our use of sustainable resources while seeking to reduce carbon emissions in line with our science-based targets. We recognize our responsibility to conserve the Earth's resources and we are committed to monitoring and improving the environmental impact of our operations.
Achieved - H1 2022/23:
o Implemented improvements including removal of plastic shrink wrap from all Harry Potter paperback boxsets, piloting removing dust jackets and plastic finishes and introducing changes to backlist printing to reduce carbon emissions;
o Completed the CDP Climate Change questionnaire; o Developed our quantitative and qualitative analysis of climate-related risks and opportunities; o Supporting the Woodland Trust and Reforest'Action for three years.
Non-Consumer Division
The Non-Consumer division consists of Academic & Professional, including BDR, and Special Interest. Revenues in the division grew by 24% to GBP46.6 million (2021: GBP37.8 million). Profit before taxation and highlighted items for the Non-Consumer division grew by 54% to GBP7.1 million (2021: GBP4.6 million). Organic revenue growth was 2%, with ABC-CLIO and RGP, acquired in December 2021 and June 2021 respectively, contributing GBP9.9 million (2021: GBP1.7 million) revenue.
Academic & Professional revenues increased by 38% to GBP36.5 million (2021: GBP26.4 million) and profit before taxation and highlighted items increased by 85% to GBP7.3 million (2021: GBP3.9 million). This was driven by the strength of our BDR strategy, with 69% revenue growth from the acquisition of ABC-CLIO and increased demand for our existing digital products.
Our BDR growth strategy is focused on accelerating our established and most successful products, leveraging content and platforms from our acquisitions, building partnerships and launching new products. We increased the breadth and depth of our portfolio with the acquisition of ABC-CLIO's 32 digital databases and accelerated growth by expanding international sales using our global infrastructure. We delivered 41% organic revenue growth from a 12% increase in the number of organic customers year-on-year, increased our organic subscription revenue by 30% and maintained our existing customer retention rate at over 90%.
Special Interest revenues were GBP10.1 million (2021: GBP11.3 million), with bestsellers during the period including Wisden Cricketers Almanack , Reeds Nautical Almanac, The Happy Me Project by Holly Matthews and Osprey Games' Stargrave and Crescent Moon . The loss before taxation and highlighted items for the period was GBP0.1 million (2021: GBP0.7 million profit before taxation and highlighted items ).
Consumer Division
The Consumer division consists of Adult and Children's trade publishing. The Consumer division achieved strong revenue growth of 21% to GBP76.3 million (2021: GBP62.9 million). Organic revenue growth was 19%. Profit before taxation and highlighted items increased by 6% to GBP8.9 million (2021: GBP8.4 million). The strong performance was driven by the Children's division, across front and backlist titles, and includes GBP4.9 million revenue (2021: GBP2.7 million) from HoZ, completed in June 2021.
Adult Trade
The Adult division revenue grew by 7% to GBP25.7 million (2021: GBP23.9 million) and profit before taxation and highlighted items was GBP0.2 million (2021: GBP1.3 million). Revenue growth was driven by the strength of the backlist and includes GBP4.9 million (2021: GBP2.7 million) revenue from HoZ, completed in June 2021.
Sunday Times bestsellers in the period included Paul Hollywood's BAKE, Galatea by Madeline Miller, Old Rage by Sheila Hancock, The Weekend Cook by Angela Hartnett and Tom Kerridge's Outdoor Cooking. New York Times bestsellers included Dirtbag, Massachusetts by Isaac Fitzgerald and Paul Hollywood's BAKE.
Children's Trade
Children's revenue increased by 30% to GBP50.6 million (2021: GBP39.0 million) and profit before taxation and highlighted items increased by 23% to GBP8.7 million (2021: GBP7.1 million). High demand for our strong titles continued the momentum from last year, with excellent sales of Sarah J. Maas' titles.
Sales of Harry Potter titles were strong, up 35%. Harry Potter and the Philosopher's Stone was the 2(nd) bestselling children's book of the year to date on UK Nielsen Bookscan, on the 25(th) anniversary of its first publication, showing the enduring appeal of this classic series.
Sarah J. Maas revenues grew by 45%, reflecting her latest bestselling frontlist title, Crescent City: House of Sky and Breath, published in February 2022, and strong backlist sales. House of Sky and Breath, House of Earth and Blood, and Throne of Glass were all New York Times bestsellers during the period. Sarah J. Maas is the bestselling author of the Crescent City, Court of Thorns and Roses and Throne of Glass series, with all of her 15 titles published by Bloomsbury, since her first novel, Throne of Glass, in 2012.
Revenues for the rest of the Children's division were also good. H ighlights in the Children's list included Katya Balen's October, October, which won the Yoto Carnegie Medal, New York Times bestsellers This Wicked Fate by Kalynn Bayron and Ways to Make Sunshine by Renee Watson and Sunday Times bestsellers We're Going on an Egg Hunt and Five Little Easter Bunnies.
Acquisitions
Bloomsbury has a strong and successful track record in strategic acquisitions, with 18 completed since 2008. We are actively targeting further acquisition opportunities in line with our long-term growth strategy.
Cash and Financing
Bloomsbury's cash generation was strong with cash at 31 August 2022 of GBP41.5 million (2021: GBP43.7 million). During the period we invested GBP0.9 million of capital expenditure in BDR.
We have increased our international revenues, in particular from the US, during the period. This has enabled us to benefit from the change in exchange rates.
The Group has an unsecured revolving credit facility with Lloyds Bank Plc. The facility comprises a committed revolving loan facility of GBP10.0 million and an uncommitted incremental term loan facility of up to GBP6.0 million. At 31 August 2022, the Group had no draw down (2021: GBPnil) of this facility.
Dividend
The Group has a progressive dividend policy aiming to keep dividend earnings cover in excess of two times, supported by strong cash cover. The Board has declared an interim dividend of 1.41 pence per share, 5% above the interim dividend for the six months ended 31 August 2021. The dividend will be paid on 2 December 2022 to Shareholders on the register on the record date of 4 November 2022.
Board Changes
As announced in March 2022, John Bason joined the Board as a Non-Executive Director on 1 April 2022. John also became a member of the Remuneration, Nomination and Audit Committees. As announced in June 2022, Steven Hall stepped down from the Board at the conclusion of Bloomsbury's 2022 AGM on 20 July 2022. John Bason succeeded Steven as Chair of the Remuneration Committee.
Future Publishing
In Non-Consumer, our BDR strategic initiatives include bringing ABC-CLIO's 32 databases into Bloomsbury Digital Resources, enabling Bloomsbury to scale ABC-CLIO's digital offering globally. The acquisition of ABC-CLIO expands Bloomsbury's reach into the lucrative US High School library market. We see significant opportunity in cross selling existing school and university level digital resources, such as our bestselling platform Drama Online, to US high schools which have well-funded budgets for digital teaching aids. We will also invest in new ABC-CLIO originated high school products. In addition, we will expand Bloomsbury Collections to include both ABC-CLIO and RGP titles as well as migrate RGP's digital products to BDR's own platform.
Our strong Consumer publishing list for the second half includes the Illustrated edition of the fifth Harry Potter title, Harry Potter and the Order of the Phoenix, Tom Kerridge's Real Life Recipes, A Visible Man by Edward Enninful, Best of Friends by Kamila Shamsie, Illuminations by Alan Moore, The Story of Russia by Orlando Figes, Defend the Dawn by Brigid Kemmerer and The Lost Girl King by Catherine Doyle. The Three-Body Problem by Cixin Liu, a HoZ title, has been filmed by the creators of Game of Thrones and will be shown on Netflix in 2023. The next Sarah J. Maas novel, the third in the Crescent City series, will be published in 2023/24.
Outlook
The strength of the first half performance means that we are confident of achieving market expectations for the year ending 28 February 2023.*
Bloomsbury's strong and resilient strategy, combined with the strength of our financial position, means the Board is confident in Bloomsbury's ability to achieve continued success. Bloomsbury plans to invest in further acquisitions and organic growth.
* The Board considers current consensus market expectation for the year ending 28 February 2023 to be revenue of GBP242.6 million and profit before taxation and highlighted items of GBP26.9 million.
Condensed Consolidated Interim Income Statement
For the six months ended 31 August 2022
6 months 6 months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
Notes GBP'000 GBP'000 GBP'000
------------------------------------- ------ ----------- ------------ -------------
Revenue 3 122,910 100,656 230,110
Cost of sales (56,804) (43,967) (107,948)
------------------------------------- ------ ----------- ------------ -------------
Gross profit 66,106 56,689 122,162
Marketing and distribution costs (14,886) (13,561) (29,808)
Administrative expenses (38,041) (31,831) (69,675)
Share of result of joint venture (67) (54) (117)
Operating profit before highlighted
items 16,091 13,072 27,112
Highlighted items 4 (2,979) (1,829) (4,550)
------------------------------------- ------ ----------- ------------ -------------
Operating profit 13,112 11,243 22,562
Finance income 46 54 105
Finance costs (213) (214) (486)
------------------------------------- ------ ----------- ------------ -------------
Profit before taxation and
highlighted items 15,924 12,912 26,731
Highlighted items 4 (2,979) (1,829) (4,550)
------------------------------------- ------ ----------- ------------ -------------
Profit before taxation 3 12,945 11,083 22,181
Taxation (2,834) (2,495) (5,291)
------------------------------------- ------ ----------- ------------ -------------
Profit for the period attributable
to owners of the Company 10,111 8,588 16,890
------------------------------------- ------ ----------- ------------ -------------
Earnings per share attributable
to owners of the Company
Basic earnings per share 6 12.49p 10.54p 20.72p
Diluted earnings per share 6 12.30p 10.41p 20.33p
------------------------------------- ------ ----------- ------------ -------------
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 2022
6 months 6 months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
------------------------------------------- ----------- ----------- -------------
Profit for the period 10,111 8,588 16,890
Other comprehensive income
Items that may be reclassified to
the income statement:
Exchange differences on translating
foreign operations 10,270 373 1,497
Items that may not be reclassified
to the income statement:
Remeasurements on the defined benefit
pension scheme - (10) (10)
------------------------------------------- ----------- ----------- -------------
Other comprehensive income for the
period net of tax 10,270 363 1,487
------------------------------------------- ----------- ----------- -------------
Total comprehensive income for the
period attributable to owners of the
Company 20,381 8,951 18,377
------------------------------------------- ----------- ----------- -------------
Items in the statement above are disclosed net of tax.
Condensed Consolidated Interim Statement of Financial Position
At 31 August 2022
Notes 31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
----------------------------------- ------ ---------- ---------- ------------
Assets
Goodwill 48,868 45,326 47,910
Other intangible assets 40,329 25,712 40,323
Investments 161 108 45
Property, plant and equipment 2,562 1,804 2,319
Right-of-use assets 10,022 10,950 10,628
Deferred tax assets 8,953 4,588 7,168
Trade and other receivables 9 1,008 934 923
----------------------------------- ------ ---------- ---------- ------------
Total non-current assets 111,903 89,422 109,316
----------------------------------- ------ ---------- ---------- ------------
Inventories 44,324 37,203 33,816
Trade and other receivables 9 114,921 100,152 104,879
Cash and cash equivalents 41,451 43,663 41,226
----------------------------------- ------ ---------- ---------- ------------
Total current assets 200,696 181,018 179,921
----------------------------------- ------ ---------- ---------- ------------
Total assets 312,599 270,440 289,237
----------------------------------- ------ ---------- ---------- ------------
Liabilities
Retirement benefit obligations - 12 -
Deferred tax liabilities 3,830 3,417 3,696
Lease liabilities 9,191 10,511 9,961
Provisions 318 249 297
----------------------------------- ------ ---------- ---------- ------------
Total non-current liabilities 13,339 14,189 13,954
----------------------------------- ------ ---------- ---------- ------------
Trade and other liabilities 112,797 91,345 103,028
Lease liabilities 2,388 1,875 2,265
Current tax liabilities 999 453 433
Provisions 982 497 588
----------------------------------- ------ ---------- ---------- ------------
Total current liabilities 117,166 94,170 106,314
----------------------------------- ------ ---------- ---------- ------------
Total liabilities 130,505 108,359 120,268
----------------------------------- ------ ---------- ---------- ------------
Net assets 182,094 162,081 168,969
----------------------------------- ------ ---------- ---------- ------------
Equity
Share capital 1,020 1,020 1,020
Share premium 47,319 47,319 47,319
Translation reserve 18,397 7,003 8,127
Other reserves 11,064 10,453 8,765
Retained earnings 104,294 96,286 103,738
----------------------------------- ------ ---------- ---------- ------------
Total equity attributable to
owners of the Company 182,094 162,081 168,969
----------------------------------- ------ ---------- ---------- ------------
Condensed Consolidated Interim Statement of Changes in Equity
At 31 August 2022
Own
Capital Share-based shares
Share Share Translation Merger redemption payment held by Retained Total
capital premium reserve reserve reserve reserve the EBT earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ -------- -------- ------------ --------- ----------- ------------ -------- --------- --------
At 1 March 2022 1,020 47,319 8,127 1,803 22 9,492 (2,552) 103,738 168,969
Profit for the
period - - - - - - - 10,111 10,111
Other
comprehensive
income
Exchange
differences
on
translating
foreign
operations - - 10,270 - - - - - 10,270
Total
comprehensive
income for the
period - - 10,270 - - - - 10,111 20,381
Transactions with
owners
Dividends to
equity
holders of
the Company - - - - - - - (7,604) (7,604)
Purchase of
shares by
the Employee
Benefit
Trust - - - - - - (375) - (375)
Share options
exercised - - - - - - 2,015 (2,014) 1
Deferred tax
on
share-based
payment
transactions - - - - - - - 63 63
Share-based
payment
transactions - - - - - 659 - - 659
------------------ -------- -------- ------------ --------- ----------- ------------ -------- --------- --------
Total
transactions
with owners of
the Company - - - - - 659 1,640 (9,555) (7,256)
------------------ -------- -------- ------------ --------- ----------- ------------ -------- --------- --------
At 31 August 2022 1,020 47,319 18,397 1,803 22 10,151 (912) 104,294 182,094
------------------ -------- -------- ------------ --------- ----------- ------------ -------- --------- --------
Own
Capital Share-based shares
Share Share Translation Merger redemption payment held by Retained Total
capital premium reserve reserve reserve reserve the EBT earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
At 1 March 2021 1,020 47,319 6,630 1,803 22 7,945 (147) 103,657 168,249
Profit for the
period - - - - - - - 8,588 8,588
Other comprehensive
income
Exchange
differences on
translating
foreign
operations - - 373 - - - - - 373
Remeasurements
on the defined
benefit
pension scheme - - - - - - - (10) (10)
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Total comprehensive
income for the
period - - 373 - - - - 8,578 8,951
Transactions with
owners
Dividends to
equity holders
of the Company - - - - - - - (14,064) (14,064)
Purchase of
shares by the
Employee
Benefit Trust - - - - - - (1,973) - (1,973)
Share options
exercised - - - - - - 2,047 (2,031) 16
Deferred tax on
share-based
payment
transactions - - - - - - - 146 146
Share-based
payment
transactions - - - - - 756 - - 756
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Total transactions
with owners of the
Company - - - - - 756 74 (15,949) (15,119)
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
At 31 August 2021 1,020 47,319 7,003 1,803 22 8,701 (73) 96,286 162,081
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Own
Capital Share-based shares
Share Share Translation Merger redemption payment held by Retained Total
capital premium reserve reserve reserve reserve the EBT earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
At 1 March 2021 1,020 47,319 6,630 1,803 22 7,945 (147) 103,657 168,249
Profit for the
period - - - - - - - 16,890 16,890
Other comprehensive
income
Exchange
differences on
translating
foreign
operations - - 1,497 - - - - - 1,497
Remeasurements
on the defined
benefit
pension scheme - - - - - - - (10) (10)
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Total comprehensive
income for the
period - - 1,497 - - - - 16,880 18,377
Transactions with
owners
Dividends to
equity holders
of the Company - - - - - - - (15,157) (15,157)
Purchase of
shares by the
Employee
Benefit Trust - - - - - - (4,489) - (4,489)
Share options
exercised - - - - - - 2,084 (2,050) 34
Deferred tax on
share-based
payment
transactions - - - - - - - 408 408
Share-based
payment
transactions - - - - - 1,547 - - 1,547
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Total transactions
with owners of the
Company - - - - - 1,547 (2,405) (16,799) (17,657)
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
At 28 February 2022 1,020 47,319 8,127 1,803 22 9,492 (2,552) 103,738 168,969
-------------------- -------- -------- ------------ --------- ----------- ------------ -------- --------- ---------
Condensed Consolidated Interim Statement of Cash Flows
For the six months ended 31 August 2022
6 months 6 months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
-------------------------------------------- ---------- ---------- ------------
Cash flows from operating activities
Profit for the period 10,111 8,588 16,890
Adjustments for:
Depreciation of property, plant and
equipment 314 239 512
Depreciation of right-of-use assets 902 794 1,889
Amortisation of intangible assets 4,774 3,114 7,505
Loss on disposal on intangible assets - - 65
Finance income (46) (54) (105)
Finance costs 213 214 486
Share of loss of joint venture 67 54 117
Share-based payment charges 874 1,021 2,054
Tax expense 2,834 2,495 5,291
-------------------------------------------- ---------- ---------- ------------
20,043 16,465 34,704
Increase in inventories (6,886) (7,165) (2,745)
(Increase)/decrease in trade and
other receivables (4,351) 1,667 1,205
Increase in trade and other liabilities 3,640 10,383 14,572
-------------------------------------------- ---------- ---------- ------------
Cash generated from operating activities 12,446 21,350 47,736
Income taxes paid (3,970) (3,456) (7,927)
-------------------------------------------- ---------- ---------- ------------
Net cash generated from operating
activities 8,476 17,894 39,809
-------------------------------------------- ---------- ---------- ------------
Cash flows from investing activities
Purchase of property, plant and equipment (485) (143) (644)
Purchases of intangible assets (2,301) (1,806) (3,693)
Purchase of business, net of cash
acquired - (5,736) (22,913)
Purchase of rights to assets - (2,992) (3,650)
Purchase of share in a joint venture (182) - -
Interest received 46 54 92
Net cash used in investing activities (2,922) (10,623) (30,808)
-------------------------------------------- ---------- ---------- ------------
Cash flows from financing activities
Equity dividends paid (7,604) (14,064) (15,157)
Purchase of shares by the Employee
Benefit Trust (375) (1,973) (4,489)
Proceeds from exercise of share options 1 16 34
Repayment of borrowing - (1,112) (1,097)
Repayment of lease liabilities (990) (897) (1,862)
Lease liabilities interest paid (187) (200) (419)
Other interest paid (26) (14) (55)
Net cash used in financing activities (9,181) (18,244) (23,045)
-------------------------------------------- ---------- ---------- ------------
Net decrease in cash and cash equivalents (3,627) (10,973) (14,044)
Cash and cash equivalents at beginning
of period 41,226 54,466 54,466
Exchange gain on cash and cash equivalents 3,852 170 804
-------------------------------------------- ---------- ---------- ------------
Cash and cash equivalents at end
of period 41,451 43,663 41,226
-------------------------------------------- ---------- ---------- ------------
Notes to the Condensed Consolidated Interim Financial Statements
1. Reporting entity
Bloomsbury Publishing Plc (the "Company") is a Company domiciled in the United Kingdom. The condensed consolidated interim financial statements of the Company as at and for the six months ended 31 August 2022 comprise the Company and its subsidiaries (together referred to as the "Group"). The Group is primarily involved in the publication of books and other related services.
2. Significant accounting policies a) Basis of preparation
These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34 'Interim Financial Reporting'. They are unaudited and do not constitute statutory accounts. Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the last annual consolidated financial statements as at and for the year ended 28 February 2022.
Except as described below, the condensed set of financial statements have been prepared on a consistent basis with the financial statements for the year ended 28 February 2022 and should be read in conjunction with the Annual Report 2022. The annual consolidated financial statements of the Group are prepared in accordance with UK-adopted International Accounting Standards and the requirements of the Companies Act 2006. The 2022 Annual Report refers to other new standards effective from 1 March 2022. None of these standards have had a material impact in these financial statements.
The comparative financial information for the year ended 28 February 2022 does not constitute statutory accounts for that financial year. This information was extracted from the statutory accounts for the year ended 28 February 2022, a copy of which has been delivered to the Registrar of Companies. The auditor's report on those accounts was unqualified and did not include a reference to any matters to which the auditor drew attention by way of emphasis of matter and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
The condensed consolidated interim financial statements were approved and authorised for issue by the Board of Directors on 25 October 2022.
b) Going concern
The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least 12 months from the date of approval of the condensed consolidated interim financial statements, being the period of the detailed going concern assessment reviewed by the Board, and therefore continue to adopt the going concern basis of accounting in preparing the condensed consolidated interim financial statements.
The Board has modelled a severe but plausible pessimistic downside scenario, including the impact of coronavirus. This assumes:
-- Sales drop by 20% with recovery during 2024/25; -- Downside assumptions about extended debtor days with recovery during 2024/25; and -- Cash preservation measures implemented and variable costs reduced.
Under this severe but plausible downside scenario, the Group has sufficient liquidity to be able to manage these downside assumptions.
The Group has an unsecured revolving credit facility with Lloyds Bank Plc. The facility comprises a committed revolving credit facility of GBP10 million, and an uncommitted incremental term loan facility of up to GBP6 million. The facilities are subject to two covenants, being a maximum net debt to EBITDA ratio of 2.5x and a minimum interest cover covenant of 4x. The agreement is to October 2024. At 31 August 2022, the Group had no draw down of this facility.
c) Uses of estimates and judgments
The preparation of condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets liabilities, income and expenses. Actual results may differ from these estimates. Critical judgments and areas where the use of estimates is significant are set out in the 2022 Annual Report.
3. Segmental analysis
The Group is comprised of two worldwide publishing divisions: Consumer and Non-Consumer, reflecting the core customers for our different operations. The Consumer division is further split out into two operating segments: Children's Trade and Adult Trade. Non-Consumer is split between two operating segments: Academic & Professional and Special Interest.
Each reportable segment represents a cash-generating unit for the purpose of impairment testing. We have allocated goodwill between reportable segments.
These divisions are the basis on which the Group primarily reports its segment information. Segments derive their revenue from book publishing, sale of publishing and distribution rights, management and other publishing services. The analysis by segment is shown below:
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Interest
Professional
Six months GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
ended 31 August
2022 GBP'000 GBP'000 GBP'000
---------------- ----------- --------- --------- ------------- --------- ------------- ------------ ---------
External
revenue 50,607 25,685 76,292 36,481 10,137 46,618 - 122,910
Cost of sales (26,453) (13,809) (40,262) (11,529) (5,013) (16,542) - (56,804)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Gross profit 24,154 11,876 36,030 24,952 5,124 30,076 - 66,106
Marketing and
distribution
costs (6,567) (3,995) (10,562) (2,929) (1,395) (4,324) - (14,886)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Contribution
before
administrative
expenses 17,587 7,881 25,468 22,023 3,729 25,752 - 51,220
Administrative
expenses
excluding
highlighted
items (8,863) (7,617) (16,480) (14,739) (3,843) (18,582) (35,062)
Share of joint
venture result - - - - - - (67) (67)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Operating
profit/(loss)
before
highlighted
items/ segment
results 8,724 264 8,988 7,284 (114) 7,170 (67) 16,091
Amortisation of
acquired
intangible
assets - (175) (175) (2,381) (107) (2,488) - (2,663)
Other
highlighted
items - - - - - - (316) (316)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Operating
profit/(loss) 8,724 89 8,813 4,903 (221) 4,682 (383) 13,112
Finance income - - - 26 - 26 20 46
Finance costs (70) (37) (107) (59) (21) (80) (26) (213)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
before
taxation
and
highlighted
items 8,654 227 8,881 7,251 (135) 7,116 (73) 15,924
Amortisation of
acquired
intangible
assets - (175) (175) (2,381) (107) (2,488) - (2,663)
Other
highlighted
items - - - - - - (316) (316)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
before
taxation 8,654 52 8,706 4,870 (242) 4,628 (389) 12,945
Taxation - - - - - - (2,834) (2,834)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
for the period 8,654 52 8,706 4,870 (242) 4,628 (3,223) 10,111
---------------- ----------- --------- --------- ------------- --------- ------------- ------------ ---------
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Interest
Professional
Six months GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
ended 31 August
2021 GBP'000 GBP'000 GBP'000
---------------- ----------- --------- --------- ------------- --------- ------------- ------------ ---------
External
revenue 38,990 23,928 62,918 26,411 11,327 37,738 - 100,656
Cost of sales (18,094) (12,001) (30,095) (8,775) (5,097) (13,872) - (43,967)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Gross profit 20,896 11,927 32,823 17,636 6,230 23,866 - 56,689
Marketing and
distribution
costs (5,663) (3,755) (9,418) (2,569) (1,574) (4,143) - (13,561)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Contribution
before
administrative
expenses 15,233 8,172 23,405 15,067 4,656 19,723 - 43,128
Administrative
expenses
excluding
highlighted
items (8,104) (6,833) (14,937) (11,120) (3,945) (15,065) - (30,002)
Share of joint
venture result - - - - - - (54) (54)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Operating
profit/(loss)
before
highlighted
items/ segment
results 7,129 1,339 8,468 3,947 711 4,658 (54) 13,072
Amortisation of
acquired
intangible
assets - (49) (49) (829) (107) (936) - (985)
Other
highlighted
items - - - - - - (844) (844)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Operating
profit/(loss) 7,129 1,290 8,419 3,118 604 3,722 (898) 11,243
Finance income - - - 38 - 38 16 54
Finance costs (75) (42) (117) (58) (25) (83) (14) (214)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
before
taxation
and
highlighted
items 7,054 1,297 8,351 3,927 686 4,613 (52) 12,912
Amortisation of
acquired
intangible
assets - (49) (49) (829) (107) (936) - (985)
Other
highlighted
items - - - - - - (844) (844)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
before
taxation 7,054 1,248 8,302 3,098 579 3,677 (896) 11,083
Taxation - - - - - - (2,495) (2,495)
---------------- ----------- --------- --------- ------------- --------- ------------ ---------
Profit/(loss)
for the period 7,054 1,248 8,302 3,098 579 3,677 (3,391) 8,588
---------------- ----------- --------- --------- ------------- --------- ------------- ------------ ---------
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Interest
Professional
Year ended 28 February 2022 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ----------- --------- --------- ------------- --------- ------------- ------------ ----------
External revenue 93,039 55,157 148,196 59,328 22,586 81,914 - 230,110
Cost of sales (46,759) (29,106) (75,865) (20,945) (11,138) (32,083) - (107,948)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Gross profit 46,280 26,051 72,331 38,383 11,448 49,831 - 122,162
Marketing and distribution
costs (12,812) (8,271) (21,083) (5,335) (3,390) (8,725) - (29,808)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Contribution before administrative
expenses 33,468 17,780 51,248 33,048 8,058 41,106 - 92,354
Administrative expenses excluding
highlighted items (17,506) (15,732) (33,238) (23,907) (7,980) (31,887) - (65,125)
Share of joint venture result - - - - - - (117) (117)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Operating profit/(loss) before
highlighted items/ segment
results 15,962 2,048 18,010 9,141 78 9,219 (117) 27,112
Amortisation of acquired intangible
assets - (272) (272) (2,349) (214) (2,563) - (2,835)
Other highlighted items - - - - - - (1,715) (1,715)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Operating profit/(loss) 15,962 1,776 17,738 6,792 (136) 6,656 (1,832) 22,562
Finance income - - - 62 - 62 43 105
Finance costs (162) (94) (256) (115) (48) (163) (67) (486)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Profit/(loss) before taxation
and highlighted items 15,800 1,954 17,754 9,088 30 9,118 (141) 26,731
Amortisation of acquired intangible
assets - (272) (272) (2,349) (214) (2,563) - (2,835)
Other highlighted items - - - - - - (1,715) (1,715)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Profit/(loss) before taxation 15,800 1,682 17,482 6,739 (184) 6,555 (1,856) 22,181
Taxation - - - - - - (5,291) (5,291)
------------------------------------- ----------- --------- --------- ------------- --------- ------------ ----------
Profit/(loss) for the year 15,800 1,682 17,482 6,739 (184) 6,555 (7,147) 16,890
------------------------------------- ----------- --------- --------- ------------- --------- ------------- ------------ ----------
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Professional Interest
Six months GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
ended 31 August
2022 GBP'000 GBP'000 GBP'000
---------------- ----------- -------- --------- --------------- ---------- ------------- ------------ --------
Operating
profit/(loss)
before
highlighted
items 8,724 264 8,988 7,284 (114) 7,170 (67) 16,091
Depreciation 429 229 658 440 118 558 - 1,216
Amortisation of
internally
generated
intangibles 223 292 515 1,428 168 1,596 - 2,111
---------------- ----------- -------- --------- --------------- ---------- ------------ --------
EBITDA before
highlighted
items 9,376 785 10,161 9,152 172 9,324 (67) 19,418
---------------- ----------- -------- --------- --------------- ---------- ------------ --------
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Professional Interest
Six months GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
ended 31 August
2021 GBP'000 GBP'000 GBP'000
---------------- ----------- -------- --------- --------------- ---------- ------------- ------------ --------
Operating
profit/(loss)
before
highlighted
items 7,129 1,339 8,468 3,947 711 4,658 (54) 13,072
Depreciation 405 229 634 274 125 399 - 1,033
Amortisation of
internally
generated
intangibles 217 228 445 1,556 128 1,684 - 2,129
---------------- ----------- -------- --------- --------------- ---------- ------------ --------
EBITDA before
highlighted
items 7,751 1,796 9,547 5,777 964 6,741 (54) 16,234
---------------- ----------- -------- --------- --------------- ---------- ------------ --------
Children's Adult Consumer Academic Special Non-Consumer Unallocated Total
Trade Trade & Professional Interest
Year ended 28 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
February 2022 GBP'000 GBP'000 GBP'000
---------------- ----------- -------- --------- --------------- ---------- ------------- ------------ --------
Operating
profit/(loss)
before
highlighted
items 15,962 2,048 18,010 9,141 78 9,219 (117) 27,112 Depreciation 914 632 1,546 604 251 855 - 2,401 Amortisation of internally generated intangibles 455 508 963 3,405 302 3,707 - 4,670 ---------------- ----------- -------- --------- --------------- ---------- ------------ -------- EBITDA before highlighted items 17,331 3,188 20,519 13,150 631 13,781 (117) 34,183 ---------------- ----------- -------- --------- --------------- ---------- ------------ --------
External revenue by product type
Six months Six months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
-------------------- ---------- ---------- ------------
Print 85,709 74,635 170,383
Digital 32,529 22,239 50,526
Rights and services 4,672 3,782 9,201
-------------------- ---------- ---------- ------------
Total 122,910 100,656 230,110
-------------------- ---------- ---------- ------------
Rights and services revenue includes revenue from copyright and trademark licences, management contracts, advertising and publishing services.
Total assets 31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
------------------------- ---------- --------------------- ------------
Children's Trade 21,337 16,247 13,633
Adult Trade 15,061 14,469 13,513
Academic & Professional 80,141 60,463 78,096
Special Interest 13,267 13,383 13,170
Unallocated 182,793 165,878 170,825
------------------------- ---------- --------------------- ------------
Total assets 312,599 270,440 289,237
------------------------- ---------- --------------------- ------------
Unallocated primarily represents centrally held assets including system development, property, plant and equipment, right-of-use assets, receivables and cash.
4. Highlighted items
Six months Six months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
------------------------------------- ----------- ----------- -------------
Legal and other professional fees 111 566 1,317
Integration and restructuring
costs 205 278 398
Other highlighted items 316 844 1,715
Amortisation of acquired intangible
assets 2,663 985 2,835
------------------------------------- ----------- ----------- -------------
Total highlighted items 2,979 1,829 4,550
------------------------------------- ----------- ----------- -------------
Highlighted items charged to operating profit comprise significant non-cash charges and major one-off initiatives, which are highlighted in the income statement because, in the opinion of the Directors, separate disclosure is helpful in understanding the underlying performance and future profitability of the business.
For the six months ended 31 August 2022 legal and other professional fees of GBP111,000 were incurred as a result of the acquisition of certain assets of Red Globe Press and the ABC-CLIO, LLC acquisition . For the six months ended 31 August 2021 integration and restructuring costs of GBP205,000 were incurred as a result of the integration of the above acquisitions and the Head of Zeus Limited acquisition.
For the six months ended 31 August 2021 legal and other professional fees of GBP566,000 were incurred as a result of the Red Globe Press and Head of Zeus Limited acquisitions . For the six months ended 31 August 2021 restructuring costs of GBP278,000 were incurred as a result of acquisitions and restructuring in both divisions.
For the year ended 28 February 2022, legal and other professional fees of GBP1,317,000 were incurred as a result of the Group's acquisitions, including ABC-CLIO, LLC, Head of Zeus Limited and certain assets of Red Globe Press. Integration and restructuring costs primarily relate to the integration of the above acquisitions including restructuring and other restructuring in both divisions.
5. Dividends
Six months Six months Year
ended ended ended
31 August 31 August 28 February
2022 2021 2022
GBP'000 GBP'000 GBP'000
--------------------------------- ----------- ----------- ------------
Amounts paid in the period
Prior period final dividend 7,604 6,141 6,141
Prior period special dividend - 7,923 7,923
Interim dividend - - 1,093
--------------------------------- ----------- ----------- ------------
Total dividend payments in the
period 7,604 14,064 15,157
Amounts arising in respect of
the period
Interim dividend for the period 1,147 1,093 1,093
Final dividend for the year - - 7,671
Total dividend for the period 1,147 1,093 8,764
--------------------------------- ----------- ----------- ------------
The proposed interim dividend of 1.41 pence per ordinary share will be paid to the equity Shareholders on 2 December 2022 to Shareholders registered at close of business on 4 November 2022.
6. Earnings per share
The basic earnings per share for the six months ended 31 August 2022 is calculated using a weighted average number of Ordinary Shares in issue of 80,921,019 (31 August 2021: 81,492,631 and 28 February 2022: 81,532,620) after deducting shares held by the Employee Benefit Trust.
The diluted earnings per share is calculated by adjusting the weighted average number of Ordinary Shares to take account of all dilutive potential Ordinary Shares, which are in respect of unexercised share options and the Performance share Plan.
6 months
ended 6 months ended Year ended
31 August 31 August 28 February
2022 2021 2022
Number Number Number
Weighted average shares in
issue 80,921,019 81,492,631 81,532,620
Dilution 1,314,336 976,492 1,530,573
------------------------------- ----------- --------------- ------------
Diluted weighted average
shares in issue 82,235,355 82,469,123 83,063,193
------------------------------- ----------- --------------- ------------
GBP'000 GBP'000 GBP'000
------------------------------- ----------- --------------- ------------
Profit after tax attributable
to owners of the Company 10,111 8,588 16,890
------------------------------- ----------- --------------- ------------
Basic earnings per share 12.49p 10.54p 20.72p
Diluted earnings per share 12.30p 10.41p 20.33p
------------------------------- ----------- --------------- ------------
Adjusted profit attributable
to owners of the Company 12,579 10,572 21,548
------------------------------- ----------- --------------- ------------
Adjusted basic earnings per
share 15.54p 12.97p 26.43p
Adjusted diluted earnings
per share 15.30p 12.82p 25.94p
------------------------------- ----------- --------------- ------------
Adjusted profit is derived as follows:
Profit before tax 12,945 11,083 22,181 Amortisation of acquired intangible assets 2,663 985 2,835 Other highlighted items 316 844 1,715 ------------------------------------- ------- ------- ------- Adjusted profit before tax 15,924 12,912 26,731 ------------------------------------- ------- ------- ------- Tax expense 2,834 2,495 5,291 Deferred tax movements on goodwill and acquired intangible assets 484 (208) (207) Tax expense on other highlighted items 27 53 99 Adjusted tax 3,345 2,340 5,183 ----------------------------------- ------ ------ ------ Adjusted profit 12,579 10,572 21,548 ----------------- ------- ------- -------
The Group includes the benefit of tax amortisation of intangible assets in the calculation of adjusted tax as this more accurately aligns the adjusted tax charge with the expected cash tax payments.
7. Business combinations
There have been no acquisitions in the 6 months to 31 August 2022.
On 2 June 2021 the Group acquired the issued share capital of Head of Zeus Limited. The consideration, net of pre-existing loans is GBP7.0 million, of which GBP5.5 million was satisfied in cash at completion, with GBP1.1 million paid in cash post completion, and GBP0.4 million of deferred consideration payable in cash subject to achievement of Netflix release targets. The latter element is discounted.
On 15 December 2021 the Group acquired the members' interest of ABC - CLIO, LLC ("ABC-CLIO"). The consideration, is GBP16.7 million, of which GBP16.6 million was satisfied in cash at completion, with GBP0.1 million payable in cash post completion, subject to working capital and other considerations.
The table below summarises the fair values to the Group included in the consolidated financial statements of the major categories of assets and liabilities of these acquisitions at the date of acquisition. Amounts are provisional for ABC-CLIO as management finalise reviews of the asset valuation.
Fair value to the Group
6 months 6 months 12 months
ended 31 ended 31 ended 28
August 2022 August 2021 February
Net assets acquired GBP'000 GBP'000 2022
GBP'000
---------------------------------- -------------- ------------- ----------
Assets
Other intangible assets - 2,800 19,372
Property, plant and equipment - 52 336
Right-of-use assets - 275 632
Deferred tax assets - 130 1,092
Total non-current assets - 3,257 21,432
----------------------------------- ------------- ------------- ----------
Inventories - 2,202 2,754
Trade and other receivables - 6,654 10,008
Cash and cash equivalents - 37 379
----------------------------------- ------------- ------------- ----------
Total current assets - 8.893 13,141
----------------------------------- ------------- ------------- ----------
Total assets - 12.150 34,573
----------------------------------- ------------- ------------- ----------
Liabilities
Deferred tax liabilities - (700) (700)
Lease liabilities - (137) (321)
Total non-current liabilities - (837) (1,021)
----------------------------------- ------------- ------------- ----------
Trade and other liabilities - (3,578) (11,,142)
Borrowings - (1,097) (1,097)
Lease liabilities - (165) (338)
Current tax liabilities - (51) (305)
Total current liabilities - (4,891) (12,882)
----------------------------------- ------------- ------------- ----------
Total liabilities - (5,728) (13,903)
----------------------------------- ------------- ------------- ----------
Identifiable net assets - 6,422 20,670
----------------------------------- ------------- ------------- ----------
Goodwill - 579 3,076
----------------------------------- ------------- ------------- ----------
Total - 7,001 23,746
----------------------------------- ------------- ------------- ----------
Satisfied by:
Cash consideration - 5,775 22,448
Deferred consideration - 1,226 1,298
----------------------------------- ------------- ------------- ----------
Total consideration - 7,001 23,746
----------------------------------- ------------- ------------- ----------
8. Rights to Assets
On 23 April 2021, the Group announced the acquisition of certain assets of Red Globe Press ("RGP"), the academic imprint, from Macmillan Education Limited, a part of Springer Nature Group. The transaction completed on 1 June 2021. The consideration was GBP3.2 million, of which GBP1.8 million was satisfied in cash at completion and GBP1.3 million was satisfied in cash post completion , with an expected further GBP0.1 million to be satisfied post-completion subject to assignment of certain contracts. The Group has taken on Inventories, Advances and intangible assets associated with taking on the titles and digital products. No cash or trade receivables transferred as part of the acquisition.
9. Trade and other receivables
31 August 31 August 28 February
2022 2021 2022
Non-current GBP'000 GBP'000 GBP'000
------------------------------------ ----------- ----------- -------------
Accrued income 1,008 934 923
------------------------------------ ----------- ----------- -------------
Current
Gross trade receivables 75,666 65,145 68,764
Less: loss allowance (3,463) (3,414) (3,551)
------------------------------------ ----------- ----------- -------------
Net trade receivables 72,203 61,731 65,213
Income tax recoverable 1,967 1,039 1,392
Other receivables 2,645 2,228 2,431
Prepayments 2,469 1,896 2,672
Accrued income 3,992 3,859 4,494
Royalty advances 31,645 29,399 28,677
------------------------------------ ----------- ----------- -------------
Total current trade and other
receivables 114,921 100,152 104,879
------------------------------------ ----------- ----------- -------------
Total trade and other receivables 115,929 101,086 105,802
------------------------------------ ----------- ----------- -------------
Non-current receivables relate to accrued income on long-term rights deals.
Trade receivables principally comprise amounts receivable from the sale of books due from distributors. The majority of trade debtors are secured by credit insurance and in certain territories by third party distributors.
A provision is held against gross advances payable in respect of published titles advances which may not be fully earned down by anticipated future sales. As at 31 August 2022 GBP8,909,000 (31 August 2021 GBP7,700,000 and 28 February 2022 GBP7,145,000) of royalty advances are expected to be recovered after more than 12 months.
10. Related parties
The Group has no related party transactions in the current or prior periods other than key management remuneration.
Responsibility Statement of the Directors in Respect of the Interim Financial Statements
Directors
--------------------- -------------------------------------
Sir Richard Lambert Independent Non-Executive Chairman
Chair of the Nomination Committee
--------------------- -------------------------------------
Nigel Newton Chief Executive
--------------------- -------------------------------------
Leslie-Ann Reed Senior Independent Director
Chair of the Audit Committee
--------------------- -------------------------------------
John Bason Independent Non-Executive Director
Chair of the Remuneration Committee
--------------------- -------------------------------------
Baroness Lola Independent Non-Executive Director
Young of Hornsey
--------------------- -------------------------------------
Penny Scott-Bayfield Group Finance Director
--------------------- -------------------------------------
We confirm that to the best of our knowledge:
-- The condensed set of financial statements has been prepared in accordance with UK-adopted International Accounting Standard 34 'Interim Financial Reporting'.
-- The interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.
By order of the Board
Nigel Newton Penny Scott-Bayfield
26 October 2022
Principal risks and uncertainties
Bloomsbury has a systematic and embedded risk management process for identifying, evaluating and managing risk, with the goal of supporting the Group in meeting its strategic and operational objectives.
The principal risks fpr the Group's business are summarised as follows:
-- Market: including market volatility, post pandemic consumer behaviour, impact of economic instability, increased dependence on internet retailing, open access, sales of used books and rental of textbooks;
-- Importance of digital publishing: BDR revenues and profit; -- Acquisitions: return on investment; -- Title acquisition (Consumer publishing): Commercial viability;
-- Information and technology systems: Cybersecurity and malware attack, and internal access controls or security measures;
-- Financial valuations: Judgemental valuation of assets and provisions; -- Intellectual property: Erosion of copyright and infringement of Group IP by third parties; -- Reliance on key counterparties: Failure of key counterparties or breakdown in key counterparty relationships;
-- Talent management: Failure to attract and retain key talent and create an inclusive and supportive environment in which the Group's employees can thrive;
-- Legal and compliance: Breach of key contracts by the Group and failure to comply with applicable regulations;
-- Reputation: Investor confidence; and -- Inflation: Print supply costs.
Further information about the principal risks and risk management is included in the 2022 Annual Report and Accounts.
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